01:46 PM EST, 01/10/2025 (MT Newswires) -- Constellation Brands ( STZ ) on Friday lowered its annual sales outlook after its fiscal third-quarter results missed Wall Street's expectations, sending the beer and wine company's shares plunging.

The parent of Modelo and Corona now expects fiscal 2025 organic net sales to increase between 2% and 5%, down from its prior enterprise growth outlook of 4% to 6%. Adjusted earnings are now pegged at $13.40 to $13.80, reducing the low-end of its previous range from $13.60. Analysts polled by FactSet are looking for $13.73.

"Subdued overall spend and prolonged value-seeking behavior among consumers have been key near-term limiting factors on demand growth, not only for our portfolio, but also for the dollar sales growth rate of total beverage alcohol," Chief Executive Bill Newlands said on an earnings conference call, according to a FactSet transcript. The company is uncertain on whether consumers will return to "more normalized" spending behaviors in the ongoing quarter, Newlands said.

Constellation shares were down nearly 17% in Friday afternoon trade.

For the full year, the company now sees beer segment revenue growth at 4% to 7%, compared with its prior outlook indicating a 6%-to-8% increase. The business is seeing "softer" consumer demand amid macroeconomic challenges, Newlands told analysts. "We are actively working on levers to address the competitive dynamics in the high-end light beer segment and continue to pursue distribution opportunities for coladas."

The wine and spirits division's sales are now seen falling 5% to 8% versus its previous view for a 4% to 6% fall. The wine category is seeing demand headwinds, especially in the lower price segments, according to Newlands.

Last month, Constellation agreed to sell its Svedka brand to Sazerac. The company has now closed the deal, Newlands said Friday.

Net sales for the quarter through Nov. 30 dropped to $2.46 billion from $2.47 billion a year earlier. The Street was looking for $2.53 billion. Adjusted EPS rose to $3.25 from $3.24, but fell short of the Street's $3.31 view.

Wine and spirits revenue decreased 14% to $431.4 million amid a 16% slump in shipment volumes. Beer sales rose 3% to $2.03 billion, supported by a 1.6% gain in shipments. The beer division's depletion rate, or the pace at which units are sold to end consumers, grew 3.2%.

Constellation has moved the completion and planned start up of its latest addition at its existing breweries in Mexico to fiscal 2026 from the end of fiscal 2025, Chief Financial Officer Garth Hankinson said on the call. The company said it expects its initial production at its third brewery site in Veracruz, Mexico, to be in late fiscal 2026 or early fiscal 2027.

Price: 182.73, Change: -36.55, Percent Change: -16.67