Executives from Jack Daniel’s parent company, Brown-Forman Corp., warned that the business is seeing pressure from cannabis, weight-loss drugs and lackluster demand from Generation Z.
Brown-Forman CEO Lawson Whiting told analysts on an earnings call that the “same big three” is the reason that there has been lower demand for liquor.
“We’ve been saying that for 1.5 years now. And I know on the sell-side that the world seems to be a little bit split on the extent of the pressure that it’s putting on our category. We’d be naive if we didn’t say that there isn’t some pressure coming from those,” Whiting told analysts.
The economy is also playing a factor, with Whiting noting that consumers don’t have as much dispensable income and are prioritizing vacations and lodging.
They go to the grocery store, I think in some cases, spirits has fallen out of the basket a little bit.
And that isn’t obviously great,” Whiting said.
However, he said that spirits are still taking market share from beer and wine. He also noted that while premiumization isn’t the same as it was, “it’s been kind of stagnant a little bit,” which he said is mostly good news.
“I think the consumers – they haven’t traded down necessarily,” he said.
However, Brown-Forman CFO Leanne Cunningham said the company projected that the operating environment will remain volatile in fiscal 2026.
“We believe that through all of that continued kind of uncertainty that the consumer is going to remain at that sustained level that it is now,” Cunningham said.
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