The Boston Beer Company (SAM) Q4 2025 earnings summary

Executive summary

• 2025 depletions declined 4%, matching the overall beer industry, with operational discipline supporting financial commitments in a challenging environment.

• Sun Cruiser's national launch was revenue and margin accretive, quickly becoming a top 5 RTD Spirits brand.

• Free cash flow reached $216 million ($19.72/share), enabling $200 million in share repurchases.

• Margin enhancement initiatives delivered 410 basis points of gross margin expansion, with record-high customer service levels and reduced inventory days.

• Operational focus remains on brand investment, innovation, and productivity initiatives.

Financial highlights

• 2025 revenue declined 2.4% year-over-year, driven by a 4.7% decrease in shipments, partially offset by positive price/mix.

• Gross margin expanded by 410 basis points to 48.5% (50% excluding certain costs), the highest since 2019.

• EPS rose 4.7% year-over-year to $9.89, excluding prior year impairment and one-time charges.

• Q4 depletions fell 6% and shipments dropped 7.5% year-over-year; gross margin for Q4 increased 360 basis points to 43.5%.

• Operating cash flow was $270 million, with $223 million in cash and no debt at year-end.

Outlook and guidance

• 2026 depletions and shipments expected to be flat to down mid-single digits, reflecting persistent macroeconomic headwinds.

• Price increases of 1%-2% anticipated, with gross margin guidance of 48%-50%.

• EPS guidance for 2026 is $8.50-$11.00 per diluted share; effective tax rate estimated at 29%-30%.

• Advertising, promotional, and selling expenses to rise by $20-$40 million in 2026.

• Capital expenditures projected at $70-$90 million, focused on brewery capabilities and efficiency.