Constellation Brands Beats Q2 Estimates, Buys SpikedAde

Constellation Brands reported stronger-than-expected second-quarter earnings and revenue on Tuesday, supported by resilient demand for popular beer brands including Modelo Especial and Victoria despite softer consumer spending across the alcohol industry.

Net sales for the quarter ended August 31 climbed 6% to $2.63 billion, exceeding analysts’ average estimate of $2.54 billion, according to LSEG data. Adjusted earnings came in at $3.74 per share, topping expectations of $3.56.

The company’s beer business continued to deliver growth, with quarterly sales rising 5%. Demand received additional support from major sporting events, including the FIFA World Cup and NBA Finals, which encouraged watch parties and other social drinking occasions. Constellation’s wine and spirits division performed even better, recording a 17% increase in net sales.

Alongside its quarterly results, Constellation Brands announced the acquisition of SpikedAde, a vodka-based ready-to-drink beverage company, as it seeks to strengthen its presence in the rapidly expanding RTD market.

Constellation will pay at least $75 million when the transaction closes. The agreement could include another $278 million in payments over five years, depending on SpikedAde’s performance and Constellation’s capital-allocation priorities.

For fiscal 2027, Constellation reaffirmed its adjusted earnings forecast of $11.20 to $11.90 per share. The company also maintained its organic net sales outlook, ranging from a 1% decline to 1% growth.

However, Constellation lowered its annual operating margin forecast to between 31% and 32%, compared with its previous projection of 32% to 33%, highlighting continued pressure on profitability.

Shares of Constellation Brands fell about 4.5% in extended trading following the earnings announcement. The stock has declined roughly 16% so far this year.

The beverage company had already withdrawn its fiscal 2028 forecast in April, citing a volatile operating environment and limited near-term visibility. Despite those uncertainties, continued beer demand and the SpikedAde acquisition underscore Constellation’s efforts to diversify its portfolio and capture growth in emerging beverage categories.