Boston Beer reported better-than-expected third-quarter earnings Thursday, but the Samuel Adams brewer is still struggling to reverse falling sales as Americans cut back on alcohol.
The stock has fallen 1.8% in after-hours trading.
The company earned an adjusted $4.37 a share, beating Wall Street estimates of about $4.21 according to FactSet. Revenue fell 3.2% from a year earlier to $520.1 million, however, below forecasts of roughly $522.9 million.
Boston Beer's shipments -- the volume of beer and other beverages it sells and delivers to distributors -- fell 4.9% in the third quarter, while depletions -- a measure of sales from distributors to retailers -- declined 5%, worsening from a 3% drop a year earlier.
Weakness in Twisted Tea, Truly hard seltzer, and Samuel Adams outweighed growth in Sun Cruiser and Angry Orchard cider, the company said.
Challenges facing the alcohol industry extend well beyond Boston Beer, as consumers cut back on drinking amid affordability pressures, changing lifestyles, and growing interest in healthier alternatives.
U.S. alcohol consumption declined 5% by volume in 2025, according to industry researcher IWSR. Beer and wine consumption each fell 6%, while spirits declined 4%.
Still, some brands are bucking the industrywide decline, suggesting consumers are becoming more selective about what they drink rather than giving up alcohol entirely.
Constellation Brands recently reported depletion growth of 19% and 15%, respectively, for its Mexican beer brands Pacifico and Victoria, despite softer demand for the bigger brands like Modelo Especial and Corona Extra.
Consumer preferences are also shifting, adding pressure on traditional beer and malt-based beverages. Spirits-based ready-to-drink cocktails grew 14% by volume in 2025, while nonalcoholic beer expanded 15%, according to IWSR.
Boston Beer now expects its sales volume to decline by a mid-single-digit percentage this year, compared with its previous forecast of a low- to mid-single-digit decline.
Still, gross profit margin increased in the third quarter, as the company cut production costs and raised prices to offset higher commodity and tariff expenses.
Management raised the lower end of its full-year adjusted earnings forecast to $9 from $8.50 a share, keeping the upper end at $10.50.
Despite continued weak sales, investors are finding reasons for optimism in alcohol stocks, many of which have been under pressure for at least two years.
Boston Beer shares jumped 7.7% on Thursday, before the earnings announcement, amid a broader rally in alcohol stocks. Constellation Brands gained 5.3%, Anheuser-Busch rose 3.9%, while Jack Daniel's maker Brown-Forman climbed 7.1%.
The gains came as technology shares sold off sharply, suggesting investors may have been shifting money toward beaten-down stocks in more defensive sectors.
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