AB InBev showcases strong Q1 results, resilience in face of recent controversy

Dive Brief:

Anheuser-Busch InBev (AB InBev) beat expectations to deliver a 13.2% revenue increase in Q1 of 2023, according to a press release from the company. The company increased both sales and marketing investments during the period.
The company’s Beyond Beer business generated over $325 million in revenue in Q1. In the U.S., the combined revenues of ready-to-drink products Cutwater and Nutrl grew by over 50%. Budweiser grew 17.8%, largely supported by demand in China and India, while Stella Artois saw a revenue growth of 13.3% and Corona 11.9%.
The ongoing backlash and sales dip that started in April following Bud Light’s partnership with influencer and actress Dylan Mulvaney was not addressed in the report, but was briefly mentioned during an earnings call, with executives calling out the company’s agility and commitment to moving forward.

Dive Insight:

While AB InBev’s Q1 earnings came in better than expected, they don’t reflect the impact on sales following the controversy around Bud Light’s partnership with Mulvaney, which didn’t happened until the beginning of Q2. Bud Light’s sales dropped 17% the second week of April and 21% the following week, per data shared with Marketing Dive by Bump Williams Consulting.

Despite these headwinds, AB InBev CEO Michel Doukeris said on an earnings call that the company’s full-year growth outlook remains unchanged. However, the controversy has put a strain on the company’s relationship with distributors, with the Wall Street Journal reporting earlier this week that Bud Light is offering its partners free beer and more advertising support as they deal with the sales drop. Doukeris called out the company’s support of wholesale partners in the earnings call and commitment to moving ahead.

“We want to reiterate our support for our wholesaler partners and everyone who brings our great beers to the market,” said Doukeris during the call. “I can tell you that we have the agility, resources and people to support the U.S. team and move forward. We will continue to learn with the moment and come out stronger.”

On April 1, Mulvaney, who is transgender, posted a video to Instagram promoting a contest involving the beer brand, and showing off her one-of-a-kind personal bottle of Bud Light. The bottle was sent to her to celebrate the one year anniversary of her transition. After the post was made, an intense period of backlash followed, including calls for a boycott. Later in the month, AB InBev placed on leave two marketing executives who oversaw the Bud Light collaboration.

The earnings release called out a few areas of promise for the marketer, including a 15.4% increase in the combined revenue outside of the home markets for global brands like Budweiser, Stella Artois and Corona. Over $100 million in revenue was also generated through the company’s robust DTC ecosystem.