The global drinks distributor and producer said Guinness and its non-alcoholic Guinness 0.0 variant performed especially well in pubs, bars and restaurants.
Diageo’s latest interim trading update, covering the six months ended 31 December 2025, showed Guinness gained share every week of H1 FY26.
Spirits, including RTDs, and Guinness accounted for 95% of Diageo’s business. Brands including Casamigos and Smirnoff proved particularly popular, the report added.
Very stable
In an investors call following the results, CEO Dave Lewis described the spirits category as “very stable”, noting volume growth reached around 13% between 2010 and 2024.
Despite these bright spots, Diageo’s group revenues fell 4% to $10.5bn (£7.7bn) during the six month period, forcing the company to downgrade its profit and sales expectations for the year.
Strong organic sales growth in Europe, Latin America, the Caribbean, and Africa was more than offset by weak trading in North America and Asia. North American revenue fell 6.8%, dragged down by a 23% decline in Tequila sales, while Asia Pacific sales were down 11.1%, attributed to poor performance of Chinese white spirits offsetting gains in India.
The challenges prompted Lewis to take what he described as a “difficult decision” to cut the company’s dividend to shareholders.
“To deliver on these opportunities, we need to create more financial flexibility,” he said. “Accordingly, the board has taken the difficult decision to reduce the dividend to a more appropriate level, which will accelerate the strengthening of our balance sheet.”
Higher growth
Lewis, who joined Diageo on Thursday 1 January 2026, outlined plans to revive the company through competitive category strategies, focusing on “relevant brands,” and a “redesign” of the company’s operating framework. Investment will continue into Guinness, while potential brand disposals will be considered carefully.
Capital expenditure for the first half was approximately $590m, down $40m from last year, reflecting a disciplined approach focused on Guinness production expansion, supply agility, and digital infrastructure. Full-year Capex guidance remains at the lower end of the $1.2-$1.3bn range.
The moves come as Diageo’s share price hit a decade low of 1,577p in January 2026, less than half its 2022 level.
Lewis remained optimistic, adding, “Only several weeks in I can already see significant opportunities for Diageo to act more decisively to enhance its competitiveness and broaden the portfolio offering, leading to higher growth.”
Diageo’s also portfolio includes Johnnie Walker, Captain Morgan, Baileys, Don Julio, and Tanqueray.
