Diageo posts flat sales in Q1
In Europe, Diageo saw its organic sales rise 3.5% to £1.21bn while its North American organic sales fell 2.6% to £1.85bn
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Diageo has revealed that its organic sales growth was flat for the 13 weeks ended 30 September 2025.
Reported sales fell 2.2% from £4.99bn down to £4.86bn largely reflecting the negative impact of disposals and with negligible impact from foreign exchange.
The company’s organic volume growth of 2.9% was offset by negative price/mix of 2.8%, largely due to adverse mix in Asia Pacific due to the weaker results in China in Chinese white spirits (CWS). Excluding this, price/mix would have been relatively flat.
Diageo stated it saw solid organic net sales growth in Europe, LAC and Africa which was offset by weakness in CWS impacting Asia Pacific results and softer performance in North America as US Spirits declined reflecting weak consumer confidence.
It estimated that weakness in CWS in China negatively impacted group net sales by around 2.5% in the quarter.
In Europe, Diageo saw its organic sales rise 3.5% to £1.21bn while its North American organic sales fell 2.6% to £1.85bn.
Nik Jhangiani, interim chief executive, said: “Net sales were flat organically in Q1, with growth in Europe, LAC and Africa offset by weakness in Chinese white spirits and a softer US consumer environment than planned for. We are not satisfied with our current performance and are focused on what we can manage and control; acting with speed to drive efficiencies, prioritising investment and adapting more quickly to an evolving consumer environment.
“We are well advanced in sharpening our strategy, and we are developing and already implementing clear plans to drive growth across the broader portfolio, ensuring that we meet relevant consumer occasions of the future. Early results from our initiatives to strengthen our commercial execution capabilities, notably in Europe, are encouraging, and we are embedding a more rigorous performance-driven culture across the business.”
He added: “For fiscal 26 we have updated our guidance and remain committed to delivering c.$3bn (£2.29) free cash flow in fiscal 26, growing this in future years. Our confidence in delivery of this cash guidance is underpinned by increased rigour and agility to manage maturing stock, A&P spend, capex, and cost discipline.”
