Budweiser brewer Anheuser-Busch InBev (BUD) denied on Thursday a report suggesting it was planning to make thousands of job cuts at its Asia-Pacific business this year amid faltering sales in China that dragged on its performance in 2024.
Bloomberg reported the company’s Budweiser Brewing Co APAC Ltd unit was looking to make cost cuts of 15% this year by trimming thousands from its headcount, on top of a 16% workforce reduction of 25,000 employees last year.
However, the company was swift to refute the report. “The news report about thousands of job cuts planned for Asia in 2025 is not true,” ABInBev spokesperson told Reuters. “We will continue our long-term investment in China.”
BUD China Sales Falter
ABInBev, which owns premium brands such as Stella Artois and Corona, is facing challenges in its Asia-Pacific business amid weakness in China which is dampening the positive uplift elsewhere. Sales volumes in China fell 19% in the Fiscal fourth quarter, with the contraction accelerating from a 14.2% fall in Q3. The brewer said it is being affected by softness in the Chinese market as customers switched products amid low consumer sentiment. In contrast, the company saw high single-digit growth in South Korea.
Globally beer demand slackened, led by China and Argentina, with total volumes declining by 1.9% in Q4, driven by a 2.1% drop in beer volumes, while non-beer volumes were down by 1.1%. Excluding China and Argentina volumes globally grew by 0.9% across the 2024 Fiscal year but overall performance was “significantly constrained” by weakness in these two countries, the company said, resulting in a total volume decline of 1.4%.
U.S. Market Recovers
But gains from its Michelob Ultra and Busch Light brands that helped drive a return to U.S. sales growth in the third quarter continued as it gained market share again in Q4.
Two years ago, the company laid off 350 employees, about 2% of its corporate staff, in the U.S. amid faltering sales of Bud Light after conservative boycotts over the company’s partnership with influencer Dylan Mulvaney. The backlash is thought to have cost the brewer up to $1.4 billion in lost sales. In January 2024, the company told Bloomberg it had laid off an unspecified number of workers in its U.S. sales division.
Is BUD a Good Stock to Buy?
Overall, Wall Street has a Strong Buy rating on BUD stock based on four analysts offering 12-month price targets in the last three months. The average BUD price target of $69.60 suggests 11% upside.
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