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Bud Light boycott likely cost Anheuser-Busch InBev over US$1 billion in lost sales

Bottles of Bud Light beer move along a conveyor at an Anheuser-Busch InBev facility in St. Louis, Missouri, United States, in July 2018. (Alex Flynn / Bloomberg / Getty Images via CNN Newsource) Bottles of Bud Light beer move along a conveyor at an Anheuser-Busch InBev facility in St. Louis, Missouri, United States, in July 2018. (Alex Flynn / Bloomberg / Getty Images via CNN Newsource)
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The world’s largest brewer may have lost as much as US$1.4 billion in sales because of the backlash to its brief partnership with a transgender influencer to promote Bud Light beer.

Anheuser-Busch InBev (BUD) reported record revenues for 2023 Thursday but said its “full growth potential was constrained” by its U.S. business, where sales were hurt by a boycott of Bud Light over a sponsored Instagram post with Dylan Mulvaney.

In North America, organic revenue, seen as the best measure of operating performance, plunged US$1.4 billion last year as beer sales by volume tumbled in the region, primarily due to a decline in Bud Light sales in the United States. Beer makes up the lion’s share of AB InBev’s revenue.

Bud Light sales tanked after the company’s partnership with Mulvaney last April sparked an anti-trans backlash and calls for a boycott. A tepid response to the controversy from the company also angered LGBTQ+ advocates.

The firestorm saw Mexican lager Modelo Especial dethrone Bud Light the following month as America’s top-selling beer, a title the brand had held for more than two decades.

From May through February, Bud Light recovered only 1.2 percentage points of lost market share, CEO Michel Doukeris told investors Thursday. The pace of the recovery is picking up, he said, but it’s still only 0.1 to 0.2 percentage points every three to four weeks.

“It’s not at the fast pace that we were expecting or that we’ve been working for. But nevertheless, progress is in place,” he added.

Some analysts were not impressed with the recovery disclosed by the company so far.

“In the U.S., performance remains very underwhelming with revenue down at double-digit rates as the group lost market share,” Aarin Chiekrie, an equity analyst at online investing platform Hargreaves Lansdown, said Thursday.

There was better news for shareholders on Wednesday, when the company reached a tentative agreement with the Teamsters union in the United States, averting a strike of 5,000 workers who had been prepared to walk out at midnight Thursday.

And AB InBev struck an optimistic note about the outlook for its US business.

“Our beer market share (in the United States) has seen continued gradual improvement since May through the end of December,” it said.

Meanwhile, shares in AB InBev’s Asia business, Budweiser Brewing Company APAC, closed nearly 7 per cent lower in Hong Kong Thursday, as profits attributable to shareholders declined because of a one-off customs charge in South Korea.

Overall sales volumes in China also fell in the fourth quarter, even as sales of premium brands grew in the double digits, AB InBev said.

Chris Isidore contributed to this article

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