Diageo Cuts Guidance as New CEO Targets Portfolio Growth

By Aimee Look

Guinness maker Diageo cut its guidance for the fiscal year on weakness in the U.S., as new chief executive Dave Lewis looks to build a larger portfolio in a bid to revive the U.K. drinks giant's fortunes.

Home to brands like Johnnie Walker and Smirnoff Vodka, Diageo said it expects a 2% to 3% decline in organic net sales, citing weakness in its U.S. business and Chinese white spirits. Organic operating profit growth for the year is expected to be flat to low-single-digits, the company said.

Diageo's new guidance for the year through June 30 is below previous expectations. The drinks maker said in its first quarter that it expects organic net sales for the 2026 fiscal year to be flat or slightly down. Organic operating profit growth was expected to be in the low to mid-single digit range.

The company set an interim dividend of 20 U.S. cents a share, down from 40.50 cents a share for the first half of fiscal 2025. Diageo said its dividend for fiscal 2026 would be at least 50 cents.

"I can already see significant opportunities for Diageo to act more decisively to enhance its competitiveness and broaden the portfolio offering leading to higher growth," Lewis said.

In the six months through December, net sales fell 4% on year to $10.46 billion.

Organic net sales dropped 2.8% over the period. Analysts polled by the company had expected a 2% organic drop in sales over the period.

Write to Aimee Look at aimee.look@wsj.com

(END) Dow Jones Newswires

February 25, 2026 03:06 ET (08:06 GMT)