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Dive Brief:
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AB InBev's “mega brands” Michelob Ultra and Busch Light helped the brewer achieve sales growth in the U.S. even as the beer category overall declines, CEO Michel Doukeris said on the brewer’s earnings call this week.
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The two brands recorded the highest market share growth in the beer category during the last quarter of 2024, Doukeris said. However, the beer executive signaled caution about sales trends in 2025, noting that economic pressure on consumers and weather events are impacting the industry.
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As the beer category experiences sluggish demand, major brewers are increasingly reliant on their premium, highly distributed brands to deliver growth.
Dive Insight:
Two years after a boycott of Bud Light roiled AB InBev’s business, the brewer has been able to turn around sales and said its growth strategy is paying off. This comes amid ongoing headwinds in domestic beer, a category that posted a 4.2% decline in sales last year, according to a TD Cowen report.
Doukeris told analysts AB InBev is seeing positive momentum in the U.S. with several of its brands growing market share in 2024. The company also invested $7.2 billion in marketing, while reducing debt by $6.9 billion, he said.
AB InBev’s 2024 earnings report, however, painted a mixed picture. While the Stella Artois brewer’s U.S. and Canada revenues increased 2% last year, volumes declined 3.8%.
The CEO said events including inflationary trends, colder weather and “migration issue[s] in some zip codes where you have more Hispanic consumers,” are having an impact on the company’s bottom line.
“I don't think that the industry is at a positive volume point yet, but we've been seeing dollar-wise, the industry is stable, growing,” Doukeris said. “Let's see what the tailwinds are during the summer.”
Doukeris also touted the success of its beyond beer portfolio, noting that Cutwater is the best-selling canned cocktail brand in the U.S., while Nutrl is the second biggest vodka seltzer after High Noon.
While AB InBev’s sales are largely driven by their largest brews, Doukeris noted 10% of its revenue is now derived from products that offer a different experience — including nonalcoholic, low carb and zero sugar drinks.
Recent earnings from rival beer giants also highlighted overarching headwinds in beer. Molson is leaning heavily toward spirits and premium beer like Blue Moon, while Heineken is betting big on its nonalcoholic offering, Heineken 0.0.