After a challenging start to FY26, owing to the prevailing US tariff constraints, Constellation Brands Inc. exceeded Wall Street expectations within the third quarter (Q3). The company exhibited effective strategy and achieved Earnings Per Share (EPS) of USD 3.06 in Q3, beating analyst forecasts despite continued pressure on sales and the market.
Q3 picks up momentum
Momentum in Q3 as Constellation exceeded earnings expectations despite continued top-line pressure. For the quarter ended November 30, net sales declined 10 per cent Y-o-Y to USD 2.22 billion, while adjusted EPS of USD 3.06 beat analyst forecasts.
The beer sector kept outperforming steadily in the broader beverage alcohol market. It gained a modest share, driven by sustained strength in Modelo and Corona. However, the weak results in wine and spirits suggested a softer demand in the area.
Constellation maintained strong cash flows, returned capital through dividends and share buybacks, despite a challenging operating environment. Management revised reported EPS guidance to a range of USD 9.72 to USD 10.02, while reaffirming comparable EPS guidance of USD 11.30 to USD 11.60.
Having dealt with the impact of the US tariffs, this underscored Constellation’s gradual recovery following the Q1 challenges and drawbacks, reflecting control rather than stress.