Investors will be watching to see if Anheuser-Busch InBev (BUD) is recovering from last year’s hangover.
The Bud Light maker is set to share its fourth quarter and fiscal 2023 results on Thursday after market close. While shareholders look for signs on whether the beer giant is still in choppy waters with drinkers, it narrowly avoided a strike at 12 US breweries after reaching a tentative agreement with the Teamster union.
For the fourth quarter, the Street expects AB InBev to report adjusted earnings per share of $0.81 and revenue of $15.66 billion, compared to $14.67 billion in 2022 Q4. Quarterly volume is expected to decline 1.48% year over year.
For the full year, volume is expected to dip 1.34%, compared to a 2.3% jump last year, as US sales dragged down its performance throughout 2023. While total revenue is expected to grow 4.74%, earnings are expected to drop 0.41% year over year.
This report comes more than 10 months after a marketing campaign with transgender influencer Dylan Mulvaney sparked a widespread boycott of Bud Light. The brand subsequently lost its crown as America’s favorite beer to Modelo last May.
All eyes are on how 2024 will play out as Anheuser-Busch also has to contend with changing consumer preferences, like the switch to Mexican import beers.
Constellation Brands (STZ), which owns Modelo, Corona, and Victoria, may already be winning there, per Bank of America analyst Bryan Spillane and others. Mexican brands are expected to make further headway, said Bump Williams of Bump Williams Consulting.
“We’ve already seen retailers in the back half of ’23 give more shelf space to these brands in this segment,” Williams told Yahoo Finance. “We’re going to continue to see that probably expand more as the spring sets get launched in March, April [2024].”
Against that backdrop, Anheuser-Busch reached a tentative agreement with Teamsters on Wednesday evening. The current contract was set to expire on Feb. 29 at midnight, and 99% of the 5,000 members voted to walk out if a deal was not reached.
The five-year agreement include improved wages, healthcare, and retirement benefits. It recognizes the “talent, dedication and hard work” of its workers, US CEO Brendan Whitworth said in the release, while also “positioning the company for long-term success.”
Teamsters general president Sean M. O’Brien said members were “prepared to do whatever it would take to get a fair agreement.”
Rival Molson Coors (TAP) is currently experiencing a strike with the same union, but it’s isolated to a single brewery in Fort Worth, Texas.
No contract has been reached, but Molson Coors chief communications officer Adam Collins told Yahoo Finance that the team has “strong contingency plans” to fulfill demand. The location is still “brewing, packaging and shipping” products with other employees.
Its five other breweries have “extra production capacity” and bulked up inventory ahead of time, Collins added.
Collins said the team is “committed to reaching an agreement that is fair to everyone.”
But Teamsters are hoping Molson Coors takes a page from its competition.
“Teamsters continue to hold the line at Molson Coors in Texas for a fair contract, but Molson Coors should pay close attention to the bar we’ve set today for brewery workers across the country,” O’Brien said in the release.
The earnings rundown
Here’s what Wall Street expects Anheuser-Busch InBev to report for its fiscal fourth quarter earnings, per Bloomberg consensus data:
Revenue: $15.66 billion
Adjusted EPS: $0.81
Volume Growth: -1.48%
Price Growth: 7.83%
Here’s what Wall Street expects Anheuser-Busch InBev to report for its fiscal 2023 year, per Bloomberg consensus data:
Revenue: $60.52 billion
Adjusted EPS: $3.02
Volume Growth: -1.34%
Price Growth: 9.09%
*This story was updated to reflect the tentative Teamster agreement reached Wednesday evening.
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Brooke DiPalma is a senior reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
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