Constellation Brands beats estimates, lowers margin outlook

Constellation Brands reported fiscal second-quarter net sales of $2.63 billion, up 6% from a year earlier, and comparable earnings of $3.74 per share, beating analyst estimates, while lowering its fiscal 2027 operating-margin outlook. The company also announced an agreement to acquire SpikedAde, a vodka-based ready-to-drink beverage brand, for $75 million at closing, with up to $278 million in additional payments tied to performance and capital-allocation priorities. For the quarter ended August 31, analysts had estimated average sales of about $2.54 billion and earnings of $3.55 to $3.56 per share, according to figures cited in reports on the results. Constellation’s reported earnings were $3.32 per share, compared with $2.65 a year earlier. Operating income fell 8% to $805 million. Net sales in the beer business increased 5%, while wine and spirits sales rose 17%. The beer division remains the larger business, but the faster percentage growth came from wine and spirits. Reports attributed support for beer demand in part to social gatherings around major sporting events, amid softer consumer spending across the alcohol industry.