Diageo Gets Q3 Boost As Distributors Stock Up Ahead Of Tariffs
May 19, 2025Diageo saw sales grow 5.9% organically to $4.4 billion in the three months through March, representing its fiscal third quarter, boosted by higher shipments as distributors stocked up ahead of expected tariffs on imported brands. In the nine months of the fiscal year to date, Diageo sales grew 2.4% organically to $15.3 billion.
“We view the near-term industry pressure as largely macroeconomic driven, with continued uncertainty impacting both the timing and pace of recovery,” said Diageo CEO Debra Crew, who will be among the speakers at this fall’s 49th Annual Impact Marketing Seminar in New York.
Diageo’s U.S. spirits sales jumped 7% in the third quarter, besting depletions growth of 5%, “driven by a pull-forward of imports to distributors in anticipation of tariffs which we expect will reverse in Q4, and also Tequila restocking given continued strong consumer sales performance,” according to the company. Diageo added that it benefited from easier comps this quarter, lapping a wave of retailer destocking at this time a year ago.
Overall, Diageo’s North America net sales rose 6% organically, helped by shipment phasing, “despite softer U.S. spirits industry consumption in Q3 compared to the first half of fiscal 25.” Price/mix rose 2%, again propelled by the core U.S. spirits business.
Looking ahead, Diageo is sticking with its earlier guidance calling for a “sequential improvement in sales” compared with its fiscal first half, along with a slight decline in organic operating profit, impacted by tariffs. The company estimates that current tariffs—including 10% levies on the U.K. and E.U.—will shave $150 million from profit, but says it can mitigate about half of that figure.
Meanwhile, Diageo is embarking on a new Accelerate cost savings initiative, aimed at saving $500 million across its business, adding that the effort will be “supported by appropriate and selective disposals over the coming years.” Crew said the cost-savings program “will strengthen Diageo by increasing our effectiveness, agility, and resilience. It will also ensure that we are well-positioned to deliver sustainable, consistent performance while maximising shareholder returns; even if current trading conditions persist.”—Daniel Marsteller
| Diageo—Top Eight Brands In The U.S. (millions of 9-liter case depletions) |
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| Rank | Brand1 | Origin/Type | 2023 | 2024 | Percent Change2 |
|
|---|---|---|---|---|---|---|
| 1 | Smirnoff | American Vodka | 8.4 | 7.9 | -6.0% | |
| 2 | Crown Royal | Canadian Whisky | 6.9 | 7.2 | 4.0% | |
| 3 | Captain Morgan | Virgin Islands Rum | 5.0 | 4.4 | -12.0% | |
| 4 | Don Julio | Tequila | 2.4 | 3.4 | 39.6% | |
| 5 | Ketel One | Imported Vodka | 2.5 | 2.5 | -0.3% | |
| 6 | Casamigos | Tequila/Mezcal | 2.5 | 2.0 | -20.4% | |
| 7 | Johnnie Walker | Scotch Whisky | 1.9 | 1.8 | -9.1% | |
| 8 | Bulleit | Bourbon/Rye | 1.8 | 1.7 | -5.7% | |
| Total Top Eight3 | 31.3 | 30.6 | -2.0% | |||
| 1 Includes flavors, excludes RTDs. 2 Based on unrounded data. 3 Addition of columns may not agree due to rounding. Source: IMPACT DATABANK © 2025 |
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Tagged : Casamigos, Crown Royal, Diageo, Don Julio, Smirnoff
