Financial Data and Key Metrics Changes - The company has lowered its fiscal 2026 guidance, expecting enterprise top line growth to decline by 4% to 6% and beer business to decline by 2% to 4% [7] - Operating income expectations have also been adjusted, with enterprise expected to decline by 9% to 11% and beer business by 7% to 9% [7][10] - Comparable EPS is now projected to be in the range of $1,130 to $1,160 [10] Business Line Data and Key Metrics Changes - The beer volume decline is impacting overhead absorption and operational efficiencies, contributing to a 100 basis point headwind to overall margin for the beer business [7][9] - The company has gained share in 49 of the 50 states, with distribution gains up in the mid-single digits [3][4] Market Data and Key Metrics Changes - The Hispanic consumer segment is facing significant socioeconomic concerns, with 80% worried about socioeconomic factors and 75% about personal finances, leading to reduced shopping occasions [3][25] - The overall beer category is experiencing a decline, with scanner data down 4.5% year to date [12] Company Strategy and Development Direction - The company continues to invest in brand equity and marketing, maintaining marketing spend as a percentage of net sales [21] - Innovation is seen as a core competency, with successful products like Corona Sunbrew and non-alcoholic options contributing positively to brand performance [26][32] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenging consumer environment and the volatility in the marketplace, emphasizing the need to control what can be controlled [17] - There is a belief that as the socioeconomic environment normalizes, the beer category will also return to more typical growth patterns [13][15] Other Important Information - The company has returned approximately $600 million to shareholders through share repurchases in the first half of the fiscal year [10] - The impact of new tariffs is expected to be around $70 million for the beer business and $20 million for the wine business, totaling $90 million across the enterprise for the full fiscal year [10] Q&A Session Summary Question: What drove the updated guidance? - The updated guidance reflects ongoing consumer demand headwinds, particularly among Hispanic consumers, and a challenging economic environment [2][3] Question: How confident is the company in the long-term growth of the beer category? - Management believes that long-term growth will eventually normalize as socioeconomic conditions improve, despite current challenges [12][13] Question: What is the impact of tariffs on the business? - The company expects a total tariff impact of approximately $90 million across the enterprise for the fiscal year, affecting margins significantly [10] Question: How is the company addressing the decline in Corona Extra? - The company is refocusing marketing efforts on the brand's core essence, emphasizing its beach-related imagery and refreshing qualities [34] Question: What is the strategy for Modelo's growth in non-traditional markets? - The company is expanding distribution in emerging markets like North and South Dakota and Georgia, leveraging local sports events for brand visibility [36][37]