AmBev reported adjusted EBITDA of R$8.85 billion for the fourth quarter, a figure that was 3% ahead of consensus but represented a 7.5% decline from the same period a year earlier. The company said total volumes declined 3.8% year-over-year and landed 2.5% below analyst expectations, a shortfall only partly offset by modestly stronger pricing and margin performance in select divisions.
Earnings per share for the quarter were R$0.28, a 10% reduction versus the prior-year quarter. Management attributed the weaker top-line volumes to challenging operating conditions across most markets.
In Brazil, beer volumes fell 2.6% year-over-year. The company cited difficult macroeconomic conditions and unfavorable weather in October and November as contributors to the domestic decline. Despite that backdrop, AmBev said it recorded market share gains in the low single-digit range. Within the portfolio, premium and zero-alcohol segments expanded by more than 15%, while core beer volumes were down in the high single digits.
Brazilian EBITDA outperformed estimates by 4.8% and was essentially flat compared with the prior year. Cost dynamics in the market were mixed: cash costs rose sharply, accelerating 13.6% year-over-year driven by hedging effects, while selling, general and administrative expenses fell 6.7%, partially offsetting those cost pressures.
Outside Brazil, the Central America and Caribbean region was the most significant underperformance. EBITDA in CAC came in roughly 15% below analyst expectations and margins contracted by 130 basis points year-over-year.
Looking forward to 2026, AmBev signaled that it expects cost pressures, with guidance indicating input cost increases in a range of 4.5% to 7.5%. Management said sustaining margins in that environment will require price increases above inflation. The company also anticipates higher marketing expenditures linked to the upcoming World Cup.
Bank of America kept a Neutral rating on AmBev and raised its price target to R$15.30 per share, which corresponds to US$2.95 per ADR, up from a prior target of R$13.50. The bank noted limited upside potential and muted momentum driven by persistent pressure on beer volumes in Brazil and constrained earnings growth. Bank of America lowered its earnings-per-share estimates by 2.4% for 2026 to R$0.95 and by 3% for 2027 to R$1.06.
Market implications
The quarter highlights a combination of demand softness in core categories and rising input costs that will shape AmBev's pricing and marketing strategy into 2026. The company faces the dual challenge of defending market share in a contracting volume environment while absorbing or passing through higher costs to preserve margins.