Molson Coors Beverage Company
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ITEM 1. BUSINESS
Unless otherwise noted in this report, any description of "we," "us" or "our" includes Molson Coors Beverage Company ("MCBC" or the "Company"), principally a holding company, and its operating and non-operating subsidiaries included within its reporting segments. Our reporting segments include the Americas and EMEA&APAC. Unless otherwise indicated, information in this report is presented in USD and comparisons are to comparable prior periods. Our primary operating currencies, other than the USD, include the CAD, the GBP and our Central European operating currencies, such as the EUR, CZK, RON and RSD.
Business and Market Overview
Our History
For more than two centuries, we have brewed beverages that unite people to celebrate all life’s moments. From our core power brands, Coors Light, Miller Lite, Coors Banquet, Molson Canadian, Carling and Ožujsko, to our above premium brands, including Madrí Excepcional, Staropramen, Blue Moon Belgian White and Leinenkugel’s Summer Shandy, to our value brands, like Miller High Life and Keystone Light, we produce many beloved and iconic beers. While our Company's history is rooted in beer, we offer a modern portfolio that expands beyond the beer aisle as well, including flavored beverages like Vizzy Hard Seltzer, spirits and non-alcoholic beverages. We also have partner brands, such as Simply Spiked, ZOA Energy, Fever-Tree, among others, through license, distribution, partnership and joint venture agreements. As a business, our ambition is to be the first choice for our people, our consumers and our customers, and our success depends on our ability to make our products available to meet a wide range of consumer segments and occasions.
Our primary founders, the Molson, Coors and Miller families date back over two centuries. Our commitment to producing the highest quality beers is a key part of our heritage and remains so to this day. Our brands are designed to appeal to a wide range of consumer tastes, styles and price preferences. Coors Brewing Company was incorporated in June 1913 under the laws of the state of Colorado. In October 2003, Coors Brewing Company merged with and into Adolph Coors Company, a Delaware corporation. In February 2005, Adolph Coors Company merged with Molson Inc. ("the Merger"). Upon completion of the Merger, Adolph Coors Company changed its name to Molson Coors Brewing Company. In 2008, Molson Coors Brewing Company and the former SABMiller plc formed the MillerCoors joint venture that combined their respective operations in the U.S. and Puerto Rico with Molson Coors Brewing Company maintaining a 42% share in the joint venture. In 2016, we acquired 100% of the outstanding equity and voting interests of MillerCoors, from SABMiller plc. In January 2020, we changed our name from Molson Coors Brewing Company to Molson Coors Beverage Company in connection with our expansion beyond the beer aisle.
Our Industry and Our Competitors
The brewing industry has significantly evolved over the years to become an increasingly global and complex market as the consolidation of brewers globally has resulted in a small number of large global brewers representing the majority of the worldwide beer market. Although we believe consolidation among current major brewers has largely concluded, the current landscape primarily features smaller-scale acquisitions including exports, licensing and partnership arrangements. These activities continue to occur predominantly among the same global competitors that represent the majority of the market. While the majority of the market is represented by a small number of large global brewers, smaller local brewers continue to inhabit the market as consumers place value on locally-produced, regionally-sourced products.
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The brewing industry is highly competitive and our portfolio of beers competes with numerous brands in all segments which are produced by international, national, regional and local brewers. Competitive factors impacting our business include, but are not limited to, brand recognition and loyalty, pricing, quality, advertising, marketing and promotional activity, packaging, product variety, and the ability to anticipate and respond to consumer tastes and preferences. We believe our brand portfolio gives us strong representation in all major beer categories. We are among the top five global brewers in the world. In the U.S. and Canada, we compete most directly with Anheuser-Busch InBev SA/NV ("ABI") and Constellation Brands, Inc., but we also compete with imports and other providers of craft beer and flavored malt beverages. In the European countries where we currently operate, our primary competitors are Heineken, Asahi, Carlsberg and ABI. Globally, our products also compete with other alcohol beverage categories, including wine, spirits as well as wine-based and spirits-based RTDs. Our products' competitive position is affected by consumer preferences between and among these other categories. Shifts between these beverage categories have resulted in a reduction in the beer segment's lead in the overall alcohol beverage market over the last decade.
Our Strategy
Consumer preferences have continued to shift within the industry to above premium products, with volume growth in recent years seen in flavored malt beverages, imports and super premium portfolios. Further, consumers are expanding into spirits, particularly to spirits-based RTDs.
As the beer industry continues its diversification of its products to meet consumer demand with broadening preferences, we believe large global brewers are uniquely positioned to leverage the scale, depth of product portfolio and industry knowledge to continue to lead the market forward. Since 2019, we have made progress on our transformation journey to become a total beverage company, but given the fast-paced and evolving industry, we are focused on transforming even faster.
Under the leadership of our new Chief Executive Officer ("CEO"), effective October 1, 2025, we are continuing our journey to become a total beverage company and putting ourselves on a path to sustainable growth. We announced an Americas Restructuring Plan aimed at putting the right level of resources closer to our consumers and customers as we pursue a return to growth, both concentrating on all segments of our beer portfolio and expanding into adjacent categories, such as premium mixers, non-alcohol beverages and energy drinks. We aim to champion beer at every turn while building a portfolio that reflects evolving preferences. Our investments in technology, capabilities, partnerships and innovation are designed to support profitable growth and diversification, positioning our company for success today and in the future.
Our Segments
Our reporting segments include the Americas and EMEA&APAC. A separate operating team manages each segment and each segment manufactures, markets, distributes and sells beer as well as offers a modern and growing portfolio that expands beyond the beer aisle.
Americas Segment
Our Americas segment consists of the production, importing, marketing, distribution and sales of our owned brands, partner brands and licensed brands in the U.S., Canada and various countries in Latin America. We currently operate nine primary breweries, three craft breweries and two container operations. The Americas segment also includes partnership arrangements with Brewers' Retail Inc. ("BRI") for the distribution of beer in Ontario, Canada, and Brewers' Distributor Ltd. ("BDL") for the distribution of beer in the western provinces of Canada. In addition, we have an agreement with Heineken that grants us the right to produce, import, market, distribute and sell certain Heineken products in Canada. We have authorizations from Red Tree Beverages, LLC that grant us the right to produce, market, advertise, promote, sell and distribute products bearing the Simply Spiked trademark in the U.S. and Canada, as well as the Topo Chico Hard Seltzer trademark in the U.S. In addition, we have agreements to brew, package and ship products for The Yuengling Company ("TYC") in the U.S. and we have a license agreement to import, produce, market, advertise, promote, sell and distribute Fever-Tree products in the U.S.
EMEA&APAC Segment
Our EMEA&APAC segment consists of the production, marketing and sales of our owned brands, partner brands and licensed brands in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, the Republic of Ireland, Romania, Serbia, the U.K., various other European countries and certain countries within the Middle East, Africa and Asia Pacific regions. We currently operate ten primary breweries, three craft breweries and one cidery. The majority of our EMEA&APAC segment sales are in the U.K., Croatia, Romania and the Czech Republic, with the U.K. representing over 55% of the segment's net sales in 2025.
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Our EMEA&APAC segment includes the sale of factored brands in the U.K. which occurs when we distribute beer, wine, spirits and other products owned and produced by other companies to the on-premise channel, such as bars and restaurants. Sales from factored brands are included in our net sales and cost of goods sold when ultimately sold.
Unallocated
We also have certain activity that is not allocated to our segments, which is reflected in "Unallocated". Specifically, Unallocated primarily includes certain financing-related activities such as interest expense and interest income, as well as foreign exchange gains and losses on intercompany balances. Unallocated activity also includes the unrealized changes in fair value on our commodity swaps not designated in hedging relationships recorded within cost of goods sold, which are later reclassified when realized to the segment in which the underlying exposure resides. Additionally, only the service cost component of net periodic pension and OPEB cost is reported within each operating segment. Meanwhile, all other components remain in Unallocated.
Business Seasonality
Total industry volume is sensitive to factors such as weather, holidays and certain occasions including major broadcasted or streamed sporting events. Weather conditions consisting of high temperatures and extended periods of warm and dry weather favor increased consumption of our products, while unseasonably cool or wet weather, especially during the summer months, adversely affects our sales volumes and net sales. Consumption of beer is seasonal with approximately 40% of financial volume occurring during the months of May through August in both the Americas and EMEA&APAC segments.
Regulation
Our business is subject to various laws and regulations in the jurisdictions around the world in which we operate. These regulations govern many parts of our operations, including distributor relationships, sales, brewing and transportation, marketing and advertising and environmental issues. Specifically, excise taxes remitted to tax authorities are government-imposed taxes on alcohol products which are shown in a separate line item in the consolidated statements of operations as a reduction of sales.
The U.S. beer business is regulated by federal, state and local governments that regulate the production, marketing, distribution and selling of beer and other alcoholic beverages. To operate our facilities, we must obtain and maintain numerous permits, licenses and approvals from various governmental agencies, including the U.S. Department of Treasury, Alcohol and Tobacco Tax and Trade Bureau, the U.S. Department of Agriculture, the U.S. Food and Drug Administration, state alcohol regulatory agencies and state and federal environmental agencies. U.S. governmental entities including state and local jurisdictions also levy taxes and may require bonds to ensure compliance with applicable laws and regulations. In 2025, our U.S. excise taxes totaled approximately $15 per hectoliter sold on a reported basis.
In Canada, provincial governments regulate the production, marketing, distribution, selling and pricing of beer and other alcoholic beverages produced or imported into Canada (including the establishment of minimum prices), and impose commodity taxes, mark-ups and license fees in relation to its production, distribution and sale. In addition, the Canadian federal government regulates the advertising, labeling, quality control and international trade of beer, and also imposes commodity taxes on both domestically produced and imported beer. Further, certain bilateral and multilateral treaties entered into by the federal government, provincial governments and certain foreign governments, especially within the U.S., affect the Canadian beer industry. In 2025, our Canadian excise taxes totaled approximately $56 per hectoliter sold on a reported basis.
In our EMEA&APAC segment, most countries where we carry out significant brewing or distribution activities are either a member of the European Union ("EU") or a current candidate to join the EU, with the exception of the U.K. As such, there are similarities in the regulations that apply to many parts of our EMEA&APAC segment's operations and products, including brewing, food safety, labeling and packaging, marketing and advertising, environmental, health and safety, employment, data protection and regulations. In the U.K., although the regulatory framework for these areas broadly aligns with the EU, there are some differences due to the U.K.'s departure from the EU ("Brexit"), particularly in areas such as labeling, marketing, and data protection standards. To operate breweries and conduct our business in these countries, we must obtain and maintain numerous permits and licenses from various governmental agencies.
All of the government(s) of each country in which we sell our products in the EMEA&APAC segment levy excise taxes on alcohol beverages. All countries which are members of the EU apply laws on excise taxes that are consistent with EU legislative acts, also known as EU Directives, and use measurements based on either alcohol by volume or Plato degrees. In contrast, the U.K. has established its own excise duty system post-Brexit, which includes specific rates and requirements. Non-EU countries use various taxation methods, including a flat excise rate per volume or methods similar to those used in the EU. In 2025, the excise taxes for our EMEA&APAC segment were approximately $45 per hectoliter on a reported basis.
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Products and Operations
Our Products
We craft and distribute high-quality, innovative beer and other beverages with the purpose of uniting people to celebrate all life's moments. We have a diverse portfolio of beloved and iconic owned and partner brands. In addition to offering beers in various price segments, we offer products in various categories like flavored beverages (which includes hard seltzers), craft, spirits and non-alcoholic beverages including premium mixers and energy drinks. We categorize our brands globally for consistency of reporting based on the following price segments: Above Premium, Premium and Value. For example, our Above Premium classification includes brands that are sold at a price point higher than the market average. Price segment classifications may vary between the Americas and EMEA&APAC segments and the naming conventions and classifications may be different in the various countries that we operate based on local terminology. For example, in our EMEA&APAC segment, brands categorized in the Premium classification such as Carling would be described as core brands in the local market.
The following presents the primary brands sold:
Above Premium - Arnold Palmer Spiked*, Aspall Cider, Beck's*, Blue Moon, Blue Run Spirits*, Cobra, Corona Extra*, Coors Original, Fever-Tree*, Heineken*, Hidra*, Leinenkugel's
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
For more than two centuries, we have brewed beverages that unite people to celebrate all life’s moments. From our core power brands, Coors Light, Miller Lite, Coors Banquet, Molson Canadian, Carling and Ožujsko, to our above premium brands, including Madrí Excepcional, Staropramen, Blue Moon Belgian White and Leinenkugel’s Summer Shandy, to our value brands, like Miller High Life and Keystone Light, we produce many beloved and iconic beers. While our history is rooted in beer, we offer a modern portfolio that expands beyond the beer aisle as well, including flavored beverages like Vizzy Hard Seltzer and Monaco, spirits and non-alcoholic beverages. We also have partner brands, such as Simply Spiked, ZOA Energy, Fever-Tree, among others, through license, distribution, partnership and joint venture agreements. As a business, our ambition is to be the first choice for our people, our consumers and our customers, and our success depends on our ability to make our products available to meet a wide range of consumer segments and occasions.
Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") in this Quarterly Report on Form 10-Q is provided as a supplement to, and should be read in conjunction with, our audited consolidated financial statements, the accompanying notes and the MD&A included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 ("Annual Report"), as well as our unaudited condensed consolidated financial statements and the accompanying notes included in this report. The results of operations for the three and six months ended June 30, 2026, are not necessarily indicative of the results that may be achieved for the full year or any other future period.
Unless otherwise noted in this report, any description of "we," "us" or "our" includes Molson Coors Beverage Company ("MCBC" or the "Company"), principally a holding company, and its operating and non-operating subsidiaries included within its reporting segments. Our reporting segments include the Americas and EMEA&APAC. Our Americas segment operates in the U.S., Canada and various countries in Latin America. Our EMEA&APAC segment operates in Bulgaria, Croatia, Czech Republic, Hungary, Montenegro, Romania, Serbia, the U.K., various other European countries and certain countries within the Middle East, Africa and Asia Pacific.
Unless otherwise indicated, information in this report is presented in USD and comparisons are to comparable prior year periods. Our primary operating currencies, other than the USD, include the CAD, the GBP and our Central European operating currencies such as the EUR, CZK, RON and RSD.
Global Market Conditions and Competitive Trends
Our industry is experiencing and continues to navigate a dynamic macroeconomic environment driven by tariffs and shifting global trade policies as well as other geopolitical events including the recent conflict in Iran with potential resulting impacts on economic growth, consumer confidence, supply chain pressures, commodity cost volatility and other inflation, and foreign currency exchange rates.
For example, the surcharge added to the base price of aluminum in the U.S., known as the Midwest Premium, rose substantially in the second quarter of 2025, and base aluminum and fuel prices have also been volatile and remain at elevated levels. In addition to impacting the prices of raw materials, a constant or periodic change in these commodities has and may continue to decrease our profit margins or we may pass on the increased costs to our customers, which could in turn result in the loss of sales if the end consumer is not willing to pay the increased price.
Further, the associated impacts of the macroeconomic environment on the beer industries in which we operate has resulted in lower consumer confidence and heightened competitive activity resulting in market share reductions of our products in certain regions and segments. The magnitude of the resulting impacts on our business are dependent on the evolution of the global macroeconomic environment and the competitive landscape, including whether share losses are sustained. The economic and competitive pressures on our Company and our consumers' consumption behavior and preferences have negatively impacted, and may continue to negatively impact, our results of operations during this volatile period.
We plan to continue to evaluate and implement strategies which are designed to help mitigate the impact on our business, consolidated results of operations and financial condition while continuing to support our long-term strategic growth and capital allocation priorities.
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Items Affecting the Americas Segment Results of Operations
Atomic Brands, Inc. Acquisition
On April 1, 2026, we acquired Atomic Brands, Inc., the maker of Monaco Cocktails ("Monaco") for a purchase price and cash paid of $275 million (subject to adjustment for net working capital). Monaco is a pioneering brand in the ready-to-drink ("RTD") cocktail segment known for combining bold flavors and quality with convenient ready-to-drink packaging. The acquisition is aligned with our strategy to expand beyond the beer aisle, especially into RTD cocktails. The acquisition was accounted for as a business combination, with approximately $65 million of consideration allocated to a definite-lived brand intangible asset to be amortized over a 15-year period and the remainder primarily allocated to goodwill of approximately $200 million for the amount in excess of net identifiable assets acquired as well as other working capital balances.
Midwest Premium Pricing
We continued to incur elevated costs attributable to Midwest Premium pricing. Midwest Premium pricing had an approximately $40 million and $70 million unfavorable impact on our cost of goods sold during the three and six months ended June 30, 2026, respectively. We expect this unfavorable impact to continue the remainder of 2026 and as a result, we anticipate Midwest Premium pricing to have an approximate $130 million unfavorable impact on our cost of goods sold for the year ending December 31, 2026 when compared to prior year.
Consolidated Results of Operations
The following table highlights summarized components of our unaudited condensed consolidated statements of operations for the three and six months ended June 30, 2026 and June 30, 2025. See Part I.—Item 1. Financial Statements for additional details of our U.S. GAAP results.
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | % change | June 30, 2026 | June 30, 2025 | % change | ||||||||||||||||||||||||||||||
| (In millions, except percentages and per share data) | |||||||||||||||||||||||||||||||||||
| Net sales | $ | 3,096.5 | $ | 3,200.8 | (3.3) | % | $ | 5,447.6 | $ | 5,504.9 | (1.0) | % | |||||||||||||||||||||||
| Cost of goods sold | (2,033.2) | (1,918.9) | 6.0 | % | (3,487.1) | (3,372.1) | 3.4 | % | |||||||||||||||||||||||||||
| Gross profit | 1,063.3 | 1,281.9 | (17.1) | % | 1,960.5 | 2,132.8 | (8.1) | % | |||||||||||||||||||||||||||
| Marketing, general and administrative expenses | (718.5) | (693.1) | 3.7 | % | (1,328.5) | (1,346.3) | (1.3) | % | |||||||||||||||||||||||||||
| Other operating income (expense), net | (16.6) | (9.2) | 80.4 | % | (48.7) | (25.1) | 94.0 | % | |||||||||||||||||||||||||||
| Equity income (loss) | 3.7 | 4.0 | (7.5) | % | 6.9 | 8.5 | (18.8) | % | |||||||||||||||||||||||||||
| Operating income (loss) | 331.9 | 583.6 | (43.1) | % | 590.2 | 769.9 | (23.3) | % | |||||||||||||||||||||||||||
| Total non-operating income (expense), net | (48.8) | (28.7) | 70.0 | % | (112.4) | (58.7) | 91.5 | % | |||||||||||||||||||||||||||
| Income (loss) before income taxes | 283.1 | 554.9 | (49.0) | % | 477.8 | 711.2 | (32.8) | % | |||||||||||||||||||||||||||
| Income tax benefit (expense) | (61.5) | (130.6) | (52.9) | % | (106.1) | (163.8) | (35.2) | % | |||||||||||||||||||||||||||
| Net income (loss) | 221.6 | 424.3 | (47.8) | % | 371.7 | 547.4 | (32.1) | % | |||||||||||||||||||||||||||
| Net (income) loss attributable to noncontrolling interests | 10.1 | 4.4 | 129.5 | % | 11.3 | 2.3 | 391.3 | % | |||||||||||||||||||||||||||
| Net income (loss) attributable to MCBC | $ | 231.7 | $ | 428.7 | (46.0) | % | $ | 383.0 | $ | 549.7 | (30.3) | % | |||||||||||||||||||||||
| Net income (loss) attributable to MCBC per diluted share | $ | 1.23 | $ | 2.13 | (42.3) | % | $ | 2.03 | $ | 2.71 | (25.1) | % | |||||||||||||||||||||||
| Financial volume in hectoliters | 19.734 | 20.870 | (5.4) | % | 34.698 | 36.279 | (4.4) | % | |||||||||||||||||||||||||||
Foreign Currency Impacts on Results
For the three months ended June 30, 2026, foreign currency movements had the following impacts on our USD consolidated results:
•Net sales - Favorable impact of $10.4 million (Favorable impact for EMEA&APAC of $11.1 million, partially offset by the unfavorable impact for Americas of $0.7 million).
•Cost of goods sold - Unfavorable impact of $6.8 million (Unfavorable impact for EMEA&APAC of $7.8 million, partially offset by the favorable impact for Americas and Unallocated of $0.5 million and $0.5 million, respectively).
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•MG&A - Unfavorable impact of $2.9 million (Unfavorable impact for EMEA&APAC of $3.1 million, partially offset by the favorable impact for Americas of $0.2 million).
•Income (loss) before income taxes - Unfavorable impact of $0.4 million (Unfavorable impact for Americas of $2.1 million, partially offset by the favorable impact for Unallocated and EMEA&APAC of $1.0 million and $0.7 million, respectively).
The impacts of foreign currency movements on our consolidated USD results described above for the three months ended June 30, 2026 were primarily due to the weakening of the USD compared to the GBP and other operating currencies in Europe and the strengthening of the USD compared to the CAD.
For the six months ended June 30, 2026, foreign currency movements had the following impacts on our USD consolidated results:
•Net sales - Favorable impact of $55.6 million (Favorable impact for EMEA&APAC and Americas of $45.1 million and $10.5 million, respectively).
•Cost of goods sold - Unfavorable impact of $38.7 million (Unfavorable impact for EMEA&APAC and Americas of $33.4 million and $6.9 million, respectively, partially offset by the favorable impact for Unallocated of $1.6 million).
•MG&A - Unfavorable impact of $19.0 million (Unfavorable impact for EMEA&APAC and Americas of $15.4 million and $3.6 million, respectively).
•Income (loss) before income taxes - Unfavorable impact of $5.0 million (Unfavorable impact for EMEA&APAC and Americas of $4.7 million and $3.7 million, respectively, partially offset by the favorable impact for Unallocated of $3.4 million).
The impacts of foreign currency movements on our consolidated USD results described above for the six months ended June 30, 2026, were primarily due to the weakening of the USD compared to the CAD, GBP and other operating currencies in Europe.
Included in these amounts are both translational and transactional impacts of changes in foreign exchange rates. We calculate the impact of foreign exchange by translating our current period local currency results at the average exchange rates used to translate the financial statements in the comparable prior year period during the respective period throughout the year and comparing that amount with the reported amount for the period. The impact of transactional foreign currency gains and losses is recorded within other non-operating income (expense), net in our unaudited condensed consolidated statements of operations.
Volume
Financial volume represents owned or actively managed brands sold to unrelated external customers within our geographic markets (net of returns and allowances), as well as contract brewing, factored non-owned volume and company-owned distributor volume. This metric is presented on a sales-to-wholesalers basis to reflect the sales from our operations to our direct customers, generally distributors. We believe this metric is important and useful for investors and management because it gives an indication of the amount of beer and adjacent products that we have produced and shipped to customers. This metric excludes royalty volume, which consists of our brands produced and sold under various license and contract brewing agreements. Factored volume in our EMEA&APAC segment represents the distribution of beer, wine, spirits and other products owned and produced by other companies to the on-premise channel, which is a common arrangement in the U.K. and other European countries.
Net sales
The following table highlights the drivers of the change in net sales for the three months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| Consolidated net sales | (5.4) | % | 1.8 | % | 0.3 | % | (3.3) | % | ||||||||||||||||
Net sales decreased 3.3% for the three months ended June 30, 2026, compared to prior year, driven by lower financial volume, partially offset by favorable price and sales mix and favorable foreign currency impacts.
Financial volume decreased 5.4% for the three months ended June 30, 2026, compared to prior year, primarily due to lower shipments in both the Americas and EMEA&APAC segments.
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Price and sales mix favorably impacted net sales by 1.8% for the three months ended June 30, 2026, compared to prior year, primarily due to increased net pricing in the Americas segment and favorable sales mix as a result of premiumization in both the Americas and EMEA&APAC segments.
The following table highlights the drivers of the change in net sales for the six months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| Consolidated net sales | (4.4) | % | 2.3 | % | 1.1 | % | (1.0) | % | ||||||||||||||||
Net sales decreased 1.0% for the six months ended June 30, 2026, compared to prior year, driven by lower financial volume, partially offset by favorable price and sales mix and favorable foreign currency impacts.
Financial volume decreased 4.4% for the six months ended June 30, 2026, compared to prior year, primarily due to lower shipments in both the Americas and EMEA&APAC segments.
Price and sales mix favorably impacted net sales by 2.3% for the six months ended June 30, 2026, compared to prior year, primarily due to increased net pricing in the Americas segment and favorable sales mix as a result of premiumization in both the Americas and EMEA&APAC segments.
A discussion of currency impacts on net sales for the three and six months ended June 30, 2026 is included in the "Foreign currency impacts on results" section above.
Cost of goods sold
We utilize cost of goods sold per hectoliter, as well as the year over year changes in this metric, as a key metric for analyzing our results. This metric is calculated as cost of goods sold per our unaudited condensed consolidated statements of operations divided by financial volume for the respective period. We believe this metric is important and useful for investors and management because it provides an indication of the trends of mix and other cost impacts on our cost of goods sold.
Cost of goods sold increased 6.0% for the three months ended June 30, 2026 compared to prior year, primarily due to higher cost of goods sold per hectoliter and unfavorable foreign currency impacts, partially offset by lower financial volume. Cost of goods sold per hectoliter increased 12.1% for the three months ended June 30, 2026, compared to prior year, primarily due to the unfavorable changes in our unrealized mark-to-market commodity derivative positions of $98.0 million, cost inflation related to materials, logistics and manufacturing expenses including approximately $40 million of an unfavorable impact attributable to Midwest Premium pricing, unfavorable mix driven by premiumization and volume deleverage, partially offset by cost savings initiatives.
Cost of goods sold increased 3.4% for the six months ended June 30, 2026 compared to prior year, primarily due to higher cost of goods sold per hectoliter and unfavorable foreign currency impacts of $38.7 million, partially offset by lower financial volumes. Cost of goods sold per hectoliter increased 8.1% for the six months ended June 30, 2026, compared to prior year, primarily due to cost inflation related to materials, logistics and manufacturing expenses including approximately $70 million of an unfavorable impact attributable to Midwest Premium pricing, unfavorable mix driven by premiumization, volume deleverage and unfavorable changes in our unrealized mark-to-market commodity derivative positions of $27.5 million, partially offset by cost savings initiatives.
A discussion of currency impacts on cost of goods sold for the three and six months ended June 30, 2026, is included in the "Foreign currency impacts on results" section above.
Marketing, general and administrative expenses
MG&A expenses increased 3.7% for the three months ended June 30, 2026, compared to prior year, primarily due to higher general and administrative expenses as a result of cycling lower incentive compensation expense in the prior year and costs incurred related to our global modernization enterprise resource planning (“ERP”) system implementation project in the current year.
MG&A expenses decreased 1.3% for the six months ended June 30, 2026, compared to prior year, primarily due to lower marketing expense and the cycling of approximately $30 million of integration and transition fees from the Fevertree USA, Inc. acquisition in the prior year, partially offset by cycling lower incentive compensation expense in the prior year, unfavorable foreign currency impacts of $19.0 million and costs incurred related to our global modernization ERP system implementation project.
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A discussion of currency impacts on MG&A expenses for the three and six months ended June 30, 2026, is included in the "Foreign currency impacts on results" section above.
Other operating income (expense), net
See Part I.—Item 1. Financial Statements, Note 12, "Other Operating Income (Expense), net" for detail of our other operating income (expense), net.
Total non-operating income (expense), net
Total non-operating expense, net increased 70.0% for the three months ended June 30, 2026, compared to prior year, primarily due to the fair value change of our investment in Fevertree Drinks plc of $18.0 million.
Total non-operating expense, net increased 91.5% for the six months ended June 30, 2026, compared to prior year, primarily due to the fair value change of our investment in Fevertree Drinks plc of $54.1 million.
Income tax benefit (expense)
| Three Months Ended | Six Months Ended | |||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | June 30, 2026 | June 30, 2025 | |||||||||||||||||||
| Effective tax rate | 22 | % | 24 | % | 22 | % | 23 | % | ||||||||||||||
The lower effective tax rate for the three and six months ended June 30, 2026, compared to the prior year, was primarily due to the recognition of a higher discrete tax benefit.
Our effective tax rate can be volatile and may change with, among other things, the amount and source of pretax income or loss, our ability to utilize foreign tax credits, excess tax benefits or deficiencies from share-based compensation, changes in tax laws and the movement of liabilities established pursuant to accounting guidance for uncertain tax positions as statutes of limitations expire, positions are effectively settled or when additional information becomes available. There are proposed or pending tax law changes in various jurisdictions and other changes to regulatory environments in countries in which we do business that, if enacted, could have an impact on our effective tax rate.
Segment Results of Operations
Americas Segment
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | % change | June 30, 2026 | June 30, 2025 | % change | ||||||||||||||||||||||||||||||
| (In millions, except percentages) | |||||||||||||||||||||||||||||||||||
Net sales(1) | $ | 2,402.4 | $ | 2,504.8 | (4.1) | % | $ | 4,302.9 | $ | 4,386.6 | (1.9) | % | |||||||||||||||||||||||
| Income (loss) before income taxes | $ | 390.1 | $ | 538.2 | (27.5) | % | $ | 597.5 | $ | 747.5 | (20.1) | % | |||||||||||||||||||||||
Financial volume in hectoliters(1)(2) | 14.326 | 15.307 | (6.4) | % | 25.753 | 27.049 | (4.8) | % | |||||||||||||||||||||||||||
(1)Includes gross inter-segment sales and volume which are eliminated in the consolidated totals.
(2)Excludes royalty volume of 0.719 million hectoliters and 1.441 million hectoliters for the three and six months ended June 30, 2026, respectively, and excludes royalty volume of 0.693 million hectoliters and 1.366 million hectoliters for the three and six months ended June 30, 2025, respectively.
Net sales
The following table highlights the drivers of the change in net sales for the three months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| Americas net sales | (6.4) | % | 2.3 | % | — | % | (4.1) | % | ||||||||||||||||
Net sales decreased 4.1% for the three months ended June 30, 2026, compared to prior year, driven by lower financial volume, partially offset by favorable price and sales mix.
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Financial volume decreased 6.4% for the three months ended June 30, 2026, compared to prior year, primarily due to lower financial volume in the U.S. in our core and value brands as well as the unfavorable timing of shipments.
Price and sales mix favorably impacted net sales by 2.3% for the three months ended June 30, 2026, compared to prior year, primarily due to increased net pricing and favorable sales mix as a result of positive brand mix.
The following table highlights the drivers of the change in net sales for the six months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| Americas net sales | (4.8) | % | 2.7 | % | 0.2 | % | (1.9) | % | ||||||||||||||||
Net sales decreased 1.9% for the six months ended June 30, 2026, compared to prior year, driven by lower financial volume, partially offset by favorable price and sales mix and favorable foreign currency impacts.
Financial volume decreased 4.8% for the six months ended June 30, 2026, compared to prior year, primarily due to lower financial volumes in the U.S. in our core and value brands.
Price and sales mix favorably impacted net sales by 2.7% for the six months ended June 30, 2026, compared to prior year, primarily due to increased net pricing and favorable sales mix as a result of positive brand mix.
A discussion of currency impacts on net sales for the three and six months ended June 30, 2026 is included in the "Foreign currency impacts on results" section above.
Income (loss) before income taxes
Income before income taxes decreased 27.5% for the three months ended June 30, 2026, compared to the prior year, primarily due to lower financial volume, cost inflation related to materials, logistics and manufacturing expenses, including approximately $40 million of an unfavorable impact attributable to Midwest Premium pricing, higher MG&A expenses, unfavorable changes in the fair value of our investment in Fevertree Drinks plc of approximately $18 million and higher other operating expenses, partially offset by increased net pricing and cost savings initiatives. Higher MG&A was primarily driven by the cycling of lower incentive compensation expense in the prior year and costs incurred related to our global modernization ERP system implementation project in the current year.
Income before income taxes decreased 20.1% for the six months ended June 30, 2026, compared to the prior year, primarily due to cost inflation related to materials, logistics and manufacturing expenses, including approximately $70 million of an unfavorable impact attributable to Midwest Premium pricing, lower financial volume and unfavorable changes in the fair value of our investment in Fevertree Drinks plc of $54.1 million, partially offset by increased net pricing, lower MG&A and cost savings initiatives. Lower MG&A was primarily due to the cycling of approximately $30 million of integration and transition fees from the Fevertree USA, Inc. acquisition in the prior year, cost savings initiatives including lower employee-related costs of our Americas Restructuring Plan and lower marketing expense, partially offset by higher incentive compensation expense and costs incurred related to our global modernization ERP system implementation project.
A discussion of currency impacts on income (loss) before income taxes for the three and six months ended June 30, 2026 is included in the "Foreign currency impacts on results" section above.
EMEA&APAC Segment
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | % change | June 30, 2026 | June 30, 2025 | % change | ||||||||||||||||||||||||||||||
| (In millions, except percentages) | |||||||||||||||||||||||||||||||||||
Net sales(1) | $ | 700.8 | $ | 703.9 | (0.4) | % | $ | 1,156.9 | $ | 1,131.2 | 2.3 | % | |||||||||||||||||||||||
| Income (loss) before income taxes | $ | 37.9 | $ | 64.8 | (41.5) | % | $ | (13.8) | $ | 45.6 | N/M | ||||||||||||||||||||||||
Financial volume in hectoliters(1)(2) | 5.409 | 5.564 | (2.8) | % | 8.949 | 9.233 | (3.1) | % | |||||||||||||||||||||||||||
(1)Includes gross inter-segment sales and volume which are eliminated in the consolidated totals.
(2)Excludes royalty volume of 0.353 million hectoliters and 0.576 million hectoliters for the three and six months ended June 30, 2026, respectively, and excludes royalty volume of 0.336 million hectoliters and 0.556 million hectoliters for the three and six months ended June 30, 2025, respectively.
33
Net sales
The following table highlights the drivers of the change in net sales for the three months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| EMEA&APAC net sales | (2.8) | % | 0.8 | % | 1.6 | % | (0.4) | % | ||||||||||||||||
Net sales decreased 0.4% for the three months ended June 30, 2026, compared to prior year, driven by lower financial volume, partially offset by favorable foreign currency impacts and favorable price and sales mix.
Financial volume decreased 2.8% for the three months ended June 30, 2026, compared to prior year, primarily due to lower volume in the U.K. driven by soft market demand and a heightened competitive landscape.
Price and sales mix favorably impacted net sales by 0.8% for the three months ended June 30, 2026, compared to prior year, primarily due to premiumization, partly offset by increased promotional activity.
The following table highlights the drivers of the change in net sales for the six months ended June 30, 2026, compared to June 30, 2025 (in percentages):
| Financial Volume | Price and Sales Mix | Currency | Total | |||||||||||||||||||||
| EMEA&APAC net sales | (3.1) | % | 1.4 | % | 4.0 | % | 2.3 | % | ||||||||||||||||
Net sales increased 2.3% for the six months ended June 30, 2026, compared to prior year, driven by favorable foreign currency impacts and favorable price and sales mix, partially offset by lower financial volumes.
Financial volume decreased 3.1% for the six months ended June 30, 2026, compared to prior year, primarily due to lower volume in the U.K. and in Central and Eastern Europe driven by soft market demand and heightened competitive landscape mainly in our core and value brands.
Price and sales mix favorably impacted net sales by 1.4% for the six months ended June 30, 2026, compared to prior year, primarily due to premiumization, partly offset by increased promotional activity.
A discussion of currency impacts on net sales for the three and six months ended June 30, 2026, is included in the "Foreign currency impacts on results" section above.
Income (loss) before income taxes
Income before income taxes of $37.9 million decreased 41.5% for the three months ended June 30, 2026, compared to the prior year, primarily due to unfavorable mix driven by channel mix, lower financial volume and cost inflation related to materials, logistics and manufacturing expenses, partially offset by lower restructuring related charges.
Loss before income taxes of $13.8 million increased $59.4 million for the six months ended June 30, 2026, compared to income in the prior year, primarily due to lower financial volume, higher restructuring related charges, cost inflation related to materials, logistics and manufacturing expenses, unfavorable geographic mix and unfavorable foreign currency impacts.
A discussion of currency impacts on income (loss) before income taxes for the three and six months ended June 30, 2026 is included in the "Foreign currency impacts on results" section above.
Unallocated Segment
We have certain activity that is not allocated to our segments, which has been reflected as Unallocated below. Specifically, Unallocated primarily includes certain financing-related activities such as interest expense and interest income, as well as foreign exchange gains and losses on intercompany balances. Unallocated activity also includes the unrealized changes in fair value on our commodity instruments not designated in hedging relationships recorded within cost of goods sold, which are later reclassified when realized to the segment in which the exposure resides. Additionally, only the service cost component of net periodic pension and OPEB cost is reported within each operating segment. Meanwhile all other components remain in Unallocated.
34
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
| June 30, 2026 | June 30, 2025 | % change | June 30, 2026 | June 30, 2025 | % change | ||||||||||||||||||||||||||||||
| (In millions, except percentages) | |||||||||||||||||||||||||||||||||||
| Cost of goods sold | $ | (91.0) | $ | 7.0 | N/M | $ | (1.8) | $ | 25.7 | N/M | |||||||||||||||||||||||||
| Gross profit (loss) | (91.0) | 7.0 | N/M | (1.8) | 25.7 | N/M | |||||||||||||||||||||||||||||
| Operating income (loss) | (91.0) | 7.0 | N/M | (1.8) | 25.7 | N/M | |||||||||||||||||||||||||||||
| Total non-operating income (expense), net | (53.9) | (55.1) | (2.2) | % | (104.1) | (107.6) | (3.3) | % | |||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | (144.9) | $ | (48.1) | 201.2 | % | $ | (105.9) | $ | (81.9) | 29.3 | % | |||||||||||||||||||||||
Cost of goods sold
The unrealized changes in fair value on our commodity derivatives, which are economic hedges, make up substantially all of the activity presented within cost of goods sold in the table above for the three and six months ended June 30, 2026 and June 30, 2025. The increase in the unrealized loss recognized during the three months ended June 30, 2026, compared to prior year, was primarily due to unrealized losses recognized on our U.S. aluminum swaps and options, U.S. Midwest Premium swaps and U.S. diesel swaps. The increase in the unrealized loss recognized during the six months ended June 30, 2026, compared to prior year, was primarily due to unrealized losses recognized on our U.S. Midwest Premium swaps and U.S. aluminum swaps, partially offset by unrealized gains on our U.S. diesel swaps. As the exposure we are managing is realized, we reclassify the gain or loss on our commodity derivatives to the segment in which the underlying exposure resides, allowing our segments to realize the economic effects of the derivative without the resulting unrealized mark-to-market volatility. See Part I.—Item 1. Financial Statements, Note 8, "Derivative Instruments and Hedging Activities" for further information.
Total non-operating income (expense), net
Next expected filings
- ~2026-11-05 10-Q expected by 2026-11-11 (in 73 days)
- ~2027-02-18 10-K expected by 2027-03-03 (in 178 days)
- ~2027-05-01 10-Q expected by 2027-05-07 (in 250 days)
- ~2027-08-07 10-Q expected by 2027-08-13 (in 348 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-08-06 8-K Earnings Release; Financial Statements and Exhibits
- 2026-08-06 10-Q Quarterly Report
- 2026-06-24 8-K Officer/Director Change
- 2026-05-27 8-K Material Agreement Entered; Material Financial Obligation; Financial Statements and Exhibits
- 2026-05-22 8-K Other Events; Financial Statements and Exhibits
- 2026-05-22 424B5 Prospectus Supplement
- 2026-04-30 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-30 10-Q Quarterly Report
- 2026-02-18 10-K Annual Report
- 2026-02-18 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-11-20 8-K Officer/Director Change; Financial Statements and Exhibits
- 2025-11-04 10-Q Quarterly Report
- 2025-11-04 8-K Earnings Release; Financial Statements and Exhibits
- 2025-10-20 8-K Costs Associated with Exit; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-10-06 8-K Officer/Director Change