Constellation Brands, the owner of Modelo and Corona, has seen its stock drop 7% following a downward revision of its fiscal outlook. In a statement, the company noted that sales declines in high-end beer, particularly among Hispanic consumers, were sharper than the overall market downturn. This is the second indication that the demand has been adversely affected by President Trump’s immigration policies, which have particularly impacted the Hispanic demographic that constitutes about half of Constellation’s business, according to CEO Bill Newlands.

Modelo Especial has recently surpassed Bud Light as the bestselling beer in the U.S., marking a significant shift in consumer preferences. However, Constellation now anticipates a decline in net beer sales of 2% to 4% for the fiscal year 2026, contrasting with earlier expectations of flat to 3% growth. Newlands highlighted the difficulties in the macroeconomic environment, stating that fewer trips are being made to purchase beer, and when purchases do occur, consumers are spending less.

Specifically, Hispanic consumers are reportedly enjoying fewer occasions to consume beer, as they are going out to eat less frequently and hosting fewer social gatherings at home. A consultant in the industry mentioned how current socio-political climates, including ICE raids and deportation fears, may deter consumers from leaving their homes, which translates to fewer opportunities for beer consumption.

The general beer market is under significant strain, with only 54% of drinking-age Americans consuming alcohol, a historic low. Those who do drink are doing so less frequently. This trend is forcing many companies within the industry to adapt to changing consumer behaviors, and Constellation has experienced a decline in beer shipment volumes by 3.3%, with competitors like Molson Coors facing even steeper drops.

In addition to these challenges, Constellation Brands has revised its operating income expectations downwards, anticipating a decline of 7% to 9% rather than the previously forecasted growth. Factors such as tariffs and lower volumes are cited as contributing elements to this adjustment.

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