Bud Light boycott takes fizz out of brewer's earnings
Bud Light's parent company is confirming big losses in U.S. sales and profits from this spring's boycott and backlash as executives now assert that the drain has been stabilized.
Anheuser-Busch InBev says it lost $395 million in North American revenue between April and June as the beer maker's revenue in the U.S dipped 10.5% compared to last year.
"The reading is really stabilization with signals of improvement," CEO Michel Doukeris told Wall Street analysts on Thursday.
"People, basically, they want to enjoy their beer without the debate," Doukeris said on Thursday. "They want us to focus and concentrate on platforms that all consumers love," which he said included the NFL, the "Folds of Honor" scholarship and music.
The financial details cap off one of the widest-reaching blowbacks against a corporate brand in recent history, which began in April.
Bud Light had struck a March Madness deal with a transgender influencer Dylan Mulvaney, who posted a promotional video. Soon after, conservative voices on social media called for a boycott, culminating with Kid Rock posting his own video firing a gun at cans of Bud Light.
Anheuser-Busch responded with a meandering apology and confirmed that two marketing executives were put on a leave of absence. LGBTQ+ advocates criticized the brand for abandoning its stance in support of the community, leaving Mulvaney to fend for herself.
The U.S. is the biggest market for the brewer. Bud Light's popularity here had been on a long slow decline, but the spring boycott saw the brand lose its top-seller spot to Modelo. On Tuesday, another rival Molson Coors reported its best quarter since 2005.
Anheuser-Busch InBev, based in Belgium, did report growing sales elsewhere in the world, which somewhat offset its U.S. losses. Executives also said costs came from big new spending on U.S. marketing and deals with distributors to rebuild its American presence.
Since April, Anheuser-Busch said it's been talking to more than 170,000 customers across the U.S. Those surveys found around 80% of them have a favorable or a neutral view of Bud Light.
The company said U.S. earnings before interest, taxes, depreciation and amortization fell more than 28% in the latest quarter — both from beer sales and big spending to restore the brand's standing. Sales to retailers declined 14% and to wholesalers 15%.
"The team in the U.S. [is] working hard to build it back and to earn back consumers," Anheuser-Busch CEO Doukeris said on Thursday. The company also owns Michelob, Corona, Stella Artois, Beck's and other beer brands.
Often brand boycotts have a temporary impact, as people return to familiar habits after headlines subside — especially if products are hard to replace. Bud Light, however, faced a protracted fallout. Although latest reports suggest even Kid Rock's bar in Nashville has continued to sell Bud Light.
Overall, Anheuser-Busch beat Wall Street's expectations. Its global sales rose, thanks to higher prices and bigger demand for its fancier beer. The company reaffirmed its forecast for the year, expecting profit growth of up to 8%. The brewer's stock price rose on Thursday.
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