Russ Mould, investment director at AJ Bell, said: “Shareholders in Diageo have been left drowning their sorrows again as the drinks giant served up another disappointment in a year littered with them.
“This latest update increases the pressure on the Diageo hierarchy to fill the leadership vacuum created by the departure of CEO Debra Crew in July and halt the sense of drift which is pervading the business.
“The weak outlook for 2026 reflects poor spirit sales in China and a weaker US consumer environment.
“The fear for markets will be that Diageo’s performance reflects more than just the ups and downs associated with fluctuations in the economy and instead hints at shifting drinking habits and/or the diminished appeal of Diageo’s key brands.
“The weak Chinese business also suggests one of Diageo’s key levers of growth – selling more to an expanding middle class in emerging markets – has broken down.
“Diageo has been struggling since the passing of the late CEO Ivan Menezes in 2023, and its travails may lead to pressure for more dramatic action to turn around the company’s fortunes, including a potential spin-off of Guinness to create a business with a distilled focus on spirits.”
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