Anheuser-Busch InBev (ticker: BUD) recently announced a rise in revenue and confirmed its full-year guidance, despite experiencing a decline in sales in the U.S. due to a boycott of Bud Light by some consumers. The company’s stock has shown an upward trend.
For the September quarter, AB InBev reported underlying earnings per share of 86 cents, with sales reaching $15.57 billion. According to a FactSet consensus, analysts had anticipated underlying earnings of 84 cents per share on sales of $15.72 billion.
The company plans to repurchase $1 billion in shares and up to $3 billion worth of its debt.
Although total volumes dropped by 3.4%, revenue increased by 5.0% compared to the same period last year. This growth is partially attributed to sales in Argentina, where high inflation has resulted in boosted prices. Excluding Argentina, the organic revenue increase for the quarter stood at 1.6%.
In the U.S., revenue declined by 14% and sales to American retailers fell by 17%. This decline can be attributed to a conservative boycott of AB InBev’s flagship American brand, Bud Light, following its marketing partnership with transgender influencer Dylan Mulvaney.
Despite this setback, AB InBev states that its total market share in the U.S. beer market has remained stable since the end of April until September.
Recently, the mixed-martial arts league, UFC, appointed Bud Light as its official beer in the U.S. and its official global beer partner.
AB InBev reaffirmed its previous guidance, stating that it expects its earnings before interest, taxes, depreciation, and amortization for 2023 to grow in line with its medium-term outlook of between 4% to 8%, while revenue is anticipated to grow ahead of Ebitda.
However, some analysts remain cautious. “The absence of incremental bad news and some buyback support is reassuring, but the increased reliance on Argentina to drive top-line organic sales growth and ongoing FX headwinds may temper the share price reaction,” noted analysts at Citi in a research note.
As of 11:14 a.m. on Tuesday, American depositary receipts of AB InBev were up 5%, following a 10% decrease so far this year.
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