European Beer & CSD Off-Premise Momentum Weakens Broadly: Divergence Among Top Brewers Intensifies, PepsiCo Continues to Gain CSD Share from Coca-Cola

Key Conclusions

European off-premise data for the four weeks ended 19 April 2026 shows both beer and carbonated soft drink (CSD) sales declining year-over-year, significantly underperforming the 12-week rolling trend, indicating an accelerated slowdown in near-term consumption momentum. Among brewers, divergence is pronounced: Heineken was the only brewer with positive volume growth (+0.5% in 4 weeks), outperforming the category and gaining share, but negative price/mix (-1.1%) suggests reliance on promotional pressure to move volume. AB InBev achieved the highest price/mix improvement (+2.9%), yet suffered a sharp volume decline (-8.6%), likely as pricing has exceeded demand tolerance, resulting in both sales and share losses. The CSD market also weakened, but PepsiCo (partially distributed through Carlsberg) continues to gain share in Europe, particularly in France and the UK, while Coca-Cola continues to lose share in key markets like Germany. Regionally, Germany was the largest drag on beer sales (4-week -6.9%), while France, Italy, and Spain maintained positive growth. Investors should be wary of the risk that European off-premise demand weakness exceeds expectations, especially for ABI with high pricing exposure and Heineken overly reliant on promotions, while PepsiCo's distribution relationships and relatively stable private label performance offer a defensive entry point.

What the Market May Be Underpricing

The market may not have fully priced in the sustained weakening of European off-premise consumption momentum, particularly the structural decline of the German beer market (52-week sales -4.2%) and AB InBev's accelerating market share loss in the UK (last 12 weeks share -100bps, sales -7.5%). Meanwhile, although Heineken posted volume share expansion, its negative price/mix (4-week -1.1%) may reflect volume-for-price trade-offs or deteriorating channel mix, posing downside risk to margins if promotional competition intensifies. In the CSD space, PepsiCo's share gains in Europe (notably in France and the UK) may be underappreciated, while Coca-Cola's share erosion in Germany and elsewhere, if sustained, could pressure Coca-Cola European bottlers such as Coca-Cola HBC.

Evidence Chain

Overall Trends: 4-Week Data Significantly Weaker than 12-Week Trends, Momentum Slowing

• European beer 4-week sales -3.6% YoY, volume -4.8%, both well below the 12-week rolling averages (-1.6% and -3.3%), with price/mix declining from +1.8% to +1.3%. European CSD also weakened: 4-week sales -0.6% (12-week +1.9%), volume -2.9% (12-week -0.9%), price/mix +2.3% (12-week +2.9%). Weakness in both volume and price suggests demand pressure rather than purely seasonal factors.
• Private label beer in the region saw only -2.3% volume in 4 weeks, far better than ABI's -8.6%, indicating consumers are shifting to cheaper alternatives in a downturn.

Brewer Divergence: Heineken Volume Up but Price Weak, ABI Price Up but Volume Down, Carlsberg Broadly Soft

• Heineken: 4-week volume +0.5% (only positive among peers), value share +56bps, volume share +86bps. But price/mix -1.1%, and Europe overall 12-week sales -1.4%, 52-week -3.5%. France and Germany were the main drags (52-week sales -6.2% and -8.8% respectively), with France 52-week share -200bps. UK relatively stable but 12-week sales -2.7%.
• AB InBev (ABI): 4-week sales -5.9%, volume -8.6%, price/mix +2.9%. Value share -42bps, volume share -56bps. UK last 12 weeks sales -7.5%, share -100bps. The pricing strategy, while supporting revenue in the short term, has significantly compressed volume, and consumers are shifting to private label.
• Carlsberg: 4-week sales -5.6%, volume -6.7%, price/mix +1.2%. Europe overall 12-week sales -1.6%, but UK 52-week sales +5.0%, France +0.3%. Germany and Spain saw share declines (Germany 52-week share -10bps). Benefiting from PepsiCo distribution, Carlsberg's UK CSD business posted +7.5% sales growth (vs. UK overall CSD -2.5%), partially offsetting beer weakness.

CSD Competitive Landscape: PepsiCo System Taking Share, Coca-Cola Under Pressure

• PepsiCo (including 7Up etc.) Europe 52-week volume share +82bps, value share +49bps; France last 12 weeks volume share +118bps, UK volume share +112bps. Coca-Cola Europe 52-week volume share -63bps, value share -57bps, Germany volume share -157bps. Private label CSD share also declined (volume -46bps), indicating brand concentration in CSD, but PepsiCo is benefiting more than Coca-Cola.
• Carlsberg-distributed PepsiCo in the UK stands out, contrasting sharply with beer weakness elsewhere, validating the value of a strong brand portfolio.

Regional Differences: Germany Drags Overall, Southern Europe Maintains Resilience

• German beer 4-week sales -6.9%, 12-week -3.9%, 52-week -4.2%, the weakest among all countries. France, Italy, Spain 52-week sales +1.0%, +0.1%, +1.3% respectively, relatively resilient. In CSD, France performed strongly (52-week +11.6%), related to PepsiCo share gains. UK CSD overall weak (4-week -2.5%), but PepsiCo grew counter-cyclically.

Key Divergences & Risks

1. Consumption weakness persists beyond expectations: The deterioration in 4-week data may be just the beginning. If the European economy slows further, off-premise volumes could continue to decline, with premium brands (e.g., ABI's premium products) facing greater pressure.
2. Backlash risk from pricing strategy: ABI's price/mix improvement of +2.9% has already caused -8.6% volume decline. Continued price increases could further lose consumers and stimulate private label growth. Meanwhile, Heineken's negative price/mix, if sustained, could damage long-term brand pricing power.
3. Regional concentration risk: Diageo, although strong overall (Europe 12-week +6.8%), derives 85.2% of sales from the UK and carries an Underweight rating, with the market already partially reflecting concentration risk. Germany's structural beer market contraction will continue to affect ABI and Carlsberg.
4. Data limitations: The report covers only European off-premise channels (supermarkets, convenience stores) and does not capture on-premise (bars, restaurants), which may behave differently (e.g., on-premise tends to favor premiumization and higher-priced products). Heineken's reliance on promotional volume means its on-premise performance is unknown.

Valuation or Trading Implications

Based on current scanner data, different companies face distinctly different risk-reward profiles:

• Heineken (current rating E, Underweight): Volume share expansion but profit quality questionable. If promotional competition escalates, margins may come in below expectations. Investors should wait for a positive price/mix signal before building positions. Avoid near term.
• AB InBev (rating O, Overweight): Pricing strategy has already led to significant volume contraction and market share loss. If demand deteriorates further, valuation downside risk is high. Recommend reducing positions until volumes stabilize.
• Carlsberg (rating O): Beer business broadly soft, but PepsiCo distribution provides a structural growth driver (UK CSD +7.5%). Meanwhile, UK and France beer shares remain stable (+60bps and +55bps), and German pressure is partially factored into valuation. Can hold, but monitor whether German market share worsens further.
• Diageo (rating U): Spirits continue to show strong growth in Europe (Germany 12-week +30.1%, Spain +22.7%), but UK concentration risk and potentially elevated valuation may limit upside. Current rating reflects cautious stance.
• CSD-related: Coca-Cola's European share erosion trend continues, which is negative for Coca-Cola HBC (CCH, rating O). PepsiCo system benefits, but pure-play exposure is scarce; Carlsberg benefits indirectly.

Trading Implications: In the near term, European beer and CSD off-premise face demand headwinds. A defensive positioning among brewers is advised (prefer Carlsberg or Diageo over ABI/Heineken), with attention to the stable growth opportunity in PepsiCo's distribution chain. Private label CSD share decline suggests branded CSD still has pricing power, but careful selection of beneficiaries is needed.

Appendix Data Summary