Diageo reaffirms guidance despite ongoing weakness in North America

5th Nov 2026 07:44

(Sharecast News) - Drinks giant Diageo reiterated its full-year outlook on Thursday, despite ongoing softness in North America, its biggest market.

Updating on first-quarter trading, the owner of Guinness and Smirnoff said net sales rose 1.2%, or 1.4% on an organic basis, to $4.93bn in the three months to September end, with volumes up 1.1% and the price/mix 0.3%.

All regions showed organic growth during the period, including a 2.4% uplift in Europe, Middle East & Africa, to $1.26bn. Diageo said weakness in Italy and France had been more than offset by strong performances in Turkey, Africa and the Middle East.

However, in North America sales fell 3.6%. The blue chip acknowledged that the market remained "soft", with double-digit declines in Don Julio, Casamigos and Crown Royal, although that had been partly offset by growth in Johnnie Walker.

However, despite that, the blue chip insisted trading remained in line with expectations, and left its full-year outlook unchanged.

Company-wide net sales growth is forecast to be broadly flat on an organic basis, with operating profits growing by low to mid-single digits.

Chief executive Dave Lewis - the former Tesco boss who took over in January - said: "In North America, we continue to focus on making our offer more competitive, and while this remains our biggest challenge, clear actions are underway.

"While the market remains challenging, and volatility continues given the geopolitical uncertainty and impact of the ongoing conflict in the Middle East on energy, supply and distribution, results in the first quarter represent a small step in the right direction."

Lewis, who has a long-held reputation for cost-cutting, is looking to turn Diageo around after a difficult few years, including changing consumer habits, tariffs and a weak economic backdrop, all of which has weighed on demand for its premium products.

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