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Key Takeaways

• Molson Coors cut its 2025 outlook and will reduce expenses on concerns economic conditions will lead to less consumer spending.

• CEO Gavin Hattersley said the global macroeconomic environment is "volatile."

• The beermaker missed first-quarter profit and sales estimates as volumes dropped.

Molson Coors Beverage Company (TAP) shares sank Thursday after the beermaker slashed its outlook and planned to reduce spending on concerns economic conditions will lead consumers to spend less.

The company behind its namesake beers, as well as Miller Lite and others, now sees full-year underlying earnings per share (EPS) increasing by a low-single-digit percentage, down from its previous estimate of a high-single-digit percentage. It expects sales to decline by a low-single-digit percentage versus the earlier guidance of a low-single-digit percent increase.

CEO Gavin Hattersley called the global macroeconomic environment "volatile," and the change in expectations was driven by "uncertainty around the effects of geopolitical events and global trade policy, including the impacts on economic growth, consumer confidence and expectations around inflation, and currencies has pressured the beer industry and consumption trends."

Hattersley added that in response, Molson Coors would be "reducing non-business critical discretionary spend and capital projects while continuing to support the medium and long-term health and growth objectives of the company."

Q1 Sales, Underlying EPS Miss Estimates

Hattersley also attributed the company's weaker-than-expected first quarter results to the macroeconomic environment along with "competitive pressures" in two markets: Europe, Middle East, and Africa, and Asia-Pacific.

Molson Coors reported underlying EPS of $0.50, with sales tumbling 11% year-over-year to $2.30 billion. Both missed Visible Alpha consensus forecasts.

Sales were dragged down by a 16% slump in financial volumes, which it explained was primarily because of "lower brand volumes, the cycling of a higher distributor inventory build in the prior year to mitigate the impact of the Fort Worth brewery strike that commenced in mid-February 2024 and an approximate 4% impact from lower contract brewing volume resulting from the exit of contract brewing arrangements in both the U.S. and Canada."

Shares of Molson Coors Beverage Company fell 5% to their lowest level in three months. 

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