Jack Daniel's next growth story may not come from whiskey.
Brown Forman Inc Class B Common Stock (NYSE:BF/B), the brand's parent company, is leaning on ready-to-drink brands and emerging markets to diversify its growth. That's because Canadian shelf restrictions and a cash-strapped Gen Z are a drag on Brown-Forman's business.
Ready-to-drink sales, meanwhile, rose 20% in the latest quarter, or 11% organically, led by the New Mix canned cocktail brand. Sales jumped 48%, with organic growth of 36%, fueled by strong demand in Mexico and its U.S. launch.
Emerging markets are showing similar momentum. Brown-Forman's sales in those markets increased 11%, or 9% organically, with Mexico and New Mix driving growth. That helped offset declines in developed international markets, where sales fell 6%.
Overall, first-quarter net sales fell 1% to $911 million, while diluted EPS increased 6% to $0.38. Management reaffirmed its fiscal 2027 outlook for roughly flat organic sales.
The Portfolio Needs To Broaden
Brown-Forman is not abandoning whiskey.
Instead, the numbers suggest the company is trying to reduce its dependence on a category facing slower demand and geopolitical friction. The strategy is already visible in its portfolio.
New Mix is expanding rapidly, Jack Daniel's Tennessee Blackberry is moving into additional international markets, and emerging markets are becoming increasingly important to growth.
Meanwhile, Brown-Forman just priced a $500 million five-year senior unsecured note that can be used for general corporate purposes, including acquisitions, capital expenditures, buybacks and debt repayment.
For Brown-Forman investors, the key question is whether these newer growth engines can become large enough to offset weakness in the company's traditional whiskey business.
Whiskey Hangover
American-made alcoholic beverages remain absent from retail shelves across most Canadian provinces following the trade dispute, hitting Brown-Forman's Jack Daniel's portfolio. The company previously reported that Canadian sales plunged 62% in the second quarter of fiscal 2026 as products remained largely unavailable.
Brown-Forman's latest quarter shows why the problem matters beyond one market. Fiscal first-quarter whiskey sales were flat, with Jack Daniel's Tennessee Whiskey also flat. Growth from the international rollout of Jack Daniel's Tennessee Blackberry was offset by declines in Tennessee Honey and Gentleman Jack.
