Major Bank Hits Anheuser-Busch As Sales Continue Decline

In a recent turn of events, Anheuser-Busch InBev, the multinational beverage company, finds itself facing a stock downgrade and a significant decline in sales. The controversy surrounding the Dylan Mulvaney partnership has continued to impact the company’s reputation, leading to this unfortunate outcome.

HSBC, a major multinational bank, downgraded the stock status of Anheuser-Busch InBev to a hold, suggesting that investors should neither buy nor sell shares of the company. Carlos Laboy, the managing director for the global beverage sector of HSBC, expressed concerns about AB InBev’s handling of its brand culture shift in the United States.

Laboy pointed out that while the brand culture transformation at Brazilian beverage giant Ambev appeared successful, the same could not be said for AB InBev’s efforts in the U.S. Laboy’s analysis, as published on CNBC via the New York Post, questioned the leadership’s ability to navigate the fallout from the Dylan Mulvaney controversy.

The response from AB InBev’s management and the subsequent loss of volume and brand relevance have raised numerous questions. Laboy questioned whether the company’s U.S. leadership underestimated the risk of pushback, considering the experiences of other firms in similar situations. Additionally, he pondered whether AB InBev was hiring the right people to drive brand growth and assess potential risks. Laboy also questioned why the marketers failed to attract new consumers without alienating the core base of the company’s largest brands, Budweiser and Bud Light.

The consequences of the Dylan Mulvaney partnership controversy have been significant for Anheuser-Busch. Nationwide retail sales of Bud Light witnessed a staggering 23.4% decline year-over-year for the week of April 29, based on data from NielsenIQ and Bump Williams Consulting, obtained by the New York Post. This decline is even worse than the 21.4% drop observed in the previous week. Notably, this marks the fourth consecutive week of double-digit sales decline.

The impact of the backlash has extended beyond Bud Light, affecting other brands within AB InBev’s portfolio. Budweiser sales saw a decline of 11.4% for the week ending April 29, while Michelob Ultra, the third highest-selling brand, experienced a 4.4% decrease. Other brands, including Natural Light and Busch Light, faced declines of 5.2% and 1.8%, respectively.

Bump Williams, CEO of Bump Williams Consulting, emphasized that the issue at hand is not limited to Bud Light alone but has become a broader portfolio problem for Anheuser-Busch.