Anheuser-Busch earnings will drop by 26% amid Bud Light controversy, analysts say

WASHINGTON (TND) — Anheuser-Busch's earnings are expected to drop by 26% in the United States this year following Bud Light's partnership with transgender activist Dylan Mulvaney.

The decline will be fueled by both a fall in sales and volume, according to an analysis released by J.P. Morgan & Co. Tuesday. JP Morgan analysts predict Anheuser-Busch will lose 12% in volume and 10% in sales before interest and tax.

J.P. Morgan analysts believe that while Anheuser-Busch should eventually see margins improve, the company's sales will not be fully recovered in the 2024 fiscal year.

“We believe there is a subset of American consumers who will not drink a Bud Light for the foreseeable future,” the analysts say.

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The latest NielsenIQ data shows that sales of Bud Light were down 23.6% for the week covering up to May 6.

The warning comes as Bud Light sales have dropped significantly since the beer brand released its social media campaign featuring Mulvaney last month. Mulvaney, who shared a promotional video featuring a customized Bud Light can with her face on it, recently gained prominence for documenting her gender transition day-by-day on social media.

Bud Light was immediately criticized for the partnership, facing accusations of "going woke" and disregarding its consumer demographic. The backlash led to both a boycott of the brand supported by more than half of Americans and Bud Light's vice president of marketing, Alissa Heinerscheid, taking a leave of absence.

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Anheuser-Busch attempted to reconnect with consumers by releasing a statement saying the company "never intended to be part of a discussion that divides people." However, the response seemingly prompted additional outrage, as the LGBTQ+ advocacy group Human Rights Campaign suspended the company's corporate equality and inclusion score.

The suspension of the score, which measures corporate practices related to the well-being of the LGBTQ+ community, means Anheuser-Busch "no longer has the right to use the ‘Best Places to Work’ distinction." The company previously held a score of 100.

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Mulvaney responded to the controversy earlier this month during an appearance on the "Dear Schuyler" podcast. She admitted that she is "having trouble sleeping," but she hopes that those criticizing her will eventually see the "importance of identity."

"Bud Light remains the #1 brand in the U.S. nationally in volume and dollar sales despite regional differences," Anheuser-Busch told The National Desk (TND) in a statement.