Boston Beer's Q4 Loss Narrows, Lower Volumes Hurt Revenues

The Boston Beer Company, Inc. SAM posted fourth-quarter 2025 results, wherein loss per share was narrower than the Zacks Consensus Estimate. Meanwhile, the top and bottom lines fell year over year.

The leading craft brewer reported a loss per share of $2.12, compared with the Zacks Consensus Estimate of a loss of $2.33. The company posted a narrower loss per share of $1.68 in the year-earlier quarter. 

It reported revenues of $409 million in the reported quarter. Net revenues of $385.7 million fell 4.1% from the prior-year quarter, owing to reduced volumes that were partly offset by higher pricing and favorable product mix. The Zacks Consensus Estimate was pegged at $385 million.

This Zacks Rank #5 (Strong Sell) company’s shares have lost 5.8% against the industry’s 17.5% growth in the past year.

Analyzing SAM’s Quarterly Performance

Boston Beer reported a 7.5% year-over-year decline in shipment volume to roughly 1.4 million barrels in the fourth quarter. The decline mainly resulted from declines in Twisted Tea, Truly Hard Seltzer and Samuel Adams brands that were partly offset by growth in Sun Cruiser, Angry Orchard and Dogfish Head brands. Meanwhile, depletions fell 6% year over year.

Year-to-date depletions through the eight weeks ended Feb. 21, 2026, are anticipated to have declined about 3% year over year.

The Boston Beer Company, Inc. Price and EPS Surprise

The Boston Beer Company, Inc. price-eps-surprise | The Boston Beer Company, Inc. Quote

As of Dec. 27, 2025, distributor inventory was at appropriate levels, averaging nearly four weeks on hand, within the company’s target distributor inventory levels.

The gross profit inched up 4.4% year over year to $167.7 million, whereas the gross margin expanded 360 basis points (bps) from the year-ago quarter to 43.5%. The gross margin was mainly driven by brewery efficiencies, procurement savings, price rises and a favorable product mix, along with a lower inventory obsolescence. Such gains were partly offset by higher inflationary and tariff costs as well as shortfall fees. The negative tariff impacts were $3.6 million in the fourth quarter.

Advertising, promotional and selling expenses rose 6% in the fourth quarter to $148 million, owing to higher salaries and benefit costs, brand media and local marketing investments of $8 million and higher freight costs of $0.4 million due to increased rates, somewhat offset by lower volumes. General and administrative expenses increased 9.4% year over year to $52.2 million, primarily driven by higher salaries and cost benefits.

SAM’s Financial Snapshot

As of Dec. 27, 2025, Boston Beer had cash and cash equivalents of $223.4 million and total stockholders’ equity of $846.3 million. The company currently has $150 million in its line of credit, which, along with its cash position, will be sufficient to meet cash requirements.

During the 52-week period ended Dec. 27, 2025, and the period from Dec. 29, 2025, through Feb. 20, 2026, SAM repurchased shares of its Class A common stock worth $199.2 million and $13.7 million, respectively. As of Feb. 20, 2026, the company had roughly $214.7 million remaining on its $1.6-billion share buyback expenditure limit.

Boston Beer’s Expectations in 2026

SAM has issued 2026 projections, which are highly sensitive to changes in volume expectations, supply-chain performance, inflation and tariff impacts. For 2026, SAM anticipates the gross margin, including tariffs, to be 48-50%, and tariff costs to be $20-$30 million. Advertising, promotion and selling expenses year-over-year change will be in the range of $20-$40 million. The effective tax rate for 2026 is forecast to be 29-30%. Management envisions earnings per share, including tariffs, in the range of $8.50-$11 for the year. Capital spending is likely to be in the $70-$90 million band.

Depletions and shipments are now expected to remain flat to down mid-single digits for 2026. Price increases are predicted at 1-2%. Boston Beer’s business is seasonal, with the first and fourth quarters being the lower volume quarters. Management anticipates first-quarter and first-half shipments to decrease toward the lower end of its full-year volume guidance with improved shipment performance later in the year.  This is owing to increased shipment comparisons in the first quarter and first half of the year, as the company shipped ahead of depletions in the last year to aid innovation and build wholesaler inventories.

During 2026, the company expects shortfall fees and non-cash expense of third-party production pre-payments in total to hurt gross margins by 40-60 bps. SAM expects year-over-year gross margin rate improvement to be significant in the fourth quarter as shortfall fees are likely to be lower in 2026 than in 2025. The majority of shortfall fees are likely to be in the fourth quarter. 

Advertising, selling and promotional expenses view does not include any changes in freight expenses for the shipment of products to the company’s distributors. Incremental advertising investment is likely to be weighted to the second and third quarters to aid the key summer selling season.

Stocks to Consider in the Consumer Staples Space

Freshpet, Inc. FRPT, which is a pet food company, currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

The Zacks Consensus Estimate for Freshpet’s current financial-year sales indicates growth of 8.5% from the prior-year level. FRPT delivered a trailing four-quarter earnings surprise of 50%, on average.

Nomad Foods Limited NOMD, which manufactures and distributes frozen foods, currently carries a Zacks Rank of 2.

The Zacks Consensus Estimate for Nomad Foods’ current financial-year earnings is expected to rise 6.2% from the year-ago reported figure. NOMD delivered a trailing four-quarter earnings surprise of 2.9%, on average.

Medifast, Inc. MED, which is a leading manufacturer and distributor of clinically-proven healthy living products and programs, currently carries a Zacks Rank of 2. MED missed the average earnings surprise by a sharp margin in the trailing four quarters. 

The Zacks Consensus Estimate for Medifast’s current financial-year earnings indicates growth of 30.5% from the year-ago number. 

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This article originally published on Zacks Investment Research (zacks.com).

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