Anheuser-Busch InBev said that Bud Light sales for the third quarter caused a 13.5 percent decline in the company’s U.S. revenue, although its worldwide adjusted earnings rose for the quarter.
“Revenue declined by 13.5 percent with revenue per hl [hectoliter] increasing by 4.9 percent driven by revenue management initiatives,” said the brewing giant in a report, released Tuesday. It also noted a 17.6 percent decline in sales to wholesalers and a decline of 16.6 percent for sales-to-retailers.
That’s “primarily due to the volume decline of Bud Light and impacted by shipment phasing ahead of our October price increase last year,” Anheuser-Busch wrote, noting that its U.S. earnings before interest, taxes, depreciation, and amortization (EBITDA) declined by 29.6 percent for the quarter.
“Approximately two-thirds of this decrease attributable to market share performance and the remainder from productivity loss, increased sales and marketing investments and support measures for our wholesaler partners,” the report said.
It marks the second quarter where the Bud Light controversy has impacted sales in the United States. In August, Anheuser-Busch InBev said that its U.S. division also saw a drop in profit amid the backlash.
But overall, the world’s largest brewer and parent company of Bud Light said adjusted earnings for the latest quarter rose 4.1 percent, to $5.4 billion, on revenues that climbed 5 percent, to $15.6 billion.
“Our mainstream portfolio delivered a mid-single-digit revenue increase as double-digit growth in South Africa, Colombia, and the Dominican Republic was partially offset by the revenue decline of Bud Light in the U.S.,” the report also said. “Our mainstream brands gained or maintained share of segment in the majority of our key markets, according to our estimates.”
Bud Light sales plunged amid a conservative backlash after the brand sent a commemorative can to transgender influencer Dylan Mulvaney in early April before it was posted on social media. For a number of consecutive weeks, according to publicly available data, sales of Bud Light saw double-digit declines year over year.
The controversy dethroned Bud Light from its position as America’s best-selling beer for more than two decades. In June, it dropped to second place in U.S. retail sales, behind Modelo Especial. Modelo is still the market leader, with nearly 9 percent of the share in year-to-date retail sales through Oct. 21, while Bud Light has an 8 percent share, according to the Associated Press.
U.S. dollar sales of Bud Light were down 29 percent in the four weeks ended Oct. 21 compared to the year-ago period, according to Nielsen data compiled by Bump Williams Consulting, reported the Associated Press. Sales are down nearly 19 percent for the year to date.
Last week, Anheuser-Busch announced a new “multiyear marketing partnership” with the Ultimate Fighting Championship (UFC) mixed-martial arts promotion, meaning that Bud Light will become the official partner of the brand. More than a decade ago, the UFC and Bud Light were partners, although that was long before the Mulvaney controversy.
In a statement, UFC CEO Dana White stated, “I’m proud to announce we are back in business together,” adding: “There are many reasons why I chose to go with Anheuser-Busch and Bud Light, most importantly because I feel we are very aligned when it comes to our core values and what the UFC brand stands for.”
However, some prominent social media users signaled they might boycott the UFC, too, over the Bud Light partnership and over Mr. White’s comments about “core values.”
“Are you saying that UFC is okay with Bud Light promoting the evil transgender ideology of Dylan Mulvaney? Signed, millions of fans who will boycott you too,” asked conservative host Liz Wheeler on X.
“No one is drinking Bud Light at any tailgate I’ve been to this fall. Brand is dead,” said commentator Clay Travis. “Lighting that money on fire would have been less embarrassing than what’s about to happen. Fighters are gonna hate this. Fans will hate it. The customers aren’t coming back,” added former Republican congressional candidate Robby Starbuck.
With the UFC deal, Bud Light appears to be taking steps to rehabilitate its image with its core consumer base after the Mulvaney controversy. Recently, the company moved to increase its visibility at NFL games and partnered with Kansas City Chiefs tight end Travis Kelce for commercials.
After the announcement, neither UFC nor Anheuser-Busch have disclosed how much it’s worth. A source who is allegedly familiar with the partnership told CNBC that it’s in the nine-figure range, or over $100 million.
Amid the boycott calls, Mr. White told Fox News host Sean Hannity last week that the deal wasn’t about money.
“There are many other things that are important to me other than just the money,” he said. “And the people that were all involved in this negotiation, on every side, absolutely, positively know that my choice was not determined by money.”
The Associated Press contributed to this report.
From The Epoch Times