AB InBev Q4 Earnings Beat on Business Momentum, Revenues Miss

Core Insights - Anheuser-Busch InBev SA/NV (AB InBev) reported fourth-quarter 2025 results with earnings per share (EPS) exceeding estimates while revenues fell short, although both metrics improved year over year, driven by strong consumer demand and a diversified portfolio [1][2][3] Financial Performance - The underlying EPS for Q4 2025 was 95 cents, reflecting a 7.5% year-over-year increase and surpassing the Zacks Consensus Estimate of 92 cents [2][6] - Revenues reached $15.55 billion, missing the Zacks Consensus Estimate of $15.58 billion but showing a 4.8% year-over-year growth, with organic revenues increasing by 2.5% [3][6] - Revenue per hectoliter (hl) improved by 4% year over year, supported by premiumization and disciplined revenue management [4][6] Volume and Market Dynamics - Organic volume declined by 1.5%, with a 1.9% drop in beer volume attributed to weak demand and adverse weather conditions, partially offset by a 0.6% increase in non-beer volume [4][7] - The performance of premium and super premium beer brands contributed significantly to revenue growth, with megabrands seeing a 4.1% increase in revenues year over year [8] Strategic Initiatives - AB InBev has focused on expanding its Beyond Beer portfolio, which recorded a 23% revenue rise in 2025, driven by significant growth in the Cutwater brand [10] - The company has invested in digital platforms, with B2B digital initiatives contributing approximately 72% to its revenues in 2025, generating $1.3 billion [9] Cost and Margin Analysis - The cost of sales increased by 4.5% to $6.9 billion, while SG&A expenses rose by 4% to $4.8 billion [10] - Normalized EBITDA was $5.47 billion, reflecting a 4.3% year-over-year improvement, with a slight contraction in the EBITDA margin to 35.2% [12] Future Outlook - For 2026, AB InBev anticipates EBITDA growth of 4-8%, supported by strong execution and market momentum [14][15] - The company expects net capital expenditure to be between $3.5 billion and $4 billion in 2026, with a normalized effective tax rate projected at 26-28% [16]