Constellation Brands Inc (NYSE:STZ) shares added more than 4% after the global alcohol producer and marketer’s fiscal third quarter earnings topped analyst expectations despite declines in sales and operating income.
The company posted net sales of $2.22 billion, down 10% from the prior year, while comparable net sales fell 2%. This was above the $2.18 billion Wall Street consensus.
Comparable earnings per share (EPS) were $3.06, down 6% year-over-year but above the $2.65 consensus estimate. Reported EPS came in at $2.88.
Constellation’s beer business continued to outperform the broader market, exceeding total beverage alcohol growth by nearly half a percentage point and the beer category by roughly one percentage point in US tracked channels for both dollar and volume sales, according to data from Circana cited by the company.
The wine and spirits segment, while maintaining strength in the higher-end wine market, saw operating income decline 65% to $33.7 million.
“The operating environment during the third quarter of fiscal 2026 remained challenged, which was in line with our expectations and relatively consistent with the prior quarter,” Constellation Brands CEO Bill Newlands said in a statement. “By focusing on factors within our control, we are confident that we are positioning the company for long-term success.”
Looking ahead, Constellation updated its fiscal 2026 reported EPS guidance to a range of $9.72 to $10.02 and reaffirmed a comparable EPS forecast of $11.30 to $11.60. Operating cash flow is expected between $2.5 billion and $2.6 billion, with free cash flow projected at $1.3 billion to $1.4 billion.