Dive Brief:
- Diageo, maker of brands such as Smirnoff, Guinness, and Jameson's, reported a 1.3% drop in sales in the most recent quarter, compared to a year earlier.
- Sales plummeted 19% in the Asia-Pacific, the UK-based company said. Sales in North America, Latin America, and Western Europe rose slightly.
- The news surprised investors. Shares fell roughly 4% after the company announced results.
Dive Insight:
An earnings report like this one is never good news. But for Diageo, which has been quite public in its belief that the company's future growth must come from developing markets that include Asia, it borders on the disastrous.
Shares were still trading down at press time. And there seems to be little reason, at least in the short-term, for optimism. Another thing complicating matters: Earlier this week, Diageo offered $1.9 billion to take control of India's United Spirits. That plan may look a little less appealing following today's earnings report.