Diageo cuts forecast again, slashes dividend as US and China demand weakens

Core Viewpoint - Diageo has revised its annual sales and profit forecast downward for the second time in four months, citing weak demand in the U.S. and China, and has reduced its dividend as a result [1] Group 1: Financial Performance - Diageo's U.S. sales have declined by 9.3%, with tequila sales, including Don Julio, dropping over 23% [1] - The company now expects organic sales to fall by 2%-3% for 2026, and organic operating profit to be flat to up low-single-digits, a revision from earlier forecasts of flat to slightly lower sales and low to mid-single-digit profit growth [1] Group 2: Leadership and Strategy - New CEO Dave Lewis, who took over in January, is focused on reducing debt and reviving growth amid various challenges, including tariff-related uncertainties in the U.S. and slowing demand in China [1] - Lewis's appointment follows the resignation of Debra Crew, under whom Diageo faced a profit warning in Latin America and a significant slowdown in global growth [1] Group 3: Dividend Changes - Diageo has declared an interim dividend of 20 cents per share, down from 40.5 cents a year ago, and has set a minimum floor for dividends at 50 cents per annum [1]