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October 24, 2021
5 minutes read

Earnings: Boston Beer’s Hard Seltzer Bet Stumbles

American brewery Boston Beer (NYSE: SAM) has released its financial results for this year’s third quarter, showing that its bet…

American brewery Boston Beer (NYSE: SAM) has released its financial results for this year’s third quarter, showing that its bet on the hard seltzer craze is stumbling. Sales of Boston Beer’s Truly seltzer brand fell significantly and made the brewery post its first quarterly loss in over a decade.

Boston Beer lost $58mn in Q3, compared to an $81mn profit in the same quarter last year. Hard seltzer brand Truly was majorly responsible for the loss as lowered sales made Boston Beer take a $102mn charge from inventory write-offs and shortfall payments to vendors for the brand.

Boston Beer’s rare loss points to the hard seltzer craze falling flat following years of rapid growth. In fact, Boston isn’t the only brewer feeling it; rival Constellation Brands (NYSE: STZ) just took an $80mn charge stemming from its seltzer brand, including $66mn in unsold inventory write-offs.

Hard seltzer is a type of highball drink containing carbonated water, alcohol, and often fruit flavorings. It stormed the American beverage market in recent years, providing an option for health-conscious consumers seeking lower-calorie, lower-sugar booze.

The hard seltzer storm was spearheaded by breweries like Boston Beer, whose Truly brand is the 2nd best selling in the industry, only beaten by rival White Claw. However, the storm is gradually fading off, proven by recent numbers from top sellers like Boston Beer.

Overall, Boston Beer posted $562mn in revenue in Q3, up 14% year-over-year. Sales of its traditional beer brands are still going strong despite the hard seltzer part stumbling.