Finance
Booze makers cut costs to brew profits and defy alcohol sector gloom
Published by Global Banking & Finance Review®
Posted on October 30, 2025
3 min readLast updated: January 21, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on October 30, 2025
3 min readLast updated: January 21, 2026
Alcohol producers like Anheuser-Busch and Carlsberg are cutting costs to boost profits despite market challenges, with some companies seeing significant profit increases.
By Emma Rumney, Jacob Gronholt-Pedersen and Dominique Vidalon
LONDON/COPENHAGEN/PARIS (Reuters) -Big beer and spirits makers are cutting costs to help burnish margins in a tough consumer market, with Stella Artois owner Anheuser-Busch InBev, Carlsberg, and Aperol-maker Campari all reporting higher profits.
AB InBev, the world's top brewer behind Budweiser and Corona, said on Thursday cost-cutting helped it post a profit beat despite a bigger-than-expected fall in volumes, letting it announce a $6 billion share buyback and interim dividend.
Brewers are mired in a multi-year slump that has dragged down their share prices, with weak demand in key markets across Latin America and Asia hitting volumes and putting more of an emphasis on costs.
"Tightening the purse strings is what people want to see," said Jack Martin, fund manager at Oberon Investments, which invests in the sector, adding that the alcohol industry was a "tough thing to get excited about" right now.
CUTS TO TRAVEL, ENTERTAINMENT - AND JOBS
Carlsberg, the No. 3 brewer and maker of Kronenbourg 1664 alongside its namesake lager, said it was cutting costs as nervous consumers pull back spending on beer, partly due to price increases.
"We've been adjusting, especially discretionary spending. We've been going very hard at travel, entertainment, conferences, and consultants," Carlsberg CEO Jacob Aarup-Andersen told Reuters after the company reported third-quarter earnings.
"This also means that, unfortunately, some people will be leaving us, but we're not going to put numbers on it."
He said consumers were drinking less but there were still signs they were shifting up-market.
"People are still willing to pay more for quality. They may moderate a bit, they may drink a little bit less alcohol, but then they are willing to pay more for the product," he said.
'IT'S TOUGH OUT THERE'
Moritz Kronenberger, a portfolio manager at Union Investment, a shareholder in AB InBev, said investors wanted to see beer makers - which have relatively high fixed costs related to production - making savings when sales are under pressure.
"When the company is growing, you don't have to turn around every coin and every stone to check where to optimise profits," Kronenberger said. "At the moment it's tough out there."
AB InBev finance chief Fernando Tennenbaum told Reuters that the firm consistently sought savings via efficiencies and technology.
CAMPARI PROMPTS MARKET CHEER
Campari benefitted from the falling cost of sales in its tequila business due to a decline in the Mexican peso and cost controls.
Shares in the Italian firm shot up 11% on Thursday after it outperformed the industry to grow sales 4.4% and comfortably beat profit forecasts.
"Our cost containment efforts are becoming more and more visible," CFO Paolo Marchesini told investors.
REMY'S COGNAC SUFFERS UNDER AUSTERITY IN CHINA
Spirits companies have suffered as a boom in pricey liquor sales following the COVID-19 pandemic went into reverse, exacerbated by tariffs in the United States and China. Hopes of a recovery keep getting pushed back.
Remy Cointreau, which makes the majority of its revenue from cognac sales in those two markets, saw its shares fall almost 11% on Thursday as it opted to spend money to revive sales at the expense of profit, cutting its annual guidance as a result.
Sales in China were hit particularly hard, with austerity measures hitting the important Mid-Autumn festival period.
Finance chief Luca Marotta said the Chinese market was "complex" and the cost of doing business was increasing.
(Reporting by Emma Rumney; Editing by Adam Jourdan and Kirsten Donovan)
Cost-cutting refers to the measures taken by a company to reduce its expenses and improve profitability. This can include reducing overhead costs, eliminating unnecessary expenditures, and optimizing operational efficiencies.
A share buyback is when a company purchases its own shares from the marketplace. This can reduce the number of outstanding shares, potentially increasing the value of remaining shares and providing a return to shareholders.
Profit margin is a financial metric that indicates the percentage of revenue that exceeds the costs of goods sold. It is calculated by dividing net income by total revenue, reflecting a company's profitability.
Consumer demand refers to the desire of consumers to purchase goods and services at given prices. It is influenced by factors such as income levels, preferences, and economic conditions.
Market share is the portion of a market controlled by a particular company or product. It is expressed as a percentage of total sales in the market and indicates the competitiveness of a company.
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