Q3 2025 Molson Coors Beverage Co Earnings Call

November 4, 2025

For more information please refer to the forward looking statements disclosure in our earnings release in.

In addition, the definitions of our reconciliations for any non U S. GAAP measures are included in our earnings release.

Please note that with the exception of earnings per share all financial metrics are in constant currency when referencing percentage changes from the prior year period.

With me on the call today are Gavin Hattersley, former Chief Executive Officer, who retired October one but remains with the company on an advisory capacity until year end.

<unk>, Chief Executive Officer, and Tracey Joubert, Chief Financial Officer.

Today, Kevin we'd like to share some opening remarks before passing to local to provide an initial high level view of his vision going forward. Tracey will then wrap up with a brief review of the quarter and our 2025 outlook.

More detailed presentation of our quarterly performance, including financial and operational metrics and drivers is available in our earnings release and earnings slides, which are made available earlier today on the IR section of our website.

Upon the conclusion of our prepared remarks, we will take your questions and as always we ask that you limit yourself to one question and then if needed return to the queue.

With that I'll pass it to you Kevin.

Thank you Tracy and Hello, everybody and thank you for joining the call.

Pleased to be here today, what is my last earnings call with Molson Coors.

It has been an incredible journey and I could not be prouder of the team and the strong foundation that we have booked this includes our iconic brands across the world, our leading capabilities from supply chain to marketing a dramatically improved balance sheet and our strong free cash flow generation.

While I am retiring during a difficult time in the industry I am confident in the company's ability to return to growth.

So with that it is my great pleasure to introduce <unk>, who took over the role of CEO in October the first.

Through March six years as CEO I worked closely with Google.

Deep strategic insights institutional knowledge fresh perspectives and proven ability to deliver which are particularly important in these dynamic times that came in my view the right choice for the job.

And while he has only been enrolled for about a month, yeah, certainly hit the ground running and to share more about this parcel of pull through.

Thank you Devin it has been a true privilege to work with you for so many years.

And I look forward to building on your many accomplishments.

To support the strong culture, you have built that makes <unk> so special.

Clearly these are dynamic times and really like many staples countries have been impacted by macro related factors that have pressured consumption behavior and.

In the U S. These macro impacts have had a disproportionate effect on the lower income in Hispanic consumer and within these couldn't do both segments have driven a reduction in the number of buyers as well as spend per trip.

The continued shift to singles in the third quarter.

The macro environment has also contributed to continued industry softness pressuring demand across all regions.

But we continue to believe that the incremental softness in the industry this year cyclical and.

And we believe that we are well positioned with a healthy balance sheet strong free cash flow and great brand. So a wide range of consumer occasions and preferences.

This all helps us to navigate these near term cyclical headwinds, while investing in our business to support the long term growth.

Everyone is eager to hear more about my vision for the future and there will be more details to come.

I would like to provide a high level view of our strategic priorities and how we plan to adapt in these challenging times improve operation performance capitalize on opportunities and ultimately return to top and bottom line growth.

Wanted to assure you we are moving with a sense of urgency and with a clear focus and.

In my first 30 days, we have already begun to implement structural changes both in terms of leadership and operations put us on the path to success at the highest level. It begins by focusing on our portfolio.

Build strong and scalable brands in both beer and beyond beer.

This entails privatizing our investments to build on the strength of our core in the column EPS portfolios and to transform our above premium beer and beyond beer portfolios.

We already have a strong core portfolio with iconic global brands and regional market leader.

The majority of our business. So we intend to continue to put strong commercial pressure behind them.

But Miller Lite and Coors light this means new campaigns and high profile sports and music alliances that build on the strong brand health and support our ambition with share growth of at least that.

And for banquet, we intend to capitalize on its impressive success by leaning in even more fueled its strong momentum and to continue to bridge the sizeable distribution gaps caused by.

Recall that banquet is only in just over half the buying outlets of Coors light.

And not only as banquet, an important growth driver in our U S business, but it offers learnings that we believe can be applied more broadly across the portfolio.

We also plan to selectively increase our focus on certain economy brands like Miller high life, and Keystone light, which are big brands with loyal consumer base.

We firmly believe that all price segments method.

And while as an industry, we are not seeing trade down at the brand level in today's environment more than ever economies that important segment and we continue to see big opportunities in about period, while we have had strong premium amortization success in markets outside the U S. The meaningfully under index above.

Premiums in the U S and we plan to lean in even Honda changed in both beer and beyond that and.

And Bill it's no secret that we think peroni has great potential.

Only been two quarters since we fully onshore peroni and activated our commercial plans.

We're already seeing good progress with brand volume up 25% in third quarter.

And with expected increases in media investment next year, including programming for the Olympics and with only about one third of the distribution of the other major competitors, we see significant runway ahead.

We also remain committed to stabilizing globally and to be Frank we haven't seen the success we would like.

Traci Mangini: Within the meaning of US federal securities laws. For more information, please refer to the forward-looking statements disclosure in our earnings release. In addition, the definitions of a reconciliation for any non-US GAAP measures are included in our earnings release. Please note that, with the exception of earnings per share, all financial metrics are in constant currency when referencing percentage changes from the prior year period. With me on the call today are Gavin Hattersley, former Chief Executive Officer who retired October 1 but remains with the company on an advisory capacity until year-end, Rahul Goyal, Chief Executive Officer, and Traci Joubert, Chief Financial Officer. Today, Gavin would like to share some opening remarks before passing to Rahul to provide an initial high-level view of his vision going forward. Traci will then wrap up with a brief review of the quarter and our 2025 outlook.

Traci Mangini: Within the meaning of US federal securities laws. For more information, please refer to the forward-looking statements disclosure in our earnings release. In addition, the definitions of or reconciliations for any non-US GAAP measures are included in our earnings release. Please note that with the exception of earnings per share, all financial metrics are in constant currency when referencing percentage changes from the prior year period. With me on the call today are Gavin Hattersley, former Chief Executive Officer who retired 1 October, but remains with the company on an advisory capacity until year-end; Rahul Goyal, Chief Executive Officer; and Tracey Joubert, Chief Financial Officer. Today, Gavin would like to share some opening remarks before passing to Rahul to provide an initial high-level view of his vision going forward. Tracey will then wrap up with a brief review of the quarter and our 2025 outlook.

Operator: Within the meaning of US federal securities laws. For more information, please refer to the forward-looking statements disclosure in our earnings release. In addition, the definitions of or reconciliations for any non-US GAAP measures are included in our earnings release. Please note that with the exception of earnings per share, all financial metrics are in constant currency when referencing percentage changes from the prior year period. With me on the call today are Gavin Hattersley, former Chief Executive Officer who retired 1 October, but remains with the company on an advisory capacity until year-end; Rahul Goyal, Chief Executive Officer; and Tracey Joubert, Chief Financial Officer. Today, Gavin would like to share some opening remarks before passing to Rahul to provide an initial high-level view of his vision going forward. Tracey will then wrap up with a brief review of the quarter and our 2025 outlook.

Recent innovation with non out at high ABB brand extensions have been encouraging while the core Blue Moon, Belgian White engineers to be challenge.

An important segment and we continue to see big opportunities in above premium while we have had strong premium amortization success in markets outside the U S. B meaningfully under index in above premium in the U S and we plan to lean in even Honda changed in both beer and beyond here.

We are going to be looking closely with our fresh promotional perspective at what we can do differently to best ensure that this big and important brand supports our premium amortization objectives.

And Bill it's no secret that we think for Roni has great potential.

<unk> is our routes and at the core of our business. You can also expect us to step up our focus on beyond beer, because we believe weekend.

Only been two quarters since we fully onshore peroni and activated our commercial plans and we are already seeing good progress with brand volume up 25% in third quarter.

Not only does it help to <unk> business.

Also creates value for our customers.

And with expected increases in media investment next year, including programming for the Olympics and with only about one third of the distribution of the other major competitors.

Leading to a wider range of consumer preferences, serving mortgage.

And flavored alcohol.

Really have big brands and some had been re challenge recently.

Significant runway ahead.

But <unk> is a great example of how with the right commercial approach, we can improve trends by focusing investments on the markets, where the total Chico brand most strongly resonate and through thoughtful innovation.

Traci Mangini: A more detailed presentation of our quarterly performance, including financial and operational metrics and drivers, is available in our earnings release and earnings slides, which are made available earlier today on the IR section of our website. Upon the conclusion of our prepared remarks, we will take your questions. As always, we ask that you limit yourself to one question and then, if needed, return to the Q. With that, I'll pass it to you, Gavin.

Traci Mangini: A more detailed presentation of our quarterly performance, including financial and operational metrics and drivers, is available in our earnings release and earnings slides, which are made available earlier today on the IR section of our website. Upon the conclusion of our prepared remarks, we will take your questions. And as always, we ask that you limit yourself to one question and then, if needed, return to the queue. With that, I'll pass it to you, Gavin.

A more detailed presentation of our quarterly performance, including financial and operational metrics and drivers, is available in our earnings release and earnings slides, which are made available earlier today on the IR section of our website. Upon the conclusion of our prepared remarks, we will take your questions. And as always, we ask that you limit yourself to one question and then, if needed, return to the queue. With that, I'll pass it to you, Gavin.

We also remain committed to stabilizing globally and to be Frank we haven't seen the success we would like.

Recent innovation with non out and high ABB brand extensions have been encouraging while the core Blue Moon, Belgian White engineers to be challenge.

Achieved positive dollar share gains in the third quarter in these leases.

We are going to be looking closely with our fresh commercial perspective at what we can do differently to best ensure that this big and important brand supports our premium amortization objectives.

And we recognize we have depths, including RTD spirits, and we intend to fill that.

Gavin Hattersley: Thank you, Tracey, and hello everybody, and thank you for joining the call. I'm pleased to be here today for what is my last earnings call with Molson Coors. It has been an incredible journey, and I could not be prouder of this team and the strong foundation that we have built. This includes our iconic brands across the world, our leading capabilities from supply chain to marketing, our dramatically improved balance sheet, and our strong free cash flow generation. And while I'm retiring during a difficult time in the industry, I am confident in the company's ability to return to growth. So with that, it is my great pleasure to introduce Rahul, who took over the role of CEO on 1 October. During my six years as CEO, I worked closely with Rahul.

Gavin Hattersley: Thank you, Traci, and hello everybody, and thank you for joining the call. I'm pleased to be here today for what is my last earnings call with Molson Coors. It has been an incredible journey, and I could not be prouder of this team and the strong foundation that we have built. This includes our iconic brands across the world, our leading capabilities from supply chain to marketing, our dramatically improved balance sheet, and our strong free cash flow generation. And while I'm retiring during a difficult time in the industry, I am confident in the company's ability to return to growth. So with that, it is my great pleasure to introduce Rahul, who took over the role of CEO on 1 October. During my six years as CEO, I worked closely with Rahul.

And now we are focused on building scale and we are off to a great start.

While bill is our routes and at the core of our business. You can also expect us to step up our focus on beyond beer, because we believe weekend.

We believe our partnership with <unk> in the U S provides a strong base from which to grow our total non us portfolio.

In fact, <unk> volume has been performing strongly and it has been very well received by distributors and retailers and we are excited by the opportunity to significantly grow the brand.

Not only does it help to <unk> business.

Also creates value for our customers.

Leading to a wider range of consumer preferences serving markets.

And flavored alcohol.

Scott.

And this is just the beginning of a non out efforts as we see opportunities to enter some other interesting areas.

Really have big brands and some had been re challenge.

But <unk> is a great example of how would the right commercial approach, we can improve trends by focusing investments on the markets, where the topo Chico brand most strongly resonate and through towards innovation.

So we are making the infrastructure investments in people and systems that help to support the development of this business into something meaningful overtime.

Gavin Hattersley: His deep strategic insights, institutional knowledge, fresh perspectives, and proven ability to deliver, which are particularly important in these dynamic times, make him, in my view, the right choice for the job. And while he has only been in role for about a month, he has certainly hit the ground running. And to share more about this, I'll pass the call to Rahul.

Gavin Hattersley: His deep strategic insights, institutional knowledge, fresh perspectives, and proven ability to deliver, which are particularly important in these dynamic times, make him, in my view, the right choice for the job. While he has only been in role for about a month, he has certainly hit the ground running. To share more about this, I'll pass the call to Rahul.

His deep strategic insights, institutional knowledge, fresh perspectives, and proven ability to deliver, which are particularly important in these dynamic times, make him, in my view, the right choice for the job. While he has only been in role for about a month, he has certainly hit the ground running. To share more about this, I'll pass the call to Rahul.

Now to achieve our commercial ambitions and taking a fresh look at our approach to commercial execution and that opportunities to optimize our cost structure with fuel reinvestment in the business.

Achieved positive dollar share gains in the third quarter in these features.

And we recognize we havent depths, including RTD spirits, and we intend to fill that in.

On the commercial side, creating value for our customers and consumers remains at the forefront of all of that to Egypt.

Non out we are focused on building scale and we are off to a great start.

Rahul Goyal: Thank you, Gavin. It has been a true privilege to work with you for so many years, and I look forward to building on your many accomplishments and continuing to support the strong culture you have built that makes Molson Coors so special. Now, clearly, these are dynamic times, and we, like many staples companies, have been impacted by macro-related factors that have pressured consumption behavior. In the US, these macro impacts have had a disproportionate effect on the lower-income and Hispanic consumer. And within beer, these consumer segments have driven a reduction in the number of buyers as well as spend for drinks, with a continued shift to singles in Q3. In Europe, the macro environment has also contributed to continued industry softness, pressuring demand across our regions. But we continue to believe that the incremental softness in the industry this year is cyclical.

Rahul Goyal: Thank you, Gavin. It has been a true privilege to work with you for so many years, and I look forward to building on your many accomplishments and continuing to support the strong culture you have built that makes Molson Coors so special. Now, clearly, these are dynamic times, and we, like many staples companies, have been impacted by macro-related factors that have pressured consumption behavior. In the US, these macro impacts have had a disproportionate effect on the lower-income and Hispanic consumer. And within beer, these consumer segments have driven a reduction in the number of buyers as well as spent for drinks, with a continued shift to singles in the third quarter. In Europe, the macro environment has also contributed to continued industry softness, pressuring demand across our regions. But we continue to believe that the incremental softness in the industry this year is cyclical.

But we believe we can be even more effective at this by focusing ownership of the business even closer to the market.

We believe our partnership with <unk> in the U S provides a strong base from which to grow our total drawn out portfolio.

And we intend to do this by deploying marketing and G&A investments based on specific market dynamics and portfolio of products.

In fact, <unk> volume has been performing strongly and it has been very well received by distributors and retailers and we are excited by the opportunity to significantly grow the brand.

This should help to increase our speed of decision making.

Agility to execute and ensure greater accountability and returns oriented mindset at the local level of our business.

And this is just the beginning of a non arc efforts as we see opportunities to enter some other interesting ideas.

On the cost side as announced last month.

So we are making the infrastructure investments in people and systems that help to support the development of this business into something meaningful overtime.

Implementing a corporate restructuring plan all of our medical business unit.

Designed to create a leaner more agile organization, while advancing our ability to reinvest in the business.

Now to achieve our commercial ambitions and taking a fresh look at our approach to commercial execution and that opportunity to optimize our cost structure with fuel reinvestment in the business.

This entails reducing America's salaried head count by approximately 400 positions or 9% by the end of the year.

On the commercial side, creating value for our customers and consumers remains at the forefront of all that we do.

This includes hundreds of salaried positions.

Rahul Goyal: And we believe that we are well-positioned with a healthy balance sheet, strong free cash flow, and great brands that serve a wide range of consumer occasions and preferences. This all helps us to navigate these near-term cyclical headwinds while investing in our business to support the long-term growth. I know everyone is eager to hear more about my vision for the future, and there will be more details to come. But today, I would like to provide a high-level view of our strategic priorities and how we plan to adapt in these challenging times, improve our commercial performance, capitalize on opportunities, and ultimately return to top and bottom-line growth. I want to assure you that we are moving with a sense of urgency and with a clear purpose.

Rahul Goyal: We believe that we are well-positioned with a healthy balance sheet, strong free cash flow, and great brands that serve a wide range of consumer occasions and preferences. This all helps us to navigate these near-term cyclical headwinds while investing in our business to support the long-term growth. I know everyone is eager to hear more about my vision for the future, and there will be more details to come. But today, I would like to provide a high-level view of our strategic priorities and how we plan to adapt in these challenging times, improve our commercial performance, capitalize on opportunities, and ultimately return to top and bottom-line growth. I want to assure you that we are moving with a sense of urgency and with a clear purpose.

We believe that we are well-positioned with a healthy balance sheet, strong free cash flow, and great brands that serve a wide range of consumer occasions and preferences. This all helps us to navigate these near-term cyclical headwinds while investing in our business to support the long-term growth. I know everyone is eager to hear more about my vision for the future, and there will be more details to come. But today, I would like to provide a high-level view of our strategic priorities and how we plan to adapt in these challenging times, improve our commercial performance, capitalize on opportunities, and ultimately return to top and bottom-line growth. I want to assure you that we are moving with a sense of urgency and with a clear purpose.

Already opened due to head count prioritization efforts earlier this year and those who may be granted voluntary severance as part of this restructuring.

But we believe we can be even more effective at this by focusing ownership of the business even closer to the market.

We intend to redeploy some of these savings to step up our investments behind key brands commercial capabilities and its supply chain and technology that support ongoing productivity and efficiency.

And we intend to do this by deploying marketing and G&A investments based on specific market dynamics and portfolio of products.

This should help to increase our speed of decision, making agility to execute and ensure greater accountability and return oriented mindset at the local level of our business.

And we will continue to be disciplined stewards of our capital using the dynamic capital allocation approach balancing investments in M&A to fill portfolio gaps, while continuing to return cash to shareholders.

On the cost side as announced last month, we are implementing a corporate restructuring plan automatic does business unit.

We'll be sharing more on capital allocation in the near future, but today, let me be very clear on two things first we seek scalable deals that we expect to be accretive to both top and bottom line and our prudent from a balance sheet perspective.

Designed to create a leaner more agile organization.

Advancing our ability to reinvest into it.

Rahul Goyal: In my first 30 days, we have already begun to implement structural changes, both in terms of leadership and operations, to put us on the path to success. At the highest level, it begins by focusing on our portfolio to build strong and scalable brands in both beer and beyond beer. This entails prioritizing our investments to build on the strengths of our core and economy beer portfolios and to transform our above-premium beer and beyond beer portfolios. In beer, we already have a strong core portfolio with iconic global brands and regional market leaders. They are the majority of our business. So we intend to continue to put strong commercial pressure behind them. For Miller Lite and Coors Light, this means new campaigns and high-profile sports and music alliances that build on their strong brand health and support our ambition for shared growth for these brands.

Rahul Goyal: In my first 30 days, we have already begun to implement structural changes, both in terms of leadership and operations, to put us on the path to success. At the highest level, it begins by focusing on our portfolio to build strong and scalable brands in both beer and beyond beer. This entails prioritizing our investments to build on the strengths of our core and economy beer portfolios and to transform our above-premium beer and beyond beer portfolios. In beer, we already have a strong core portfolio with iconic global brands and regional market leaders. They are the majority of our business, so we intend to continue to put strong commercial pressure behind them. For Miller Lite and Coors Light, this means new campaigns and high-profile sports and music alliances that build on their strong brand health and support our ambition for shared growth for these brands.

In my first 30 days, we have already begun to implement structural changes, both in terms of leadership and operations, to put us on the path to success. At the highest level, it begins by focusing on our portfolio to build strong and scalable brands in both beer and beyond beer. This entails prioritizing our investments to build on the strengths of our core and economy beer portfolios and to transform our above-premium beer and beyond beer portfolios. In beer, we already have a strong core portfolio with iconic global brands and regional market leaders. They are the majority of our business, so we intend to continue to put strong commercial pressure behind them. For Miller Lite and Coors Light, this means new campaigns and high-profile sports and music alliances that build on their strong brand health and support our ambition for shared growth for these brands.

This entails reducing America's salaried head count by approximately 400 positions on 9% by the end of the year.

Second we remain committed to our dividend and to our share repurchase program as we continue to view our stock as a compelling investment.

This includes hundreds of salaried positions that were already open due to head count prioritization efforts earlier this year and those who may be granted voluntary severance as part of this restructure.

Now there is a lot of work to do but we see a clear path forward.

Results will take some time, but we are moving with a sense of urgency.

We intend to redeploy some of these savings to step up our investments behind key brands promotional capabilities and its supply chain and technology that support ongoing productivity and efficiency.

Confident we have the right brands and the plans to be successful and I look forward to updating you on more of the detailed strategy and financials and operational objectives in the coming months.

With that I will pass it to Tracy, who will talk about our financial performance and outlook.

Thank you.

Third quarter consolidated net sales revenue was down three 6% underlying pretax income was down 11, 9% and <unk>.

Underlying <unk> was down seven 2%.

On an underlying basis, the key quarterly five it's been largely as expected.

Rahul Goyal: And for Banquet, we intend to capitalize on its impressive success by leaning in even more to fuel its strong momentum and to continue to bridge the sizable distribution gap with Coors Light. Recall that Banquet is only in just over half the buying outlets of Coors Light. And not only is Banquet an important growth driver in our US business, but it offers learnings that we believe can be applied more broadly across the portfolio. We also plan to selectively increase our focus on certain economy brands like Miller High Life and Keystone Light, which are big brands with loyal consumer bases. We firmly believe that all price segments matter. While as an industry, we are not seen trade down at the brand level, in today's environment, more than ever, economy is an important segment. We continue to see big opportunities in above-premium.

Rahul Goyal: For Banquet, we intend to capitalize on its impressive success by leaning in even more to fuel its strong momentum and to continue to bridge the sizable distribution gap with Coors Light. Recall that Banquet is only in just over half the buying outlets of Coors Light. Not only is Banquet an important growth driver in our US business, but it offers learnings that we believe can be applied more broadly across the portfolio. We also plan to selectively increase our focus on certain economy brands like Miller High Life and Keystone Light, which are big brands with loyal consumer bases. We firmly believe that all price segments matter. While as an industry, we have not seen trade down at the brand level, in today's environment, more than ever, economy is an important segment. We continue to see big opportunities in Above Premium.

For Banquet, we intend to capitalize on its impressive success by leaning in even more to fuel its strong momentum and to continue to bridge the sizable distribution gap with Coors Light. Recall that Banquet is only in just over half the buying outlets of Coors Light. Not only is Banquet an important growth driver in our US business, but it offers learnings that we believe can be applied more broadly across the portfolio. We also plan to selectively increase our focus on certain economy brands like Miller High Life and Keystone Light, which are big brands with loyal consumer bases. We firmly believe that all price segments matter. While as an industry, we have not seen trade down at the brand level, in today's environment, more than ever, economy is an important segment. We continue to see big opportunities in Above Premium.

Industry was down minus four seven to date based on our internal estimate.

And second we remain committed to our dividend and to our share repurchase program as we continue to view our stock as a compelling investment.

Our unit volume was down 40 basis points based on our internal estimate.

Now there is a lot of work to do but we see a clear path forward.

<unk> latest data shape, performing any unfinished channel compared to the.

<unk> will take some time, but we are moving with a sense of urgency.

Countries with a 450000 hits can eat at all three percentage point headwind to the American financial target.

We're confident we have the right brands and the plans to be successful.

And I look forward to updating you on more of the detailed strategy and financials and operational objectives in the coming months.

Excluding context you May proceed.

Japanese uptake API, resulting in immediate two percentage point benefit to American financial volume in the quarter.

With that I will pass it to Tracy, who will talk about our financial performance and outlook.

EMEA and APAC volume continued to be pressured across all regions ongoing soft market demand.

Thank you.

Third quarter consolidated net sales revenue was down three 3% underlying pretax income was down 11, 9%.

Talking competitive landscape.

The Midwest premium remained innovative it was within the expected cost range.

Underlying <unk> was down seven 2%.

Rahul Goyal: While we have had strong premiumization success in markets outside the US, we meaningfully under-index in above-premium in the US. We plan to lean in even harder to change that in both beer and beyond-beer. In beer, it's no secret that we think Peroni has great potential. It's only been two quarters since we fully onshored Peroni and activated our commercial plans, and we are already seeing good progress with brand volume up 25% in Q3. With expected increases in media investment next year, including programming for the Olympics, and with only about 1/3 of the distribution of the other major competitors, we see significant runway ahead. We also remain committed to stabilizing Blue Moon. To be frank, we haven't seen the success we would like. Recent innovation with non-alc and high ABV brand extensions have been encouraging, while the core Blue Moon Belgian White continues to be challenged.

Rahul Goyal: While we have had strong premiumization success in markets outside the US, we meaningfully underindex in Above Premium in the US. And we plan to lean in even harder to change that in both beer and Beyond Beer. In beer, it's no secret that we think Peroni has great potential. It's only been two quarters since we fully onshored Peroni and activated our commercial plans, and we are already seeing good progress with brand volume up 25% in the third quarter. And with expected increases in media investment next year, including programming for the Olympics, and with only about 1/3 of the distribution of the other major competitors, we see significant runway ahead. We also remain committed to stabilizing Blue Moon. And to be frank, we haven't seen the success we would like.

While we have had strong premiumization success in markets outside the US, we meaningfully underindex in Above Premium in the US. And we plan to lean in even harder to change that in both beer and Beyond Beer. In beer, it's no secret that we think Peroni has great potential. It's only been two quarters since we fully onshored Peroni and activated our commercial plans, and we are already seeing good progress with brand volume up 25% in the third quarter. And with expected increases in media investment next year, including programming for the Olympics, and with only about 1/3 of the distribution of the other major competitors, we see significant runway ahead. We also remain committed to stabilizing Blue Moon. And to be frank, we haven't seen the success we would like.

The higher end.

And marketing was up while G&A was down largely due to lower incentive compensation as compared to prior year.

On an underlying basis, the key quarterly five it's been largely as expected.

Industry was down minus four seven to date based on our internal estimate.

While our discussion today. Its typical has been on an underlying basis. We also recorded a noncash partial goodwill impairment charge of $3 $6 billion as well as noncash intangible asset impairment charges of $274 million in the quarter, which I'll discuss in detail in today's earnings release.

Our unit volume was down 40 basis points based on our internal estimate.

Competing relatively better shape, performing any unfinished channel compared to the off highway.

Countries with a 450000 hits davita or three percentage point headwind to the American financial target.

In Q.

I also wanted to take the execution I've actually lease a sustained during the quarter.

Excluding contact Billy you May proceed.

Restrictions under our policies have prohibited us from executing under the repurchase pain during open trading window. Following last quarter's inning, because we really integration of material nonpublic information regarding Sti's states.

That is an API, resulting in immediate two percentage point benefit to American financial volume in the quarter.

EMEA and APAC volume continued to be pressured across all regions the ongoing soft market demand.

We expect our reconnect quarterly trading window to open tomorrow, and we want to stress that we remain fully committed to our share repurchase plan and continue to strongly believe.

<unk> competitive landscape.

Rahul Goyal: Recent innovation with non-alc and high ABV brand extensions have been encouraging, while the core Blue Moon Belgian White continues to be challenged. We are going to be looking closely with a fresh commercial perspective at what we can do differently to best ensure that this big and important brand supports our premiumization objectives. Now, while beer is our roots and at the core of our business, you can also expect us to step up our focus on beyond beer because we believe we can win here. Not only does it help to premiumize our business, but it also creates value for our customers by appealing to a wider range of consumer preferences and serving more occasions. In flavored alcohol, we already have big brands, and some have been rechallenged recently. But Topo Chico is a great example of how, with the right commercial approach, we can improve trends.

Recent innovation with non-alc and high ABV brand extensions have been encouraging, while the core Blue Moon Belgian White continues to be challenged. We are going to be looking closely with a fresh commercial perspective at what we can do differently to best ensure that this big and important brand supports our premiumization objectives. Now, while beer is our roots and at the core of our business, you can also expect us to step up our focus on beyond beer because we believe we can win here. Not only does it help to premiumize our business, but it also creates value for our customers by appealing to a wider range of consumer preferences and serving more occasions. In flavored alcohol, we already have big brands, and some have been rechallenged recently. But Topo Chico is a great example of how, with the right commercial approach, we can improve trends.

The Midwest premium remained innovative it was with <unk>.

The expected cost range or about at the higher end.

<unk> is a compelling investment.

And marketing with asphalt G&A was down largely due to lower incentive compensation as compared to prior year.

Rahul Goyal: We are going to be looking closely with a fresh commercial perspective at what we can do differently to best ensure that this big and important brand supports our premiumization objectives. Now, while beer is our roots and at the core of our business, you can also expect us to step up our focus on beyond-beer because we believe we can win here. Not only does it help to premiumize our business, but it also creates value for our customers by appealing to a wider range of consumer preferences and serving more occasions. In flavored alcohol, we already have big brands, and some have been rechallenged recently. But Topo Chico is a great example of how, with the right commercial approach, we can improve trends.

With that let's discuss our outlook, we are reaffirming our 2020 guidance, which we now expect to come in at the low end of the prior ranges for our key metrics.

While our discussion today. It typically has been on an underlying basis. We also recorded a noncash partial goodwill impairment charge of $3 $6 billion as well as noncash intangible asset impairment charges of $274 million in the quarter, which I'll discuss in detail in today's earnings release.

The key metrics in ranges are as follows.

Net sales revenue to decline, 3% to 4% on a constant currency basis.

Underlying pre tax income to decline, 12% to 15% on a constant currency basis.

In Q.

Underlying earnings per share to the time given to teams of themes and underlying free cash flow of $1 3 billion.

I also wanted to take the execution of SG&A sustained during the quarter.

Restrictions under our policies have prohibited us from executing under the repurchase paying Jimmy open trading window. Following last quarters earnings because really integration of material nonpublic information regarding Sti's states.

<unk>, 10%.

Now before we get into the details I'll remind you that the impacts of the global macro environment, our multifaceted and difficult to predict.

And while we have included in our guidance update estimates of some of these external drivers base significantly impact our actual results either up or down.

We expect our reconnect quarterly trading window, I think tomorrow, and we want to state that we remain fully committed to our share repurchase plan and continue to strongly believe our stock is a compelling investment.

Rahul Goyal: By focusing investments on the markets where the Topo Chico brand most strongly resonates and through thoughtful innovation, we achieved positive dollar share gains in Q3 in these regions. We recognize we have gaps, including RTD spirits, and we intend to fill them. In non-alc, we are focused on building scale, and we are off to a great start. We believe our partnership with Pivotry in the US provides a strong base from which to grow our total non-alc portfolio. In fact, Pivotry volume has been performing strongly, and it has been very well received by distributors and retailers. We are excited by the opportunity to significantly grow the brand in the years to come. This is just the beginning of our non-alc efforts, as we see opportunities to enter some other interesting areas.

Rahul Goyal: By focusing investments on the markets where the Topo Chico brand most strongly resonates and through thoughtful innovation, we achieved positive dollar share gains in Q3 in these regions. We recognize we have gaps, including RTD spirits, and we intend to fill them. In non-alc, we are focused on building scale, and we are off to a great start. We believe our partnership with Fever-Tree in the US provides a strong base from which to grow our total non-alc portfolio. In fact, Fever-Tree volume has been performing strongly, and it has been very well received by distributors and retailers. We are excited by the opportunity to significantly grow the brand in the years to come. This is just the beginning of our non-alc efforts, as we see opportunities to enter some other interesting areas.

By focusing investments on the markets where the Topo Chico brand most strongly resonates and through thoughtful innovation, we achieved positive dollar share gains in Q3 in these regions. We recognize we have gaps, including RTD spirits, and we intend to fill them. In non-alc, we are focused on building scale, and we are off to a great start. We believe our partnership with Fever-Tree in the US provides a strong base from which to grow our total non-alc portfolio. In fact, Fever-Tree volume has been performing strongly, and it has been very well received by distributors and retailers. We are excited by the opportunity to significantly grow the brand in the years to come. This is just the beginning of our non-alc efforts, as we see opportunities to enter some other interesting areas.

Starting with the top line, we now expect lower year end U S distributor inventory levels.

With that let's discuss our outlook we.

Year to date unit Ftw's, largely caught up to HR to the third quarter.

We are reaffirming our 2025 guidance, we now expect to come in at the lower end of the prior ranges for our key metrics.

However, given the lower 2025 volume impacted by industry performance, we now anticipate year end distributor inventory to be another compared to year end 2024 on an absolute basis.

Key metrics in ranges are as follows.

Net sales revenue to decline, 3% to 4% on a constant currency basis.

Underlying pre tax income to decline, 12% to 15% on a constant currency basis.

Days of inventory to remain relatively consistent.

And it really is healthy levels entering the new year.

Underlying earnings per share to decline seven to 10 days.

As a result for the fourth quarter, we expect to use its CW team to trail the U S.

And underlying free cash flow of $1 3 billion.

You're saying excluding contract.

<unk>, 10%.

All at the top line five has remained unchanged.

Now before we get into the details I'll remind you that the impacts of the global macro environment, our multifaceted and difficult to predict.

We continue to expect industry volume to be down on average 46% for the second half of the year, while mindful of comparisons versus the year ago period with somewhat softer in the third quarter before becoming more difficult engineering.

Rahul Goyal: So we are making the infrastructure investments in people and systems that help to support the development of this business into something meaningful over time. Now, to achieve our commercial ambitions, we are taking a fresh look at our approach to commercial execution and at opportunities to optimize our cost structure with fuel reinvestment in the business. On the commercial side, creating value for our customers and consumers remains at the forefront of all that we do. But we believe we can be even more effective at this by focusing ownership of the business even closer to the market. And we intend to do this by deploying marketing and G&A investments based on specific market dynamics and portfolio priorities. This should help to increase our speed of decision-making, our agility to execute, and ensure greater accountability and return-oriented mindset at the local level of our business.

So we are making the infrastructure investments in people and systems that help to support the development of this business into something meaningful over time. Now, to achieve our commercial ambitions, we are taking a fresh look at our approach to commercial execution and at opportunities to optimize our cost structure with fuel reinvestment in the business. On the commercial side, creating value for our customers and consumers remains at the forefront of all that we do. But we believe we can be even more effective at this by focusing ownership of the business even closer to the market. And we intend to do this by deploying marketing and G&A investments based on specific market dynamics and portfolio priorities. This should help to increase our speed of decision-making, our agility to execute, and ensure greater accountability and return-oriented mindset at the local level of our business.

And while we have included in our guidance up eight estimate of some of these external drivers may significantly impact our actual results either up or down.

We will tackle $1 9 million hit to needed the contract brewing volume in the Americas in 2025 related to tax in the bank and we're thoughtful to remain three from 1000 here in the fourth quarter.

Starting with the top line, we now expect lower year end U S distributor inventory levels.

Year to date unit Gw's, largely caught up to HR to the third quarter.

However, given the lower 2025 volumes impacted by industry performance. We now anticipate year end distributor inventory to be another compared to year end 2024 on an absolute basis.

And we continue to expect an annual price increase of one 2% in North America in line with the average historical range and mixed benefits from Socgen contract moving from 2020 full as well as from premium amortization in both business units.

But Gary and days of inventory to remain relatively consistent and it really is healthy levels entering the new yes.

Moving down the P&L, we expect Cogs to be negatively impacted by volume deleverage, including a lower expectation for year end distributor inventory.

As a result for the fourth quarter, we expect the unit is TWD claim to trail the U S.

Dr claims excluding contract.

Also the Midwest premium pricing has continued to increase.

All of the top line five has remained unchanged.

Our guidance assumed a price range of 60 to 75 things that turned this in time for the full year, let me premium costs that exceed the prior year by $40 billion to $55 billion, but most of the increase occurring in the second half of the year.

We continue to expect U S industry volume to be down on average 46% for the second half of the year, while monthly comparisons versus the year ago period with somewhat softer in the third quarter before becoming more difficult engineering.

Rahul Goyal: On the cost side, as announced last month, we are implementing a corporate restructuring plan of our Americas business unit, designed to create a leaner, more agile organization while advancing our ability to reinvest in the business. This entails reducing our Americas salaried headcount by approximately 400 positions or 9% by the end of the year. This includes hundreds of salaried positions that were already open due to headcount prioritization efforts earlier this year and those who may be granted voluntary severance as part of this restructuring. We intend to redeploy some of these savings to step up our investments behind key brands, commercial capabilities, and in supply chain and technology that support ongoing productivity and efficiency. And we will continue to be disciplined stewards of our capital, using a dynamic capital allocation approach, balancing investments in M&A to fill portfolio gaps while continuing to return cash to shareholders.

Rahul Goyal: On the cost side, as announced last month, we are implementing a corporate restructuring plan of our Americas business unit, designed to create a leaner, more agile organization while advancing our ability to reinvest in the business. This entails reducing our Americas salaried headcount by approximately 400 positions or 9% by the end of the year. This includes hundreds of salaried positions that were already open due to headcount prioritization efforts earlier this year and those who may be granted voluntary severance as part of this restructuring. We intend to redeploy some of these savings to step up our investments behind key brands, commercial capabilities, and in supply chain and technology that support ongoing productivity and efficiency. We will continue to be disciplined stewards of our capital, using a dynamic capital allocation approach, balancing investments in M&A to fill portfolio gaps while continuing to return cash to shareholders.

On the cost side, as announced last month, we are implementing a corporate restructuring plan of our Americas business unit, designed to create a leaner, more agile organization while advancing our ability to reinvest in the business. This entails reducing our Americas salaried headcount by approximately 400 positions or 9% by the end of the year. This includes hundreds of salaried positions that were already open due to headcount prioritization efforts earlier this year and those who may be granted voluntary severance as part of this restructuring. We intend to redeploy some of these savings to step up our investments behind key brands, commercial capabilities, and in supply chain and technology that support ongoing productivity and efficiency. We will continue to be disciplined stewards of our capital, using a dynamic capital allocation approach, balancing investments in M&A to fill portfolio gaps while continuing to return cash to shareholders.

However, as you can see on page 18 of our earnings slides the cost seemed at the at the end of this range in the third quarter and was slightly above it Ted.

We will tackle one 9 million hit to meet as a contract brewing volume in the Americas in 2025 related to perhaps in the back and we'll talk on the remaining 300000 here in the fourth quarter.

We expect increases to be at the high end of that range.

And we continue to expect an annual price increase of 1% to 2% in North America in line with the average historical range and mixed benefits from Socgen contract brewing from 2020 full as well as from premium amortization in both business units.

As for in G&A, we continue to expect it to be down slightly for the year due to lower incentive compensation, which is largely offset by higher non our infrastructure cost.

Well as with CVT, one time transition and integration fees in the face of it yet.

Moving down the P&L, we expect Cogs to be negatively impacted by volume deleverage, including the lower expectations for year end U S distributor inventory.

Again, those one time fees were approximately $50 million and will be with cabot's unique sales over the next two years, which began in the second quarter of this year.

Also the Midwest premium pricing has continued to increase.

We remain committed to increasing shareholder value and look forward to sharing more about our strategic plans and long term objectives in the coming months.

Our guidance assumed a price range of 60 to 75 things that turned this in time for the full year Midwest premium costs that exceed the prior year, a $40 55 billion with most of the increase occurring in the second half of the year.

With that we will take your questions operator.

Rahul Goyal: We'll be sharing more on capital allocation in the near future, but today, let me be very clear on two things. First, we seek scalable deals that we expect to be accretive to both top and bottom line and are prudent from a balance sheet perspective. And second, we remain committed to our dividend and to our share repurchase program as we continue to view our stock as a compelling investment. Now, there is a lot of work to do, but we see a clear path forward. Results will take some time, but we are moving with a sense of urgency. We're confident we have the right brands and the plans to be successful. And I look forward to updating you on more of the details of strategy and financials and operational objectives in the coming months.

Rahul Goyal: We'll be sharing more on capital allocation in the near future, but today, let me be very clear on two things. First, we seek scalable deals that we expect to be accretive to both top and bottom line and are prudent from a balance sheet perspective. And second, we remain committed to our dividend and to our share repurchase program as we continue to view our stock as a compelling investment. Now, there is a lot of work to do, but we see a clear path forward. Results will take some time, but we are moving with a sense of urgency. We're confident we have the right brands and the plans to be successful. And I look forward to updating you on more of the details of strategy, financials, and operational objectives in the coming months.

We'll be sharing more on capital allocation in the near future, but today, let me be very clear on two things. First, we seek scalable deals that we expect to be accretive to both top and bottom line and are prudent from a balance sheet perspective. And second, we remain committed to our dividend and to our share repurchase program as we continue to view our stock as a compelling investment. Now, there is a lot of work to do, but we see a clear path forward. Results will take some time, but we are moving with a sense of urgency. We're confident we have the right brands and the plans to be successful. And I look forward to updating you on more of the details of strategy, financials, and operational objectives in the coming months.

Thank you we will now begin the question and answer session as.

As a reminder, if you would like to ask a question. Please.

However, as you can see on page 18 of our earnings slides the Pos seem that at the at the end of this range in the third quarter and was slightly above it Ted.

So now by pressing star followed by the number one on your telephone keypad.

You changed your mind do you feel like your question has already been answered.

April we expect increases to be at the high end of that range.

Press Star followed by two to withdraw yourself from Nikkei.

Our first question today comes from Peter Grom with UBS.

As for in G&A, we continue to expect it to be down slightly for the year due to lower incentive compensation, which is largely offset by higher non our infrastructure cost.

Peter Please go ahead.

Great. Thank you good morning, everyone. Two questions for me one for Al and one for Tracy first of all you've been in the role for about 30 days at this point and recognizing you've been with the company for some time, but just as you step into the CE Award would love to get your perspective on what you see.

Well as with CVT, one time transition and integration fees in the first half of the year.

Again, those one time fees were approximately $50 million and will be with Cabot's unit sales over the next two years, which began in the second quarter of this year in closing, we remain committed to increasing shareholder value and look forward to sharing more about our strategic plans and long term objectives in the coming months.

Rahul Goyal: With that, I will pass it to Traci, who will talk about our financial performance and outlook.

Rahul Goyal: With that, I will pass it to Tracey, who will talk about our financial performance and outlook.

With that, I will pass it to Tracey, who will talk about our financial performance and outlook.

As the biggest opportunities and challenges ahead, and then Tracy adjustments, hoping to get some color on the implied improvement for the fourth quarter embedded in the top line guidance just given the commentary on tougher category comps.

Tracey Joubert: Thank you, Rahul. Third quarter consolidated net sales revenue was down 3.3%. Underlying pre-tax income was down 11.9%, and underlying earnings per share was down 7.2%. On an underlying basis, the key quarterly drivers were largely as expected. The US beer industry was down -4.7% based on our internal estimates. Our US volume share was down 40 basis points based on our internal estimates, including relatively better share performance in the On-Premise channel compared to the Off-Premise. Contract brewing was a 450,000 hectoliter or 3 percentage points headwind to the Americas financial volume. Excluding contract brewing, US SCWs outpaced STRs, resulting in a nearly 2 percentage points benefit to Americas financial volume in the quarter. EMEA and APAC volume continued to be pressured across all regions for ongoing soft market demand and a heightened competitive landscape.

Traci Joubert: Thank you, Rahul. Third quarter consolidated net sales revenue was down 3.3%. Underlying pre-tax income was down 11.9%, and underlying earnings per share was down 7.2%. On an underlying basis, the key quarterly drivers were largely as expected. The US beer industry was down minus 4.7% based on our internal estimates. Our US volume share was down 40 basis points based on our internal estimates, including relatively better share performance in the on-premise channel compared to the off-premise. Contract brewing was a 450,000 hectoliter or 3 percentage points headwind to the Americas financial volume. Excluding contract brewing, US FTWs outpaced FTRs, resulting in a nearly 2 percentage points benefit to Americas financial volume in the quarter. Americas and APAC volume continued to be pressured across all regions for ongoing soft market demand and a heightened competitive landscape.

With that we will take your questions operator.

Now expecting to ship behind in America can you just walk through the building blocks for <unk> as you can see that today. Thanks.

Thank you we will now begin the question and answer session.

If you would like to ask a question. Please do so now by pressing star followed by the number one on your telephone keypad.

Thanks, Pete and.

And good morning to you.

If you look at the last 30 days.

Your mind do you feel like your question has already been answered.

My focus and my priority has been I would say in two fronts, one is listening to our people and our customers.

Followed by two to withdraw yourself from Nikkei.

Our first question today comes from Peter Grom with UBS.

And if you look at our business.

Peter Please go ahead.

Please so if we have a strong foundation, we got great brands healthy balance sheet.

Great. Thank you good morning, everyone. Two questions for me one for Al and one for Tracy first role he's been in the role for about 30 days at this point and recognizing you've been with the company for some time, but just as you step into the CE Award would love to get your perspective on what you see.

But we have great opportunities. So if you look at the outperformance this year.

The majority of our share losses has been a few in a few areas the economy category or the flavor category.

Co brands that are pretty strong and so we need to find a way to make them stronger.

In above premium we have great opportunities with.

The portfolio we have.

But what he is doing really well we have some more work to do and Blue Moon.

Again, the beyond beer strategy I think <unk> has been a great add to our business. So.

Now expecting to ship behind in America can you just walk through the building blocks for <unk> as you can see that today. Thanks.

Traci Joubert: The Midwest premium remained elevated, but was within the expected price range, although at the higher end. Marketing was up while G&A was down largely due to lower incentive compensation as compared to prior years. While our discussion today, as typical, has been on an underlying basis, we also recorded a non-cash partial goodwill impairment charge of $3.6 billion, as well as non-cash intangible asset impairment charges of $274 million in the quarter, which I'll discuss in detail in today's earnings release and 10Q. I also wanted to address the execution of our share repurchase plan during the quarter. Restrictions under our policies have prohibited us from executing under the repurchase plan during the open trading window following last quarter's earnings because we were in possession of material non-public information regarding our CEO search.

Tracey Joubert: The Midwest Premium remained elevated, but was within the expected price range, although at the higher end. And marketing was up while G&A was down largely due to lower incentive compensation as compared to prior years. While our discussion today, as typical, has been on an underlying basis, we also recorded a non-cash partial goodwill impairment charge of $3.6 billion, as well as non-cash intangible asset impairment charges of $274 million in the quarter, which are discussed in detail in today's earnings release and 10Q. I also wanted to address the execution of our share repurchase plan during the quarter. Restrictions under our policies have prohibited us from executing under the repurchase plan during the open trading window following last quarter's earnings because we were in possession of material non-public information regarding our CEO search.

The Midwest Premium remained elevated, but was within the expected price range, although at the higher end. And marketing was up while G&A was down largely due to lower incentive compensation as compared to prior years. While our discussion today, as typical, has been on an underlying basis, we also recorded a non-cash partial goodwill impairment charge of $3.6 billion, as well as non-cash intangible asset impairment charges of $274 million in the quarter, which are discussed in detail in today's earnings release and 10Q. I also wanted to address the execution of our share repurchase plan during the quarter. Restrictions under our policies have prohibited us from executing under the repurchase plan during the open trading window following last quarter's earnings because we were in possession of material non-public information regarding our CEO search.

If you look at the balance Im pretty excited about a number of things we have going but recognize the challenges we have in some other parts of our portfolio.

Thanks, Pete and good morning to you.

If you look at the last 30 days.

Wanting to really get behind it I think the piece I'll leave you with is.

My focus and my priority has been I would say in two fronts. One is listening to our people and our customers and if you look at our business.

We're definitely moving with a sense of urgency and base.

Right I mean, we've recognized the volatility in the category. This year, but we also recognize the things that we can work on within though but theyre not being so.

So if we have a strong foundation, we got great brands healthy balance sheet.

But we have great opportunities. So if you look at the outperformance this year.

So looking forward to with beta it's been it's been a quick 30 days, but definitely moving with pace. If you wanted to take the second one.

The majority of our share losses has been a few in a few areas the economy category or the flavor category.

Thanks, Peter for the question.

Co brands that are pretty strong and so we need to find a way to make them stronger.

In terms of Q4, we are expecting better top line performance.

In above premium we have great opportunities with.

Our EMEA APAC and Canada business units and in addition, we are lapping softer comps from contract brewing in the UAE.

The portfolio we have.

But what he is doing really well we have some more work to do and Blue Moon.

Traci Joubert: We expect our regular quarterly trading window to open tomorrow, and we want to stress that we remain fully committed to our share repurchase plan and continue to strongly believe our stock is a compelling investment. With that, let's discuss our outlook. We are reaffirming our 2025 guidance, but we now expect to come in at the low end of the prior ranges for our key metrics. Those key metrics and ranges are as follows. Net sales revenue to decline 3% to 4% on a constant currency basis. Underlying pre-tax income to decline 12% to 15% on a constant currency basis. Underlying earnings per share to decline 7% to 10%. Underlying free cash flow of $1.3 billion ±10%. Now, before we get into the details, I'll remind you that the impacts of the global macro environment are multifaceted and difficult to predict.

Tracey Joubert: We expect our regular quarterly trading window to open tomorrow, and we want to stress that we remain fully committed to our share repurchase plan and continue to strongly believe our stock is a compelling investment. With that, let's discuss our outlook. We are reaffirming our 2025 guidance, but we now expect to come in at the low end of the prior ranges for our key metrics. Those key metrics and ranges are as follows. Net sales revenue to decline 3% to 4% on a constant currency basis. Underlying pre-tax income to decline 12% to 15% on a constant currency basis. Underlying earnings per share to decline 7% to 10%. Underlying free cash flow of $1.3 billion ±10%. Now, before we get into the details, I remind you that the impacts of the global macro environment are multifaceted and difficult to predict.

We expect our regular quarterly trading window to open tomorrow, and we want to stress that we remain fully committed to our share repurchase plan and continue to strongly believe our stock is a compelling investment. With that, let's discuss our outlook. We are reaffirming our 2025 guidance, but we now expect to come in at the low end of the prior ranges for our key metrics. Those key metrics and ranges are as follows. Net sales revenue to decline 3% to 4% on a constant currency basis. Underlying pre-tax income to decline 12% to 15% on a constant currency basis. Underlying earnings per share to decline 7% to 10%. Underlying free cash flow of $1.3 billion ±10%. Now, before we get into the details, I remind you that the impacts of the global macro environment are multifaceted and difficult to predict.

So that's a big driver.

Again, the beyond beer strategy I think <unk> has been a great add to our business. So.

The big drivers of our top line performance.

I don't want to translate to better bottom line performance as well as.

If you look at the balance Im pretty excited about a number of things we have going but recognize the challenges we have in some other parts of our portfolio.

We will have lower G&A in the fourth quarter really driven by the lower incentive compensation.

Wanting to really get behind it I think the piece I'd leave you with is.

Thank you. Our next question comes from Chris Carey with Wells Fargo.

We're definitely moving with a sense of urgency and base.

Right I mean, we recognize the volatility in the category. This year, but we also recognize the things that we can work on within the open and not be so.

Chris. Please go ahead.

Hi, good morning, everyone.

Good morning.

Be remiss not to say congratulations Kevin on your career and best of luck.

So looking forward to it Peter it's been a it's been a.

30 days, but definitely moving with pace, Chris do you want to take the second one.

And so just from a from an inventory perspective.

Thanks, Peter for the question.

I think the message today is that you would expect them to be lower.

In terms of Q4, we are expecting better top line performance.

And exit the year in 2025 on an absolute basis, but closer to historical average Ids inventory basis.

Our EMEA APAC and Canada business units.

And in addition, we are lapping softer comps from contract brewing in the U S.

Traci Joubert: While we have included in our guidance our best estimate of some of these factors, external drivers may significantly impact our actual results, either up or down. Starting with the top line, we now expect lower year-end US distributor inventory levels. Year-to-date, US FTWs largely caught up to FTRs in the third quarter. However, given lower 2025 volumes impacted by industry performance, we now anticipate year-end distributor inventories to be lower compared to year-end 2024 on an absolute basis, with year-end days of inventory to remain relatively consistent, and at what we view as healthy levels entering the new year. As a result, for Q4, we expect the US FTW trend to trail the US FTR trend, excluding contract brewing. All other top line drivers remain unchanged.

Tracey Joubert: While we have included in our guidance our best estimate of some of these factors, external drivers may significantly impact our actual results, either up or down. Starting with the top line, we now expect lower year-end US distributor inventory levels. Year-to-date, US SCWs largely caught up to STRs in the third quarter. However, given lower 2025 volumes impacted by industry performance, we now anticipate year-end distributor inventories to be lower compared to year-end 2024 on an absolute basis, with year-end days of inventory to remain relatively consistent and at what we view as healthy levels entering the new year. As a result, for the fourth quarter, we expect the US SCW trend to trail the US STR trend, excluding contract brewing. All other top line drivers remain unchanged. We continue to expect US.

While we have included in our guidance our best estimate of some of these factors, external drivers may significantly impact our actual results, either up or down. Starting with the top line, we now expect lower year-end US distributor inventory levels. Year-to-date, US SCWs largely caught up to STRs in the third quarter. However, given lower 2025 volumes impacted by industry performance, we now anticipate year-end distributor inventories to be lower compared to year-end 2024 on an absolute basis, with year-end days of inventory to remain relatively consistent and at what we view as healthy levels entering the new year. As a result, for the fourth quarter, we expect the US SCW trend to trail the US STR trend, excluding contract brewing. All other top line drivers remain unchanged. We continue to expect US.

I just wanted to maybe check does that mean that the category improves a little bit next year from the current lows you would be entering 2025 width with low inventories say say lower than average of the category consumption picks up just a little bit.

So that's a big driver those are.

The big drivers of our top line performance.

Once it translates to better bottom line performance as well as.

We will have lower G&A in the fourth quarter really driven by the lower incentive compensation.

I'm, just conscious beer distributor and talking to you here and to clean up inventory and perhaps there are feeling a bit more anxious about that even more this year and so I just wanted to ask kind of how you see your inventory position going into next year, and then I was listening to the.

Thank you. Our next question comes from Chris Carey with Wells Fargo.

Please go ahead.

Hi, good morning, everyone.

Prepared remarks from Rahul Thank you for all that.

Good morning.

Is it fair to say that you don't see this massive need to reinvest in the business as is typical when you when you enter a new leadership position that with restructuring.

Be remiss not to say congratulations Kevin on your career and best of luck.

And so just from a from an inventory perspective.

Sustained commitment to some of the strategies that you've you've laid out as you evolve into new strategies, you don't see that or do you see a business that perhaps is a bit under invested in this opportunity going into next year on top of that.

I think the message today is that you would expect them to be lower.

In.

We exit the year in 2025 on an absolute basis, but closer to historical average ideal inventory basis.

Traci Joubert: We continue to expect US industry volume to be down on average 4% to 6% for H2 of the year, while the comps at comparison versus the year-ago period was somewhat softer earlier in Q3 before becoming more difficult into year-end. We will cycle 1.9 million hectoliters of contract brewing volume in the Americas in 2025 related to PAPS and LEVAC, and we'll cycle the remaining 300,000 hectoliters in Q4. We continue to expect an annual net price increase of 1% to 2% in North America, in line with the average historical range, and mixed benefits from cycling contract brewing from 2024, as well as from premiumization in both business units. Moving down the P&L, we expect COGS to be negatively impacted by volume deleverage, including the lower expectations for year-end US distributor inventory. Also, Midwest premium pricing has continued to increase.

Tracey Joubert: Industry volume to be down on average 4% to 6% for the second half of the year, while malt beverage comparisons versus the year-ago period were somewhat softer earlier in the third quarter before becoming more difficult into year-end. We will cycle 1.9 million hectoliters of contract brewing volume in the Americas in 2025 related to Pabst and Labatt, and we'll cycle the remaining 300,000 hectoliters in the fourth quarter. We continue to expect an annual net price increase of 1% to 2% in North America, in line with the average historical range, and mix benefits from cycling contract brewing from 2024, as well as from premiumization in both business units. Moving down the P&L, we expect COGS to be negatively impacted by volume deleverage, including the lower expectations for year-end US distributor inventory. Also, Midwest premium pricing has continued to increase.

Industry volume to be down on average 4% to 6% for the second half of the year, while malt beverage comparisons versus the year-ago period were somewhat softer earlier in the third quarter before becoming more difficult into year-end. We will cycle 1.9 million hectoliters of contract brewing volume in the Americas in 2025 related to Pabst and Labatt, and we'll cycle the remaining 300,000 hectoliters in the fourth quarter. We continue to expect an annual net price increase of 1% to 2% in North America, in line with the average historical range, and mix benefits from cycling contract brewing from 2024, as well as from premiumization in both business units. Moving down the P&L, we expect COGS to be negatively impacted by volume deleverage, including the lower expectations for year-end US distributor inventory. Also, Midwest premium pricing has continued to increase.

On the software so thanks on the inventory and the investment case.

And then just wanted to maybe check does that mean that the category improves a little bit next year from from the current lows you would be entering 2025 width with low inventories say same lower than average, but the category consumption picks up just a little bit.

Thank you, Chris and good morning.

Looking at this too, but any inventory that way.

We've looked at it has been a pretty healthy place right I mean, you've seen what's happened to the category. This year. So.

Going into end of this year and getting ourselves into next year.

I'm just conscious beer distributor in talking to us year end cleanup inventory and perhaps there are feeling a bit more anxious about that even more this year and so I just wanted to kind of how you with your inventory position going into next year and I was listening to the.

You had mentioned that you believe is in a good place.

In terms of capacity to do it and make sure we have the right level of supply in Q1.

Feel good about it with our brewery network and infrastructure, so and if you remember.

Prepared remarks from our board. Thank you for all that.

Is it fair to say that you don't see this massive need to reinvest in the business as is typical when you when you enter a new leadership position that with restructuring.

Wrapping a few things around the Falklands.

Strike et cetera earlier this year. So I think we feel pretty good about being in a good place closing out this year, but also preparing and pivoting to getting our distributors the right inventory levels next year.

Sustained commitment to some of the strategies that you've you've laid out as you evolve into new strategies.

See that or do you see a business that perhaps is a bit underinvested in this opportunity going into next year on top of a tough from a software so things on the inventory and the investment piece.

In terms of your question of shape of the investment.

Traci Joubert: Our guidance assumed a price range of $0.60 to $0.75 per pound. This implies for the full year, Midwest premium costs will exceed the prior year by 40% to 55%, with most of the increase occurring in H2 of the year. However, as you can see on page 18 of our earnings slides, the price trended at the upper end of this range in Q3 and was slightly above it in October. Therefore, we expect increases to be at the high end of that range. As for MG&A, we continue to expect it to be down slightly for the year due to lower incentive compensation, which is largely offset by higher non-alc infrastructure costs, as well as the Fever-Tree one-time transition and integration fees in H1 of the year.

Tracey Joubert: Our guidance assumed a price range of $0.60 to $0.75 per pound. This implies for the full year, Midwest Premium costs will exceed the prior year by 40% to 55%, with most of the increase occurring in H2 of the year. However, as you can see on page 18 of our earnings slides, the price trended at the upper end of this range in Q3 and was slightly above it in October. Therefore, we expect increases to be at the high end of that range. As for MG&A, we continue to expect it to be down slightly for the year due to lower incentive compensation, which is largely offset by higher non-alc infrastructure costs, as well as the Fever-Tree one-time transition and integration fees in H1 of the year.

Our guidance assumed a price range of $0.60 to $0.75 per pound. This implies for the full year, Midwest Premium costs will exceed the prior year by 40% to 55%, with most of the increase occurring in H2 of the year. However, as you can see on page 18 of our earnings slides, the price trended at the upper end of this range in Q3 and was slightly above it in October. Therefore, we expect increases to be at the high end of that range. As for MG&A, we continue to expect it to be down slightly for the year due to lower incentive compensation, which is largely offset by higher non-alc infrastructure costs, as well as the Fever-Tree one-time transition and integration fees in H1 of the year.

<unk>.

Share with you a couple of Goldman and I know, probably looking from the strategy of what 2026 looks like but.

Thank you, Chris and good morning.

Looking at this Q&A inventories I think the way.

I'm committed to making sure that we are building a brand. So if you look at our category, we need to be jump getting do we need to be making sure.

We've looked at it has been a pretty healthy place right I mean, you've seen what's happened to the category. This year, so going into the end of this year and getting ourselves into next year.

We as along with the other folks in the category are making sure that the category is healthy.

We believe it is in a good place.

And in that you are going to be leaning in and making sure we can support our brands appropriately.

In terms of capacity to do it and make sure we have the right level of supply in Q1.

It's the co brands above premium.

And the economy, one thing I would call out as being very disciplined around geographic.

He is good about it with our brewery network and infrastructure, so and if you remember.

Geographic view of isonomy portfolio and.

Lapping a few things around the Falklands.

The strike et cetera earlier this year so.

Making sure we are investing it in a smart way.

Traci Joubert: Again, those one-time fees were approximately $30 million, and will be recovered through net sales over the next two years, which began in Q2 of this year. In closing, we remain committed to improving shareholder value and look forward to sharing more about our strategic plans and long-term objectives in the coming months. With that, we will take your questions. Operator.

Tracey Joubert: Again, those one-time fees were approximately $30 million and will be recovered through net sales over the next three years, which began in the second quarter of this year. In closing, we remain committed to improving shareholder value and look forward to sharing more about our strategic plans and long-term objectives in the coming months. With that, we will take your questions. Operator.

Again, those one-time fees were approximately $30 million and will be recovered through net sales over the next three years, which began in the second quarter of this year. In closing, we remain committed to improving shareholder value and look forward to sharing more about our strategic plans and long-term objectives in the coming months. With that, we will take your questions. Operator.

We feel pretty good about being in a good place closing out this year, but also preparing and pivoting to getting our distributor inventory levels next year.

The other part I just called out is our balance sheet and cash flow right. I mean, we are committed to returning cash to shareholders.

I also want to find ways to deploy capital to fill some gaps in our portfolio to get outgrowth going so I would say, it's going to be a combination of all of those in terms of.

In terms of your question of shape of the investment.

<unk>.

Share with you a couple of Goldman and I know, probably looking from the strategy of what 2026 looks like but.

Making sure our brands are well supported but also using our balance sheet in a smart way of enabling top and bottom line growth, but also returning cash to shareholders.

Operator: Thank you. We will now begin the question and answer session. As a reminder, if you would like to ask a question today, please do so now by pressing Start, followed by the number one on your telephone keypad. If you change your mind or you feel like your question has already been answered, you can press Start, followed by two to withdraw yourself from the queue. Our first question today comes from Peter Grom with UBS. Peter, please go ahead.

Operator: Thank you. We will now begin the question and answer session. As a reminder, if you would like to ask a question today, please do so now by pressing star, followed by the number one on your telephone keypad. If you change your mind or you feel like your question has already been answered, you can press star, followed by two, to withdraw yourself from the queue. Our first question today comes from Peter Grom with UBS. Peter, please go ahead.

I am committed to making sure that we are building a brand so I think.

If you look at our category, we need to be jump getting build to be making sure.

Thank you.

Next question comes from Bonnie Herzog with Goldman Sachs. Please.

We as along with other folks in the category are making sure that the category is healthy.

Please go ahead.

Thank you good morning, everyone.

And in that we are going to be leaning in and making sure we can support our brands appropriately.

I was hoping you could give us a little more color on the pressures you're facing that are facing the beer category and I guess why you believe it's cyclical versus structural.

Co brands above premium.

And the economy, one thing I would call out as being very disciplined around.

Peter Grom: Great. Thank you. Good morning, everyone. Two questions for me: one for Rahul, and one for Tracey. First, Rahul, you've been in the role for about 30 days at this point, and recognizing you've been with the company for some time, but just as you step into this CEO role, would love to get your perspective on what you see as the biggest opportunities and challenges ahead. And then, Tracey, just was hoping to get some color on the implied improvement for the fourth quarter embedded in the top line guidance, just given the commentary on tougher category comps and now expecting the shift behind in Americas. Can you just walk through the building blocks for Q4 as you see them today? Thanks.

Peter Grom: Great. Thank you. Good morning, everyone. Two questions for me, one for Rahul and one for Traci. First, Rahul, you've been in the role for about 30 days at this point, and recognizing you've been with the company for some time. But just as you step into this CEO role, would love to get your perspective on what you see as the biggest opportunities and challenges ahead. Then, Traci, just was hoping to get some color on the implied improvement for the fourth quarter embedded in the top line guidance, just given the commentary on tougher category comps and now expecting the shift behind in Americas. Can you just walk through the building blocks for Q4 as you see them today? Thanks.

Essentially you know and then what is your expectation for category growth. This year and do you expect the category to recover next year and if so what do you think will be the drivers of this I guess ultimately where do you see the biggest areas of opportunity and I guess risk next year. Thanks.

Geographic view of Isonomy portfolio.

And making sure we are investing it in a smart way.

The other part I just called out is our balance sheet and cash flow right. I mean, we are committed to returning cash to shareholders, but we also want to find ways to deploy capital to fill some gaps in our portfolio to get our growth going so I would say, it's going to be a combination of all of those in terms of.

Thanks, Bob and good morning to you so.

I'm seeing a break your question into two pieces right. So if you think about the pressures on the category.

Making sure our brands are well supported but also using our balance sheet in a smart way of enabling top and bottom line growth, but also returning cash to shareholders.

Pre 2025.

Last few years he has been in the minus three ish range and if you look at this year.

Rahul Goyal: Thanks, Peter, and good morning to you. If you look at the last 30 days, my focus and my priority has been, I would say, two fronts. One is listening to our people and then our customers. And if you look at our business, right, I mean, I come from a place of we have a strong foundation. We got great brands, healthy balance sheet, but we have great opportunities. So if you look at our performance this year, the majority of our share losses have been in a few areas, the economy category or the flavor category. But we got core brands that are pretty strong, and so we need to find a way to make them stronger. In Above Premium, we have great opportunities with the portfolio we have. Peroni is doing really well. We have some more work to do in Blue Moon.

Rahul Goyal: Thanks, Peter, and good morning to you. If you look at the last 30 days, my focus and my priority has been, I would say, two fronts. One is listening to our people and then our customers. If you look at our business, right, I mean, I come from a place of we have a strong foundation. We got great brands, healthy balance sheet, but we have great opportunities. So if you look at our performance this year, the majority of our share losses has been in a few areas, the economy category or the flavor category. But we got core brands that are pretty strong. And so we need to find a way to make them stronger. In above premium, we have great opportunities with the portfolio we have. Peroni is doing really well. We have some more work to do in Blue Moon.

Thank you. Our next question comes from Bonnie Herzog with Goldman Sachs.

We've been in the minus four to minus six and I think that's what we shared at the end of Q2.

Please go ahead.

We believe this yes got it because he is going to be in the minus two minus six minus photo-mount of things and this year.

Thank you good morning, everyone.

I was hoping you could give us a little more color on the pressures you're facing that are facing the beer category and I guess why you believe it's cyclical versus structural.

Every quarter every month has been pretty volatile, but you probably end up in that range. So I think our internal estimates.

Yes at the end of minus four seven range in terms of the category. So there is something different this year.

And then what is your expectation for category growth. This year and do you expect the category to recover next year and if so what do you think will be the drivers of this I guess.

Right now there is.

The structural issues that we've all talked about in the industry, but then it is health and wellness, whether it's generational change.

Currently you know where do you see the biggest areas of opportunity and I guess risk next year. Thanks.

But this year, there's been a lot of other macro issues right.

<unk>.

Thanks Bonnie.

The economic impacts.

Good morning to you so.

I'm seeing a break your question into two pieces right. So if you think of the pressures on the category.

<unk>.

Immigration. So so we still believe that we are this year is this year going into next year is cyclical.

Rahul Goyal: Again, and then the Beyond Beer strategy, I think this year, Fever-Tree has been a great add to our business. So if you look at in balance, I'm pretty excited about a number of things we have going, but recognize the challenges we have in some other parts of our portfolio and wanting to really get behind it. I think the piece I'll leave you with is, we're definitely moving with a sense of urgency and pace. Right? I mean, we recognize the volatility in the category this year, but we also recognize the things that we can work on within our team. Looking forward to it, Peter. It's been a quick 30 days, but definitely moving with pace. Traci, you want to take the second one?

Rahul Goyal: Again, and then the Beyond Beer strategy, I think this year, Fever-Tree has been a great add to our business. So if you look at in balance, I'm pretty excited about a number of things we have going, but recognize the challenges we have in some other parts of our portfolio and wanting to really get behind it. I think the piece I'll leave you with is we're definitely moving with a sense of urgency and pace. Right? I mean, we recognize the volatility in the category this year, but we also recognize the things that we can work on within our team. So looking forward to it, Peter. It's been a quick 30 days, but definitely moving with pace. Tracey, you want to take the second one?

Again, and then the Beyond Beer strategy, I think this year, Fever-Tree has been a great add to our business. So if you look at in balance, I'm pretty excited about a number of things we have going, but recognize the challenges we have in some other parts of our portfolio and wanting to really get behind it. I think the piece I'll leave you with is we're definitely moving with a sense of urgency and pace. Right? I mean, we recognize the volatility in the category this year, but we also recognize the things that we can work on within our team. So looking forward to it, Peter. It's been a quick 30 days, but definitely moving with pace. Tracey, you want to take the second one?

Pre 2025.

Once we get through some of these macro issues behind us we should be getting back to the pre 2025 levels.

The last few years he has been in the minus three ish range and if you look at this year.

So that's how we're thinking about the business and the way I would.

We've been in the minus four to minus six and I think that's what we shared at the end of Q2.

Well that out is if you look at our portfolio.

Believe this year's scatter because he is going to be in the minus two minus six minus four to minus things.

Definitely have so much more opportunity to really lead into our business right. So while we've done a great job of being revising outside the United States. We're so under indexed.

And this year.

Every quarter every month has been pretty volatile, but you probably end up in that range. So I think our internal estimates suggest that the minus four seven range in terms of the category. So there is something different this year.

In the U S and therefore, the opportunity for us there remains.

And then if you look at our share losses this year.

It's been around flavors and the economy and Thats why you see be talking a little bit more about that because those are the gaps we need to be.

Right now there is.

Tracey Joubert: Yeah. Thanks, Peter, for the question. So in terms of Q4, look, we are expecting better top line performance in our EMEA, APAC, and Canada business units. And in addition, we are lapping softer comps from contract brewing in the US. So that's a big driver. Those two are the big drivers of our top line performance. And then just as that also translates to better bottom line performance, as well as we will have lower G&A in the fourth quarter, really driven by the lower incentive compensation.

Traci Joubert: Yeah. Thanks, Peter, for the question. So in terms of Q4, look, we are expecting better top line performance in our Americas, APAC, and Canada business units. And in addition, we are lapping softer comps from contract brewing in the US. So that's a big driver. Those two are the big drivers of our top line performance. And then just as that also translates to better bottom line performance as well. We will have lower G&A in the fourth quarter, really driven by the lower incentive compensation.

The structural issues that we've all talked about in the industry, but it is health and wellness, whether it's generational change.

Filling all improving on so hopefully I answered your question about.

But this year, there's been a lot of other macro issues right.

Throughout the the category performance in just our views on that in the last in the short term and then also the long term.

Economic impacts.

Immigration toe. So we still believe that we are this year is this year going into next year is cyclical.

Thank you. Our next question comes from Andrew <unk> with J P. Morgan.

Once we get through some of these macro issues behind us we should be getting back to the pre 2025 levels.

Please go ahead.

Hey, Good morning. This is drew on for Andrea and Thanks for taking my question. So.

So that's how we're thinking about the business and the way I would.

Well that out is if you look at our portfolio.

So Rahul you just noted.

Operator: Thank you. Our next question comes from Chris Carey with Wells Fargo. Chris, please go ahead.

We definitely have so much more opportunity to really lead into our business and so while we've done a great job of be revising outside the United States. We're so under indexed.

The expectation I guess.

That industry could return to pre 2025 levels.

Christopher Carey: Hi. Good morning, everyone.

Chris Carey [Senior Equity Analyst: Hi. Good morning everyone.

Christopher Carey: Hi, good morning, everyone.

He also noted in the prepared remarks that results Ralph will take some time to see.

Traci Joubert: Morning.

Tracey Joubert: Morning.

In the U S and therefore, the opportunity for us there remains.

Christopher Carey: be remiss not to say congratulations, Gavin, on your career and best of luck. So just from an inventory perspective, I think the message today is that you expect them to be lower in 2025 on an absolute basis, but closer to historical average on a daily inventory basis. I just wanted to maybe check this. Does that mean if the category improves a little bit next year from the current lows, you would be entering 2025 with low inventory, say, lower than average if the category consumption picks up just a little bit? So I'm just conscious beer distributors often use year-end to clean up inventory, and perhaps they're feeling a bit more anxious about that even more this year. I just want to test kind of how you would see your inventory position going into next year. I was listening to the prepared remarks from Rahul.

Christopher Carey: be remiss not to say congratulations, Gavin, on your career and best of luck. So just from an inventory perspective, I think the message today is that you expect them to be lower in 2025 on an absolute basis, but closer to historical average on a days inventory basis. I just wanted to maybe check this. Does that mean if the category improves a little bit next year from the current lows, you would be entering 2025 with low inventories, say, lower than average if the category consumption picks up just a little bit? So I'm just conscious beer distributors often use year-end to clean up inventory, and perhaps they're feeling a bit more anxious about that even more this year. I just want to test kind of how you would see your inventory position going into next year.

Chris Carey [Senior Equity Analyst: be remiss not to say congratulations, Gavin, on your career and best of luck. So just from an inventory perspective, I think the message today is that you expect them to be lower in 2025 on an absolute basis, but closer to historical average on a days inventory basis. I just wanted to maybe check this. Does that mean if the category improves a little bit next year from the current lows, you would be entering 2025 with low inventories, say, lower than average if the category consumption picks up just a little bit? So I'm just conscious beer distributors often use year-end to clean up inventory, and perhaps they're feeling a bit more anxious about that even more this year. I just want to test kind of how you would see your inventory position going into next year.

So I guess, if you could just provide any more context.

And then if you look at our share losses this year.

Two if you think that the.

It's been around flavors and economy and Thats why you see be talking a little bit more about that because those are the gaps we need to be.

The company could return to low single digit organic sales growth.

Industry remains down in that sort of 3% range.

Filling all improving on so hopefully I answered your question about.

And then you also talked about.

Throughout the the category performance in just our views on that in the last in the short term and then also the long term.

Being willing to deploy.

The balance sheet and cash flow to fill portfolio gaps I know under Gavin It was talked about as sort of a string of pearls approach.

Thank you. Our next question comes from Andrew <unk> with J P. Morgan.

If you think that given where the industry is if we could kind of look out for anything a little bit more sizable. Thank you.

Please go ahead.

Hey, Good morning. This is drew Levine on for Andrea and Thanks for taking my question. So.

Yes. Thank you.

Just a couple of comments I think.

So Rahul you just noted.

Few questions. So.

The expectation I guess.

With the industry being being where it is I think we still see the box way for delivering.

That industry could return to pre 2025 levels.

Christopher Carey: I was listening to the prepared remarks from Rahul. Thank you for all that. Is it fair to say that you don't see this massive need to reinvest in the business as is typical when you enter a new leadership position, and that with restructuring and sustained commitment to some of the strategies that you've laid out as you evolve into new strategies? You don't see that, or do you see a business that perhaps is a bit underinvested in this opportunity going into next year on top of a soft year? Thanks on the inventory and the investment piece.

I was listening to the prepare remarks from Rahul. Thank you for all that. Is it fair to say that you don't see this massive need to reinvest in the business as is typical when you enter a new leadership position, and that with restructuring and sustained commitment to some of the strategies that you've laid out as you evolve into new strategies? You don't see that, or do you see a business that perhaps is a bit underinvested in this opportunity going into next year on top of a soft year? Thanks on the inventory and the investment piece.

Growth was on top and bottom line.

He also noted in the prepared remarks that results Ralph will take some time to see.

Christopher Carey: Thank you for all that. Is it fair to say that you don't see this massive need to reinvest in the business as is typical when you enter a new leadership position and that with restructuring and sustained commitment to some of the strategies that you've laid out as you evolve into new strategies, you don't see that, or do you see a business that perhaps is a bit underinvested in this opportunity going into next year on top of a soft year? So thanks on the inventory and the investment piece.

If you look at this year, what's the impact is obviously category, but also on the bulk side right.

So I guess, if you could just provide any more context.

There's been so much volatility around inflation with best premium mono we spoken about.

If you think that the.

The company could return to low single digit organic sales growth.

So those are the I would say the headwinds we are dealing with this year.

If you again go back to the.

Industry remains down in that sort of 3% range.

So pathway to get back to top line.

And then you also talked about.

Being willing to deploy.

In the U S a breakdown.

The balance sheet and cash flow to fill portfolio gaps.

Portfolio, maybe in four buckets.

Rahul Goyal: Yeah. Thank you, Chris, and good morning. I think if you look at distributed inventories, I think the way we look at it is we're in a pretty healthy place, right? I mean, you've seen what's happened to the category this year. So, going into the end of this year and getting ourselves into next year, days of inventory, we believe we're in a good place. In terms of our capacity to pivot and make sure we have the right level of supply in Q1, we feel good about it with our brewery network and infrastructure. So if you remember, we were lapping a few things around the Fort Worth, the strike, etc., earlier this year. So I think we feel pretty good about being in a good place, closing out this year, but also preparing and pivoting to getting our distributors the right inventory levels next year.

Rahul Goyal: Yeah. Thank you, Chris, and good morning. I think if you look at distributed inventories, I think the way we look at it is we're in a pretty healthy place, right? I mean, you've seen what's happened to the category this year. So, going into the end of this year and getting ourselves into next year, days of inventory, we believe we're in a good place. In terms of our capacity to pivot and make sure we have the right level of supply in Q1, we feel good about it with our brewery network and infrastructure. So if you remember, we were lapping a few things around the Fort Worth strike, etc., earlier this year. So I think we feel pretty good about being in a good place, closing out this year, but also preparing and pivoting to getting our distributors the right inventory levels next year.

Strengthening Gordon economy becomes important and these are big parts of our portfolio and frankly, they are a big part of our distributable formula So making sure. These parts of the portfolio to a strong and healthy is important.

Gavin I was talked about as sort of a string of pearls approach.

If you think that given where the industry is if we could kind of look out for anything a little bit more sizable. Thank you.

We've done a decent job on share.

Yes. Thank you.

With our co brands co brands is still higher shares in 2022.

Just a couple of comments I think on your.

Few questions. So.

Having worked with them on economy.

With the industry being being where it is I think we still see the box way for delivering.

But the runway we have in above premium with so much in build and beyond beer.

Right.

On the index and I called out in my comments.

Growth both in top and bottom line.

Work to do.

If you look at this year, what's the impact is obviously category, but also on the bulk side right.

Belgian White Blue Moon.

But priority is growing.

Flavor is something that is volatile we had.

There's been so much volatility around inflation with best premium mono we spoken about.

Some good success with our brands.

So those are the I would say the headwinds were dealing with this year.

This year, we have some challenges with simply topos, starting to get that much stronger.

If you again go back to the.

Rahul Goyal: In terms of your question of shape of reinvestment, I'll share with you a couple of comments, and I know, probably looking for clarity of what 2026 looks like, but. I'm committed to making sure that we are building our brands, right? If you look at our category, we need to be championing beer. We need to be making sure we, along with other folks in the category, are making sure that the category is healthy. And in that, we're going to be leaning in and making sure we can support our brands appropriately, whether it's the core brands above premium, in the economy one I call out as being very disciplined around, a geographic view of our economy portfolio and making sure we are investing it in a smart way. The other part I'd just call out is our balance sheet and cash flow, right?

Rahul Goyal: In terms of your question of shape of reinvestment, I'll share with you a couple of comments, and I know probably looking for clarity of what 2026 looks like, but I'm committed to making sure that we are building our brands, right? If you look at our category, we need to be championing beer. We need to be making sure we, along with other folks in the category, are making sure that the category is healthy. And in that, we're going to be leaning in and making sure we can support our brands appropriately, whether it's the core brands above premium. In the economy one, I call out as being very disciplined around a geographic view of our economy portfolio and making sure we are investing it in a smart way. The other part I'd just call out is our balance sheet and cash flow, right?

In terms of your question of shape of reinvestment, I'll share with you a couple of comments, and I know probably looking for clarity of what 2026 looks like, but I'm committed to making sure that we are building our brands, right? If you look at our category, we need to be championing beer. We need to be making sure we, along with other folks in the category, are making sure that the category is healthy. And in that, we're going to be leaning in and making sure we can support our brands appropriately, whether it's the core brands above premium. In the economy one, I call out as being very disciplined around a geographic view of our economy portfolio and making sure we are investing it in a smart way. The other part I'd just call out is our balance sheet and cash flow, right?

The.

And then the non out the slight fever tree was a great add.

But we need to get back to top line.

Citing brand for us it's exciting brand for our networks. So between the combination of that and along with our Canadian and Euro business, we can get our business back in sort of single digit growth.

In the U S. A breakdown our portfolio maybe in four buckets.

Strengthening Korean economy becomes important and these are big parts of our portfolio and frankly, they are a big part of our distributable folio, so making sure. These parts of the portfolio strong and healthy is important I would say we've done a decent job on share.

And then is obviously deploying capital right.

Your question of M&A.

We want to make sure we deploy capital for brands that fill gaps in our portfolio. So I think thats important too we want to be disciplined about it being accretive to both top and bottom line.

With our co brands that co brands is still higher share than in 2022, but we have work to do on economy.

Right. So we're not going to chase top line.

But the runway we have in above premium with so much in build and beyond beer.

Top line.

And then third is we wanted to do it in a way that is.

Right.

The index I called out in my comments that we have.

Prudent from a balance sheet perspective, and utilizing our balance sheet. So we.

Work to do in Belgium, White Blue Moon.

But <unk> is growing.

We stay committed to our investment grade rating, we stayed committed to two and a half times leverage ratio and.

Flavor is something there is volatile we had some good success with our brands.

Returning cash to shareholders, but we can.

Rahul Goyal: I mean, we are committed to returning cash to shareholders, but we also want to find ways to deploy capital to fill some gaps in our portfolio to get our growth going. So I would say it's going to be a combination of all of those in terms of making sure our brands are well supported, but also using our balance sheet in a smart way of enabling top and bottom line growth, but also returning cash to shareholders.

I mean, we are committed to returning cash to shareholders, but we also want to find ways to deploy capital to fill some gaps in our portfolio to get our growth going. So I would say it's going to be a combination of all of those in terms of making sure our brands are well supported, but also using our balance sheet in a smart way of enabling top and bottom line growth, but also returning cash to shareholders.

This year, we have some challenges with simply topos, starting to get that much stronger.

Deploy capital to augment organic portfolio and make sure we're making some changes that are meaningful to our total enterprise. So.

And then the non out the strategy with <unk> was a great add.

Fighting brand for us it is cutting brand for our networks.

Probably I can give you a specific number of size but.

So between the combination of that and along with our Canadian.

Definitely want to leave it in the right way off.

Europe business, we can get our business back in the low single digit growth.

Enabling total enterprise growth.

It is obviously deploying capital right. So your question of M&A.

Drones.

Okay.

Thank you. Our next question comes from Peter Galbo with Bank of America.

We want to make sure we deploy capital for brands that fill gaps in our portfolio.

Operator: Thank you. Our next question comes from Bonnie Herzog with Goldman Sachs. Please go ahead.

Please go ahead.

That's important to be want to be disciplined about.

Rahul Goyal: Thank you. Good morning, everyone. I was hoping you could give us a little more color on the pressures you're facing or that are facing the beer category, and I guess why you believe it's cyclical versus structural. And then what is your expectation for category growth this year? And do you expect the category to recover next year? And if so, what do you think will be the drivers of this? I guess ultimately, where do you see the biggest areas of opportunity and I guess risk next year? Thanks.

Hey, good morning, Kevin ROE with Tracy Thanks, very much for the questions.

Rahul Goyal: Thank you. Good morning, everyone. I was hoping you could give us a little more color on the pressures you're facing or that are facing the beer category and, I guess, why you believe it's cyclical versus structural. And then what is your expectation for category growth this year? And do you expect the category to recover next year? And if so, what do you think will be the drivers of this? I guess, ultimately, where do you see the biggest areas of opportunity and, I guess, risk next year? Thanks.

Bonnie Herzog: Thank you. Good morning, everyone. I was hoping you could give us a little more color on the pressures you're facing or that are facing the beer category and, I guess, why you believe it's cyclical versus structural. And then what is your expectation for category growth this year? And do you expect the category to recover next year? And if so, what do you think will be the drivers of this? I guess, ultimately, where do you see the biggest areas of opportunity and, I guess, risk next year? Thanks.

Being accretive to both top and bottom line right.

So we're not going to chase top line just for the sake of the top line.

I also actually wanted to ask two questions on the balance sheet are related to the balance sheet.

And then third is we wanted to do it in a way that is.

Molson Coors is done I think a much better job relative to history of kind of preparing the balance sheet to weather, maybe some downturns.

Prudent from a balance sheet perspective, and utilizing our balance sheet. So.

Stay committed to our investment grade rating, we stay committed to.

Structural and cyclical headwinds, but to two things I would like to ask one.

Two five times leverage ratio.

Returning cash to shareholders, but we can.

Tracy I think Theres a row. This quarter you moved into a relatively big bond maturity that's coming in the next 12 months, just maybe how we should think about addressing that particularly as we as we start to contemplate 26.

Deploy capital to augment augment portfolio and make sure we're making some changes that are meaningful to our total enterprise. So.

Rahul Goyal: Thanks, Bonnie, and good morning to you. So I think I'll break your question into two or three pieces, right? So if you think about the pressures on the category pre-2025, the last few years, our category has been in the minus three-ish range. And if you look at this year, we've been in the minus four to minus six. And I think that's what we shared at the end of Q2, that we believe this year's category is going to be in the minus two, minus six, minus four to minus six. And this year, every quarter, every month has been pretty volatile, but you probably end up in that range, right? So I think our internal estimates suggest that we're in the minus 4.7 range in terms of the category health. So there's something different this year.

Rahul Goyal: Thanks, Bonnie, and good morning to you. So I think I'll break your question into two or three pieces, right? So if you think about the pressures on the category pre-2025, the last few years, our category has been in the minus three-ish range. And if you look at this year, we've been in the minus four to minus six. And I think that's what we shared at the end of Q2, that we believe this year's category is going to be in the minus four to minus six. And this year, every quarter, every month has been pretty volatile, but you probably end up in that range, right? So I think our internal estimates suggest that we're in the minus 4.7 range in terms of the category health. So there's something different this year.

Probably I can give you a specific number of size but.

And the second would be just on the impairment itself.

Absolutely.

The right way off.

Again relatively sizable.

Enabling total enterprise.

Hits the balance sheet.

Rahul I think understandably you have to go through impairment testing, but in the context of <unk>.

Growth.

Thank you. Our next question comes from Peter Galbo with Bank of America.

Cyclical versus structural I would think this would lean more towards the structural and so maybe you can help compare and contrast.

Please go ahead.

Hey, good morning, Kevin ROE with Tracy Thanks, very much for the questions.

Just what happened with the impairment charge relative to kind of your views on the overall industry. Thank you very much.

I also actually wanted to ask two questions on the balance sheet are related to the balance sheet.

Thank you Peter.

<unk> answer the bond maturity question and then I'll take go embedded with the question and thanks, Peter So yes, we do have some day coming to <unk>. Thanks.

Molson Coors is done I think a much better job relative to history of kind of preparing the balance sheet to weather, maybe some downturns.

I think the overview.

Rahul Goyal: Right now, there's the structural issues that we've all talked about in the industry, whether it's health and wellness, whether it's the generational change. But this year, there's been a lot of other macro issues, right? Whether it's the economic impacts, tariffs, immigration. So we still believe that this year or going into next year is cyclical. Once we get through some of these macro issues behind us, we should be getting back to the pre-2025 levels. So that's how we're thinking about the business. And the way I would call that out is if you look at our portfolio, we definitely have so much more opportunity to really lean into our business, right? So while we've done a great job of premiumizing outside the United States, we're so underindexed in the US, and therefore that opportunity for us there remains.

Rahul Goyal: Right now, there's the structural issues that we've all talked about in the industry, whether it's health and wellness, whether it's the generational change. But this year, there's been a lot of other macro issues, right? Whether it's the economic impacts, tariffs, and immigration. So we still believe that this year or going into next year is cyclical. Once we get through some of these macro issues behind us, we should be getting back to the pre-2025 levels. So that's how we're thinking about the business. And the way I would call that out is if you look at our portfolio, we definitely have so much more opportunity to really lean into our business, right? So while we've done a great job of premiumizing outside the United States, we're so underindexed in the US, and therefore, that opportunity for us there remains.

Right now, there's the structural issues that we've all talked about in the industry, whether it's health and wellness, whether it's the generational change. But this year, there's been a lot of other macro issues, right? Whether it's the economic impacts, tariffs, and immigration. So we still believe that this year or going into next year is cyclical. Once we get through some of these macro issues behind us, we should be getting back to the pre-2025 levels. So that's how we're thinking about the business. And the way I would call that out is if you look at our portfolio, we definitely have so much more opportunity to really lean into our business, right? So while we've done a great job of premiumizing outside the United States, we're so underindexed in the US, and therefore, that opportunity for us there remains.

Or more structural and cyclical headwinds, but two two things I'd like to ask kind of one.

As we get closer to the due dates.

I think the important thing is that.

We remain focused on maintaining our leverage ratios relative speed.

And alignment at the target of two and a half times than we are.

Currently in that range, and we will make sure that going forward we are in.

And the second would be just on the impairment itself.

Again relatively sizable hit.

Two and a half times said.

It hits the balance sheet.

At the time real estate.

Rahul I think understandably you have to go through impairment testing, but in the context of cyclic.

What particularly at the gate.

Yes, Thanks, Tracy and BW.

Cyclical versus structural I would think this would lean more towards the structural and so maybe you can help compare and contrast.

Right.

The impairment charge to goodwill of about $6 6 billion in Q3, and so firstly a number of factors that impacted right. So obviously this year's performance.

Just what happened with the impairment charge relative to kind of your views on the overall industry. Thank you very much.

Thank you Peter let me.

<unk>.

That is a question about the outlook of our business, but the other factors that come in as.

Answer the bond maturity question and then I'll take go embedded with your question.

Thanks, Peter So yes, we do have some day coming to <unk>.

Discount rates.

Rahul Goyal: And then if you look at our share losses this year, it's been around flavors and economy, and that's why you see me talking a little bit more about that because those are the gaps we need to be filling or improving on. So hopefully, I answered your question about the category performance and just our views on that in the short term and then also the long term.

And then if you look at our share losses this year, it's been around flavors and economy, and that's why you see me talking a little bit more about that because those are the gaps we need to be filling or improving on. So hopefully, I answered your question about the category performance and just our views on that in the short term and then also the long term.

The risk premium.

As an owner the owner of U S.

And frankly, the multiple right so.

As we get closer to the date.

Think about this is.

I think the important thing is that we remain focused on maintaining our leverage ratios relative speed.

We can get this business back to top and bottom line growth.

I think we are.

Undervalued in the context of.

And alignment at the target of <unk>, two and a half times.

Our market cap right now.

We are currently in that range and we will make sure that going forward we are in.

Those are the things that we need to lean into and make sure we can demonstrate.

Quarter over quarter.

This is something that as you said, it's something we need to do every year and check check ourselves to make sure we're thinking of the business in a prudent way.

Operator: Thank you. Our next question comes from Andrea Teixeira with J.P. Morgan. Please go ahead.

Two and a half times said.

At the time real estate.

What we do with the gate.

Embedded in it.

Thanks Tracy.

Christopher Carey: Hey, good morning. This is Drew Levine on for Andrea. Thanks for taking our question. So Rahul, you just noted the expectation, I guess, that industry could return to pre-2025 levels. You also noted in the prepared remarks that results will take some time to see. So I guess if you could just provide any more context to if you think that the company could return to low single-digit organic sales growth if the industry remains down in that sort of 3% range. And then you also talked about being willing to deploy the balance sheet and cash flow to fill portfolio gaps. I know under Gavin, it was talked about as sort of a string of pearls approach. If you think that given where the industry is, if we could be on the lookout for anything a little bit more sizable. Thank you.

Drew Levine: Hey, good morning. This is Drew Levine on for Andrea. Thanks for taking our question. So Rahul, you just noted the expectation, I guess, that industry could return to pre-2025 levels. You also noted in the prepared remarks that results will take some time to see. So I guess if you could just provide any more context to if you think that the company could return to low single-digit organic sales growth if the industry remains down in that sort of 3% range. And then you also talked about being willing to deploy the balance sheet and cash flow to fill portfolio gaps. I know under Gavin, it was talked about as sort of a string of pearls approach. If you think that given where the industry is, if we could be on the lookout for anything a little bit more sizable. Thank you.

Peter Grom: Hey, good morning. This is Drew Levine on for Andrea. Thanks for taking our question. So, Rahul, you just noted the expectation, I guess, that industry could return to pre-2025 levels. You also noted in the prepared remarks that results will take some time to see. So, I guess if you could just provide any more context to if you think that the company could return to low single-digit organic sales growth if the industry remains down in that sort of 3% range. And then you also talked about being willing to deploy the balance sheet and cash flow to fill portfolio gaps. I know under Gavin, it was talked about as sort of a string of pearls approach. If you think that, given where the industry is, if we could be on the lookout for anything a little bit more sizable. Thank you.

The segment's a function of that.

Peter I mean, youre, absolutely right I mean.

Yeah.

Okay.

The impairment charge to goodwill of about $6 6 billion in Q3, and so firstly a number of factors that impact right. So obviously this year's performance.

Thank you. Our next question comes from Bill Kirk with Roth Capital Partners.

Please go ahead.

Okay.

Good morning, everybody, Hey, Rob I was hoping to get a little bit more on your vision for the business you mentioned portfolio gaps a couple of times do you think the gaps are more related to regions, alright gaps more like categories related or the gap's brand specific and then and then maybe backing up either.

<unk>.

There is a question about the outlook of our business, but the other factors that come in as.

Discount rates.

The risk premium and frankly, the multiple right. So.

The way I think about this is.

We can get this business back to top and bottom line growth.

Further should the company's focus become more narrow or should the focus broadens and introduced new regions and categories.

I think we are.

They are undervalued in the context of.

Our market cap right now.

Those are the things that we need to lean into and make sure we can demonstrate.

Yes.

Yes, Thank you bill.

Currently looking forward to sharing a lot more about.

Quarter over quarter and.

The plans and how to think about that.

This is something that as you said.

We need to do every year in check.

Maybe break it down.

And.

To make sure we're thinking of the business in a prudent way and the impediment is.

Maybe three different ways. So one is about portfolio as you said.

The pediments a function of that.

Rahul Goyal: Yeah. Thank you, Drew. Just a couple of comments, I think, on your few questions. So with the industry being where it is, I think we still see the pathway for delivering growth, both in top and bottom line. If you look at this year, what's impacted is obviously category, but also on the COGS side, right? I mean, there's been so much volatility around inflation, Midwest Premium, I know we've spoken about. So those are, I would say, the headwinds we're dealing with this year. If you, again, go back to the pathway to get back to top line, I mean, in the US, I'd break down our portfolio maybe in four buckets. Strengthening core and economy becomes important. And these are big parts of our portfolio. And frankly, they are big parts of our distributor portfolio.

Rahul Goyal: Yeah, thank you. Drew, just a couple of comments, I think, on your few questions. So, with the industry being where it is, I think we still see the pathway for delivering growth, both in top and bottom line. If you look at this year, what's impacted is obviously category, but also on the COGS side, right? I mean, there's been so much volatility around inflation, Midwest premium, I know we've spoken about. So those are, I would say, the headwinds we're dealing with this year. If you again go back to the pathway to get back to top line, I mean, in the US, I'd break down our portfolio maybe in four buckets. Strengthening core and economy becomes important. These are big parts of our portfolio. And frankly, they are big parts of our distributor portfolio.

Yes.

We have a pretty broad portfolio in the U S.

<unk> broad portfolio in Canada, even in Euro and generally we do believe all segments matter right. So so we do definitely being to work within that.

Thank you. Our next question comes from Bill Kirk with Roth Capital Partners.

Please go ahead.

Okay.

Good morning, everybody, Hey, Rob I was hoping to get a little bit more on your vision for the business you mentioned portfolio gaps a couple of times do you think the gaps are more related to regions are the gaps more like categories related or the gap's brand specific and then and then maybe backing up either.

We work.

Parts of the portfolio I think Thats, where youll see me highlighting some of the areas of opportunity we have.

Now in some parts, we do have gaps right. So I talked about.

The.

Flavor part of our portfolio right. So we have some gaps that we need to fill.

Further should the company's focus become more narrow or should the focus broadens and introduced new regions and categories.

We filled some gaps in beyond beer.

Right so.

So that is an element of both fixing some of the portfolio players we have.

Yeah.

Yes.

Yes, Thank you bill.

Currently looking forward to sharing a lot more about.

Filling some gaps.

So that's I would say part one of the broad plan. The second thought is.

The plans and how to think about that but maybe break it down.

Execution right and nothing.

Rahul Goyal: So making sure these parts of the portfolio are strong and healthy is important. And I would say we've done a decent job on share with our core brands, right? Our core brands are still higher share than 2022, but we have work to do on economy. But the runway we have in above premium is so much in beer and beyond beer, right? In beer, we are underindexed. I called out in my comments that we have work to do on Belgian White, Blue Moon. But Peroni is growing. Flavor is something that is volatile. We had some good success with our brands, but this year, we have some challenges with Simply. Topo is starting to get much stronger. And then the non-alc piece, right? Fever-Tree was a great add. It's an exciting brand for us. It's an exciting brand for our network.

Rahul Goyal: So making sure these parts of the portfolio are strong and healthy is important. I would say we've done a decent job on share with our core brands, right? Our core brands are still higher share than 2022, but we have work to do on economy. But the runway we have in Above Premium is so much in beer and Beyond Beer, right? In beer, we are underindexed. I called out in my comments that we have work to do on Belgian White, Blue Moon, but Peroni is growing. Flavor is something there is volatile. We had some good success with our brands, but this year, we have some challenges with Simply. Topo is starting to get much stronger. Then the non-alc piece, right? Fever-Tree was a great add. It's an exciting brand for us. It's an exciting brand for our network.

So making sure these parts of the portfolio are strong and healthy is important. I would say we've done a decent job on share with our core brands, right? Our core brands are still higher share than 2022, but we have work to do on economy. But the runway we have in Above Premium is so much in beer and Beyond Beer, right? In beer, we are underindexed. I called out in my comments that we have work to do on Belgian White, Blue Moon, but Peroni is growing. Flavor is something there is volatile. We had some good success with our brands, but this year, we have some challenges with Simply. Topo is starting to get much stronger. Then the non-alc piece, right? Fever-Tree was a great add. It's an exciting brand for us. It's an exciting brand for our network.

Maybe three different ways. So one is about portfolio as you said.

As all of you know welbilt is a global business and our national business. It is a very local business, so us executing as close as possible to customers and distributors and retailers.

We have a pretty broad portfolio in the U S.

Great broad portfolio in Canada, even in Euro and generally we do believe all segments matter right. So so we do definitely to work within that now.

It's going to be Super important and Thats not just.

In terms of just the sales function right. It is about how we deploy our people resources, how we deploy our marketing resources.

How we work.

<unk> parts of the portfolio I think Thats, where you see me highlighting some of the areas of opportunity we have.

It has to be as close as possible to consumer.

Now in some parts, we do have gaps right. So I talked about.

Consumers and customers so.

The.

There is a definitely.

Yeah.

And how we execute and take that to our brands to market.

The flavor part of our portfolio right. So we have some gaps that we need to fill.

Third element to your question is.

So we feel some gaps in beyond beer.

The capabilities, we have a strong foundation and infrastructure, whether it's breweries in the supply chain.

Right so.

So there is an element of both fixing some of the portfolio players we have.

Rahul Goyal: So between the combination of that and along with our Canadian and our Europe business, we can get our business back in those single-digit growth. And then it's obviously deploying capital, right? So your question of M&A. We want to make sure we deploy capital for brands that fill gaps in our portfolio, right? So I think that's important. Two, we want to be disciplined about it being accretive to both top and bottom line, right? So we're not going to chase top line just for the sake of top line. And then third is we want to do it in a way that is prudent from a balance sheet perspective and utilizing our balance sheet. So we stay committed to our investment rating.

Rahul Goyal: So between the combination of that and along with our Canadian and our Europe business, we can get our business back in those single-digit growth. And then it's obviously deploying capital, right? So your question of M&A, we want to make sure we deploy capital for brands that fill gaps in our portfolio, right? So I think that's important. Two, we want to be disciplined about it being accretive to both top and bottom line, right? So we're not going to chase top line just for the sake of top line. And then third is we want to do it in a way that is prudent from a balance sheet perspective and utilizing our balance sheet. So we stay committed to our investment rating.

So between the combination of that and along with our Canadian and our Europe business, we can get our business back in those single-digit growth. And then it's obviously deploying capital, right? So your question of M&A, we want to make sure we deploy capital for brands that fill gaps in our portfolio, right? So I think that's important. Two, we want to be disciplined about it being accretive to both top and bottom line, right? So we're not going to chase top line just for the sake of top line. And then third is we want to do it in a way that is prudent from a balance sheet perspective and utilizing our balance sheet. So we stay committed to our investment rating.

But it is an area that we need to make sure we are keeping up with either on the commercial side, whether it's on the technology side.

Filling some gaps.

So thats I would say part one of the broad plan. The second part is <unk>.

Optimizing our brewery footprint in the best possible way.

Execution right.

Zinc.

Making sure we can meet the needs of a new capability, so you're definitely going to see that us leaning into that.

As all of you know.

<unk> is a global business and our national business. It is a very local business. So us executing as close as possible to customers and distributors and retailers is going to be super important and thats not just.

Then capital deployment driving our capital allocation approach to face you mentioned us wanting to be disciplined about that so I would say those are the broad areas.

In terms of just the sales function right. It is about how we deploy our people resources, how we deploy our marketing resources.

Question about being broad or narrow.

We love the markets, we already have.

Some of the best profit pools in the world.

It has to be as close as possible to.

We just got to win in those so thats, how youre going to see us lean in on on winning in the market.

Rahul Goyal: We stay committed to our 2.5x leverage ratio, returning cash to shareholders, but we can deploy capital to really augment portfolio and make sure we're making some changes that are meaningful to our total enterprise. So probably can't give you a specific number or size, but definitely want to lean in in the right way of enabling total enterprise growth.

We stay committed to our 2.5x leverage ratio, returning cash to shareholders, but we can deploy capital to really augment portfolio and make sure we're making some changes that are meaningful to our total enterprise. So probably can't give you a specific number or size, but definitely want to lean in in the right way of enabling total enterprise growth.

Consumers and customers. So there is a definitely.

Got it.

Difference in how we execute and take that to our brands to market.

Pretty strong foundation.

The third element to your question is.

Thank you. Our next question comes from Felipe <unk> with Stifel.

<unk> capabilities.

We have a strong foundation and infrastructure, whether it's <unk> or the supply chain.

Please go ahead.

Hi, good morning, everyone.

But it is an area that we need to make sure we are keeping up with either on the commercial side, whether it's on the technology side.

Also I wanted to ask about your experience working with and building a partnership with Coca Cola fever tree and some of the non arc initiatives like solar.

Optimizing our brewery footprint in the best possible way.

Operator: Thank you. Our next question comes from Peter Galbo with Bank of America. Peter, please go ahead.

Making sure we can meet the needs of our new capabilities, so you're definitely going to see that ethylene.

Should we expect more initiatives by debt from Molson Coors in the future to your point as a way to fill some gaps in a capital efficient way or do you see the opportunity for maybe more traditional acquisitions going forward.

Leaning into that.

Rahul Goyal: Hey, good morning. Gavin Hattersley, Tracey, thanks very much for the question. I also actually wanted to ask two questions on the balance sheet or related to the balance sheet. Molson Coors has done, I think, a much better job relative to history of kind of preparing the balance sheet to weather maybe some downturns or more structural cyclical headwinds. But two things I'd like to ask on. One, Tracey, I think this quarter you moved into a relatively big bond maturity that's coming in the next 12 months. Just maybe how we should think about addressing that, particularly as we start to contemplate 2026. And the second would be just on the impairment itself, again, relatively sizable hit to the balance sheet.

Peter Galbo: Hey, good morning. Gavin Hattersley, Tracey, thanks very much for the question. I also actually wanted to ask two questions on the balance sheet or related to the balance sheet. Molson Coors has done, I think, a much better job relative to history of kind of preparing the balance sheet to weather maybe some downturns or more structural cyclical headwinds. But two things I'd like to ask on. One, Tracey, I think this quarter you moved into a relatively big bond maturity that's coming in the next 12 months. Just maybe how we should think about addressing that, particularly as we start to contemplate 2026. And the second would be just on the impairment itself, again, relatively sizable hit to the balance sheet.

Christopher Carey: Hey, good morning. Gavin Hattersley, Traci, thanks very much for the question. I also actually wanted to ask two questions on the balance sheet or related to the balance sheet. Molson Coors has done, I think, a much better job relative to history of kind of preparing the balance sheet to weather maybe some downturns or more structural cyclical headwinds. But two things I'd like to ask. On one, Traci, I think there's, this quarter, you moved into a relatively big bond maturity that's coming in the next 12 months. Just maybe how we should think about addressing that, particularly as we start to contemplate 2026. And the second would be just on the impairment itself. Again, relatively sizable hit to the balance sheet.

And then capital deployment driving our capital allocation approach that Tracy mentioned us wanting to be disciplined about that so I would say those are the broad areas.

And then.

On the restructuring that you've announced recently.

Your question about being broad or narrow.

We love the markets, we already have some.

You indicated most of the charge is $35 million to $50 million will be in Q4 can you provide some sense of the savings on a run rate basis going forward and when should we expect those savings for growth. Thank you.

Some of the best profit pools in the world.

We just got to win in those so thats, how youre going to see us lean in on on when.

And the markets that can be done.

I have a pretty strong foundation.

Yes.

Thank you Philippe.

Let me talk about the portfolio and the Bath tissue comments and Tracey if you can help on the restructuring piece.

Thank you. Our next question comes from Felipe <unk> with Stifel.

If you look at all.

Please go ahead.

Portfolio.

Hi, good morning, everyone.

Definitely going to be focused on bill I just wanted to make sure I mean, that's been our roots.

Also I wanted to ask about your experience working with and building a partnership with Coca Cola fever tree and some of the non arc initiatives like solar.

So big Spas and foundation of our business. So there is always going to be super important indefinitely.

Christopher Carey: Rahul, I think understandably, you have to go through impairment testing, but in the context of cyclical versus structural, I would think this would lean more towards the structural end. So maybe you can help compare and contrast just what happened with the impairment charge relative to kind of your views on the overall industry. Thanks very much.

Rahul Goyal: Rahul, I think understandably you have to go through impairment testing, but in the context of cyclical versus structural, I would think this would lean more towards the structural end. So maybe you can help compare and contrast just what happened with the impairment charge relative to kind of your views on the overall industry. Thanks very much.

Rahul, I think understandably you have to go through impairment testing, but in the context of cyclical versus structural, I would think this would lean more towards the structural end. So maybe you can help compare and contrast just what happened with the impairment charge relative to kind of your views on the overall industry. Thanks very much.

No.

Should we expect more initiatives by death from Molson Coors in the future to your point as a way to fill some gaps in a capital efficient way or do you see the opportunity for maybe more traditional acquisitions going forward.

Getting into that space.

In terms of.

Partnerships and acquisitions I think if you look at what we have done with boats Coca Cola PBT or.

I think we've figured out a way of work working with partners to really leverage our platform leverage our infrastructure to scale scale brands and I think.

Rahul Goyal: Thank you, Peter. Let me have Traci answer the bond maturity question, and then I'll take your impairment question.

Rahul Goyal: Thank you, Peter. Let me have Tracey answer the bond maturity question, and then I'll take your impairment question.

And then.

On the restructuring that you've announced recently you indicated most of the charge is $35 million to $50 million will be in Q4 can you provide some sense of the savings on a run rate basis going forward and when should we expect those savings to fund growth.

Traci Joubert: Yes. Thanks, Peter. So yeah, we do have some debt coming due in 2026. And as with all our debt, we'll review that as we get closer to the due dates. I think the important thing is that we remain focused on maintaining our leverage ratios, as Rahul just said, in alignment with the target of being below 2.5x. And we are currently in that range, and we will make sure that going forward, we are in sort of below 2.5x. So closer to the time, we'll assess what we do with the debt. Thanks, Peter.

Tracey Joubert: Thanks, Peter. So yeah, we do have some debt coming due in 2026. And as with all our debt, we'll review that as we get closer to the due dates. I think the important thing is that we remain focused on maintaining our leverage ratios, Rahul just said, in alignment with the target of being below two and a half times. And we are currently in that range, and we will make sure that going forward, we are in sort of below two and a half times. So closer to the time, we'll assess what we do with the debt. Thanks, Peter.

I would say both of those partnerships have worked really well for our business.

No.

But in terms of deploying capital I do think we continue to look at areas and opportunities to deploy capital to augment our portfolio.

Yes.

Okay.

Thank you Philippe.

Let me talk about the portfolio and the artificial comments and Tracey if you can help on the restructuring piece.

So so your question of whether we are going to do more partnerships versus more acquisitions I think that is a function of how these opportunities come up.

If you look it up.

Portfolio.

Definitely going to be focused on bill I just wanted to make sure I mean, that's been our roots.

But what you will see us leaning into spaces, where we have gaps in the portfolio to fill right.

So big Spas and foundation of our business. So there is always going to be super important indefinitely.

Maybe three four years ago, we didn't have the capital to deploy right now I think our balance sheets in a strong way that we can do it in a disciplined way so.

No.

Rahul Goyal: Yeah, thanks, Tracey. And Peter, I mean, you're absolutely right. I mean, we took the impairment charge to goodwill of about $3.6 billion in Q3. And so firstly, a number of factors that impacted, right? So obviously, this year's performance, there is a question about the outlook of our business. But the other factors that come in is discount rates, risk premium, and frankly, the multiple, right? So the way I think about this is we can get this business back to top and bottom line growth. We think we are very undervalued in the context of our market cap right now. Those are the things that we need to lean into and make sure we can demonstrate quarter over quarter.

Rahul Goyal: Yeah, thanks, Traci. And Peter, I mean, you're absolutely right. I mean, we took the impairment charge to goodwill of about $3.6 billion in Q3. And so firstly, a number of factors that impacted, right? So obviously, this year's performance. There is a question about the outlook of our business. But the other factors that come in is discount rates. Risk premium, and frankly, the multiple, right? So the way I think about this is we can get this business back to top and bottom line growth. We think we are very undervalued in the context of our market cap right now. Those are the things that we need to lean into and make sure we can demonstrate quarter over quarter.

Getting into that space.

In terms of the.

So you can focus on their continued focus on some of the above premium agenda, but in the beyond <unk>.

Partnerships and acquisitions I think if you look at what we have done with both Coca Cola Pvt or.

Probably need to be both creative and deploy capital to fill some gaps.

I think we've figured out a way of work working with partners to really leverage our platform leverage our infrastructure to scale scale brands and I think.

And Chris do you want to.

Thanks, Okay. So yes in terms of cost savings, if we haven't provided specific cost savings target.

I would say both of those partnerships that worked really well for our business.

Finalizing the details around on this restructuring and what he has been equally.

No.

But in terms of deploying capital I do think we continue to look at areas and opportunities to deploy capital to augment our portfolio.

We expect charges to be in the range of $35 million to $50 million and they are expected to be the future cash expenditures as the next 12 months.

So so your question of whether we are going to do more partnerships versus more acquisitions I think that is a function of how these opportunities come up.

Substantially all of the charges are expected to be related to severance payments and pension payments and benefits, but one thing in terms of the cost savings.

But what you will see us leaning into spaces, where we have gaps in the portfolio to fill right.

Rahul Goyal: And this is something that, as you said, it's something we need to do every year and check ourselves to make sure we're thinking of the business in a prudent way and the impairment is a function of that.

Rahul Goyal: This is something that, as you said, it's something we need to do every year and check ourselves to make sure we're thinking of the business in a prudent way and the impairment is a function of that.

This is something that, as you said, it's something we need to do every year and check ourselves to make sure we're thinking of the business in a prudent way and the impairment is a function of that.

Maybe three four years ago, we didn't have the capital to deploy right now I think our balance sheets in a strong way that we can do it in a disciplined way so.

Sure.

A meaningful amount of the head count reductions was from the elimination of open positions in 2025. So we wouldn't expect to get a full data set in 2026, because we did have the open head count as we prioritize.

Potentially you focus on would be our continued focus on some of the above premium agenda, but in the beyond <unk>.

Operator: Thank you. Our next question comes from Bill Kirk with Roth Capital Partners. Bill, please go ahead.

And in 2025.

Probably need to be both creative and deploy capital to fill some gaps.

Rahul Goyal: Good morning, everybody. Hey, Rahul. I was hoping to get a little bit more on your vision for the business. You mentioned portfolio gaps a couple of times. Do you think the gaps are more related to regions? Are the gaps more categories related, or are the gaps brand-specific? And then maybe backing up even further, should the company's focus become more narrow, or should the focus broaden and introduce new regions and categories?

Bill Kirk: Good morning, everybody. Hey, Rahul. I was hoping to get a little bit more on your vision for the business. You mentioned portfolio gaps a couple of times. Do you think the gaps are more related to regions? Are the gaps more categories related, or are the gaps brand-specific? And then maybe backing up even further, should the company's focus become more narrow, or should the focus broaden and introduce new regions and categories?

So instead of a cost savings point of view, because we do intend to replace some of the savings and team based in on that brand.

And Chris do you want to.

Yeah. Thanks, Steve So yes in terms of cost savings. If we haven't provided specific cost savings target for finalizing the details around this restructuring and what do you think the equator.

<unk> commercial capabilities has been a real estate banking and commercial and in supply chain and in technology to support ongoing productivity and efficiency around our business.

The.

<unk> charges to be in the range of $35 million to $50 million and they are expected to be the future cash expenditures as the next 12 months.

Thank you.

Our next question comes from Steve powers with Deutsche Bank.

Substantially all of the charges are expected to be related to severance payments and payments and benefit.

Rahul Goyal: Yeah, thank you, Bill. Definitely looking forward to sharing a lot more about the plans and how to think about that. But let me maybe break it down in maybe three different ways. So one is about portfolio. As you said, we have a pretty broad portfolio in the US. We have a great broad portfolio in Canada, even in Europe. And generally, we do believe all segments matter, right? So we do definitely need to work within that. Now, how we work the specific parts of the portfolio, I think that's where you see me highlighting some of the areas of opportunity we have. Now, in some parts, we do have gaps, right? So I talk about the flavor part of our portfolio, right? So we have some gaps there we need to fill. We fill some gaps in Beyond Beer in non-alc, right?

Rahul Goyal: Yeah, thank you, Bill. Definitely looking forward to sharing a lot more about the plans and how to think about that. But let me maybe break it down in maybe three different ways. So, one is about portfolio. As you said, we have a pretty broad portfolio in the US. We have a great broad portfolio in Canada, even in Europe. And generally, we do believe all segments matter, right? So, we do definitely need to work within that. Now, how we work the specific parts of the portfolio, I think that's where you see me highlighting some of the areas of opportunity we have. Now, in some parts, we do have gaps, right? So, I talk about the flavor part of our portfolio, right? So, we have some gaps there we need to fill. We fill some gaps in beyond beer in non-alc, right?

Please go ahead.

Yeah.

Great. Thank you.

These are probably.

And one thing in terms of the cost savings.

Two follow ups.

Much of what you've just recently discussed on their on their restructuring I'm curious.

Okay.

A meaningful amount of the head count reductions was from the elimination of open positions in 2025.

You spoke about how this is going to make the Americas organization faster more nimble more agile just curious as to.

We expect to get a full data set in 2026, because we did have the open head count as we prioritize.

Exactly how the restructuring will enable that that.

And in 2025.

That increase speed number one and then number two early <unk>.

Talked a lot about the portfolio and beer versus beyond beer.

Instead of a cost savings point of view, because we do intend to replace some of the savings.

I'm still struggling to really conceptualize the balance of those investments in your mind.

Tim.

Brand key in baseband exponential capability is as real estate banking and commercial and if the timeframe any technology to support E.

Really it's a game of Ann.

As you've described it and both are important but.

Just again the balance beer, obviously, the bigger business investments to drive premium position seem to be a core part of the vision.

Productivity and efficiencies around our business.

But do you see beyond beer as the bigger growth driver going forward I'm trying to figure that out and if so how does that influence your <unk>.

Rahul Goyal: So, there is an element of both fixing some of the portfolio plays we have, filling some gaps. So, that's, I would say, part one of the broad plan. The second part is execution, right? And I think, as all of you know, while beer is a global business and a national business, it is a very local business. So, us executing as close as possible to customers and distributors and retailers is going to be super important. And that's not just in terms of just the sales function, right? It is about how we deploy our people resources, how we deploy our marketing resources. It has to be as close as possible to our consumers and customers. So, there is definitely a difference in how we execute and take that to our brands to market. The third element to your question is capabilities.

Rahul Goyal: So there is an element of both fixing some of the portfolio plays we have, filling some gaps. So that's, I would say, part one of the broad plan. The second part is execution, right? And I think, as all of you know, while beer is a global business and a national business, it is a very local business. So us executing as close as possible to customers, distributors, and retailers is going to be super important. And that's not just in terms of just the sales function, right? It is about how we deploy our people resources, how we deploy our marketing resources has to be as close as possible to our consumers and customers. So there is definitely a difference in how we execute and take that to our brands to market. The third element to your question is capabilities.

So there is an element of both fixing some of the portfolio plays we have, filling some gaps. So that's, I would say, part one of the broad plan. The second part is execution, right? And I think, as all of you know, while beer is a global business and a national business, it is a very local business. So us executing as close as possible to customers, distributors, and retailers is going to be super important. And that's not just in terms of just the sales function, right? It is about how we deploy our people resources, how we deploy our marketing resources has to be as close as possible to our consumers and customers. So there is definitely a difference in how we execute and take that to our brands to market. The third element to your question is capabilities.

Thank you.

Next question comes from Steve powers with Deutsche Bank.

Please go ahead.

So prioritization broader capital allocation et cetera, thanks for both of us.

Yeah.

Great. Thank you.

These are probably.

Thank you Steve So maybe address both of your different questions. One is about the restructuring and portfolio. So.

Two follow ups.

Much of what you've just recently discussed on their on their restructuring I'm curious.

If you think about.

Back to what I've said about customer and consumer focus we wanted to make sure that the leaders driving that agenda to seats on the table right. So whether it's sales whether it's our marketing leadership, whether it's the Canadian leadership.

You spoke about how this is going to make the Americas organization faster more nimble more agile just curious as to.

Exactly how the restructuring will enable that.

That increased speed number one and then number two.

We needed to make sure that.

<unk>, you've talked a lot about the portfolio and beer versus beyond beer.

Land where category.

Challenge in that guidance, we talked about minus six minus almost minus six.

I'm still struggling to really conceptualize the balance of those investments in your mind.

We need to be getting much closer to how we execute in the in the front end of our business. So.

Clearly, it's a game of and then as you described it and both are important but.

From that thesis of making sure. We can bring these leaders around the table is really make sure we are executing with speed.

Just again the balance beer, obviously, the bigger business investments to drive premium position seem to be a core part of the vision.

And where we need to.

Rahul Goyal: We have a strong foundation in our infrastructure, whether it's breweries, whether it's supply chain. But it is an area that we need to make sure we are keeping up with either on the commercial side, whether it's on the technology side, optimizing our brewery footprint in the best possible way with making sure we can meet some of the needs of our new capabilities. So, you're definitely going to see us leaning into that. And then capital deployment, right? I mean, our capital allocation approach, Traci mentioned us wanting to be disciplined about that. So, I would say those are the broad areas. Your question about being broader or narrow. We love the markets we are in. I mean, we are in some of the best profit pools in the world. We just got to win in those.

Rahul Goyal: We have a strong foundation in our infrastructure, whether it's breweries, whether it's supply chain. But it is an area that we need to make sure we are keeping up with either on the commercial side, whether it's on the technology side, optimizing our brewery footprint in the best possible way with making sure we can meet some of the needs of our new capabilities. So you're definitely going to see us leaning into that. And then capital deployment, right? I mean, our capital allocation approach, Tracey mentioned us wanting to be disciplined about that. So I would say those are the broad areas. Your question about being broader or narrow, we love the markets we are in. I mean, we are in some of the best profit pools in the world. We just got to win in those.

We have a strong foundation in our infrastructure, whether it's breweries, whether it's supply chain. But it is an area that we need to make sure we are keeping up with either on the commercial side, whether it's on the technology side, optimizing our brewery footprint in the best possible way with making sure we can meet some of the needs of our new capabilities. So you're definitely going to see us leaning into that. And then capital deployment, right? I mean, our capital allocation approach, Tracey mentioned us wanting to be disciplined about that. So I would say those are the broad areas. Your question about being broader or narrow, we love the markets we are in. I mean, we are in some of the best profit pools in the world. We just got to win in those.

But do you see beyond beer as the bigger growth driver going forward I'm trying to figure that out and if so how does that influence your <unk>.

Being reached any focus where we need to and this is also about shifting our resources internal both people and marketing dollars.

It's a prioritization broader capital allocation et cetera, thanks for both those.

Where we see the opportunities right. So that requires us to be I would say a lot more quicker more nimble.

Thank you Steve So maybe address both are different questions. One is about the restructuring and portfolio. So.

And it starts with obviously.

If you think about going back to what I've said about customer and consumer focused.

Neither is having the ability to drive that the other part I, obviously talked about briefly was around making sure we can enable.

We wanted to make sure that the leaders driving that agenda had the seats on the table right. So whether it's sales whether it's our marketing leadership, whether it's the Canadian leadership.

Our teams were close to the markets to make those decisions and so how do we drive both the decision, making and accountability as close to the markets as possible. So I think those are the two few principles that we've used and that's what we're trying to drive in terms of the REIT structure changes.

We needed to make sure that.

Land where category.

Challenging to get into the right I mean, we talked about minus six minus almost minus six.

We need to be getting much closer to how we execute in the front end of our business. So.

Rahul Goyal: So, that's how you're going to see us lean in on winning in the markets that we currently have a pretty strong foundation in.

Rahul Goyal: So that's how you're going to see us lean in on winning in the markets that we currently have a pretty strong foundation in.

So that's how you're going to see us lean in on winning in the markets that we currently have a pretty strong foundation in.

Both in the U S and in Canada, and making sure we can execute faster because BR.

From that thesis of making sure. We can bring these leaders around the table is really make sure we're executing with speed, but pivoting.

Operator: Thank you. Our next question comes from Filippo Falorni with Citi. Please go ahead.

Category context that is that is challenged.

Pivoting, where we need to we're.

In terms of portfolio I break it up into two different ways. One is around marketing dollars investment and then about balance sheet deployment of capital.

Being reached any focus where we need to and this is also about shifting our resources internal both people and marketing dollars.

Christopher Carey: Hi, good morning, everyone. Rahul, so I wanted to ask about your experience working with and building the partnership with Coca-Cola, Fever-Tree, and some of the non-alc initiatives like Zoa. Should we expect more initiatives like that from Molson Coors in the future, to your point, as a way to fill some gaps in a capital-efficient way, or do you see still the opportunity for maybe more traditional acquisitions going forward? And then on the restructuring that you've announced recently, you indicated most of the charges, $35 to 50 million, will be in Q4. Can you provide some sense of the savings on a run-rate basis going forward, and when should we expect those savings to flow through? Thank you.

Filippo Falorni: Hi, good morning, everyone. Rahul, so I wanted to ask about your experience working with and building the partnership with Coca-Cola, Fever-Tree, and some of the non-alc initiatives like Zoa. Should we expect more initiatives like that from Molson Coors in the future, to your point, as a way to fill some gaps in a capital-efficient way, or do you see still the opportunity for maybe more traditional acquisitions going forward? And then on the restructuring that you've announced recently, you indicated most of the charges, $35 to 50 million, will be in Q4. Can you provide some sense of the savings on a run-rate basis going forward, and when should we expect those savings to flow through? Thank you.

Bill Kirk: Hi, good morning, everyone. Rahul, so I wanted to ask about your experience working with and building the partnership with Coca-Cola, Fever-Tree, and some of the non-alc initiatives like ZOA. Should we expect more initiatives like that from Molson Coors in the future, to your point, as a way to fill some gaps in a capital-efficient way, or do you see still the opportunity for maybe more traditional acquisitions going forward? On the restructuring that you've announced recently, you indicated most of the charges, $35 to 50 million, will be in Q4. Can you provide some sense of the savings on a run-rate basis going forward, and when should we expect those savings to flow through? Thank you.

Where we see the opportunities right. So that requires us to be I would say a lot more quicker more nimble.

Steve.

You're going to see US continue making sure we have the right pressure against our big brands.

Whether thats caused light.

And it starts with this.

Like banquet.

Phebe leaders, having the ability to drive that the other part I obviously.

You know things like Peroni Blue Moon. So those are important brands.

Talked about briefly was around making sure we can enable.

We believe.

So much potential that make sure we are winning in the payer landscape. So you will see us continue.

Our teams were close to the markets to make those decisions right and so how do we drive both of the decision making and accountability.

<unk> focused on those and making sure we have the right marketing pressure around it.

In terms of beyond.

As close to the markets as possible. So I think those are the two few principles that we've used and that's what we're trying to drive in terms of the REIT structure changes.

We do want to make it big enough that it starts having an impact to our total enterprise I would say we are still a lead that journey.

You know both in the U S and in Canada, and making sure we can execute faster because BR.

That's fair I would say the balance sheet comes into help us a little bit on <unk>.

Rahul Goyal: Thank you, Filippo. Let me talk about the portfolio, the partnership comments, and Tracey, if you can help on the restructuring piece. If you look at our portfolio, Filippo, I mean, we're definitely going to be focused on beer. I just want to make sure. I mean, that's been our roots, and it's a big part and foundation of our business. So beer is always going to be super important and definitely leaning into that space. In terms of partnerships and acquisitions, I think if you look at what we have done with both Coca-Cola, Fever-Tree, or I think we've figured out a way of working with partners to really leverage our platform, leverage our infrastructure to scale brands. And I think I would say both of those partnerships have worked really well for our business.

Rahul Goyal: Thank you, Filippo. Let me talk about the portfolio and the partnership comments, and Traci, if you can help on the restructuring piece. If you look at our portfolio, Filippo, I mean, we're definitely going to be focused on beer. I just want to make sure. I mean, that's been our roots, and it's a big part and foundation of our business. So beer is always going to be super important and definitely leaning into that space. In terms of partnerships and acquisitions, I think if you look at what we have done with both Coca-Cola, Fever-Tree, or. I think we've figured out a way of working with partners to really leverage our platform, leverage our infrastructure to scale brands. And I think I would say both of those partnerships have worked really well for our business.

Making sure we have the right portfolio.

In a category context that is that a challenge.

In terms of what the right balance is between build and beyond goes Steve I think more to come on that piece, but the way I would think about investment is making sure. We have the right marketing pressure against our big brands, but being sure. We can use our balance sheet to augment our portfolio add.

In terms of portfolio I break it up into two different ways. One is around marketing dollars investment and then about balance sheet deployment of capital.

Steve.

You're going to see US continue making sure we have the right pressure against our big brands.

Some scale brands that we can really use as the foundation and the beyond beer space.

Thats caused light.

Miller Lite banquet.

Yeah.

Things like Peroni Blue Moon. So those are important brands that we believe.

Our next question comes from Michael Lavery with Piper Sandler.

Have so much potential that make sure we.

Please go ahead.

Thank you and good morning, and congrats a governor in rubles.

We are winning in the payer landscape. So you will see us continue.

Super focused on those and making sure we have the right marketing pressure around it.

Just wanted to come back to a couple of things you touched on.

Needing to win an economy.

In terms of beyond we do want to make it big enough that it starts having an impact to our total enterprise I would say we are still early in that journey.

On in your opening remarks, just wanted to focus a little more on highlife and Keystone.

Rahul Goyal: But in terms of deploying capital, I do think we continue to look at areas and opportunities to deploy capital to augment our portfolio. So your question of whether we're going to do more partnerships versus more acquisitions, I think that is a function of how these opportunities come up. But what you will see us leaning into spaces where we have gaps in the portfolio to fill, right? Maybe three, four years ago, we didn't have the capital to deploy. But right now, I think our balance sheet's in a strong way that we can do it in a disciplined way. So continue to focus on beer, continue to focus on some of the above-premium agenda. But in the beyond-beer space, we probably need to be both creative and deploy capital to fill some gaps. And Traci, you want to?

Rahul Goyal: But in terms of deploying capital, I do think we continue to look at areas and opportunities to deploy capital to augment our portfolio. So your question of whether we're going to do more partnerships versus more acquisitions, I think that is a function of how these opportunities come up. But what you will see us leaning into spaces where we have gaps in the portfolio to fill, right? Maybe three, four years ago, we didn't have the capital to deploy. But right now, I think our balance sheet's in a strong way that we can do it in a disciplined way. So continue to focus on beer, continue to focus on some of the Above Premium agenda. But in the Beyond Beer space, we probably need to be both creative and deploy capital to fill some gaps. And Tracey, you want to?

But in terms of deploying capital, I do think we continue to look at areas and opportunities to deploy capital to augment our portfolio. So your question of whether we're going to do more partnerships versus more acquisitions, I think that is a function of how these opportunities come up. But what you will see us leaning into spaces where we have gaps in the portfolio to fill, right? Maybe three, four years ago, we didn't have the capital to deploy. But right now, I think our balance sheet's in a strong way that we can do it in a disciplined way. So continue to focus on beer, continue to focus on some of the Above Premium agenda. But in the Beyond Beer space, we probably need to be both creative and deploy capital to fill some gaps. And Tracey, you want to?

Can you maybe touch on why you think you might not have been winning there already and whether it's maybe an innovation issue a price issue just not enough marketing, but what more you know maybe what should we expect looking ahead.

And Thats, where I would say the balance sheet comes into help us a little bit on.

Being sure we have the right portfolio.

In terms of what the right balance is between <unk> and beyond <unk> I think more to come on that piece, but the way I would think about investment is making sure. We have the right marketing pressure against our big brands, but being should we can use our balance sheet to augment our portfolio add.

And then just a follow up on the goodwill you touched on how.

It is impacted by the assessment process is impacted by this past year's results and evidently has a bit of a backwards look but also seems to reflect that outlook ahead, and maybe what is kind of a balance there and how much is it more a function of whats happened already or what you think is to come.

Some scale brands that we can really use as the foundation and the beyond beer space.

Yes.

Thank you. Our next question comes from Michael Lavery with Piper Sandler.

Yeah.

Please go ahead.

Thank you Michael So again just to be talking about the economy portfolio and then add a few comments on <unk> anything else you would like to add on the goodwill but.

Thank you and good morning, and congrats a governor in rubles.

Just wanted to come back to a couple of things you touched on.

Tracey Joubert: Yeah, thanks, Filippo. So yeah, in terms of cost savings, look, we haven't provided specific cost savings targets as we're still finalizing the details around this restructuring. What we have said, though, you correctly say, we expect charges to be in the range of $35 to 50 million. They are expected to be the future cash expenditures over the next 12 months. Substantially, all of the charges are expected to be related to severance payments and post-employment benefits. But one thing in terms of the cost savings, look, a meaningful amount of the headcount reductions was from the elimination of open positions in 2025. So we wouldn't expect to get a full benefit in 2026 because we did have the open headcounts as we prioritized our costs in 2025. So that's from sort of the cost savings point of view.

Traci Joubert: Yeah. Thanks, Filippo. So yeah, in terms of cost savings, look, we haven't provided specific cost savings targets as we're still finalizing the details around this restructuring. What we have said, though, you correctly say. We expect charges to be in the range of $35 to 50 million. They are expected to be the future cash expenditures over the next 12 months. Substantially all of the charges are expected to be related to severance payments and post-employment benefits. But one thing in terms of the cost savings, look. A meaningful amount of the headcount reductions was from the elimination of open positions in 2025. So we wouldn't expect to get a full benefit in 2026 because we did have the open headcounts as we prioritized our costs in 2025. So. That's from sort of the cost savings point of view.

If you I would go back to.

Needing to win an economy you touched on it in your.

Couple of ways to think about the economy portfolio.

Opening remarks.

As a consumer that.

Wanted to focus a little more on highlife and Keystone.

Got it.

No.

Can you maybe touch on why you think you might not have been winning there already and whether it's maybe an innovation issue a price issue just not enough marketing, but what more maybe should we expect looking ahead.

Consumer.

I think human everybody is aware I mean, the consumer from the Staples perspective, especially and so for us making sure we have a portfolio that can meet our consumers.

And in every location.

And then just a follow up on the goodwill you touched on how.

This category and we definitely don't see trade down from a from a brand perspective.

But we have brands that consumers love like highlife like each tools built on Canada.

Et cetera, So we have a broad economy portfolio.

Consumers really love.

This is big Michael I mean, this is a big part of our portfolio in terms of scale and volume.

Whats happened already or what you think is to come.

Frankly, it's a big part of our customers' portfolio, so making sure that we're doing the right things of keeping it as healthy as possible is super important. So the things you talked about all of that matters. It's the right level of marketing to the right level of innovation.

Thank you Michael So again, just let me talk about the economy portfolio and then add a few comments on <unk> anything else you would like to add on the goodwill but.

Traci Joubert: But look, we do intend to redeploy some of the savings to invest behind our brands, to invest behind our commercial capabilities, as Rahul has said, both in commercial, in supply chain, and in technology to support the ongoing productivity and efficiencies around our business.

Tracey Joubert: But look, we do intend to redeploy some of the savings to invest behind our brands, to invest behind our commercial capabilities, as Rahul has said, both in commercial, in supply chain, and in technology to support the ongoing productivity and efficiencies around our business.

But look, we do intend to redeploy some of the savings to invest behind our brands, to invest behind our commercial capabilities, as Rahul has said, both in commercial, in supply chain, and in technology to support the ongoing productivity and efficiencies around our business.

If you I would go back to a couple of ways to think about the economy portfolio.

Right again, but price back in that part of the portfolio.

As a consumer that.

Got it.

No.

Consumer.

And I would call the regional element of it right. So this is a portfolio is valued each mill and we need to make sure that we are winning.

I think human everybody is aware I mean, the consumer from the Staples perspective, especially and so for us it's making sure we have a portfolio that can meet our consumers.

Operator: Thank you. Our next question comes from Steve Powers with Deutsche Bank. Please go ahead.

Very very peaceful way with all of that so probably less slightly different the way, we think about growth like the line back quickly jump big national brands that need to win.

In every location.

This category and we definitely don't see trade down from a from a brand perspective, but.

Traci Mangini: Great. Thank you. I guess these are probably two follow-ups to much of what you've just recently discussed. On the restructuring, I'm curious. You spoke about how this is going to make the Americas organization faster, more nimble, more agile. I'm just curious as to exactly how the restructuring will enable that increased speed, number one. And then number two, Rahul, you've talked a lot about the portfolio and beer versus Beyond Beer. I'm still struggling to really conceptualize the balance of those investments in your mind. Clearly, it's a game of the hand, and as you've described it, both are important. But just again, that balance, beer, obviously the bigger business, investments to drive premiumization seem to be a core part of the vision. But do you see Beyond Beer as the bigger growth driver going forward? I'm trying to figure that out.

Steve Powers: Great. Thank you. I guess these are probably two follow-ups to much of what you've just recently discussed. On the restructuring, I'm curious. You spoke about how this is going to make the Americas organization faster, more nimble, more agile. I'm just curious as to exactly how the restructuring will enable that increased speed, number one. And then number two, Rahul, you've talked a lot about the portfolio and beer versus Beyond Beer. I'm still struggling to really conceptualize the balance of those investments in your mind. Clearly, it's a game of the hand, and as you've described it, both are important. But just again, that balance, beer, obviously the bigger business, investments to drive premiumization seem to be a core part of the vision. But do you see Beyond Beer as the bigger growth driver going forward? I'm trying to figure that out.

Traci Mangini: Great. Thank you. I guess these are probably two follow-ups to much of what you've just recently discussed. On the restructuring, I'm curious. You spoke about how this is going to make Americas organization faster, more nimble, more agile. Just curious as to exactly how the restructuring will enable that. Increased speed, number one. And then number two, Rahul, you've talked a lot about the portfolio and beer versus beyond beer. I'm still struggling to really conceptualize the balance of those investments in your mind. Clearly, it's a game of the hand, and as you've described it, both are important. But just again, that balance, beer, obviously the bigger business. Investments to drive premiumization seem to be a core part of the vision. But do you see beyond beer as the bigger growth driver going forward? I'm trying to figure that out.

But we have brands that consumers love like highlife like each tool built on Canada.

In different ways.

The focus on economies I would say that.

Et cetera, right. So we have a broad economy portfolio.

First of all I'm going a different purpose.

To your point about goodwill.

That consumers really love.

It is a function of this year's performance, it's a function of discount rates.

And this is big Michael I mean, this is a big part of our portfolio in terms of scale and volume.

Multiple but yes. It does have a view of the outlook.

Frankly, it's a big part of our customers' portfolio, so making sure that we're doing the right things of keeping it as healthy as possible is super important so.

Again versus what we had previously and I think that was informed by this year.

Things you talked about all of that matters right.

Both category performance and our performance. So I would say those are the big drivers.

That level of marketing to the right level of innovation.

As you know math these things discount rates and multiples have a big.

Again, but price back in that part of the portfolio.

The big impact on some of these elements so.

And I would call the regional element of it right. So this is.

Tracy anything else.

Our portfolio is valued each mill.

No I think if you basically covered it well.

And we need to make sure that one of them.

And just maybe an added thing intense as a current outlook is and the costs and particularly driven by the Midwest premium.

We are winning.

Very very peaceful way with all of that so probably less slightly different the way, we think about growth like the line back quickly jump big national brands that need to win.

Traci Mangini: And if so, how does that influence your investment prioritization, broader capital allocation, etc.? Thanks for both of those.

Traci Mangini: And if so, how does that influence your investment prioritization, broader capital allocation, etc.? Thanks for both those.

And if so, how does that influence your investment prioritization, broader capital allocation, etc.? Thanks for both those.

We have seen that.

<unk> being the highest.

Rahul Goyal: Thank you, Steve. So maybe address both your different questions. One is about restructuring and portfolio. So if you think about going back to what I said about customer and consumer focus, we wanted to make sure that the leaders driving that agenda had a seat around the table, right? So whether it's US sales, whether it's our marketing leadership, whether it's the Canadian leadership, we needed to make sure that in a land where we're challenged in the category, right? I mean, we talked about -3%, -4% to -6%. We need to be getting much closer to how we execute in the front end of our business. So it starts from that thesis of making sure we can bring these leaders around the table, really make sure we're executing with speed, we're pivoting where we need to, we're being regionally focused where we need to.

Rahul Goyal: Thank you, Steve. Maybe address both your different questions. One is about restructuring and portfolio. If you think about going back to what I said about customer and consumer focus, we wanted to make sure that the leaders driving that agenda had a seat around the table, right? So whether it's US sales, whether it's our marketing leadership, whether it's the Canadian leadership, we needed to make sure that in a land where we're challenged in the category, right? I mean, we talked about -3%, -4% to -6%. We need to be getting much closer to how we execute in the front end of our business. So it starts from that thesis of making sure we can bring these leaders around the table, really make sure we're executing with speed. We're pivoting where we need to. We're being regionally focused where we need to.

In different ways.

And with potential more increases coming.

The focus on economies I would say that.

First of all make a different focus.

Also a part of.

To your point about goodwill.

Outlook for product costs, but having said that look we remain confident in the resilience of the industry and <unk>.

It is a function of this year's performance, it's a function of discount rates.

Multiples, but yes. It does have a view of the outlook right again versus what we had previously and I think that was informed by this year.

<unk> retained to both top and bottom line.

Thank you. Our next question comes from Rob <unk> with Evercore.

Both category performance and our performance. So I would say those are the big drivers.

Please go ahead.

As you know math Andy.

Great. Thank you very much and congratulations too to euro and together and best of luck.

These things discount rates and multiples have a big.

Big impact on some of these elements so.

So I guess the <unk>.

Tracy anything else.

I'd like to try to approach role.

No I think if you think you could covenant.

And just maybe an added thing.

To get a sense of.

<unk>.

Rahul Goyal: And it's also about shifting our resources, internal, both people and marketing dollars, where we see the opportunities, right? So that requires us to be, I would say, a lot more quicker, a lot more nimble. And it starts with, obviously, being leaders, having the ability to drive that. The other part I obviously talked about briefly was around making sure we can enable our teams who are closest to the markets to make those decisions, right? And so how do we drive both the decision-making and accountability as close to the markets as possible? So I think those are the two few principles that we've used, and that's what we're trying to drive in terms of the restructure changes, both in the US and in Canada, in making sure we can execute faster because, yeah, we are in a category context that is challenged.

Rahul Goyal: It's also about shifting our resources, internal, both people and marketing dollars, where we see the opportunities, right? That requires us to be, I would say, a lot more quicker, a lot more nimble. It starts with, obviously, being leaders, having the ability to drive that. The other part I obviously talked about briefly was around making sure we can enable our teams who are closest to the markets to make those decisions, right? How do we drive both decision-making and accountability as close to the markets as possible? I think those are the two few principles that we've used, and that's what we're trying to drive in terms of the restructure changes, both in the US and in Canada, in making sure we can execute faster because, yeah, we are in a category context that is challenged.

It's also about shifting our resources, internal, both people and marketing dollars, where we see the opportunities, right? That requires us to be, I would say, a lot more quicker, a lot more nimble. It starts with, obviously, being leaders, having the ability to drive that. The other part I obviously talked about briefly was around making sure we can enable our teams who are closest to the markets to make those decisions, right? How do we drive both decision-making and accountability as close to the markets as possible? I think those are the two few principles that we've used, and that's what we're trying to drive in terms of the restructure changes, both in the US and in Canada, in making sure we can execute faster because, yeah, we are in a category context that is challenged.

Current outlook and the cost and particularly driven by the Midwest premium.

You know your mandate from the board.

We have seen that.

And.

<unk> the highest.

How much freedom.

And with.

Do you is the board, giving you.

So more increases coming.

So in a sense that you know.

If you wanted to make significant changes as kind of everything on the table.

And part of that.

The outlook for.

From a prospect.

You bet.

No sacred cows.

We remain confident in the resilience of the industry and <unk> ability to maintain to both top and bottom line growth.

And that kind of approach so something that maybe a departure from the past or are or is the mandate from the board more like.

Thank you.

Question comes from Bob <unk> with Evercore.

Just kind of stay the course tweak things around the edges improve execution here and there, but basically what's weather the storm and keep kind of plugging forward. So just really just trying to get a sense of kind of.

Please go ahead.

Great. Thank you very much and congratulations too to euro and together and best of luck.

So I guess the question.

I'd like to try to approach role.

How those discussions went and what what range of freedom you feel that you have to create shareholder value here. Thank you.

Rahul Goyal: In terms of portfolio, I'd break it up in two different ways. One is around marketing dollars, investment, and then about balance sheet deployment of capital. Steve, you're going to see us continue making sure we have the right pressure against our big brands. So whether that's Coors Light, Miller Lite, Banquet, things like Peroni, Blue Moon, those are important brands that we believe have so much potential and make sure we are winning in the beer landscape. So you will see us continue being super focused on those and making sure we have the right marketing pressure around it. In terms of beyond beer, we do want to make it big enough that it starts having an impact to our total enterprise. I would say we are still early in that journey.

Rahul Goyal: In terms of portfolio, I'd break it up in two different ways. One is around marketing dollars, investment, and then about balance sheet deployment of capital. Steve, you're going to see us continue making sure we have the right pressure against our big brands. So whether that's Coors Light, Miller Lite, Banquet, things like Peroni, Blue Moon. So those are important brands that we believe have so much potential and make sure we are winning in the beer landscape. So you will see us continue being super focused on those and making sure we have the right marketing pressure around it. In terms of beyond beer, we do want to make it big enough that it starts having an impact to our total enterprise. I would say we are still early in that journey.

In terms of portfolio, I'd break it up in two different ways. One is around marketing dollars, investment, and then about balance sheet deployment of capital. Steve, you're going to see us continue making sure we have the right pressure against our big brands. So whether that's Coors Light, Miller Lite, Banquet, things like Peroni, Blue Moon. So those are important brands that we believe have so much potential and make sure we are winning in the beer landscape. So you will see us continue being super focused on those and making sure we have the right marketing pressure around it. In terms of beyond beer, we do want to make it big enough that it starts having an impact to our total enterprise. I would say we are still early in that journey.

To get a sense of.

You know your mandate from the board.

Good morning, Rob and thanks for the question.

And.

How much freedom.

I would say we definitely our board is always focused on what's the best thing for all shareholders right. I mean, that's definitely the lengths and frankly I don't there is no sacred cows, I think they've given us given me the freedom to say, let's make sure we have a plan that can drive.

Do you is the board, giving you.

The sense that you know.

If you wanted to make significant changes as kind of everything's on the table.

No sacred cows.

And that kind of approach so something that maybe a departure from the past or or or is the mandate from the board more like.

Most shareholder value.

And that's what we that's.

What I'm leading for.

So yes.

Sacred cows is no constraints.

I think.

You and everybody on this call understands the challenges that are in the category.

Rahul Goyal: And that's where I would say the balance sheet comes in to help us a little bit on making sure we have the right portfolio. In terms of what the right balance is between beer and beyond beer, Steve, I think more to come on that piece. But the way I would think about investment is making sure we have the right marketing pressure against our big brands, but making sure we can use the balance sheet to augment our portfolio, add some scale brands that we can really use as a foundation in the beyond-beer space.

Rahul Goyal: And that's where I would say the balance sheet comes in to help us a little bit on making sure we have the right portfolio. In terms of what the right balance is between beer and beyond beer, Steve, I think more to come on that piece. But the way I would think about investment is making sure we have the right marketing pressure against our big brands, but making sure we can use the balance sheet to augment our portfolio, add some scaled brands that we can really use as a foundation in the beyond beer space.

And that's where I would say the balance sheet comes in to help us a little bit on making sure we have the right portfolio. In terms of what the right balance is between beer and beyond beer, Steve, I think more to come on that piece. But the way I would think about investment is making sure we have the right marketing pressure against our big brands, but making sure we can use the balance sheet to augment our portfolio, add some scaled brands that we can really use as a foundation in the beyond beer space.

I know.

A lot written about our portfolio. So I mean, all of that is real and that's the context too.

Within <unk> in terms of the direction from the board.

How those discussions went and what what range of freedom you feel that you have to create shareholder value here. Thank you.

It is about driving maximizing shareholder value and the best absolutely.

So definitely we don't feel any constrained there can be no fix it.

Yeah.

Good morning, Rob and thanks for the question.

I think the tricky part in some of your colleagues asked this question right.

I would say we definitely our board is always focused on what's the best thing for all shareholders right. I mean, that's definitely the lens and frankly I don't there is no sacred cows.

The category is going through a tricky time this year.

Operator: Thank you. Our next question comes from Michael Lavery with Piper Sandler. Please go ahead.

Again I'll go back to we are in great geographies with big profit pools, but it comes with a different shape of category health.

They've given us given me the freedom to say, let's make sure we have a plan that can drive the most shareholder value.

Traci Mangini: Thank you. Good morning and congrats, Gavin and Rahul both. I just want to come back to a couple of things. You touched on needing to win in economy. You touched on, in your opening remarks, just wanting to focus a little more on High Life and Keystone. Can you maybe touch on why you think you might not have been winning there already and whether it's maybe an innovation issue, a price issue, or just not enough marketing? What more maybe should we expect looking ahead? Then just to follow up on the goodwill, you touched on how it's impacted by the investment process, is impacted by this past year's results, and evidently has a bit of a backwards look, but also seems to reflect an outlook ahead.

Michael Lavery: Thank you. Good morning and congrats, Gavin and Rahul both. I just want to come back to a couple of things. You touched on needing to win in economy. You touched on, in your opening remarks, just wanting to focus a little more on High Life and Keystone. Can you maybe touch on why you think you might not have been winning there already and whether it's maybe an innovation issue, a price issue, or just not enough marketing? What more maybe should we expect looking ahead? Then just to follow up on the goodwill, you touched on how it's impacted by the investment process, is impacted by this past year's results, and evidently has a bit of a backwards look, but also seems to reflect an outlook ahead.

Traci Mangini: Thank you. And good morning and congrats, Gavin and Rahul, both. I just want to come back to a couple of things you touched on: needing to win in economy. You touched on in your opening remarks just wanting to focus a little more on High Life and Keystone. Can you maybe touch on why you think you might not have been winning there already and whether it's maybe an innovation issue, a price issue, just not enough marketing? But what more maybe should we expect looking ahead? And then just to follow up on the goodwill, you touched on how it's impacted by the investment process, is impacted by this past year's results, and evidently has a bit of a backwards look, but also seems to reflect an outlook ahead.

And those are all reality context, but it doesn't take away from the opportunities we have for our portfolio.

And Thats, what we are.

What I'm leading for.

So I think that's the best way and again, that's why you see me talk about the.

So yes.

Sacred cows Theres no constraints.

Our balance sheet.

While we are committed to.

I think.

Returning cash to shareholders.

You and everybody on this call understands the challenges that are in the category.

Find the right ideas to deploy capital to get ourselves back to top and bottom line growth also so.

I know.

A lot written about our portfolio. So I mean, all of that is real and that's the context too.

Yeah, No I understand the question Robert no constraints from the board or anybody else.

Within but in terms of the direction of the board.

It is about driving maximizing shareholder value and the best absolutely.

Yeah.

Thank you. Our next question comes from Eric <unk> with Morgan Stanley.

So definitely we don't feel any constrained there can be no fixed cows.

Please go ahead.

Great. Thank you and congratulations again to Gavin.

I think the tricky part in some of your colleagues asked this question right.

Traci Mangini: And maybe what is kind of the balance there and how much is it more a function of what's happened already or what you think is to come?

Traci Mangini: Maybe what is kind of the balance there, and how much is it more a function of what's happened already or what you think is to come?

Maybe what is kind of the balance there, and how much is it more a function of what's happened already or what you think is to come?

Who.

The category is going through the tricky time this year.

Hoping you can talk a little bit more about the.

Again I'll go back to we are in great geographies with big profit pools, but it comes with a different shape of category health.

Overall level of investment in capabilities.

With the current level I know you talked about.

Rahul Goyal: Thank you, Michael. So again, just let me talk about the economy portfolio and then add a few comments. And Tracey, anything else you would like to add on the goodwill? But I would go back to a couple of ways to think about the economy portfolio. First is a consumer lens, right? I mean, the consumer, I think you and everybody is aware. I mean, the consumer from a staples perspective is pressured. And so for us, making sure we have a portfolio that can meet our consumers in every occasion. In this category, in beer, we definitely don't see trade down from a brand perspective. But we have brands that consumers love, like High Life, like Keystone, like Pilsen in Canada, etc., right? So we have a broad economy portfolio that consumers really love. And this is big, Michael.

Rahul Goyal: Thank you, Michael. So again, just let me talk about the economy portfolio and then add a few comments. And Traci, anything else you would like to add on the goodwill? I would go back to a couple of ways to think about the economy portfolio. First is a consumer lens, right? I mean. The consumer, I think you and everybody is aware, I mean, the consumer from a staples perspective is pressured. And so for us, making sure we have a portfolio that can meet our consumers in every location. In this category, in beer, we definitely don't see trade down from a brand perspective. But we have brands that consumers love, like High Life, like Keystone, like Pilsner in Canada, etc., right? So we have a broad economy portfolio that consumers really love. And this is big, Michael.

Having the right marketing pressure behind the brands, but if you look a little bit more broadly investment obviously as is.

And those are all reality context, but it doesn't take away from the opportunities we have for our portfolio.

So I think that's the best way and again Thats why you see me talk about the.

More broadband marketing support I think look at the organization come a long way in terms of capabilities.

Our balance sheet.

While we are committed to.

Returning cash to shareholders.

2019, and the revitalization plan.

Find the right ideas to deploy capital to get ourselves back to top and bottom line growth also so.

Are there areas.

Is it that need.

Increased investment.

No I understand the question Robert No constraints here from the board or anybody else.

Or where you need to further build out capabilities, either from an opex or capex standpoint from here.

Yeah.

Thank you. Our next question comes from Eric <unk> with Morgan Stanley.

Please go ahead.

Thank you Ed and good morning to you and.

Great. Thank you and congratulations again see Gavin.

Yes, no I would break up the capabilities and broadly maybe three broad buckets right. So one is our supply chain.

Who.

Hoping you can talk a little bit more about the <unk>.

Wanting to make sure that we have the right level of Capex.

Rahul Goyal: I mean, this is a big part of our portfolio in terms of scale and volume. And frankly, it's a big part of our customers' portfolio. So making sure that we're doing the right things of keeping it as healthy as possible is super important. So the things you talked about, all of that matters, right? Whether it's the right level of marketing, it's the right level of innovation, right? Again, price back in that part of the portfolio. And I would call out the regional element of it, right? So our portfolio is very regional. And we need to make sure that we are winning in a very, very regional way with all of that. So probably less, slightly different, the way we think about Coors Light, Miller Lite, Banquet, which are big national brands that need to win in different ways.

Rahul Goyal: I mean, this is a big part of our portfolio in terms of scale and volume. And frankly, it's a big part of our customers' portfolio. So making sure that we're doing the right things of keeping it as healthy as possible is super important. So the things you talked about, all of that matters, right? Whether it's the right level of marketing, it's the right level of innovation, right? Again, price back in that part of the portfolio. And I would call out the regional element of it, right? So this is our portfolio is very regional, and we need to make sure that we are winning in a very, very regional way with all of that. So probably less, slightly different the way we think about Coors Light, Miller Lite, Banquet, which are big national brands that need to win in different ways.

I mean, this is a big part of our portfolio in terms of scale and volume. And frankly, it's a big part of our customers' portfolio. So making sure that we're doing the right things of keeping it as healthy as possible is super important. So the things you talked about, all of that matters, right? Whether it's the right level of marketing, it's the right level of innovation, right? Again, price back in that part of the portfolio. And I would call out the regional element of it, right? So this is our portfolio is very regional, and we need to make sure that we are winning in a very, very regional way with all of that. So probably less, slightly different the way we think about Coors Light, Miller Lite, Banquet, which are big national brands that need to win in different ways.

That gets drives the right ROI, but also build capabilities and our infrastructure. So again give you. A example, and I know we've spoken about this in the.

Overall level of investment in capabilities.

With the current level I know you talked about.

Having the right marketing pressure behind the brands, but if you look a little bit more broadly investment obviously as is.

The last few years is <unk>.

Things like variety backing in things like having the ability of new flavors.

More broadband marketing support I think look at the organization come a long way in terms of capabilities.

In our breweries.

Things whenever possible, maybe five years ago and this is the investment that we've made to CMS these capabilities in infrastructure right. So.

2019, and the revitalization plan.

Are there areas.

Is it that need.

Making sure we have the right level of Capex right, which is.

Increased investment.

It is important so I think that's one thing we're going to continue to look at.

Or where you need to further build out capabilities, either from an opex or capex standpoint from here.

Supply chain continues to be an area of making sure we have strong capabilities again.

Outside Capex in supply chain, it seems like optimization off of logistics and transportation costs right to some of the new tools and technology et cetera can enable us to do that.

Thank you Eric good morning to you and.

Yes, I would break up the capabilities and broadly maybe three broad buckets right. So one is our supply chain.

Rahul Goyal: The focus on economies, I would say, for solving a different purpose. To your point about goodwill. It is a function of this year's performance. It's a function of discount rates, multiples. But yeah, it does have a view of the outlook, right? Again, versus what we had previously. And I think that was informed by this year's both category performance and our performance. So I would say those are the big drivers. But as you know, math and these things, discount rates and multiples have a big impact on some of these elements. Traci, anything else?

Rahul Goyal: The focus on economies, I would say, for solving a different purpose. To your point about goodwill, it is a function of this year's performance. It's a function of discount rates, multiple. But yeah, it does have a view of the outlook, right? Again, versus what we had previously. And I think that was informed by this year's both category performance and our performance. So I would say those are the big drivers. But as you know, math and these things, discount rates and multiples have a big impact on some of these elements. So Tracey, anything else?

The focus on economies, I would say, for solving a different purpose. To your point about goodwill, it is a function of this year's performance. It's a function of discount rates, multiple. But yeah, it does have a view of the outlook, right? Again, versus what we had previously. And I think that was informed by this year's both category performance and our performance. So I would say those are the big drivers. But as you know, math and these things, discount rates and multiples have a big impact on some of these elements. So Tracey, anything else?

Wanting to make sure that we have the right level of Capex.

The other one is commercial capabilities right. So if you think about.

That gets drives the right ROI, but also build capabilities and our infrastructure. So again give you. A example, and I know we've spoken about this in the.

Our market share in the United States.

The dog category captaincy is significantly higher than the market share we have.

The last few years is <unk>.

And that means we all.

Playing a role in driving that.

Things like variety backing in things like having the ability to new flavors.

Capability with our retailers so that again goes back to <unk>.

In our breweries.

Symptoms of capabilities.

Things whenever possible, maybe five years ago and this is the investment that we've made to create these capabilities in infrastructure right. So.

And then the last part is technology.

Bullets in terms of baseline technology needs, but some of the new capabilities around AI and how do we leverage that with our infrastructure.

Infrastructure. So we're going to continue focusing on these areas I think your question around what's the right level of investment.

Making sure we have the right level of Capex right, which is.

Tracey Joubert: No, I think you've basically covered it. Rahul, just maybe an added thing in terms of the current outlook is the cost, and particularly driven by the Midwest Premium. We have seen that now in October being the highest level ever, with potential more increases coming. So that was also a part of the outlook for our costs. But having said that, look, we remain confident in the resilience of the beer industry. And also, as Rahul has said, our ability to return to both top and bottom line growth.

Traci Joubert: No, I think you've basically covered it. Rahul, just maybe an added thing in terms of the current outlook is the cost, and particularly driven by the Midwest premium. We have seen that now in October being the highest level ever with potential more increases coming. So that was also a part of the outlook for our costs. But having said that, look, we remain confident in the resilience of the beer industry, and also, as Rahul has said, our ability to return to both top and bottom line growth.

<unk> is important so I think that's one thing we're going to continue to look at.

I think again more to come on that as we think about our total business, but the lengths. We usually have on this is what is it driving for our business is it productivity is it efficiency is it enabling it offline so being very clear on the kpis or metrics that.

Supply chain continues to be an area of making sure we have strong capabilities again.

Outside Capex in supply chain, it seems like optimization off of logistics and transportation costs right. So some of the new tools and technology et cetera can enable us to do that.

We use to make sure that these investments are returning something to the business. So so while we will focus on capabilities. It is from our lens, so productivity efficiency or to enable the top and bottom line.

The other one is commercial capabilities right. So if you think about them.

Our market share in the United States.

<unk> category captaincy is significantly higher than the market share we have.

And that means we are.

Yes.

Plays a role in driving that.

Operator: Thank you. Our next question comes from Rob Ottenstein with Evercore. Please go ahead.

Thank you. Our next question comes from Kevin Grundy with BNP Paribas.

Operator: Thank you. Our next question comes from Rob Ottenstein with Evercore. Please go ahead.

Capability with our retailers so that again goes back to.

Please go ahead Kevin.

<unk> of capabilities.

Great. Thanks, good morning, everyone.

Traci Mangini: Great. Thank you very much. And congratulations to you, Rahul, and to Gavin. And best of luck. So I guess the question I'd like to try to approach, Rahul, is to get a sense of your mandate from the board and to what how much freedom is the board giving you to the sense that if you wanted to make significant changes, is kind of everything on the table, no sacred cows, and that kind of approach. So something that may be a departure from the past, or is the mandate from the board more like just kind of stay the course, tweak things around the edges, improve execution here and there, but basically let's weather the storm and keep kind of plugging forward?

Rob Ottenstein: Great. Thank you very much. And congratulations to you, Rahul, and to Gavin. And best of luck. So I guess the question I'd like to try to approach, Rahul, is to get a sense of your mandate from the board and to what how much freedom is the board giving you to the sense that if you wanted to make significant changes, is kind of everything on the table, no sacred cows, and that kind of approach. So something that may be a departure from the past, or is the mandate from the board more like just kind of stay the course, tweak things around the edges, improve execution here and there, but basically let's weather the storm and keep kind of plugging forward?

Traci Mangini: Great. Thank you very much. And congratulations to you, Rahul, and to Gavin. And best of luck. So I guess the question I'd like to try to approach, Rahul, is to get a sense of your mandate from the board and to what, how much freedom is the board giving you, to the sense that if you wanted to make significant changes, it's kind of everything on the table, no sacred cows, and that kind of approach, so something that may be a departure from the past. Or is the mandate from the board more like, "Just kind of stay the course, tweak things around the edges, improve execution here and there, but basically, let's weather the storm and keep kind of plugging forward"?

And then the last part is technology.

ROE a question two questions for me actually kind of pull together some of the themes that we've talked about and that is your assessment of the company's cost structure more broadly.

Both in terms of baseline technology needs, but some of the new capabilities around AI and how do we leverage that with our infrastructure.

Infrastructure. So we're going to continue focusing on these areas I think your question around what's the right level of investment.

Particularly from a supply chain of brewery optimization perspective, so the company made some difficult choices at the corporate level, but.

I think again more to come on that as we think about our total business, but the lengths. We usually have on this is what is it driving for our business right is it productivity is it efficiency is it enabling adult line, so being very clear on all the kpis or metrics that.

But it's the volume outlook has certainly become quite a bit more challenging.

Perhaps the company's fixed cost structures not appropriately sized for kind of the new reality.

So one do you view that as a fair assessment.

Two in light of one of the questions earlier on investment levels do you view incremental productivity as an enabler to support higher investment levels or would incremental investment be a near term drag on margins. So thank you for that.

We use to make sure that these investments are returning something to the business. So so while we will focus on capability that is from a lens of productivity efficiency or to enable top and bottom line.

Thank you Kevin.

Okay.

So let me address your first thing around the brewery, one and the second one I just want to make sure I got your question right, but on the brewery stuff on a brewery infrastructure.

Yeah.

Thank you. Our next question comes from Kevin Grundy with BNP Paribas.

Please go ahead Kevin.

We're always looking at ways of making our brewery network efficient rather than you've seen some of the actions we've taken in the past.

Great. Thanks, good morning, everyone.

ROE a question two questions for me actually kind of pull together some of the themes that we've talked about and that is your assessment of the company's cost structure more broadly.

Couple of things I'd call out as we think about infrastructure one is around transportation.

Traci Mangini: So just really just trying to get a sense of kind of how those discussions went and what range of freedom you feel that you have to create shareholder value here. Thank you.

Traci Mangini: Just really just trying to get a sense of kind of how those discussions went and what range of freedom you feel that you have to create shareholder value here. Thank you.

Just really just trying to get a sense of kind of how those discussions went and what range of freedom you feel that you have to create shareholder value here. Thank you.

Particularly from a supply chain of brewery optimization perspective, so the company made some difficult choices at the corporate level.

<unk> cost rather than making sure that we are looking at brewery infrastructure in the context of transportation.

But it's the volume outlook has certainly become quite a bit more challenging.

The bodies, the seasonality of our business right to see.

Now in terms of summer and being sure we.

Rahul Goyal: Good morning, Rob. Thanks for the question. Yeah. I would say we definitely, our board is always focused on what's the best thing for all shareholders, right? I mean, that's definitely the lens. Frankly, there is no sacred cows. I mean, I think they've given us, given me the freedom to say, "Let's make sure we have a plan that can drive the most shareholder value." And that's what we are, that's what I'm leading for. So yeah, there are no sacred cows. There's no constraints, I think. You and everybody on this call understands the challenges that are in the category. I know there's been a lot written about our portfolio. So I mean, all of that is real, and that's the context to work within. But in terms of the direction for the board, it is about driving, maximizing shareholder value in the best possible way we can.

Rahul Goyal: Good morning, Rob. Thanks for the question. Yeah. I would say we definitely our board is always focused on what's the best thing for all shareholders, right? I mean, that's definitely the lens. Frankly, there is no sacred cows. I mean, I think they've given us, given me the freedom to say, "Let's make sure we have a plan that can drive most shareholder value." That's what we are, that's what I'm leading for. So yeah, there are no sacred cows. There's no constraints. I think you and everybody on this call understands the challenges that are in the category. I know there's been a lot written about our portfolio. So I mean, all of that is real, and that's the context to work within.

Perhaps the company's fixed cost structures not appropriately sized for kind of the new reality. If you will so one do you view that as a fair assessment.

Think about that so.

To answer your question broadly, we're absolutely going to be thinking about all the elements of Av.

Our fixed cost base.

Right now I don't believe.

We need to be closing a brewery I think we need to be smart about how we think about lines in particular breweries may reproduce what product how do we get smarter about some of the efficiency in terms of moving up your hands down.

Thank you Kevin.

So let me address your first thing around the brewery, one and the second one I just want to make sure I got your question right, but on the brewery stuff on a brewery infrastructure.

I think thats, how we think about it.

Fair question as we think about the volume outlook and what that does but a cost thing will always be a focus for us whether it's on the fixed side, whether it's on the G&A side I think.

We're always looking at ways of making our brewery network efficient rather than you've seen some of the actions we've taken in the past.

Couple of things I'd call out as we think about our brewery infrastructure. One is around transportation costs, right and making sure that we are looking at brewery infrastructure in the context of transportation. The other bodies the seasonality of our business right now.

That that priority and focus I would say always remain.

Rahul Goyal: But in terms of the direction for the board, it is about driving, maximizing shareholder value in the best possible way we can. Definitely don't feel any constraint. There's going to be no sacred cows. I think the tricky part in terms of your colleagues asked this question, right? Category is going through a tricky time this year. Again, I go back to, we are in great geographies with big profit pools, but yeah, it comes with a different shape of category health. Those are all reality contexts, but it doesn't take away from the opportunities we have for our portfolio. I think that's the best way. Again, that's why you see me talk about even the balance sheet.

But in terms of the direction for the board, it is about driving, maximizing shareholder value in the best possible way we can. Definitely don't feel any constraint. There's going to be no sacred cows. I think the tricky part in terms of your colleagues asked this question, right? Category is going through a tricky time this year. Again, I go back to, we are in great geographies with big profit pools, but yeah, it comes with a different shape of category health. Those are all reality contexts, but it doesn't take away from the opportunities we have for our portfolio. I think that's the best way. Again, that's why you see me talk about even the balance sheet.

Question about do we need investment to drive productivity.

Rahul Goyal: So definitely don't feel any constraint. Definitely be no sacred cows. I think the tricky part in terms of your colleagues asked this question, right? Category is going through a tricky time this year. Again, I go back to we are in great geographies with big profit pools, but yeah, it comes with a different shape of category health. And those are all reality contexts, but it doesn't take away from the opportunities we have for our portfolio. So I think that's the best way. And again, that's why you see me talk about even the balance sheet. And while we're committed to returning cash to shareholders, we're going to find the right ideas to deploy capital to get ourselves back to top and bottom line growth also. Yeah, no, I understand the question, Rob, but no constraints here from the board or anybody else.

I think that was the theme of the question.

Don't believe we need some high elevated levels of investment to drive productivity I think we need to.

In terms of summer and being sure we.

Think about that so.

To answer your question broadly yeah, we're absolutely going to be thinking about all the elements of.

Looking at our Capex and the right to win and be checking ourselves to make sure we get the right ROI.

Of our fixed cost base.

We need to make sure that the investment we have in people technology is driving the right returns.

Right now I don't believe.

We need to be closing the brewery thing we need to be smart about how we think about lines in particular breweries, where we produce what products how do we get smarter about some of the.

But I don't believe I think the question was do you expect a big Spike in investment.

Dock productivity I think that bill.

<unk> fee in terms of moving up your hands around.

Believe I see that right now I think.

Marketing again, I want to make sure we have the right pressure against our brands again, but check desktop sales to make sure we're getting the right return on the marketing right. So.

Rahul Goyal: While we're committed to returning cash to shareholders, we're going to find the right ideas to deploy capital to get ourselves back to top and bottom line growth also. So yeah, no, I understand the question, Rob, but no constraints here from the board or anybody else.

While we're committed to returning cash to shareholders, we're going to find the right ideas to deploy capital to get ourselves back to top and bottom line growth also. So yeah, no, I understand the question, Rob, but no constraints here from the board or anybody else.

I think thats, how we think about it.

Fair question as we think about the volume outlook and what that does but a.

Costing will always be a focus for us whether it's on the fixed side, whether it's on the G&A side I think.

So hopefully I answer Kevin move to your questions in terms of fixed costing and the investment profile.

That that priority and focus I would say always remain.

Thank you.

Our next question comes from come out.

Operator: Thank you. Our next question comes from Eric Serotta with Morgan Stanley. Please go ahead.

Operator: Thank you. Our next question comes from Eric Sirotta with Morgan Stanley. Please go ahead.

Question about do we need investments to drive productivity.

With Jefferies.

Please go ahead.

Yeah.

That was the theme of the question that I don't believe we need some high elevated levels of investment to drive productivity I think we need to.

Hey, everybody. Good morning, Congratulations all around also I think congratulations to Eric Cerrado and might have been the first analyst to pronounce your name correctly.

Christopher Carey: Great. Thank you. Congratulations again to Gavin and Rahul. Rahul, hoping you can talk a little bit more about the overall level of investment and capabilities, your comfort with the current level. I know you talked about having the right marketing pressure behind the brands, but if you look a little bit more broadly, investment obviously is more broad than marketing support. As you look at the organization, it's come a long way in terms of capabilities since 2019 and the revitalization plan. Are there areas either that need increased investment or where you need to further build out capabilities either from an OpEx or CapEx standpoint from here?

Eric Serotta: Great. Thank you. Congratulations again to Gavin and Rahul. Rahul, hoping you can talk a little bit more about the overall level of investment and capabilities, your comfort with the current level. I know you talked about having the right marketing pressure behind the brands, but if you look a little bit more broadly, investment obviously is more broad than marketing support. As you look at the organization, it's come a long way in terms of capabilities since 2019 and the revitalization plan. Are there areas either that need increased investment or where you need to further build out capabilities either from an OpEx or CapEx standpoint from here?

Bill Kirk: Great. Thank you. And congratulations again to Gavin and Rahul. Rahul, hoping you can talk a little bit more about the overall level of investment and capabilities, your comfort with the current level. I know you talked about having the right marketing pressure behind the brands, but if you look a little bit more broadly, investment obviously is more broad than marketing support. As you look at the organization, it's come a long way in terms of capabilities since 2019 and the revitalization plan. Are there areas either that need increased investment or where you need to further build out capabilities, either from an OpEx or CapEx standpoint from here?

<unk>.

Looking at our Capex and the right to win and be checking ourselves to make sure we get the right ROI.

Youll find named pronunciation to be a thing on it.

Many of these calls.

Need to make sure that the.

Youre getting the same question I guess over and over again around the restructuring and investment levels and I think a lot of that is because in many instances when the industry is struggling and has struggled for.

But we haven't people technology is driving the right returns.

But I don't believe I think the question was do you expect a big spike in investments.

To drive productivity I think that I don't believe I see that right now.

Over a decade.

Marketing again, I want to make sure we have the right pressure against our brands again, but check desktop subs to make sure we're getting the right return on the marketing right. So.

We see bigger bigger restructuring bigger savings.

The time of.

A management change in whats been announced so far seems small.

Yes.

So hopefully I answer Kevin most of your questions in terms of fixed costing and the investment profile.

I'm curious is this just the first step and theres bigger restructuring to come or.

Is it sort of everything is in place now and it's time to go.

Thank you.

Our next question comes from come out.

Goldman Thanks, Paul Thanks for the question.

With Jefferies.

Please go ahead.

I think.

Yeah.

I know I'm keen to also talk about I told Ben and I look forward to sharing that in the coming months right.

Rahul Goyal: Thank you, Eric. Good morning to you. And yeah, no, I would break out the capabilities in probably maybe three broad buckets, right? So one is our supply chain, wanting to make sure that we have the right level of CapEx that drives the right ROI, but also builds capabilities in our infrastructure. So again, give you an example, and I know we've spoken about this in the last few years, is things like variety packing and things like having the ability to do flavors in our breweries. I mean, these things were never possible maybe five years ago. And this is investment that we've made to create these capabilities in our infrastructure, right? So making sure we have the right level of CapEx, right, which is important. So I think that's one thing we're going to continue to look at.

Rahul Goyal: Thank you, Eric. Good morning to you. And yeah, no, I would break out the capabilities in probably maybe three broad buckets, right? So one is our supply chain, wanting to make sure that we have the right level of CapEx. That drives the right ROI, but also builds capabilities in our infrastructure. So again, give you an example, and I know we've spoken about this in the last few years, is things like variety packing and things like having the ability to do flavors in our breweries. I mean, these things were never possible maybe five years ago. And this is investment that we've made to create these capabilities in our infrastructure, right? So making sure we have the right level of CapEx, right, which is important. So I think that's one thing we're going to continue to look at.

Hey, everybody. Good morning, Congratulations all around also I think congratulations to Eric Cerrado might've been the first analyst to pronounce your name correctly.

We definitely if you think about our business and you said this with respect to long term trends, making sure. We are looking at our cost base in the right way.

Youll find named pronunciation to be a thing on it.

Many of these calls.

I think we're going to look at everything.

The piece that we took action on in the short term in the last 30 days was to make sure. We are set up well in the Americas for 2020 six so.

Over a decade.

I would say more to come in as we think about all the elements of the plan.

We see bigger bigger restructuring bigger savings at the time.

Cost and efficiency is another element that is super important.

A management change in whats been announced so far seems small.

Yes.

But people are trying to move with pace as we think about setting ourselves up in the Americas for 'twenty 'twenty six.

Curious is this just the first step and there is a bigger restructuring to come or.

Is it sort of everything is in place now and it's time to go.

Thank you our next.

Rahul Goyal: So supply chain continues to be an area of making sure we have strong capabilities. Again, outside CapEx and supply chain is things like optimization of logistics and transportation costs, right? So some of the new tools and technology, etc., can enable us to do that. The other one is commercial capabilities, right? So if you think about our market share in the United States, but our category captaincy is significantly higher than the market share we have. And that means we are playing a role in driving that capability with our retailers. So that, again, goes back to examples of capabilities. And then the last part is technology, both in terms of baseline technology needs with some of the new capabilities around AI and how do we leverage that with our infrastructure. So we're going to continue focusing on these areas.

Rahul Goyal: So supply chain continues to be an area of making sure we have strong capabilities. Again, outside CapEx and supply chain is things like optimization of logistics and transportation costs, right? So some of the new tools and technology, etc., can enable us to do that. The other one is commercial capabilities, right? So if you think about our market share in the United States, but our category captaincy is significantly higher than the market share we have. And that means we are playing a role in driving that capability with our retailers. So that, again, goes back to examples of capabilities. And then the last part is technology, both in terms of baseline technology needs, with some of the new capabilities around AI and how do we leverage that with our infrastructure. So we're going to continue focusing on these areas.

So supply chain continues to be an area of making sure we have strong capabilities. Again, outside CapEx and supply chain is things like optimization of logistics and transportation costs, right? So some of the new tools and technology, etc., can enable us to do that. The other one is commercial capabilities, right? So if you think about our market share in the United States, but our category captaincy is significantly higher than the market share we have. And that means we are playing a role in driving that capability with our retailers. So that, again, goes back to examples of capabilities. And then the last part is technology, both in terms of baseline technology needs, with some of the new capabilities around AI and how do we leverage that with our infrastructure. So we're going to continue focusing on these areas.

Next question comes from Lauren Lieberman with Barclays.

Goldman Thanks, Paul Thanks for the question.

Please go ahead great. Thanks.

Thank you.

I know I'm keen to also talk about I told Ben and I look forward to sharing that in the coming months right.

Thanks, so much good morning.

One thing I wanted to go back to we've just.

In the prepared remarks, Phil when you commented on I find that quite again.

We would be definitely if you think about our business and you said this with respect to long term trends, making sure. We are looking at our cost space and the right way.

The commercial changes I know you answered <unk> question, you have a little of that architecture, but you also talked about deploying marketing.

Based on market dynamics and portfolio priority and I just.

I think we're going to look at everything.

Was curious what were you doing before because that sounds like I would think thats whats already I think so just curious how you maybe compare and contrast.

The piece that we took action on in the in the short term in the last 30 days was to make sure. We are set up well, India Medical's for 2020 six so.

Sure.

What it is that needs that need to change. Thanks, so much.

I would say more to come in as we think about all the elements of the plan.

Yes, Thank you Lauren.

Cost and efficiency is another element that is super important.

Absolutely Great question I think the way I would think about this is is how do we react faster to the external market dynamics right. I mean, if you look at our brands, while we have big national brands, they play different roles regionally.

But people are trying to move with pace as we think about setting ourselves up in the Americas for 2026.

Rahul Goyal: I think your question around what's the right level of investment. I think, again, more to come on that as we think about our total business. But the lens we usually have on this is what is it driving for our business, right? Is it productivity? Is it efficiency? Is it enabling the top line? So being very clear on all the KPIs or metrics that we use to make sure that these investments are returning something to the business. So while we will focus on capabilities, it is from a lens of productivity, efficiency, or to enable top and bottom line.

Rahul Goyal: I think your question around what's the right level of investment, I think again, more to come on that as we think about our total business. But the lens we usually have on this is what is it driving for our business, right? Is it productivity? Is it efficiency? Is it enabling the top line? So being very clear on all the KPIs or metrics that we use to make sure that these investments are returning something to the business. So while we will focus on capabilities, it is from a lens of productivity, efficiency, or to enable top and bottom line.

I think your question around what's the right level of investment, I think again, more to come on that as we think about our total business. But the lens we usually have on this is what is it driving for our business, right? Is it productivity? Is it efficiency? Is it enabling the top line? So being very clear on all the KPIs or metrics that we use to make sure that these investments are returning something to the business. So while we will focus on capabilities, it is from a lens of productivity, efficiency, or to enable top and bottom line.

Thank you our next.

Our next question comes from Lauren Lieberman with Barclays.

Hey.

Operators in terms of market share we have in each state or each region is different and we need to just find ways of being deploying I don't have the resources in our store.

Please go ahead great. Thanks.

Thanks, so much good morning.

One thing I wanted to go back to we've just.

In the prepared remarks, Phil when you commented on quite a bit.

I'll go away.

Added part and some of this we were doing but again I have the pieces I would say is different or will be different is in the context of accountability. How do we make sure our decision making is as close to those markets as possible. How do we make sure we can shift both people and dollars resources closest to that decision making.

Hum.

The commercial changes I know you in answering Steve's question, you talked a little of that structure, but you also talked about deploying marketing.

Based on market dynamics and portfolio priority and I just.

Was curious what were you doing before because that sounds like I would think that's what's already happening. So I'm just curious how you maybe compare and contrast.

Operator: Thank you. Our next question comes from Kevin Grundy with BNP Paribas. Please go ahead, Kevin.

Operator: Thank you. Our next question comes from Kevin Grande with BNP Paribas. Please go ahead, Kevin.

<unk>.

And I think thats those are the changes that.

No.

What does it mean that needs to change thanks, so much.

We would feel different for our teams how we operate how we engage with our distributor network.

Traci Mangini: Great. Thanks. Morning, everyone. Rahul, two questions for me, actually, kind of pulling together some of the themes that we've talked about. That is your assessment of the company's cost structure more broadly, particularly from a supply chain and brewery optimization perspective. So the company made some difficult choices at the corporate level, but as the volume outlook has certainly become quite a bit more challenging. Perhaps the company's fixed cost structure is not appropriately sized for kind of the new realities, if you will. So one, do you view that as a fair assessment? And two, in light of one of the questions earlier on investment levels, do you view incremental productivity as an enabler to support higher investment levels, or would incremental investment be a near-term drag on margins? So thank you for that.

Kevin Grundy: Great. Thanks. Morning, everyone. Rahul, two questions for me, actually, kind of pulling together some of the themes that we've talked about. That is your assessment of the company's cost structure more broadly, particularly from a supply chain and brewery optimization perspective. So the company made some difficult choices at the corporate level, but as the volume outlook has certainly become quite a bit more challenging. Perhaps the company's fixed cost structure is not appropriately sized for kind of the new realities, if you will. So one, do you view that as a fair assessment? And two, in light of one of the questions earlier on investment levels, do you view incremental productivity as an enabler to support higher investment levels, or would incremental investment be a near-term drag on margins? So thank you for that.

Traci Mangini: Great. Thanks. Morning, everyone. Rahul, two questions for me, actually, kind of pulling together some of the themes that we've talked about. And that is your assessment of the company's cost structure more broadly, particularly from a supply chain and brewery optimization perspective. So the company made some difficult choices at the corporate level, but as the volume outlook has certainly become quite a bit more challenging, perhaps the company's fixed cost structure is not appropriately sized for kind of the new realities, if you will. So one, do you view that as a fair assessment? And two, in light of one of the questions earlier on investment levels, do you view incremental productivity as an enabler to support higher investment levels, or would incremental investment be a near-term drag on margins? So thank you for that.

Yes, Thank you Loren.

Absolutely Fair question I think.

And so I think.

It is things I would say, we weren't doing what you just need to lean in harder given how the category has changed right. I mean, if you look at the regional performance.

The way I would think about this is is how do we react faster to be external market dynamics right. I mean, if you look at our brands, while we have big national brands, they play different roles regionally.

We talk about our national performance organically.

But the category is performing very differently in different parts of this country and we need to make sure.

<unk>.

<unk> operates in terms of market share we have in each state or each region is different and we need to just find ways of being deploying our resources in a stronger way.

We're pivoting to that both from a resource perspective from a brand perspective, that's where the economy context comes in.

Conversation right.

The part and some of this we were doing but again the pieces I would say is different or will be different is in the context of accountability.

Because some of our economy brands are very big in particular geographies.

If we are not putting the right focus on those stats.

Do we make sure our decision making is as close to those markets as possible. How do we make sure we can shift both people and dollars resources closest to that decision making.

The whole growth algorithm becomes very hard to to.

Rahul Goyal: Thank you, Kevin. So let me address your first thing around the brewery one. And the second one, I just want to make sure I got your question right. But on the brewery stuff, on our brewery infrastructure, I mean, we're always looking at ways of making our brewery network efficient, right? And you've seen some of the actions we've taken in the past. A couple of things I'd call out as we think about our brewery infrastructure. One is around transportation costs, right, and making sure that we are looking at brewery infrastructure in the context of transportation. The other part is the seasonality of our business, right? So seasonality in terms of summer and making sure we think about that. So to answer your question broadly, yeah, we're absolutely going to be thinking about all the elements of our fixed cost base.

Rahul Goyal: Thank you, Kevin. So let me address your first thing around the brewery one. And the second one, I just want to make sure I got your question right. But on the brewery stuff, on our brewery infrastructure, I mean, we're always looking at ways of making our brewery network efficient, right? And you've seen some of the actions we've taken in the past. A couple of things I'd call out as we think about our brewery infrastructure. One is around transportation costs, right, and making sure that we are looking at brewery infrastructure in the context of transportation. The other part is the seasonality of our business, right? So seasonality in terms of summer and making sure we think about that. So, to answer your question broadly, yeah, we're absolutely going to be thinking about all the elements of our fixed cost base.

To make happen so.

No.

I would say those are the big highlights I would call out lower than your question.

I think thats those are the changes that would.

Thank you our next.

I would feel different for our teams how we operate how we engage with our distributor network.

Next question comes from <unk> <unk> with Bernstein.

Please go ahead.

Yes, hi, Thank you for taking my question I'd like to come back to some of the cyclical pressures that you called out in the prepared remarks.

Laurence I think.

It is and so I would say we were doing was we just need to lean in harder given.

The category has changed right I mean, if you look at the regional performance.

And in particular, what are you seeing in terms of consumer sentiment for your consumers in Q3 and to the extent that you can comment on this in October I. Appreciate the prepared remarks, you made but are there any internal surveys where analytics that you're able to share about what's driving consumer behavior today.

We talk about the national performance of the category.

But the category is performing very differently in different parts of this country and we need to make sure.

Pivoting to that both from a resource perspective from a brand perspective, that's where the economy context comes into conversation right.

And how does that help you be more confident in your statement that.

Some of our economy brands are very big in particular geographies.

Rahul Goyal: Right now, I don't believe we need to be closing a brewery. I think we need to be smart about how we think about lines in particular breweries, where we produce what product, how do we get smarter about some of the efficiency in terms of moving our brands around. I think that's how we think about it. But fair question as we think about the volume outlook and what that does. But a cost thing will always be a focus for us, whether it's on the fixed side, whether it's on the G&A side. I think that priority and focus will, I would say, always remain. Your question about do we need investment to drive productivity, I think that was the theme of the question. I don't believe we need some high elevated levels of investment to drive productivity.

Rahul Goyal: Right now, I don't believe we need to be closing a brewery. I think we need to be smart about how we think about lines in particular breweries, where we produce what product, how do we get smarter about some of the efficiency in terms of moving our brands around. I think that's how we think about it. But fair question, as we think about the volume outlook and what that does. But a cost thing will always be a focus for us, whether it's on the fixed side, whether it's on the G&A side. I think that priority and focus will, I would say, always remain. Your question about do we need investment to drive productivity, I think that was the theme of the question. I don't believe we need some high elevated levels of investment to drive productivity.

Right now, I don't believe we need to be closing a brewery. I think we need to be smart about how we think about lines in particular breweries, where we produce what product, how do we get smarter about some of the efficiency in terms of moving our brands around. I think that's how we think about it. But fair question, as we think about the volume outlook and what that does. But a cost thing will always be a focus for us, whether it's on the fixed side, whether it's on the G&A side. I think that priority and focus will, I would say, always remain. Your question about do we need investment to drive productivity, I think that was the theme of the question. I don't believe we need some high elevated levels of investment to drive productivity.

The incremental pressure, we're seeing today is firmly cyclical as opposed to structural thank you.

If we are not putting the right focus on those stats.

The whole growth then it becomes very hard to.

Yes.

To make happen so.

Again, I understand the question, but so if I address it and maybe a few added points to give you some context or at least how we're seeing it I mean.

So.

I would say those are the big highlights I would call out Laurent Ezekiel question.

Thank you.

If you go back to pre 2005, I mean, some of these trends have been with us.

Question comes from <unk> <unk> with Bernstein.

Please go ahead.

As the beer category.

Yes, hi, Thank you for taking my question I'd like to come back to some of the cyclical pressures that you called out in the prepared remarks.

One of our longtime right, whether it's health and wellness whether it's.

Generational change with his people making choices around.

And in particular, what are you seeing in terms of consumer sentiment for your consumers in Q3 and to the extent that you can comment on this in October I. Appreciate the prepared remarks, you made but are there any internal surveys where analytics that youre able to share about what's driving consumer behavior today.

Alcohol I think that some of those have been.

And everybody in the industry have known about those.

If you look at the category historically used to be in the minus one two with.

The last few years has been to minus six range.

Rahul Goyal: I think we need to look at our CapEx in the right way and be checking ourselves to make sure we get the right ROI. We need to make sure that the investment we have in people, technology, is driving the right returns. But I don't believe I think the question was, do I expect a big spike in investment to drive productivity? I think that I don't believe I see that right now. I think marketing, again, I want to make sure we have the right pressure against our brands again, but check, test ourselves to make sure we're getting the right return on the marketing, right? So, hopefully, I answered, Kevin, both your questions in terms of fixed costing and the investment profile.

Rahul Goyal: I think we need to look at our CapEx in the right way and be checking ourselves to make sure we get the right ROI. We need to make sure that the investment we have in people, technology is driving the right returns. But I don't believe I think the question was, do I expect a big spike in investment to drive productivity? I think that I don't believe I see that right now. I think marketing, again, I want to make sure we have the right pressure against our brands again, but check, test ourselves to make sure we're getting the right return on the marketing, right? So hopefully, I answered Kevin both your questions in terms of fixed costing and the investment profile.

I think we need to look at our CapEx in the right way and be checking ourselves to make sure we get the right ROI. We need to make sure that the investment we have in people, technology is driving the right returns. But I don't believe I think the question was, do I expect a big spike in investment to drive productivity? I think that I don't believe I see that right now. I think marketing, again, I want to make sure we have the right pressure against our brands again, but check, test ourselves to make sure we're getting the right return on the marketing, right? So hopefully, I answered Kevin both your questions in terms of fixed costing and the investment profile.

This year I would say that's been definitely.

Added pressure and you see that.

And how does that help you be more confident in your statement that.

Across staples, and there hasnt been immune to that so whether that is.

The incremental pressure, we're seeing today is firmly cyclical as opposed to structural thank you.

Yeah.

Impact of tariffs on consumer sentiment if it is.

Yes.

The focus on the Hispanic community.

Again, I understand the question, but so if I address it and maybe a few added points to give you some context audris how are we seeing it.

Any of those elements. So I do believe that haven't had.

Different type of an impact too.

The beer category this year.

If you go back to pre 2005, I mean, some of these trends have been with us.

And.

Thats, where once we got through these macro issues than.

As the beer category.

Then we need to get back to those baseline levels of how we think about the category and then making sure we're winning in that category.

All of our longtime right, whether it's health and wellness whether it's.

Generational change with his people making choices around.

Operator: Thank you. Our next question comes from Kaumil Gajrawala with Jefferies. Please go ahead.

Alcohol I think that some of those have been.

Thank you. Our next question comes from Robert Moskow with TD Cowen.

And everybody in the industry have known about those.

Please go ahead.

If you look at the category historically used to be in the minus one two with the.

Rahul Goyal: Hey, everybody. Good morning. Congratulations all around. Also, I think congratulations to Eric Serotta who might have been the first analyst to pronounce your name correctly. You'll find name pronunciation to be a thing on many of these calls. You're getting the same question, I guess, over and over again around the restructuring and investment levels. And I think a lot of that is because in many instances when an industry is struggling and has struggled for over a decade, we see bigger restructurings, bigger savings at the time of management change. And what's been announced so far seems small. So just curious, is this just the first step and there's bigger restructuring to come, or is it sort of everything's in place now and it's time to go?

Kaumil Gajrawala: Hey, everybody. Good morning. Congratulations all around. Also, I think congratulations to Eric Serotta who might have been the first analyst to pronounce your name correctly. You'll find name pronunciation to be a thing on many of these calls. You're getting the same question, I guess, over and over again around the restructuring and investment levels. And I think a lot of that is because in many instances when an industry is struggling and has struggled for over a decade, we see bigger restructurings, bigger savings at the time of management change. And what's been announced so far seems small. So just curious, is this just the first step and there's bigger restructuring to come, or is it sort of everything's in place now and it's time to go?

Kaumil Gajrawala: Hey, everybody. Good morning. Congratulations all around. Also, I think congratulations to Eric Sirotta. You might have been the first analyst to pronounce your name correctly. You'll find name pronunciation to be a thing on many of these calls. You're getting the same question, I guess, over and over again around the restructuring and investment levels. I think a lot of that is because in many instances, when an industry is struggling and has struggled for over a decade, we see bigger restructurings, bigger savings at the time of management change. What's been announced so far seems small. So just curious, is this just the first step and there's bigger restructuring to come, or is it sort of everything's in place now and it's time to go?

Hey, Thank you Rob.

I'm trying to.

The last few years has been providers see ish range.

Trying to summarize all of the commentary about the regional execution versus the national.

This year I would say that's been definitely.

Added pressure and you see that.

The marketing of your brands and I just wanted to make sure I understand you.

Across staples, and there hasnt been immune to that so whether that is.

You have Coors light and Miller Lite. Your two biggest brands is it your view that on a national level.

The.

The impact of tariffs on consumer sentiment if it is.

That the marketing of those brands has been just fine because there has been multiyear share losses of those one of your competitors has made great inroads in the light category probably at their expense so.

We focus on the Hispanic community.

Any of those elements. So I do believe that has had a different type of an impact too.

The organically this year.

And that's.

Is there.

Thats, where once we got through these macro issues than.

Do you think that the national marketing of those brands is doing just fine and really it's just the regional execution could improve in and that's the way to stabilize.

And then we need to get back to those baseline levels of how we think about the category and then making sure we're winning in that category.

No. Thank you for that question, we definitely think there is opportunities for us as we think about.

Thank you. Our next question comes from Robert Moskow with TD Cowen.

Rahul Goyal: Thanks for the question. I think I know I'm keen to also talk about our total plan, and I look forward to sharing that in the coming months, right? I mean, we definitely, if you think about our business, and you said this with respect to long-term trends, making sure we are looking at our cost base in the right way. I think we're going to look at everything. The piece that we took action on in the short term in the last 30 days was to make sure we are set up well in the Americas for 2026. So I would say more to come as we think about all the elements of the plan. Cost and efficiency is another element that is super important. But we were trying to move with pace as we think about setting ourselves up in the Americas for 2026.

Rahul Goyal: Colin, thanks for the question. I think I know. I'm keen to also talk about our total plan, and I look forward to sharing that in the coming months, right? I mean, we definitely, if you think about our business, and you said this with respect to long-term trends, making sure we are looking at our cost base in the right way. I think we're going to look at everything. The piece that we took action on in the short term in the last 30 days was to make sure we are set up well in the Americas for 2026. So, I would say more to come as we think about all the elements of the plan. Cost and efficiency is another element that is super important. But we were trying to move with pace as we think about setting ourselves up in the Americas for 2026.

Please go ahead.

Now these brands show up too.

Hey, Thank you Rob.

If you think about.

The work we are doing on Miller Lite with video.

Trying to.

Trying to summarize all of the commentary about the regional execution versus the national.

Dr campaign.

I think if.

If you look at share share losses.

Marketing up your brands and I just wanted to make sure I understand you.

Was like versus in Q3 versus Q2 so.

Definitely that's something we're looking at of the national campaigns for our big brands and how do we lean into a different piece, how do we think about it going forward.

You have Coors light and Miller Lite. Your two biggest brands is it your view that on a national level.

And I'll just point to point it out to Coors banquet right I mean, I think it's a brand that as.

Clearly medical Zuma need as it is.

As a native with consumers.

Obviously executed well in the context of distribution gains.

Is there.

Do you think that the national marketing of those brands is doing just fine and really it's just the regional execution could improve in and that's the way to stabilize.

But.

Absolutely.

Focused on making sure we've got the right campaigns for Coors light and Miller Lite and you can see some of that play out as.

Operator: Thank you. Our next question comes from Lauren Lieberman with Barclays. Please go ahead.

No. Thank you for that question, we definitely think there is opportunities for us as we think about.

But with live sports in the coming months.

Lauren Lieberman: Great. Thanks. Thanks so much. Good morning. One thing I wanted to go back to was just in the prepared remarks where you commented on—I'm just going to find the quote again—the commercial changes. And I know you, in answer to Steve's question, you talked a little bit about org structure, but you also talked about deploying marketing based on market dynamics and portfolio priorities. And I just was curious, what were you doing before? Because that sounds like I would think that's what's already happening. So I'm just curious how you maybe compare and contrast and what it is that needs to change. Thanks so much.

Rahul Goyal: Great. Thanks so much. Good morning. One thing I wanted to go back to was just in the prepared remarks role when you commented on. I'm just going to find the quote again. On the commercial changes. And I know you, in answer to Steve's question, you talked a little bit about org structure, but you also talked about deploying marketing based on market dynamics and portfolio priorities. And I just was curious, what were you doing before? Because that sounds like I would think that's what's already happening. So I'm just curious how you maybe compare and contrast and what it is that needs to change. Thanks so much.

How these brands show up too.

If you think about.

Thank you. Our final question today comes from Gerald Pascarelli with Nathan Cai.

The work we are doing on Miller Lite with 50 video campaign.

Please go ahead.

I think.

And if you look at share share losses of course lag versus in Q3 versus Q2. So.

Great. Thank you very much.

Well I guess, just going back to some of the prior commentary on this call and summarize it.

Definitely that's something we're looking at the.

The national campaigns for our big brands and how do we lean into a different deal how do we think about it going forward.

Is it fair to assume or expect that bolt on M&A or a more aggressive push into beyond beer ultimately becomes a more important part of a larger part of the capital allocation strategy looking forward and then Patrice you just coming back to the Midwest premium.

0.2 pointed out two quarters banquet drive me nothing it's a brand that as.

Early medicines human need.

We've been increasing $81 10 per pound.

Rahul Goyal: Yeah. Thank you, Lauren. Absolutely fair question. I think the way I would think about this is how do we react faster to the external market dynamics, right? I mean, if you look at our brands, while we have big national brands, they play different roles regionally. They operate in terms of market share we have in each state or each region is different. We need to just find ways of deploying our internal resources in a stronger way. The added part, and some of this we were doing, right? But again, the pieces I would say are different or will be different is in the context of accountability. How do we make sure our decision-making is as close to those markets as possible? How do we make sure we can shift both people and dollar resources closest to that decision-making?

Rahul Goyal: Yeah. Thank you, Lauren. Absolutely fair question. I think the way I would think about this is how do we react faster to the external market dynamics, right? I mean, if you look at our brands, while we have big national brands, they play different roles regionally. They operate in terms of market share we have in each state or each region is different. And we need to just find ways of deploying our internal resources in a stronger way. The added part, and some of this we were doing, right? But again, the pieces I would say are different or will be different is in the context of accountability. How do we make sure our decision-making is as close to those markets as possible? How do we make sure we can shift both people and dollar resources closest to that decision-making?

As a native of consumers.

I know, there's like less than two months left in the year.

Obviously executed well in the context of distribution gains.

Premium continue to spike.

But.

Spot price threshold for us to be mindful of that could potentially put your PBT guidance.

Absolutely.

Focused on making sure we've got the right campaigns for Coors light and Miller Lite.

Risk for the year any color there would be great. Thanks.

You'll see some of that play out as.

Yes, thank you John for that and enrolling.

But with live sports in the coming months.

We look at M&A and deploying of capital we have.

Okay.

It would be strong via portfolio across across the world right. I mean, we continue to fill some gaps in that but.

Thank you. Our final question today comes from Gerald Pascarelli with Nathan Cai.

The places where we need to fill some gaps are probably in the beyond beer. So in terms of deploying capital.

Please go ahead.

Great. Thank you very much.

Well I guess, just going back to some of the prior commentary on this call and to summarize.

You will see us probably leaning a lot more on the beyond beer space.

Then the payer space.

But if there are ideas that make sense that.

Augment our business and drive top and bottom line growth.

Rahul Goyal: And I think those are the changes that would feel different for our teams, how we operate, how we engage with our distributor network. Lauren, I think it is things I would say we were doing, but we just need to lean in harder given how the category has changed, right? I mean, if you look at even regional performance, I know we talk about the national performance of the category. But the category is performing very differently in different parts of this country. And we need to make sure we're pivoting to that both from a resource perspective, from a brand perspective. That's where the economy context comes into conversation, right? Because some of our economy brands are very big in particular geographies. And if we are not putting the right focus on those, that's the whole growth algorithm becomes very hard to make happen.

Rahul Goyal: I think those are the changes that would feel different for our teams, how we operate, how we engage with our distributor network, Lauren. I think it is things I would say we were doing, but we just need to lean in harder given how the category has changed, right? I mean, if you look at even regional performance, I know we talk about the national performance of the category, but the category is performing very differently in different parts of this country. We need to make sure we're pivoting to that both from a resource perspective, from a brand perspective. That's where the economy context comes into conversation, right? Because some of our economy brands are very big in particular geographies. If we are not putting the right focus on those, that's the whole growth algorithm becomes very hard to make happen.

Are going to look at that.

I think those are the changes that would feel different for our teams, how we operate, how we engage with our distributor network, Lauren. I think it is things I would say we were doing, but we just need to lean in harder given how the category has changed, right? I mean, if you look at even regional performance, I know we talk about the national performance of the category, but the category is performing very differently in different parts of this country. We need to make sure we're pivoting to that both from a resource perspective, from a brand perspective. That's where the economy context comes into conversation, right? Because some of our economy brands are very big in particular geographies. If we are not putting the right focus on those, that's the whole growth algorithm becomes very hard to make happen.

But I think broadly speaking.

I think your assessment of deploying entity.

We've been increasing $81 10 per pound.

And beyond <unk>.

I know, there's like less than two months left in the year, but if the premium continue to spike.

Right way to think about it.

You want to address the Midwest premium question, yes.

Spot price threshold for us to be mindful of that could potentially put your PBT guidance.

Hi, Joe look I mean, we've spoken about the Midwest premium.

And as you rightly say.

For the year any color there would be great. Thanks.

It continues to increase.

And he can all time high in October.

Yeah. Thank you John for that and rolling.

Potentially.

Look at M&A and deploying of capital we have.

Now we do have anything for taking program.

Would be strong via portfolio across across the world right. I mean, we continue to fill some gaps in that.

<unk> operates.

Great.

<unk> between <unk> and.

The places where we need to fill some gaps are probably in the beyond beer. So in terms of deploying capital.

As well as maybe you is opportunistic.

Depending on the markets.

Hey, Jack multiple years and made update to these to smooth out the impact of any unfavorable swing in commodity and Forex.

You'll see us probably leaning a lot more on the beyond beer space.

Then the payer space.

But if there are ideas that make sense that.

Rahul Goyal: I would say those are the big highlights I would call out, Lauren, to your question.

Rahul Goyal: So I would say those are the big highlights I would call out, Lauren, to your question.

So I would say those are the big highlights I would call out, Lauren, to your question.

But as it relates specifically to the Midwest premium if we do have coverage and we do that.

Augment our business and drive top and bottom line growth.

Are going to look at that.

But I think broadly speaking.

Operator: Thank you. Our next question comes from Nadine Sarwat with Bernstein. Please go ahead.

Operator: Thank you. Our next question comes from Nadine Sowat with Bernstein. Please go ahead.

Carve out in our program, but as Ive said before some theory difficult commodity to H and.

I think your assessment of just deploying entity.

And beyond <unk>.

Nadine Sarwat: Yes. Hi. Thank you for taking my question. I'd like to come back to some of the cyclical pressures that you called out in the prepared remarks. In particular, what are you seeing in terms of consumer sentiment for your consumers in Q3 and to the extent that you can comment on this in October? I appreciate the prepared remarks you made, but are there any internal surveys or analytics that you're able to share about what's driving consumer behavior today? How does that help you be more confident in your statement that the incremental pressure we're seeing today is firmly cyclical as opposed to structural? Thank you.

Traci Mangini: Yes. Hi. Thank you for taking my question. I'd like to come back to some of the cyclical pressures that you called out in the prepared remarks. And in particular, what are you seeing in terms of consumer sentiment for your consumers in Q3 and to the extent that you can comment on this in October? I appreciate the prepared remarks you made, but are there any internal surveys or analytics that you're able to share about what's driving consumer behavior today? And how does that help you be more confident in your statement that the incremental pressure we're seeing today is firmly cyclical as opposed to structural? Thank you.

It's pricing does not follow conventional market infant size and liquidity is limited and so on.

Right way to think about it.

You want to address the Midwest premium question, yes.

Hi, Joe look I mean, we've spoken about the Midwest premium.

<unk> to be a headwind for us.

And as you rightly say.

And we do try and.

It's continued to increase.

Eliminate the volatility.

And it's an all time high in October.

You bet.

Potentially much higher now we do have anything for taking program.

At the levels that it did.

Is it.

Is that.

The reason for that.

That's great.

Rain between scratch, it and as well as maybe you is opportunistic.

Continue to track it and do what they can in turn.

We're trying to mitigate the volatility that PTC in that commodity.

Depending on the markets.

Hey, Jack multiple years and lead us to smooth out the impact of any unfavorable swing in commodity anytime.

Okay.

Thank you that concludes our question and answer period, you may now disconnect.

Rahul Goyal: Yeah. Again, I understand the question, but so if I address it in maybe a few added points to give you some context or at least how we're seeing it. I mean, if you go back to pre-25, I mean, some of these trends have been with us as a beer category for a long time, right? Whether it's health and wellness, whether it's generational change, whether it's people making choices around alcohol. I think that some of those have been we and everybody in the industry have known about those. And if you look at the category historically, it used to be in the minus one, two, and the last few years it's been in the minus three-ish range. This year, I would say there's been definitely added pressure. And you see that across staples, and beer hasn't been immune to that.

Rahul Goyal: Yeah. Again, I understand the question, but so if I address it in maybe a few added points to give you some context, at least how we're seeing it. I mean, if you go again back to pre-2025, I mean, some of these trends have been with us as a beer category for a long time, right? Whether it's health and wellness, whether it's generational change, whether it's people making choices around alcohol. I think that some of those have been we and everybody in the industry have known about those. If you look at the category historically, it used to be in the minus one, two, and the last few years it's been in the minus three-ish range. This year, I would say there's been definitely added pressure, and you see that across staples, and beer hasn't been immune to that.

Thanks.

Hey, Pete.

The Midwest premium look we do have coverage and we do that.

Growth in our program, but I.

As I've said before with some theory difficult Anthony in terms of commodity T H.

It's pricing does not follow conventional market ancient size and liquidity is limited and so on.

Continues to be a headwind for us.

And we do try and.

Eliminate the volatility hedging bet.

The level that it is.

Is that.

Got it.

For that we will discuss.

<unk> attracted and retained intensive kind.

Trying to mitigate the volatility that BTC net commodity.

Rahul Goyal: So whether that is impact of tariffs on consumer sentiment, if it is the focus on the Hispanic community, any of those elements. So I do believe that has had a different type of an impact to the beer category this year. That's where once we've got through these macro issues, then we need to get back to those baseline levels of how we think about the category and then making sure we're winning in that category.

Rahul Goyal: So whether that is the impact of tariffs on consumer sentiment, if it is the focus on the Hispanic community, or any of those elements. So I do believe that has had a different type of an impact to the beer category this year. And that's where, once we've got through these macro issues, then we need to get back to those baseline levels of how we think about the category, and then making sure we're winning in that category.

So whether that is the impact of tariffs on consumer sentiment, if it is the focus on the Hispanic community, or any of those elements. So I do believe that has had a different type of an impact to the beer category this year. And that's where, once we've got through these macro issues, then we need to get back to those baseline levels of how we think about the category, and then making sure we're winning in that category.

Okay.

Thank you that concludes our question and answer period, you may now disconnect.

[music].

Operator: Thank you. Our next question comes from Robert Moskow with TD Cowen. Please go ahead.

Rahul Goyal: Hey, thank you, Rahul. I'm trying to summarize all of the commentary about the regional execution versus the national marketing of your brand. I just want to make sure I understand. You have Coors Light and Miller Lite, your two biggest brands. Is it your view that on a national level, that the marketing of those brands has been just fine? Because there's been multi-year share losses of those. One of your competitors has made great inroads in the light category, probably at their expense. Do you think that the national marketing of those brands is doing just fine? And really, it's just the regional execution could improve, and that's the way to stabilize. Thanks.

Robert Moskow: Hey, thank you, Rahul. I'm trying to summarize all of the commentary about the regional execution versus the national marketing of your brand. I just want to make sure I understand. You have Coors Light and Miller Lite, your two biggest brands. Is it your view that on a national level, that the marketing of those brands has been just fine? Because there's been multi-year share losses of those. One of your competitors has made great inroads in the light category, probably at their expense. Do you think that the national marketing of those brands is doing just fine? And really, it's just the regional execution could improve, and that's the way to stabilize. Thanks.

Kaumil Gajrawala: Hey, thank you, Rahul. I'm trying to summarize all of the commentary about the regional execution versus the national marketing of your brand. And I just want to make sure I understand. You have Coors Light and Miller Lite, your two biggest brands. Is it your view that on a national level that the marketing of those brands has been just fine? Because there's been multi-year share losses of those. One of your competitors has made great inroads in the light category, probably at their expense. So, do you think that the national marketing of those brands is doing just fine? And really, it's just the regional execution could improve, and that's the way to stabilize. Thanks.

Rahul Goyal: No, thank you for that question. We definitely think there's opportunities for us as we think about how these brands show up. If you think about the work we are doing on Miller Lite with the 50-year campaign, I think, and if you look at share losses for Coors Light versus in Q3 versus Q2. So definitely, that's something we're looking at of the national campaigns for our big brands and how do we lean into it differently, how we think about it going forward. And I just pointed out to Coors Banquet, right? I mean, I think it's a brand that has really met a consumer need, has resonated with consumers. We've obviously executed well in the context of distribution gains, but absolutely focused on making sure we get the right campaigns for Coors Light and Miller Lite.

Rahul Goyal: No, thank you for that question. We definitely think there's opportunities for us as we think about how these brands show up. If you think about the work we are doing on Miller Lite with the 50-year campaign, I think. And if you look at share losses for Coors Light versus in Q3 versus Q2. So, definitely, that's something we're looking at of the national campaigns for our big brands and how do we lean into it differently, how we think about it going forward. I just pointed out to Coors Banquet, right? I mean, I think it's a brand that has really met a consumer need, has resonated with consumers. We've obviously executed well in the context of distribution gains. Absolutely, focused on making sure we get the right campaigns for Coors Light and Miller Lite.

Rahul Goyal: And I think you'll see some of that play out as with live sports in the coming months.

Rahul Goyal: I think you'll see some of that play out with live sports in the coming months.

I think you'll see some of that play out with live sports in the coming months.

Operator: Thank you. Our final question today comes from Gerald Pascarelli with Needham & Co. Gerald, please go ahead.

Operator: Thank you. Our final question today comes from Gerald Passarelli with Needham & Co. Gerald, please go ahead.

Rahul Goyal: Great. Thank you very much. Rahul, I guess just going back to some of the prior commentary on this call and to summarize, is it fair to assume or expect that bolt-on M&A or a more aggressive push into Beyond Beer ultimately becomes a more important part or a larger part of the capital allocation strategy looking forward? And then for Tracey, just going back to the Midwest Premium, it's obviously been increasing $0.81 per pound. I know there's less than two months left in the year, but if the premium continues to spike, is there a spot price threshold for us to be mindful of that could potentially put your PBT guidance at risk for the year? Any color there would be great. Thanks.

Gerald Pascarelli: Great. Thank you very much. Rahul, I guess just going back to some of the prior commentary on this call and to summarize, is it fair to assume or expect that bolt-on M&A or a more aggressive push into Beyond Beer ultimately becomes a more important part or a larger part of the capital allocation strategy looking forward? And then for Tracey, just going back to the Midwest Premium, it's obviously been increasing $0.81 per pound. I know there's less than two months left in the year, but if the premium continues to spike, is there a spot price threshold for us to be mindful of that could potentially put your PBT guidance at risk for the year? Any color there would be great. Thanks.

Gerald Pascarelli: Great. Thank you very much. Rahul, I guess just going back to some of the prior commentary on this call and to summarize. Is it fair to assume or expect that bolt-on M&A or a more aggressive push into beyond beer ultimately becomes a more important part or a larger part of the capital allocation strategy looking forward? And then for Traci, just going back to the Midwest premium, it's obviously been increasing $0.81 per pound. I know there's less than two months left in the year, but if the premium continues to spike, is there a spot price threshold for us to be mindful of that could potentially put your EBIT guidance at risk for the year? Any color there would be great. Thanks.

Rahul Goyal: Yeah. Thank you, Jeff, for that, and morning. If you look at M&A and deploying of capital, we have a pretty strong beer portfolio across the world, right? I mean, we continue to fill some gaps in that, but the places where we need to fill some gaps are probably in the Beyond Beer. So in terms of deploying capital, you will see us probably lean in a lot more on the Beyond Beer space than the beer space. But if there are ideas that make sense that augment our business and drive top and bottom line growth, we're going to look at that. But I think broadly speaking, I think your assessment of deploying M&A dollars in Beyond Beer is probably the right way to think about it. Tracey, you want to address the Midwest Premium question?

Rahul Goyal: Yeah. Thank you, Jeff, for that and morning. If you look at M&A and deploying of capital, we have a pretty strong beer portfolio across the world, right? I mean, we continue to fill some gaps in that, but the places where we need to fill some gaps are probably in the beyond beer. So in terms of deploying capital, you will see us probably lean in a lot more on the beyond beer space than the beer space. But if there are ideas that make sense that augment our business and drive top and bottom line growth, we're going to look at that. But I think broadly speaking, I think your assessment of deploying M&A dollars in beyond beer is probably the right way to think about it. Traci, you want to address the Midwest premium question?

Lauren Lieberman: Yeah. So I mean, we've spoken about the Midwest Premium a lot. As you rightly say, it just continues to increase. It hit an all-time high in October, potentially going much higher. Now, we do have an extensive hedging program that operates sort of as a blend between structured as well as where we use opportunistic depending on the markets. We're able to hedge out multiple years. Really, the objective is to smooth out the impacts of any unfavorable swings in commodities and in forex. As it relates specifically to the Midwest Premium, look, we do have coverage, and we do follow the guardrails in our program. As I've said before, it's a very difficult and very expensive commodity to hedge. Its pricing does not follow conventional market ebbs and flows, and liquidity is limited. So it continues to be a headwind for us.

Tracey Joubert: Yeah. So I mean, we've spoken about the Midwest Premium a lot. As you rightly say, it just continues to increase. It hit an all-time high in October, potentially going much higher. Now, we do have an extensive hedging program that operates sort of as a blend between structured as well as where we use opportunistic depending on the markets. We're able to hedge out multiple years. Really, the objective is to smooth out the impacts of any unfavorable swings in commodities and in forex. As it relates specifically to the Midwest Premium, look, we do have coverage, and we do follow the guardrails in our program. As I've said before, it's a very difficult and very expensive commodity to hedge. Its pricing does not follow conventional market ebbs and flows, and liquidity is limited. So it continues to be a headwind for us.

Rahul Goyal: Yeah. So, I mean, we've spoken about the Midwest premium a lot. And as you rightly say, it just continues to increase. It hit an all-time high in October, potentially going much higher. Now, we do have an extensive hedging program that operates sort of as a blend between structured as well as where we use opportunistic, depending on the market. We're able to hedge out multiple years. And really, the objective is to smooth out the impacts of any unfavorable swings in commodities and in forex. But as it relates specifically to the Midwest premium, look, we do have coverage, and we do follow the guardrails in our program. But as I've said before, it's a very difficult and very expensive commodity to hedge. Its pricing does not follow conventional market ebbs and flows, and liquidity is limited. And so, it continues to be a headwind for us.

Rahul Goyal: And we do try and eliminate the volatility through hedging, but at the level that it is, there's no sort of reason for that. So we'll just continue to track it and do what we can in terms of trying to mitigate the volatility that we do see in that commodity.

Lauren Lieberman: We do try and eliminate the volatility through hedging, but at the level that it is, there's no sort of reason for that. We'll just continue to track it and do what we can in terms of trying to mitigate the volatility that we do see in that commodity.

We do try and eliminate the volatility through hedging, but at the level that it is, there's no sort of reason for that. We'll just continue to track it and do what we can in terms of trying to mitigate the volatility that we do see in that commodity.

Operator: Thank you. That concludes our question and answer period. You may now disconnect.

Q3 2025 Molson Coors Beverage Co Earnings Call

Request a DemoDemo

TAP

Molson Coors Beverage

Earnings