Investing.com -- Diageo cut its fiscal 2026 sales and profit outlook on Thursday, citing weaker demand in key markets including North America and China.
The alcoholic beverage maker now expects revenue to be flat or slightly lower for the year, with operating profit rising at a low- to mid-single-digit pace.
The guidance downgrade comes as the world’s largest spirits producer looks to rein in costs and explore significant asset sales to help reduce its $22 billion debt load.
For the first quarter of fiscal 2026, Diageo reported revenue of $4.9 billion, reflecting flat organic growth from a year earlier, while volumes rose 2.9% organically. The flat organic sales growth compares with a consensus of -1.3%, according to Jefferies.
Commenting on the outlook cut, Jefferies analyst Edward Mundy said Diageo "is doubling down on factors within its control, and we would not expect street EBIT/EPS to move materially today."
"However, top-line shaving and lack of visibility on management succession could weigh on the shares today," he added.
The company reaffirmed its goal of generating around $3 billion in free cash flow in fiscal 2026 and said it aims to return its leverage ratio to within the target range of 2.5 to 3.0 times by fiscal 2028.
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Diageo trims sales and profit forecast amid weak U.S., China demand
Published 2 days ago
Nov 6, 2025 at 8:33 AM
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