AB InBev outlines midterm EBIT 5%-9% outlook while board approves EUR 0.40 interim dividend

• "The momentum of our business continued in the third quarter" (Global Chief Executive Officer Michel Doukeris). "Volumes grew for a third consecutive quarter with market share growth globally" and the company cited "record high third quarter volumes in 15 markets" (Global Chief Executive Officer Doukeris).

• "Revenue increased by 4.9%" and "Underlying EPS increased by 22% to reach $1.21" (Global Chief Executive Officer Doukeris). He also said, "BEES Marketplace continued to scale with GMV increasing by 45% to reach $1.4 billion" and "the Board has approved an interim dividend of EUR 0.40 per share" (Global Chief Executive Officer Doukeris).

• "EBITDA increased by 3.9% with flattish margins as higher sales and marketing investments and commodity headwinds were partially offset by disciplined revenue and cost management" (Global Chief Executive Officer Doukeris). He added, "In China, revenue and volumes declined by 16.8% as we underperformed a challenging industry" and said the company is "investing to improve our execution and rebalance our portfolio towards growing segments, channels and geographies" (Global Chief Executive Officer Doukeris).

• "Over the last 12 months, we have invested $8.1 billion in sales and marketing" and "we are confident we have opportunities for further margin expansion over time" (Global Chief Financial Officer Fernando Tennenbaum). "We also continue to execute on the 24-month $6 billion share buyback program announced last year" and "to date, we have repurchased $2.6 billion of shares" (Global Chief Financial Officer Tennenbaum).

Outlook

• "We are not providing any guidance so far for 2027" (Global Chief Executive Officer Doukeris). He reiterated the company’s framework from the Capital Markets Day: "this midterm outlook evolving from EBITDA 4% to 8% to become EBIT 5% to 9%" (Global Chief Executive Officer Doukeris).

• "Looking ahead...solid year-to-date results, reinforce our confidence in our ability to deliver our 2026 outlook" (Global Chief Financial Officer Tennenbaum). In Q2, management had explicitly referenced an "outlook of 4% to 8% EBITDA growth"; in Q3, the company referenced its "2026 outlook" without restating the numeric range (Chief Executive Officer Michel Doukeris, prior quarter).

• "We price in line with CPI on average" (Global Chief Executive Officer Doukeris). On costs, "we are not providing any guidance or any outlook so far" for next year, and the company expects to disclose next-year outlook "during our full year earnings in February" (Global Chief Financial Officer Tennenbaum).

Financial results

• "Total volumes grew by 0.4%" and "Revenue increased by 4.9% with solid revenue per hectoliter growth of 4.2%" (Global Chief Executive Officer Doukeris). He said "U.S. dollar EBITDA increased by 6.5% in the third quarter" and "EBIT increased by 6%" (Global Chief Executive Officer Doukeris).

• On ecosystem monetization, "BEES captured $15.9 billion in gross merchandising value" and "Our digital platforms served 13 million consumers and generated $158 million in revenue" (Global Chief Executive Officer Doukeris). He also said the D2C marketplace has "annualized GMV of $200 million" (Global Chief Executive Officer Doukeris).

• On balance sheet and financing profile, "our last 12 months free cash flow is greater than any of our annual bond maturities" and "98% of our debt is fixed rate with an average coupon of around 4%" (Global Chief Financial Officer Tennenbaum). He added, "there are no financial covenants on our bonds" (Global Chief Financial Officer Tennenbaum).

Q&A

• Edward Mundy, Jefferies: Asked about the balance of "volumes, price and mix" into 2027 and whether non-alcohol is reaching a "tipping point"; Global Chief Executive Officer Doukeris answered, "we are not providing any guidance so far for 2027" and said non-alcohol was "more than 1.5%, approaching 2% on a run rate"; Global Chief Financial Officer Tennenbaum added that "even without the FX, we are growing at 13.9% at constant currency."

• Sanjeet Aujla, UBS: Pressed on China drivers (weather vs. consumer, destocking timing) and Middle Americas acceleration; Global Chief Executive Officer Doukeris said, "majority of the decline in China was industry and inventories driven" and "we are planning...to get to the end of this year with normal inventories in China," while calling Middle Americas "fantastic performance" with support from "a very good weather" and improving affordability dynamics.

• Andrea Pistacchi, BofA: Asked to reconcile Brazil sell-in vs sell-out and questioned whether the dividend step-up changes payout trajectory; Global Chief Financial Officer Tennenbaum said the interim dividend increase was "consistent with our stated ambition of a progressive dividend over time," and Global Chief Executive Officer Doukeris said Brazil quarter dynamics reflected timing and inventories, adding, "as we look to the fourth quarter in Brazil, we will see...the consumer environment...improving" tied to elections and seasonality.

• Robert Ottenstein, Evercore ISI: Asked about incremental cost pressure into Q4 and 2027 and the global brand strategy for Michelob ULTRA; Global Chief Financial Officer Tennenbaum said cost was expected "more balanced between half 1 and half 2" and that next year looked "more of a normal year"; Global Chief Executive Officer Doukeris said in Q3, "60% of all the growth that the brand had globally came from outside of the U.S." and called the expansion "very incremental for our portfolio."

• Mitchell Collett, Deutsche Bank: Asked whether EBITDA growth phasing still implies a Q4 step-up and probed industry pricing; Global Chief Financial Officer Tennenbaum said the balanced-year view "still holds" and Global Chief Executive Officer Doukeris stated, "there's no change on our view that we price in line with CPI on average."

• Laurence Whyatt, Barclays: Checked on BeatBox progress and APAC SG&A; Global Chief Executive Officer Doukeris said, "BeatBox is going through the year 1 of the integration" and "next year is the year where it's going to be fully integrated," and attributed APAC SG&A dynamics largely to variable costs as volumes fell; Global Chief Financial Officer Tennenbaum added it was "mostly driven by sales and marketing."

• Jean-Olivier Nicolai, Goldman Sachs: Asked about revenue/hl mix, U.S. EBITDA decline drivers, and Brazil gambling/tax; Global Chief Executive Officer Doukeris said "25% to 30% is mix" within revenue/hl and that U.S. EBITDA pressure included "costs from FIFA marketing" and "transportation" driven by diesel; on Brazil, he said gambling "was impacting...available income" and that tax reform was "still very early."

Sentiment analysis

• Analysts were neutral-to-skeptical, focusing repeatedly on China underperformance, cost inflation, Brazil demand visibility, and capital returns, including questions framed around "incremental pressures" and whether destocking ends "by the end of this fiscal year" (Sanjeet Aujla, UBS).

• Management tone was slightly positive in prepared remarks ("continued momentum," "record high" volumes in multiple markets) and more defensive/mitigating on pressure points, emphasizing actions in China ("There is more work to do") and reaffirming policy stances on pricing ("we price in line with CPI on average") (Global Chief Executive Officer Doukeris).

• Versus Q2, management reiterated similar themes (brand investment, revenue management, BEES scaling) while Q3 Q&A sharpened attention on China inventory dynamics and U.S. cost drivers tied to FIFA and transportation; management continued to avoid 2027 guidance in both quarters (Global Chief Executive Officer Doukeris).

Quarter-over-quarter comparison

• Q3 added a new shareholder-returns datapoint with "an interim dividend of EUR 0.40 per share" (Global Chief Executive Officer Doukeris), while Q2 emphasized balance-sheet progress and free cash flow expansion.

• Q3 highlighted a deeper China contraction ("declined by 16.8%") with more detail on inventory and footprint/weather exposure; Q2 described China as revenue down "8.8%" with sequential share improvement but fewer inventory specifics (Global Chief Executive Officer Doukeris, prior quarter).

• Q3 messaging leaned more on capital allocation flexibility (buybacks and higher interim dividend) and midterm framing ("EBIT 5% to 9%"), while Q2 repeatedly tied confidence to explicit "4% to 8% EBITDA growth" language for 2026 (Global Chief Executive Officer Doukeris, prior quarter).

Risks and concerns

• "Commodity headwinds" and unhedged cost exposure were flagged as margin pressures, with management pointing to "disciplined revenue and cost management" and revenue management capabilities as offsets (Global Chief Executive Officer Doukeris).

• China remained the clearest operational risk, with management stating, "We are investing to improve our execution and rebalance our portfolio" and targeting "normal inventories in China" by year-end (Global Chief Executive Officer Doukeris).

• Brazil regulatory uncertainty was noted, with management calling tax reform "still very early" and describing gambling as previously "a big discussion" that weighed on disposable income (Global Chief Executive Officer Doukeris).

Final takeaway

Management framed Q3 as continued top- and bottom-line momentum supported by revenue per hectoliter growth, ongoing marketing investment, scaling digital platforms, and increased capital allocation flexibility, while positioning China as the main near-term execution and industry headwind and reiterating that 2027 guidance is not being provided yet but midterm ambitions include an EBIT growth range of 5% to 9%.

Read the full Earnings Call Transcript

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