Boston Beer (SAM) Q2 Earnings Miss Estimate, Shipments Dip 6.4%

Core Viewpoint - The Boston Beer Company, Inc. (SAM) reported disappointing second-quarter 2024 results, with both net sales and earnings missing the Zacks Consensus Estimate, primarily due to weak performance in the Truly Hard Seltzer segment [12][13]. Financial Performance - Earnings per share for the second quarter were $4.39, missing the Zacks Consensus Estimate of $4.99 and declining 7% year over year [1]. - Net revenues totaled $579.1 million, a decrease of 4% from the prior year and below the Zacks Consensus Estimate of $595 million [13]. - Shipment volume fell 6.4% year over year to 2.2 million barrels, while depletions volume decreased by 4% [15]. - Gross profit declined 2.8% year over year to $266.5 million, but gross margin improved by 60 basis points to 46% [16]. Cost Management - Advertising, promotional, and selling expenses decreased by 3.5% to $144.2 million, attributed to lower freight costs and reduced spending on brand media [4]. - General and administrative expenses rose by 7% year over year to $48 million, mainly due to increased salaries and benefits [17]. Inventory and Supply Chain - As of June 29, 2024, distributor inventories averaged three and a half weeks, below the targeted four to five weeks, impacting the company's ability to meet demand [3]. Share Repurchase and Guidance - The company repurchased $127 million in Class A common stocks year to date, with $140 million remaining under its current share repurchase authorization of $1.2 billion [5]. - Boston Beer reaffirmed its 2024 guidance, projecting GAAP earnings per share between $7.00 and $11.00, with depletions and shipments expected to decline by low single digits to zero [6].