Constellation Maintains Full-Year Profit Outlook, Posts Surprise Fiscal Second-Quarter Earnings Growth

06:56 AM EDT, 10/07/2026 (MT Newswires) -- Constellation Brands (STZ) shares fell early Wednesday as the beer and wine company reiterated its full-year adjusted profit outlook and reported an unexpected year-over-year increase in fiscal second-quarter earnings. Constellation continues to project adjusted earnings between $11.20 and $11.90 per share for fiscal 2027, it said late Tuesday. The current FactSet consensus is non-GAAP EPS of $11.71. Enterprise organic sales, beer net sales and organic sales in the wine and spirits division are still pegged to be down 1% to up 1% for the ongoing fiscal year, according to the company. The stock fell 4.5% in the most recent premarket activity. For the three months through August, Constellation's adjusted EPS advanced to $3.74 from $3.63, defying the Street's view of a decline to $3.55. Net sales improved 6% to $2.63 billion, topping the average analyst estimate of $2.54 billion. "We have sharpened our execution and increased investment across the business, and are beginning to see early returns through accelerating dollar and volume share gains in both our Beer and Wine & Spirits businesses relative to the first quarter," Chief Executive Nicholas Fink said in the earnings release. Beer revenue increased 5% to $2.47 billion, buoyed by shipment growth of 5.5%. However, the division's depletions, or the pace at which units are sold to end consumers, edged down 0.6%, amid declines in the Modelo Especial and Corona Extra brands. RBC Capital Markets analyst Nik Modi said in a note emailed on Wednesday that beer depletions fell short of consensus expectations for growth of 0.1%. Still, Modi called the decline a "clean number," saying the benefit from an extra selling day was offset by the timing of Labor Day. The company said in prepared remarks that off-premise activity around the FIFA World Cup "came in below industry expectations in June and July." The beer division's operating margin fell 160 basis points year over year amid increased marketing investment and other selling, general, and administrative spend. Net sales of wine and spirits climbed 17% to $159.4 million, boosted by a 15% gain in shipment volume and "slightly favorable" pricing, the company said. The division's depletions jumped about 10%, driven by the strength of Kim Crawford and Mi Campo, according to the group. Operating margin rose to 3.8%. In a separate statement, Constellation said it acquired spirit-based beverage brand SpikedAde in a deal worth up to $353 million, strengthening its position in the ready-to-drink market. The company will integrate the SpikedAde team into its beer division and said the deal does not affect its fiscal 2027 outlook. The deal is a positive because Constellation needs to participate in faster-growing segments of the beverage alcohol market, according to RBC. In the broader industry, brewing giant and Budweiser parent Anheuser-Busch InBev (BUD) is scheduled to report its latest financial results on Oct. 29.