December offered a modest bright spot for Spirits, helped in part by an extra shipping day that improved monthly performance. Volume trends outpaced revenue growth, signaling healthier underlying demand even as pricing and mix remained pressured. Wine, however, did not share in the same momentum, and continues to face broad-based challenges.
KEY TAKEAWAYS:
Stabilization Emerges Late in 2025 as Industry Looks Ahead to 2026
Spirits showed signs of stabilization in December, with volumes outperforming revenue and indicating steadier underlying demand despite continued pricing pressure.
The broader Wine & Spirits category softened in the second half of 2025, as volume declines accelerated and PODs continued to trend lower, reflecting evolving distribution and consumption patterns.
The outlook for 2026 centers on stability rather than rapid recovery, with easier first-quarter comparisons and steady performance in select segments offering a foundation for gradual improvement.
While December provided some relief, the back half of calendar 2025 proved difficult for the combined Wine & Spirits category. Volume declines accelerated as the year progressed, with January through June showing a six-month volume decline of -6.4%, worsening to -8.0% from July through December. This deceleration highlights how fragile demand remained despite pockets of stabilization in certain segments.
One of the more concerning structural trends continues to be the decline in PODs. In 2025, PODs fell -4.5%, following a -3.7% decline in 2024. Sustained erosion at this level raises questions about long-term distribution health and consumption occasions, particularly for Wine.
Overall, calendar year 2025 was a struggle. That said, we believe trends will begin to stabilize in 2026. Importantly, while we do not expect a sharp rebound, we also do not see macro conditions worsening meaningfully. Spirits trends appear to have largely stabilized, though the December revenue dip bears close monitoring. Wine remains the greater concern, with softness persisting across all price segments. Meaningful improvement in Wine will be critical to improving total category performance in 2026.
As we look ahead, first-quarter 2026 comparisons will be an important benchmark. In Q1 2025, Spirits declined -4.9% in volume and -3.6% in revenue, while Wine posted steeper declines of -8.3% in both volume and revenue. These comps create an opportunity for stabilization, but execution and demand recovery will matter.
Looking further into 2026, several product classes warrant close attention. Within Whiskey, Bourbon remains steady, while Irish Whiskey continues to experience significant short-term volatility. In Tequila, the “Other” segment remains strong, though Tequila-Reposado may have peaked. Finally, Prosecco stands out as a key watch item—can it continue to defy broader Wine trends and deliver another year of growth?
As we move into 2026, stability—not rapid recovery—remains the most realistic near-term goal.