- Sales in three months to end of June fall by 2.2% to US$4.71bn
- Fiscal full-year sales down 2% to US$19.64bn
- Losses driven by declines in ‘North America’ and ‘Asia Pacific’
- Strong double-digit declines for Don Julio, Casamigos and Crown Royal
- Restructuring programme to deliver US$850m in savings over two years
Diageo closed out a disappointing fiscal 2026 with another quarterly sales fall, thanks largely to double-digit declines in US spirits – notably tequila – and Chinese white spirit baijiu.
The 2.2% sales dip in the three months to the end of June followed a flat third quarter, leaving the full year down 2%, although Diageo pointed out that, excluding Chinese white spirits, sales would have been essentially flat (-0.5%).
Regional performance was mixed, with full-year declines in ‘North America’ (-8.4%, but -10.7% in Q4) and ‘Asia Pacific’ (-6.3%), partially offset by gains in ‘Europe’ (+3.4%), ‘Latin America & Caribbean’ (+7.7%) and ‘Africa’ (+13.3%).
Spirits sales in the US slumped by 11.5% in the year, with tequila falling 21.1% (Don Julio -19.2%, Casamigos -27.7%) and Canadian whisky Crown Royal declining by 15.9%, although RTDs/cocktails grew by 35.2%.
In ‘Europe’, Diageo was boosted by double-digit growth for Guinness in Great Britain, despite softer spirits sales, and by a 25.5% sales spike in Türkiye, with raki, scotch and gin all up by double digits.
‘Asia Pacific’ was headlined by a 34.9% decline in Greater China (Chinese white spirits volumes -41.9%), but sales rose 7.1% in India, led by Johnnie Walker, fellow scotch brand Black & White, and Smirnoff vodka.
Scotch was the big winner in ‘Latin America & Caribbean’, as Johnnie Walker (plus Smirnoff RTDs and Tanqueray) drove an 11.2% sales gain in Brazil, with Colombia up 21.7% thanks to scotch whiskies Buchanan’s and Old Parr, plus Smirnoff. However, Mexico was flat.
In ‘Africa’, robust growth in rum and beer helped Uganda and Tanzania to record double-digit gains, while RTDs spearheaded strong double-digit increases in South Africa.
Diageo’s full-year spirits sales fell by 5%, with only scotch and rum in positive territory, and double-digit declines for tequila, Canadian whisky and Chinese white spirits.
Among the company’s key brands, only Johnnie Walker (+2%) and Guinness (+12%) gained ground, with the most notable declines recorded by Don Julio (-14%), Casamigos (-25%) and Crown Royal (-15%).
“We are pleased with our progress in Latin America & Caribbean, Europe and Africa,” said Diageo CEO Sir Dave Lewis. “We are focused on recovering our competitiveness in North America, and we are working through the consequences of government policy in Chinese white spirits.”
He added: “The three priorities set out at the half-year – i) Relevant brands in competitive category strategies; ii) Customer, customer, customer; and iii) A more agile and competitive operating framework – are serving us well.”
Diageo also offered an update on the company’s restructuring programme, which it said would deliver savings of about US$850m over two years, starting in fiscal 2027, incurring charges in fiscal 2026 of US$900m, mostly related to the implementation of the company’s new operating framework.
It also announced impairment charges of US$1.5bn, mainly related to the impact of “hyperinflationary accounting” and pricing changes in Türkiye, along with the writedowns of Don Papa rum and other smaller brands.
The results announcement comes a day after a Scottish trade union claimed that 172 Diageo staff at the company’s scotch whisky distilleries were at risk of redundancy, with 38 jobs to be axed as part of the restructuring programme.
