Constellation Brands, Inc.
Key statistics
from XBRL data in SEC filingsAI briefing
from the latest 10-K, 10-Q and 8-K eventsConstellation Brands is an international beer, wine, and spirits producer whose Beer segment, led by Modelo Especial and Corona, drives most of its sales and profit.
What they do
Constellation Brands produces and markets beer, wine, and spirits with operations in the U.S., Mexico, New Zealand, and Italy. Its Beer segment holds an exclusive perpetual license to produce its beer portfolio and import, market, and sell it in the U.S.; it operates two breweries in Nava and Obregon, Mexico, with a third under construction in Veracruz. The Wine and Spirits segment sells higher-end brands such as Kim Crawford, Ruffino, The Prisoner Wine Company, Robert Mondavi Winery, Mi CAMPO, and High West. Corporate Operations and Other holds unallocated corporate costs.
Revenue drivers
- Beer — High-end imported beer and ABAs, including Modelo Especial, Corona Extra, Pacifico, and Victoria; generated $2,283.5 million of net sales and $891.4 million of operating income in the quarter ended May 31, 2026, the largest segment.
- Wine and Spirits — Higher-end wine and spirits brands including Kim Crawford, Ruffino, The Prisoner Wine Company, Robert Mondavi Winery, Mi CAMPO, and High West; latest quarterly net sales fell 47% to a level not separately disclosed in the excerpt, reflecting 2025 Wine Divestitures.
- Enterprise organic net sales — Reported net sales of $2,433 million in Q1 FY2027 fell 3%, while organic net sales rose 3%, as the prior-year period included $142.0 million of net sales from divested wine brands.
Recent performance
For the first quarter of fiscal 2027 (ended May 31, 2026), net sales were $2,433 million, down 3% reported but up 3% organic. Reported operating income rose 18% to $845 million and reported EPS was $3.79, up 31%. Beer net sales rose 2% to $2,283.5 million on a 1.8% shipment volume increase, while Beer depletions fell 0.3% as Modelo Especial declined about 2% and Corona Extra over 5%. Wine and Spirits reported a 47% net sales decline, but organic net sales grew 8% and depletions 6.6%. Operating cash flow was $662 million and free cash flow $485 million.
Strategy
Management states a strategic vision to deliver industry-leading total stockholder returns through brand building, consumer-obsessed innovation, disciplined capital deployment, best-in-class operational efficiency, and ESG initiatives. The company has repositioned Wine and Spirits to a portfolio of exclusively higher-end brands and is expanding supply channels through DTC and international markets. It continues modular capacity additions at its breweries and is progressing construction of a third brewery in Veracruz. Capital allocation priorities include share repurchases and dividends while holding a target comparable net leverage ratio of 3.0x.
Risks
- Tariffs and trade policy — U.S. tariffs on imports including aluminum and products from Mexico, Italy, the European Union, and New Zealand, plus retaliatory tariffs and Canadian provincial restrictions on U.S. beverage alcohol, could affect costs and demand.
- Beer brand concentration — Modelo Especial is the #1 U.S. beer brand by dollar sales, but depletions declined approximately 2% in Q1 FY2027 and Corona Extra fell over 5%, so weakness in these brands has outsized impact.
- Competitive industry — The beverage alcohol industry is highly competitive, with principal beer competitors including Anheuser-Busch InBev, Boston Beer, Heineken, Mark Anthony, and Molson Coors, and Constellation competes for shelf space, restaurant presence, and wholesaler attention.
- Wine and Spirits transition — The segment is executing a multi-year repositioning after the 2025 Wine Divestitures, and reported net sales declined 47% in Q1 FY2027, so execution and category trends affect overall results.
Outlook
Management updated fiscal 2027 reported EPS guidance to $11.50-$12.20 and affirmed comparable EPS guidance of $11.20-$11.90. It also affirmed operating cash flow target of $2.4-$2.5 billion and free cash flow target of $1.6-$1.7 billion. The company cites a discerning and value-conscious consumer environment but believes it is positioned to drive sustainable organic growth while investing in brands. It plans to continue balancing growth investments with shareholder returns while maintaining its 3.0x comparable net leverage target.