Modelo, Corona sales plunge as demand among Hispanic consumers slips

Core Viewpoint - Constellation Brands has lowered its full-year sales and profit outlook due to declining demand from Hispanic consumers, who represent a significant portion of its business [1][2]. Sales and Profit Outlook - The company now expects net sales of beer to decline between 2% and 4% in its fiscal 2026, a shift from a previous forecast of up to a 3% increase [7][9]. - Adjusted earnings per share are now projected to be between $11.30 and $11.60, down from an earlier forecast of $12.60 to $12.90 [7]. Consumer Behavior - Constellation's President and CEO Bill Newlands noted that U.S. purchases of high-end beers have decreased, with consumers making fewer trips to buy beer and spending less per trip [1][6]. - The trend of reduced spending is particularly pronounced among Hispanic consumers, who account for about half of Constellation's business [2][6]. Market Context - The company has been licensed to sell Modelo and Corona in the U.S. since 2013, following AB InBev's acquisition of Grupo Modelo [3]. - Concerns among Hispanic consumers include rising prices for food and essentials, immigration issues, and job market stability, which have contributed to reduced spending on various categories, including beer [5][6]. Stock Performance - Following the announcement of the revised outlook, Constellation's shares fell more than 7% in afternoon trading [8].