Constellation Brands, the distributor of Modelo Especial beer, received positive news through a strong earnings report this week. The news pushed the company’s anticipated stock price higher and represented negative news for its main competitor, Bud Light.
This week the beverage giant announced that its earnings and revenue figures were higher than previously expected. Overall, the company saw an increase in beer sales growth above 10%. The news sent its projected stock prices significantly higher.
The report from the third quarter of 2023 saw Modelo’s growth increase by almost 9%. The beer is now the most-sold brand in the country.
The previous quarter also saw strong growth, as Constellation’s beer brands rose by 11%.
“We expected net sales growth and operating income growth of that business to ramp up through the remainder of fiscal ’24,” said Constellation Brands CEO Bill Newlands. He also said that other aspects of the company’s business, including wine and spirits, were expected to grow in coming years.
Modelo has seen a sharp increase in part due to marketing efforts and due to a widespread public boycott of competitor Bud Light following their April announcement of a marketing deal with transgender activist Dylan Mulvaney.
While Modelo has seen a significant increase in sales, Bud Light sales have not recovered from the Mulvaney partnership. October marked six months since the start of the marketing deal, and figures have shown no signs of bettering.
Sales figures from September showed a number of negative signals for Bud Light. These included a decline in market share and in overall sales.
— New York Post (@nypost) October 5, 2023
The figures show that Bud Light controlled slightly less than 9% of the overall American beer market, compared to 12% before the Mulvaney partnership was announced. Furthermore, both dollar and volume sales of Bud Light were down about 30% compared to the same point last year.
This figure represented a larger decline in sales compared to earlier in the public backlash in June.