Bud Light sales and revenue continue to plummet following its marketing partnership with transgender influencer Dylan Mulvaney, with volume, or units of beer sold, down 29.5% in the week ending May 20, Newsweek reports.
Sales revenue declined 25.7% in the same week, compared to the same period last year.
This is on top of a 24.3% decline in Bud Light’s revenue in the four weeks to May 20 and a 17.2% decline in revenue in the four weeks to April 29 — indicating that the national boycott against the brewery is gaining steam.
When Bud Light debuted its tie-up with Mulvaney on social media on April 1, some consumers thought it was an April Fool’s prank.
The Bump Williams Consulting and Nielsen IQ data suggests that the effects of the boycott against the brewery worsened in May.
Dave Williams, vice president for analytics and insights at Bump Williams, says that the decline in Bud Light sales was “a bit steeper” in May than it was in April, but adds that the decline “does appear to be plateauing.”
However, if the boycott continues throughout the summer months when beer consumption rises, especially on holiday weekends, the year-over-year figures could worsen, Williams says, noting:
“The absolute magnitude could still creep up if those percentage drops are going against bigger holiday/summer weeks in the [year ago] time period,” Williams said.
“One thing is for sure: the rate of decline has not gotten any better yet,” he added.
Anheuser-Busch InBev’s flagship Budweiser brand is also suffering from the Mulvaney fallout, with sales revenue for that brand 10.5% lower in the four weeks to May 20 and 11.5% lower in April, according to Beer Business Daily.
Other brands of Anheuser-Busch, the largest beer company in the world, are hurting, as well, with Budweiser Red volumes cascading 14.9% in the latest week and Michelob Ultra, which is Anheuser’s biggest-selling brand in the U.S., down 6.9%, Barron’s reports.
2023 Sales Projected 26% Lower
Wall Street analysts predict the controversy over the Bud Light campaign and customers’ backlash will continue to hurt earnings and stock this year into next.
JPMorgan analyst Jared Dinges, who is bullish on Anheuser-Busch stock and maintains the bad news is already priced in, wrote pessimistically in a May 23 client note:
“While we recognize the data may evolve further, based on the current available data, we prudently model U.S. Ebit (earnings before interest and taxes) to decline by 26% in fiscal 2023 with no fiscal 2024 recovery,” Dinges wrote, rating the stock Overweight and giving it a price target of $76.
Anheuser-Busch (BUD) stock is down 18.4% from $66.73 on March 31, the day before the Mulvaney social media campaign debuted, to $54.46 on May 30.
Its market capitalization has declined by $24.19 billion, or 18.3%, from $132.38 billion on March 31 to $108.19 billion on May 30.
CEO Doukeris Speaks
While Anheuser-Busch makes 30% of its profits in the U.S., CEO Michel Doukeris downplayed the Mulvaney episode on the first-quarter earnings call earlier this month, saying, “Let me start by clarifying a few facts. This was the result of one can.
“It was not made for production or sale to the general public,” Doukeris continued. “It was one post, not a formal campaign or advertisement. Bud Light’s campaign is, ‘Easy to Drink, Easy to Enjoy.’
“The Bud Light volume decline in the U.S. over the first three weeks of April as publicly reported would represent around 1% of our overall global volumes for that period.”
AB has been accused of alienating its loyal customer base with the transgender partnership, ostensibly to reach younger customers. The brewer has also offended some LGBTQ+ community members, who have said AB should have defended its collaboration with Mulvaney.
Beverage brand strategists have characterized Anheuser-Busch’s response to the backlash as knee-jerk, lacking foresight and aggravating the storm.
With sales flagging, Anheuser-Busch is now offering $15 rebates on cases of Bud Light and Budweiser, lowering the price for 24 cans of beer to under $5, and, in some locations, as little as $3.49.
Beer Business Daily calls the markdowns “significant — and it isn't even Memorial Day yet.”
Meanwhile, while Bud Light and Budweiser sales have tanked, competitors’ sales have appreciably risen. Molson Coors sales rose 7.6% in the four weeks ended April 29 and Corona gained 3.8%. Among light beers, Coors Light expanded by 10.9% and Miller Lite climbed 12.8%.
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