6 November 2025
If you are covering Diageo’s latest financial results, please find below a comment from Chris Beckett, consumer staples analyst at Quilter Cheviot:
“Diageo’s problems are well documented now so it is not a surprise to see a fairly mixed bag of results from the drinks giant this morning. The overall numbers were better than expected, with sales growth flat, but management has taken this opportunity to cut its guidance to both sales and profits for the year to the end of June. Diageo is a business that isn’t trading particularly well right now, but it is not cratering. The problem the business has is that flat sales in the drinks industry is not a good place to be, and the spirits market is showing little sign of improving.
“Diageo’s hero brands in Guinness and the Scotch whisky segment continue to do well, with tequila and Chinese white spirits struggling. These are well known weak spots that show no sign of immediate improvement. The guidance cut that has come today simply accepts the reality of the market and Diageo’s individual case.
“The big disappointment from the results today, however, is the lack of announcement of a new CEO. Chief financial officer, Nik Jhangiani, remains in charge on an interim basis, but it is surprising not to see him be given the role permanently. He is a very rational executive with a good plan around cost cutting and turning the business around. The lack of announcement today suggests an external appointment may come and this may result in a complete shift in strategy. We watch this news very closely as a result.
“Ultimately, Diageo is not a broken business, and the valuations looks compelling on paper. This is a tough period that the business will have to ride out, but structural trends do still remain in place for it to eventually come out of this turnaround in a strong position.”
