Desperate Bud Light Parent Company Offers Disgruntled Shareholders $1 Billion Apology for Dylan Mulvaney Disaster
The parent company of Bud Light is making a $1 billion buyback of shares as a way to rebound from the disaster caused by the company’s partnership with transgender influencer Dylan Mulvaney.
The buyback will take place over the next year and kick in “almost immediately,” Anheuser-Busch InBev Chief Financial Officer Fernando Tennenbaum said on a call with investors, according to Yahoo Finance.
It was announced Tuesday in AB InBev’s third-quarter report.
Bank of America analyst Andrea Pistacchi said the gesture by the Belgium-based conglomerate was “not large” but was also “not expected.”
Trevor Stirling, an analyst at Bernstein, said the buyback was “a very important psychological signal” to investors, according to The Times of London.
According to The Hill, ABInBev’s stock has lost $27 billion in value since the Mulvaney promotion sparked a boycott of Bud Light.
Bud Light’s parent company Anheuser-Busch InBev saw its sales sink by 13.5% last quarter as fallout from the Bud Light boycott continues.
See the full story at https://t.co/VkKHQwI3eK pic.twitter.com/lySyzIpbSN
— Freespoke (@FreespokeSearch) November 1, 2023
In presenting its quarterly results, the company noted that revenue in the United States was down 13.5 percent largely as a result of the Bud Light boycott.
Yahoo Finance reported that U.S. sales to wholesalers were down 17.6 percent and sales to retailers dropped 16.6 percent. That led to a 29.3 percent drop in operating profit, according to MarketWatch.
In looking ahead, the company is focusing its marketing on more traditional areas, such as the partnership with UFC that begins Jan. 1.
We’re proud to announce that starting in 2024, we’ll once again be the official beer sponsor of @UFC pic.twitter.com/n9jcDyLhVv
— Bud Light (@budlight) October 24, 2023
“They’re trying to find some new people, and I think the UFC provides them the opportunity to do so,” said Anjali Bal, associate professor of marketing at Babson College.
AB InBev CEO Michel Doukeris referenced the partnership during the earnings call.
“I could not be more excited about joining or rejoining UFC on this comeback and to have Bud Light in the US for the fans and Budweiser being activated globally,” he said.
Doukeris offered some hope that the worst has passed, noting that the company’s market share has not fallen further since it cratered in April, according to ABC News.
He claimed an internal poll found 40 percent of former Bud Light drinkers would come back to the brand.
“This gives us some certainty that we are moving in the right direction. don’t think we are at a new normal yet, but we have a good grip on what we need to do and how we are proceeding,” the CEO said.
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