Jameson Maker Pernod Ricard Warns of Sales Hit as Americans Ease Off on Drinking

Jameson Maker Pernod Ricard Warns of Sales Hit as Americans Ease Off on Drinking

Joshua Kirby

Thu, August 27, 2026 at 4:14 PM GMT+3 5 min read

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Pernod Ricard said fading interest in booze in the U.S. will continue to weigh on sales over the coming years, offsetting growing enthusiasm in newer drinking markets like India.

The French distiller of major labels like Jameson, Ballantine's and Chivas Regal whiskies, as well as Absolut vodka and Martell cognac, made 9.4 billion euros ($11 billion) in sales over the 12 months through June. That was 14% lower than last fiscal year, or 3.9% lower on an organic basis.

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Sales were dragged by sharp falls in the key markets of the U.S. and China. In America, Pernod pointed to a "spirits market slowdown with economic moderation and subdued consumer confidence." While trends should begin to brighten in China—where tighter rules on boozing among public officials have hit cognac sales—the outlook in the U.S. market remains worrying for the group. Continued softness in demand in the U.S. will keep group sales growth toward the lower end of a guided 3%-6% annual range through the next three years, Pernod said.

"The U.S. market will remain soft over that period," Chief Executive Officer Alexandre Ricard said. "It's as simple as that."

The prospect of more years of weak U.S. sales hit Pernod stock following Thursday's update. Shares lost more than 7% by afternoon in Paris, trading at 62.64 euros.

"It is difficult to see a reason or catalyst for shares to re-rate from here," analyst Celine Pannuti at JPMorgan wrote.

Still, stripping out China and the U.S., which together contribute around a quarter of the group's revenue, Pernod's sales rose slightly from a year earlier. India was among the markets showing a solid rise in revenue; the world's most populous nation has developed a thirst for whiskies, with local brand Royal Stag and imported Jameson both selling well, Pernod said. The company expects an "accelerating performance underpinned by dynamic consumer demand" over the coming year in India, which makes up around 13% of group revenue.

Ricard said the company is looking at a possible separate listing of the Indian business, a move that remains at "discussion level."

"It's not an obvious yes or no," he said.

Like many peers in the alcohol business, Pernod Ricard has been forced to contend with sliding sales as drinkers cut back for the good of their livers and wallets. Companies like Dutch brewer Heineken, Jack Daniel's maker Brown-Forman and Diageo, the world's largest drinks group, have turned to job cuts in a bid to keep their operations efficient. Diageo—which makes Guinness stout, Smirnoff vodka and Johnnie Walker whisky—this month said it aims to save some $1 billion in total through an operational overhaul.

Pernod Ricard similarly said it achieved half of a planned 1 billion-euro cutback in fiscal 2026, with the rest planned through fiscal 2028.

Pernod Ricard's more downbeat sales guidance for the coming years tallies with Diageo's own "prudent" sales-growth expectations, James Edwardes Jones at RBC Capital Markets wrote in a note following the update.

In the face of dim consumer confidence and changing social habits, the industry is striving to meet drinkers in new ways, with smaller-format products including ready-mixed cocktails. In the U.S., Pernod said it is aiming to adapt to "evolving market conditions," with innovation in ready-to-drink formats, which include the likes of Jameson and cola, Beefeater gin with tonic, or canned daiquiris made with the group's Malibu coconut liqueur. Sales in Pernod's ready-to-drink, or RTD, category grew 12% on year in fiscal 2026, it said. Younger drinkers of Generation Z have a particular taste for RTDs, Ricard said.

"That offers a recruitment opportunity for us," he said.

The group said it is also looking to cultural partnerships and activation in the on-premise scene, a strategy that has been central to above-industry growth at smaller peer Campari, maker of bitters Aperol.

Pernod made a recurring operating profit—a preferred metric—of 2.42 billion euros for fiscal 2026, down around 5% on an organic basis on year, as the margin slipped to 25.8% on a weaker price mix, trade tariffs and higher input costs, offset to some extent by the savings drive. Over the medium term, the group expects to see its margin recover, despite keeping promotional investment at a solid roughly 16% of net sales.

"We will strongly defend our organic operating margin, supported by strict cost control," the company said.

Write to Joshua Kirby at joshua.kirby@wsj.com

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