Pernod Ricard has reported another period of sliding sales and profits, driven by sharp declines in China and the US.
Sales at the Paris-headquartered spirits group declined organically by 5.9% to €5.3bn in the six months to 31 December 2025, slightly worse than the 5.7% decline predicted by analysts. A strong negative foreign currency impact linked to the US dollar, Indian rupee and Turkish lira meant sales were down by 14.9% on a reported basis, meanwhile.
Profits fared little better, sliding 7.5% organically and 18.7% on a reported basis, as Pernod battled the impact of US and China tariffs and inflation in “aged wet goods”.
A 28% fall in sales in China and a 15% decline in the US were responsible for the majority of Pernod Ricard’s woes. Excluding two of its three largest markets, sales were “broadly stable,” the Malibu owner insisted.
In the US, market conditions remained soft and Pernod’s performance was impacted by “some inventory adjustments,” in the first half of its financial year.
In China, meanwhile there was a “tightened regulatory environment” and “persistent macroeconomic and consumer sentiment weakness,” impacting sales of brands including Martell and Chivas. Other labels including Absolut and Jameson were in “strong growth”.
In Europe, sales declined by 3% organically, with UK performance “resilient in a market showing signs of stabilisation”.
On a brand basis, there were declines across the portfolio, most notably on Martell in China and Jameson in the US. RTDs were a rare bright spot, climbing by 12%.
Pernod Ricard had “made significant progress” on a €1bn, three-year cost-cutting programme and was “committed to adapting with agility and executing with discipline to meet evolving consumer needs”, said CEO Alexandre Ricard in prepared remarks.
The group would deliver one-third of total savings this year and had “accelerated the normalisation of our strategic investments”, with a maximum €800m per year allocated for new acquisitions, he added.
In H1 2026, structural costs fell by 10%, driven by a further 6% reduction in headcount vs a FY2023 baseline, Pernod Ricard revealed. In the space of less than three years, the Jameson owner’s employee base has shrunk by almost a fifth (18%).
Pernord Ricard was “doubling down on controllables including cost cutting and cash,” analysts at Jefferies noted. They praised its “commitment to ‘defend operating margins to the fullest extent possible’” but noted “underlying category conditions” remained challenging and sequential recovery vs Q1 across regions including Asia and Global Travel Retail was “only gradual”.
Looking ahead, Pernod Ricard forecast sales would grow between 3%-6% organically between its fiscal 2027 and 2029. The current financial year to June was described as “a transition year with improving trends in organic net sales, skewed towards H2”.
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