Brown‑Forman Corporation reported second‑quarter 2025 revenue of $1.04 billion, a 5% decline from the $1.10 billion recorded in the same period last year. The figure still surpassed analysts’ consensus estimate of $1.03 billion by $10 million, reflecting stronger demand in emerging markets and travel‑retail channels that offset softness in the United States.
Earnings per share came in at $0.47, missing the consensus estimate of $0.48 by $0.01 (a 2.1% miss). The shortfall was driven by higher input costs, unfavorable fixed‑cost absorption due to lower production volumes, and negative foreign‑exchange effects. These headwinds were partially mitigated by a favorable price and mix shift, but not enough to offset the cost pressures.
Gross margin contracted to 59.1% from 60.6% in Q2 2024, a decline of 1.5 percentage points. The compression was largely attributable to increased raw‑material costs and lower production levels, which reduced the company’s ability to spread fixed costs over a smaller volume. Currency movements also weighed on the margin, while a modest price lift helped keep the margin from falling further.
Management reiterated its annual revenue and earnings guidance, maintaining a forecast of a low‑single‑digit organic net‑sales decline and a similar decline in operating income for fiscal 2026. The company cautioned that the operating environment will be challenging, citing macroeconomic and geopolitical volatility, consumer uncertainty, and lower non‑branded barrel sales as key headwinds.
Segment performance highlighted the launch of Jack Daniel’s Tennessee Blackberry in August 2025 and continued growth of the New Mix RTD line. Emerging‑market demand and travel‑retail sales helped offset the decline in U.S. core whiskey sales, while the flavored‑whiskey portfolio expansion provided a new growth engine. The company’s restructuring program, which includes a 12% workforce reduction and the closure of its Louisville cooperage, is expected to deliver $70‑$80 million in annualized savings and supports the company’s margin improvement strategy.
"We continue to anticipate the operating environment for fiscal 2026 to be challenging, with low visibility due to macroeconomic and geopolitical volatility as we face headwinds from consumer uncertainty and lower non‑branded sales of used barrels," said the company’s management.
The content on BeyondSPX is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.