Constellation Brands, Inc 10-Q for FY2026 Q3

Constellation Brands, Inc. (STZ)

10-Q 2026-01-08 For: 2025-11-30

Added on April 08, 2026

About this 10-Q

Constellation Brands, Inc filed this 10-Q on January 8, 2026, covering the quarter ended November 30, 2025 (FY2026 Q3).

Headline figures

Quarter ended November 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.22B; down 9.8% from $2.46B a year earlier
Net income: $502.8M; down 18.4% from net income of $615.9M a year earlier

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Delaware			16-0716709
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Class A Common Stock	STZ	New York Stock Exchange


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐


		Page

DEFINED TERMS		i

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets		1
Consolidated Statements of Comprehensive Income (Loss)		2
Consolidated Statements of Changes in Stockholders’ Equity		3
Consolidated Statements of Cash Flows		5
Notes to Consolidated Financial Statements
	1. Basis of Presentation	7
	2. Acquisitions and Divestitures	7
	3. Restructuring	8
	4. Inventories	9


	5. Derivative Instruments	9
	6. Fair Value of Financial Instruments	12
	7. Goodwill	15
	8. Intangible Assets	16

	9. Other Assets	16

	10. Borrowings	17
	11. Income Taxes	19


	12. Stockholders' Equity	21
	13. Net Income (Loss) Per Common Share Attributable to CBI	22
	14. Comprehensive Income (Loss) Attributable to CBI	23
	15. Business Segment Information	25
	16. Accounting Guidance Not Yet Adopted	29

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		30
Item 3. Quantitative and Qualitative Disclosures About Market Risk		53
Item 4. Controls and Procedures		54

PART II – OTHER INFORMATION
Item 1. Legal Proceedings		55

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		56
Item 5. Other Information		56
Item 6. Exhibits		56

SIGNATURES		60


TERM						MEANING
$						U.S. dollars

10b5-1 Trading Plan						a pre-arranged trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act

2025 Annual Report						our Annual Report on Form 10-K for the fiscal year ended February 28, 2025

2025 Authorization						authorization to repurchase up to $4.0 billion of our publicly traded common stock, approved by our Board of Directors in April 2025

2025 Credit Agreement						eleventh amended and restated credit agreement, dated as of April 28, 2025, that provides for a $2.25 billion aggregate revolving credit facility

2025 Restructuring Initiative						an enterprise-wide cost savings and restructuring initiative designed to help optimize the performance of our business, including through enhanced organizational efficiency and optimized expenditures across our organization, with the majority of the work expected to be completed within Fiscal 2026 and net annualized cost savings expected to be fully realized by Fiscal 2028

2025 Term Credit Agreement						term loan credit agreement, dated as of May 9, 2025, that provided for a $500.0 million unsecured delayed draw term loan facility, now terminated

2025 Wine Divestitures						sale and, in certain instances, exclusive license to use the trademarks of a portion of our wine and spirits business, primarily centered around our then-owned mainstream wine brands and associated inventory, wineries, vineyards, offices, and facilities on June 2, 2025

3-tier						distribution channel where products are sold to a distributor (wholesaler) who then sells to a retailer; the retailer sells the products to a consumer

3-tier eCommerce						digital commerce experience for consumers to purchase beverage alcohol from retailers

4.40% October 2018 Senior Notes						$500.0 million principal amount of 4.40% senior notes issued in October 2018, now repaid in full

4.75% December 2015 Senior Notes						$400.0 million principal amount of 4.75% senior notes issued in December 2015, now fully redeemed

4.80% May 2025 Senior Notes						$500.0 million aggregate principal amount of senior notes issued in May 2025

4.95% October 2025 Senior Notes						$500.0 million aggregate principal amount of senior notes issued in October 2025

5.00% February 2023 Senior Notes						$500.0 million principal amount of 5.00% senior notes issued in February 2023, now fully redeemed

ABA						alternative beverage alcohol

Administrative Agent						Bank of America, N.A., as administrative agent for the senior credit facility and the 2025 Term Credit Agreement

AOCI						accumulated other comprehensive income (loss)




Canopy						Canopy Growth Corporation, an Ontario, Canada-based public company in which we have an investment

CB International						CB International Finance S.à r.l., a wholly-owned subsidiary of ours

CircanaTM						Industry market research publication used by consumer packaged goods companies


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I i


TERM						MEANING
Class 1 Stock						our Class 1 Convertible Common Stock, par value $0.01 per share

Class A Stock						our Class A Common Stock, par value $0.01 per share

CODM						chief operating decision maker, our President and Chief Executive Officer

Comparable Adjustments						certain items affecting comparability that have been excluded because management uses this information in monitoring and evaluating the results and underlying business trends of the core operations of the Company and/or in internal goal setting



CSR						corporate social responsibility

Depletions						represent U.S. distributor shipments of our respective branded products to retail customers, based on third-party data



DTC						direct-to-consumer inclusive of (i) a digital commerce experience for consumers to purchase directly from brand websites with inventory coming straight from the supplier and (ii) consumer purchases at hospitality locations (tasting rooms and tap rooms) from the supplier



Exchangeable Shares						class of non-voting and non-participating exchangeable shares in Canopy which are convertible into common shares of Canopy on a one-for-one basis

Exchange Act						Securities Exchange Act of 1934, as amended

FASB						Financial Accounting Standards Board

Financial Statements						our consolidated financial statements and notes thereto included herein





Fiscal 2025						the Company’s fiscal year ended February 28, 2025

Fiscal 2026						the Company’s fiscal year ending February 28, 2026

Fiscal 2027						the Company’s fiscal year ending February 28, 2027

Fiscal 2028						the Company’s fiscal year ending February 29, 2028

Fiscal 2029						the Company’s fiscal year ending February 28, 2029

Fiscal 2030						the Company’s fiscal year ending February 28, 2030

Fiscal 2031						the Company’s fiscal year ending February 28, 2031

Form 10-Q						this Quarterly Report on Form 10-Q for the quarterly period ended November 30, 2025, unless otherwise specified

IRA						Inflation Reduction Act of 2022

IT						information technology

mainstream						wine that sells less than $11.00 per bottle at retail and sparkling wine and all other wine that sells less than $13.00 per bottle at retail, as defined by Circana™

MD&A						Management’s Discussion and Analysis of Financial Condition and Results of Operations under Part I – Item 2. of this Form 10-Q

Mexicali Brewery						canceled brewery construction project located in Mexicali, Baja California, Mexico, sold the remaining assets classified as held for sale in July 2024

Mexico Beer Projects						expansion, optimization, and/or construction activities at the Obregón Brewery, Nava Brewery, and Veracruz Brewery

M&T						Manufacturers and Traders Trust Company

Nava						Nava, Coahuila, Mexico

Nava Brewery						our brewery located in Nava

Net sales						gross sales less promotions, returns and allowances, and excise taxes


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I ii


TERM						MEANING

Nine Months 2025						the Company’s nine months ended November 30, 2024

Nine Months 2026						the Company’s nine months ended November 30, 2025

NM						not meaningful

Non-GAAP						financial measures not calculated in accordance with U.S. GAAP, for example, comparable operating income (loss)

Note(s)						notes to the consolidated financial statements

OB3 Act						One Big Beautiful Bill Act, signed into U.S. law on July 4, 2025

Obregón						Obregón, Sonora, Mexico

Obregón Brewery						our brewery located in Obregón

OECD						Organization for Economic Cooperation and Development

OCI						other comprehensive income (loss)

Pre-issuance hedge contracts						treasury lock and/or swap lock contracts designated as cash flow hedges entered into to hedge treasury rate volatility on future debt issuances


premium						wine that sells between $11.00 to $24.99 per bottle at retail and sparkling wine that sells between $13.00 to $34.99 per bottle at retail, as defined by Circana™



SEC						Securities and Exchange Commission





Securities Act						Securities Act of 1933, as amended





SOFR						secured overnight financing rate administered by the Federal Reserve Bank of New York

SVEDKA Divestiture						sale of the SVEDKA brand and related assets, primarily including inventory and equipment on January 6, 2025

Third Quarter 2025						the Company’s three months ended November 30, 2024

Third Quarter 2026						the Company’s three months ended November 30, 2025

U.S.						United States of America

U.S. GAAP						generally accepted accounting principles in the U.S.

Veracruz						Heroica Veracruz, Veracruz, Mexico

Veracruz Brewery						our new brewery being constructed in Veracruz

Wine and Spirits Divestitures						the 2025 Wine Divestitures and the SVEDKA Divestiture, collectively


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I iii


	November 30, 2025		February 28, 2025
ASSETS
Current assets:
Cash and cash equivalents	$	152.4	$	68.1
Accounts receivable	708.3		736.5
Inventories	1,379.2		1,437.2
Prepaid expenses and other	669.2		561.1
Assets held for sale	—		913.5
Total current assets	2,909.1		3,716.4
Property, plant, and equipment, net of accumulated depreciation of $2,918.0 and $2,547.9, respectively	8,211.5		7,409.8
Goodwill	5,190.6		5,126.8
Intangible assets	2,532.7		2,532.3


Deferred income taxes	1,569.0		1,805.3

Other assets	1,270.5		1,061.7
Total assets	$	21,683.4	$	21,652.3

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings	$	374.7	$	806.7
Current maturities of long-term debt	4.0		1,402.0
Accounts payable	976.5		939.8
Other accrued expenses and liabilities	818.0		886.7
Total current liabilities	2,173.2		4,035.2
Long-term debt, less current maturities	10,285.1		9,289.0

Deferred income taxes and other liabilities	1,224.8		1,193.3
Total liabilities	13,683.1		14,517.5
Commitments and contingencies
CBI stockholders’ equity:
Class A Stock, $0.01 par value – Authorized, 322,000,000 shares; Issued, 212,699,268 shares and 212,698,298 shares, respectively	2.1		2.1
Additional paid-in capital	2,166.8		2,144.6
Retained earnings	13,550.4		12,603.4
Accumulated other comprehensive income (loss)	(0.8)		(662.7)
Class A Stock in treasury, at cost, 39,314,643 shares and 34,505,141 shares, respectively	(8,007.7)		(7,205.4)
Total CBI stockholders’ equity	7,710.8		6,882.0
Noncontrolling interests	289.5		252.8
Total stockholders’ equity	8,000.3		7,134.8
Total liabilities and stockholders’ equity	$	21,683.4	$	21,652.3


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 1


	For the Nine Months Ended November 30,				For the Three Months Ended November 30,
	2025		2024		2025		2024
NET INCOME (LOSS) ATTRIBUTABLE TO CBI
Sales	$	7,705.8	$	8,644.2	$	2,374.4	$	2,644.4
Excise taxes	(487.0)		(599.7)		(151.6)		(180.6)
Net sales	7,218.8		8,044.5		2,222.8		2,463.8
Cost of product sold	(3,459.0)		(3,844.6)		(1,039.6)		(1,179.5)
Gross profit	3,759.8		4,199.9		1,183.2		1,284.3
Selling, general, and administrative expenses	(1,427.9)		(1,444.7)		(491.2)		(491.3)
Goodwill impairment	—		(2,250.0)		—		—

Asset impairment and related expenses	(52.1)		—		—		—

Operating income (loss)	2,279.8		505.2		692.0		793.0
Income (loss) from unconsolidated investments	16.5		65.8		23.5		(15.0)
Interest expense, net	(269.7)		(311.2)		(83.2)		(104.4)

Income (loss) before income taxes	2,026.6		259.8		632.3		673.6
(Provision for) benefit from income taxes	(494.5)		79.7		(110.1)		(44.5)
Net income (loss)	1,532.1		339.5		522.2		629.1
Net (income) loss attributable to noncontrolling interests	(47.2)		(45.6)		(19.4)		(13.2)
Net income (loss) attributable to CBI	$	1,484.9	$	293.9	$	502.8	$	615.9

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO CBI
Comprehensive income (loss)	$	2,221.0	$	(810.4)	$	617.9	$	319.3
Comprehensive (income) loss attributable to noncontrolling interests	(74.2)		2.8		(23.6)		(1.1)
Comprehensive income (loss) attributable to CBI	$	2,146.8	$	(807.6)	$	594.3	$	318.2

CLASS A STOCK
Net income (loss) per common share attributable to CBI – basic	$	8.43	$	1.61	$	2.88	$	3.40
Net income (loss) per common share attributable to CBI – diluted	$	8.43	$	1.61	$	2.88	$	3.39
Weighted average common shares outstanding – basic	176.051		181.988		174.515		181.243
Weighted average common shares outstanding – diluted	176.189		182.555		174.614		181.753
Cash dividends declared per common share	$	3.06	$	3.03	$	1.02	$	1.01


FINANCIAL STATEMENTS			Table of Contents


FINANCIAL STATEMENTS			Table of Contents


FINANCIAL STATEMENTS			Table of Contents


FINANCIAL STATEMENTS			Table of Contents


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 2


CONSTELLATION BRANDS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (in millions) (unaudited)
	Class A Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Non-controlling Interests		Total
Balance at February 28, 2025	$	2.1	$	2,144.6	$	12,603.4	$	(662.7)	$	(7,205.4)	$	252.8	$	7,134.8

Comprehensive income (loss):
Net income (loss)	—		—		516.1		—		—		7.7		523.8
Other comprehensive income (loss), net of income tax effect	—		—		—		350.7		—		13.6		364.3
Comprehensive income (loss)													888.1
Repurchase of shares	—		—		—		—		(306.1)		—		(306.1)
Dividends declared	—		—		(180.6)		—		—		—		(180.6)
Noncontrolling interest distributions	—		—		—		—		—		(7.5)		(7.5)
Shares issued under equity compensation plans	—		(24.3)		—		—		17.4		—		(6.9)
Stock-based compensation	—		10.3		—		—		—		—		10.3
Balance at May 31, 2025	2.1		2,130.6		12,938.9		(312.0)		(7,494.1)		266.6		7,532.1
Comprehensive income (loss):
Net income (loss)	—		—		466.0		—		—		20.1		486.1
Other comprehensive income (loss), net of income tax effect	—		—		—		219.7		—		9.2		228.9
Comprehensive income (loss)													715.0
Repurchase of shares	—		—		—		—		(297.9)		—		(297.9)
Dividends declared	—		—		(179.4)		—		—		—		(179.4)
Noncontrolling interest distributions	—		—		—		—		—		(10.0)		(10.0)
Shares issued under equity compensation plans	—		(1.8)		—		—		6.6		—		4.8
Stock-based compensation	—		21.7		—		—		—		—		21.7
Balance at August 31, 2025	2.1		2,150.5		13,225.5		(92.3)		(7,785.4)		285.9		7,786.3
Comprehensive income (loss):
Net income (loss)	—		—		502.8		—		—		19.4		522.2
Other comprehensive income (loss), net of income tax effect	—		—		—		91.5		—		4.2		95.7
Comprehensive income (loss)													617.9
Repurchase of shares	—		—		—		—		(220.1)		—		(220.1)
Dividends declared	—		—		(177.9)		—		—		—		(177.9)
Noncontrolling interest distributions	—		—		—		—		—		(20.0)		(20.0)
Shares issued under equity compensation plans	—		—		—		—		(2.2)		—		(2.2)
Stock-based compensation	—		16.3		—		—		—		—		16.3

Balance at November 30, 2025	$	2.1	$	2,166.8	$	13,550.4	$	(0.8)	$	(8,007.7)	$	289.5	$	8,000.3


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 3


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 4


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 5


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 6


(in millions)
Cash received from buyer	$	845.9
Net assets sold	(874.1)
Direct costs to sell	(2.8)
Loss on sale of business (1)	$	(31.0)


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 7


	For the Nine Months Ended November 30, 2025		For the Three Months Ended November 30, 2025
(in millions)


Employee termination	$	22.7	$	22.7
Consulting services	33.5		12.0
Other	0.2		0.1
	$	56.4	$	34.8


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 8


	Cumulative Costs as of November 30, 2025		Percent of Total Costs
(in millions)


Employee termination	$	69.6	66	%
Consulting services	36.3		34	%
Other	0.2		0	%
	$	106.1	100	%


	Employee Termination		Consulting Services		Other		Total
(in millions)
Balance at February 28, 2025	$	46.9	$	2.8	$	—	$	49.7
Restructuring costs	22.7		33.5		0.2		56.4
Cash payments	(33.9)		(19.7)		(0.1)		(53.7)

Balance at November 30, 2025 (1)	$	35.7	$	16.6	$	0.1	$	52.4


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 9


Assets					Liabilities
	November 30, 2025		February 28, 2025			November 30, 2025		February 28, 2025
(in millions)
Derivative instruments designated as hedging instruments
Foreign currency contracts:
Prepaid expenses and other	$	133.1	$	56.2	Other accrued expenses and liabilities	$	13.9	$	36.9
Other assets	$	116.2	$	39.3	Deferred income taxes and other liabilities	$	0.5	$	38.6


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 10


Derivative Instruments in Designated Cash Flow Hedging Relationships	Net Gain (Loss) Recognized in OCI		Location of Net Gain (Loss) Reclassified from AOCI to Income (Loss)	Net Gain (Loss) Reclassified from AOCI to Income (Loss)
(in millions)
For the Nine Months Ended November 30, 2025
Foreign currency contracts	$	244.1	Sales	$	0.9
			Cost of product sold	47.2
			Selling, general, and administrative expenses	0.2
Pre-issuance hedge contracts	(5.0)		Interest expense, net	(0.3)
	$	239.1		$	48.0
For the Nine Months Ended November 30, 2024
Foreign currency contracts	$	(209.2)	Sales	$	0.6
			Cost of product sold	89.5

Pre-issuance hedge contracts	3.1		Interest expense, net	—
	$	(206.1)		$	90.1
For the Three Months Ended November 30, 2025
Foreign currency contracts	$	41.4	Sales	$	0.3
			Cost of product sold	24.2

Pre-issuance hedge contracts	(1.6)		Interest expense, net	(0.2)
	$	39.8		$	24.3


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 11


Derivative Instruments Not Designated as Hedging Instruments	Location of Net Gain (Loss) Recognized in Income (Loss)	Net Gain (Loss) Recognized in Income (Loss)
(in millions)
For the Nine Months Ended November 30, 2025
Commodity derivative contracts	Cost of product sold	$	7.9
Foreign currency contracts	Selling, general, and administrative expenses	6.0
Interest rate swap contracts	Interest expense, net	(0.3)
		$	13.6

For the Nine Months Ended November 30, 2024
Commodity derivative contracts	Cost of product sold	$	(10.5)
Foreign currency contracts	Selling, general, and administrative expenses	(31.0)

		$	(41.5)

For the Three Months Ended November 30, 2025
Commodity derivative contracts	Cost of product sold	$	12.6
Foreign currency contracts	Selling, general, and administrative expenses	(1.3)
Interest rate swap contracts	Interest expense, net	(0.1)
		$	11.2
For the Three Months Ended November 30, 2024
Commodity derivative contracts	Cost of product sold	$	(0.8)
Foreign currency contracts	Selling, general, and administrative expenses	(4.3)

		$	(5.1)


Constellation Brands, Inc. Q3 FY 2026 Form 10-Q			#WORTHREACHINGFOR I 12


	Fair Value Measurements Using
	Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
(in millions)
November 30, 2025
Assets:
Foreign currency contracts	$	—	$	249.6	$	—	$	249.6
Commodity derivative contracts	$	—	$	21.0	$	—	$	21.0