Brown-Forman Sees 2% Net Sales Drop, 8% U.S. Slump and 60% Canadian Plunge
Brown-Forman’s first nine fiscal months of 2026 saw net sales down 2% and gross profit falling 1%, driven by 8% U.S. and 2% developed markets declines. Canadian sales plunged 60% with American spirits off shelves, while a 16% emerging markets surge and 2% whiskey growth offset tequila and barrel weakness.
1. Financial Performance
In the first nine months of fiscal 2026, Brown-Forman reported net sales of $X billion, down 2%, and gross profit declining 1%. U.S. net sales fell 8%, while developed international markets collectively declined by 2%, reflecting ongoing trade pressures and lower consumer demand.
2. Regional Market Trends
Canadian net sales plunged nearly 60% as American-made spirits remain largely unavailable across provinces, prompting management to assume the ban will persist through year-end. In contrast, emerging markets achieved a 16% increase in net sales, led by robust double-digit growth in Mexico and Brazil.
3. Product Portfolio Impact
Within the core whiskey category, net sales increased 2%, driven by expanded distribution of flagship brands. The tequila portfolio contracted 6%, and Ready-to-Drink offerings grew 8%, illustrating mixed consumer preferences across segments.
4. Barrel Sales and Outlook
Lower demand for used aging barrels exerted additional downward pricing pressure, impacting gross margins. Executive leadership is focusing on controllable factors as cyclical headwinds persist and continues to monitor international supply chains and market access developments.