Anheuser-Busch InBev, the parent company of Budweiser and Bud Light, reports first-quarter results on Thursday. But the usual executive drone about sales volumes will likely be overshadowed by what, if anything, executives say about the conservative-led backlash to Bud Light’s promotional partnership with trans influencer Dylan Mulvaney.
The financial impact from that uproar probably won’t show up in the quarterly results themselves, as the quarter ended in March — before calls for a Bud Light boycott began in earnest in response to the partnership. And demand for light beer has faded for years anyway, following the rise and peak of craft beer and seltzer, and Bud Light has become less financially relevant overall to AB-InBev
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Still, as Barron’s noted, the trade publication Beer Business Daily reported that the amount of Bud Light sold outside bars and restaurants fell 26.1% year-over-year during the week ending April 22, after falling 21.1% during the prior week. During the company’s earnings call, AB-InBev executives could offer further commentary about where sales are headed.
Still, AB-InBev is a massive, global company that sells beer like Stella Artois, Beck’s and Hoegaarden, and it has lots of ways to patch up any holes in sales trends. Backlash aside, the quarter could be another marked by muted growth in volume — a measure of liquid sold — with a bigger sales increase.
That’s been a trend in other food and beverage companies, as executives raise prices to squeeze out more sales gains, even as growth in the amount of product they actually sell remains subdued. But some analysts have said that easing costs for ingredients and other inputs like aluminum, as well as China’s reopening, could help financials during the quarter.
What to expect
Earnings: Wall Street expects AB InBev to earn 59 cents a share, compared with 67 cents in the same quarter a year ago.
Revenue: FactSet forecast revenue of $14.06 billion, compared with $13.24 billion a year earlier.
Stock movement: Shares have rattled around since the backlash to the Bud Light campaign began, and finished April lower. But they’re up 14.6% over the past 12 months. The stock rose 0.3% on Wednesday.
The results will come after Bud Light last month partnered with Mulvaney, who has millions of followers across Instagram and TikTok, for a March Madness promotional campaign. In one post, Mulvaney, 26, appeared in a bathtub with a can of Bud Light. In another, she showed a can that Bud Light gave her with an illustration of her on it to celebrate 365 days as a woman.
For more context: Bud Light was already swimming upstream against inflation rates and recession fears. Then came the trans ‘influencer’ backlash.
Those handful of posts were enough to prompt online calls for a boycott, complaints about “woke” corporate agendas, and for Kid Rock to shoot up a few Bud Light cases. Anheuser-Busch’s chief executive said in a statement, “We never intended to be part of a discussion that divides people.” Liberals said the statement ceded to transphobic anger, while conservatives said it didn’t apologize directly enough.
Mulvaney, in an Instagram post last week, said she was doing OK after staying offline for a few weeks. But she said that the repeated mention of her name online made her feel like she wasn’t even part of the conversation. Mulvaney, who grew up in a religious conservative family, said she’s always tried to love everyone. She added that she hoped to share aspects of her life online that had nothing to do with her identity.
“What I’m struggling to understand is the need to dehumanize and to be cruel,” she said. “I don’t think that’s right. Dehumanization’s never fixed anything in history, ever.”
Jefferies analysts noted that Bud Light made up around 36% of AB-InBev’s U.S. volumes in 2021, down from 45% in 2012. Still, others have noted that the backlash could boost Bud Light’s rivals.
“We view Molson Coors
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as the largest beneficiary of the lost Bud Light volume,” Bill Kirk, an analyst with Roth MKM Partners, said in a research note last month. “We believe consumption habits will not easily revert to March patterns.”
Also read: Molson Coors’ stock rallies as adjusted profit jumps 82%
Even though the backlash led AB-InBev to place two executives on leave, a recent Morning Consult survey found that 53% of U.S. beer drinkers “say they would feel favorable toward a brand that works with a transgender spokesperson.”
Others who have followed previous social-media boycotts have said that the financial impact has been limited to a few days or weeks. Others have noted that while Anheuser-Busch is a big GOP donor, anti-trans sentiment has catalyzed social conservatives in recent years.
From April: How a conservative boycott of Bud Light could create a backlash to the backlash
“Unfortunately, I do think the outrage cycle could be stronger in this case, but I still think the overall response will be short-lived,” Beth Fossen, an assistant professor of marketing at Indiana University, said over email. “That is, in two to three months, I don’t think many consumers will be thinking about this marketing campaign while shopping for beer.”
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