LONDON, March 9, 2026, 22:48 GMT
- Diageo shares ended Monday at 1,521 pence, down 0.29%, after touching 1,491.5 pence in the session. 1
- The company now expects 2026 organic sales to fall 2%-3% and has cut its interim dividend to 20 cents a share. 2
- Chief executive Dave Lewis is due to unveil a fuller strategy later this year. 3
Diageo plc shares closed down 0.29% at 1,521 pence on Monday, staying near the levels hit after chief executive Dave Lewis cut the drinks group’s 2026 sales forecast and halved its interim dividend on Feb. 25. The stock touched 1,491.5 pence during the session before trimming the loss. 1
That matters now because Diageo’s portfolio runs from Johnnie Walker and Smirnoff to Don Julio and Guinness. Pernod Ricard, Remy Cointreau and Campari also fell after Diageo’s Feb. 25 update, pointing to wider anxiety over premium spirits as the United States and China stay soft. 4
Lewis, who took over in January, plans to take a fuller strategy to the board in the second quarter and share it publicly in the third. For now, the company has cut cash returns to shareholders while trying to reduce debt, repair customer ties and broaden its range for consumers with tighter budgets. 2
Diageo said on Feb. 25 that 2026 organic sales — stripping out currency swings and portfolio changes — would fall 2%-3%. In the first half, organic net sales and organic operating profit each fell 2.8%, as weakness in U.S. spirits and Chinese white spirits, or baijiu, outweighed growth in Europe, Latin America and Africa. 2
The board cut the interim dividend to 20 cents a share and reset its payout ratio, or the share of earnings paid out as dividends, to 30%-50%, with a floor of 50 cents a year. Net debt stood at $21.7 billion at Dec. 31, and Diageo said its agreed $2.3 billion sale of its East African Breweries stake and Kenyan spirits business to Asahi should lower debt relative to earnings once the deal closes in the second half of calendar 2026. 2
Lewis said pressure on consumer wallets was “by far and away” the biggest challenge. He has also signaled selective price cuts, more focus on cheaper spirits and action on Guinness capacity constraints, while saying customer service had been “really very poor” in some cases. 3
Outside analysts were blunt. Dan Coatsworth at AJ Bell called the half-year numbers “awful results” and said the “repair job is massive”, while Goodbody analyst Fintan Ryan said Lewis’s first moves were only the “trailer” before a fuller strategy. 3
But the reset could still misfire. U.S. demand could stay soft, China could remain weak and tariff uncertainty could keep pinching margins just as Lewis tries to spend more on the business. Diageo also has to show it can keep Guinness growing without supply bottlenecks and without leaning too hard on price moves that could hurt profit. 2
Peer results underline how uneven the backdrop is. Pernod Ricard reported weaker sales across all five of its priority markets last month, while Brown-Forman beat quarterly estimates last week on steady demand for whiskey and ready-to-drink products. 5
The next clear checkpoint is Lewis’s promised strategy review later this year, first with the board and then with investors. 3
