Diageo cuts full-year sales and profit forecast

Diageo Revises Full-Year Sales and Profit Outlook

On Thursday, drinks producer Diageo lowered its full-year forecasts for sales and profits due to weak demand for Chinese white spirits and slowing consumption in North America. The company now predicts 2026 organic net sales to be flat or slightly down, impacted by challenges in China and softer-than-expected US consumer spending.

Sales and Profit Expectations

Diageo expects organic operating profit growth for the year to be low to mid-single digits. In the first quarter, organic net sales remained flat. Volume growth of 2.9% was almost entirely canceled out by a negative price/mix factor of 2.8%, mainly caused by unfavorable sales mix in Asia Pacific because of declining Chinese white spirits (CWS) results.

Excluding CWS impact, the price/mix would have been nearly stable.

Comments from Interim CEO Nik Jhangiani

"Net sales were flat organically in Q1, with growth in Europe, LAC and Africa offset by weakness in Chinese white spirits and a softer US consumer environment than planned for."

"We are not satisfied with our current performance and are focused on what we can manage and control; acting with speed to drive efficiencies, prioritising investment and adapting more quickly to an evolving consumer environment."

"We are well advanced in sharpening our strategy, and we are developing and already implementing clear plans to drive growth across the broader portfolio, ensuring that we meet relevant consumer occasions of the future."

Diageo is concentrating on efficiency improvements and strategic adjustments to meet changing consumer needs and stimulate growth.

Author's summary: Diageo cuts its 2026 sales and profit outlook due to softness in Chinese white spirits and US markets, while focusing on strategic shifts to boost future growth.

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Sharecast Sharecast — 2025-11-06

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