Pernod Ricard China’s 'Scissors Gap': Retail Sales Turn Positive While Revenue Falls 25%

Reporter Zheng Yuxin On October 15, global spirits giant Pernod Ricard released its financial results for the first quarter of fiscal year 2027 (July–September 2026), reporting net sales of €2.234 billion (approximately RMB 16.77 billion), a 0.9% organic decline year-on-year (a 6.3% decline on a reported basis). China and the United States—Pernod Ricard’s two largest markets—continue to face pressure. In the first quarter of the new fiscal year, net sales in the U.S., its largest market, declined 10% year-on-year; in China, net sales fell 25% year-on-year—both impacted by channel inventory destocking. Over the past three years, affected by inventory reduction efforts and geopolitical factors, Pernod Ricard’s core operating metrics have declined consecutively. In fiscal year 2026, both net sales and operating profit declined double-digit percentages on a reported basis. However, during the earnings call held the same day, Mauve Croizat, Executive Vice President of Finance & Technology at Pernod Ricard, stated that retail sales (i.e., end-consumer demand) in the Chinese market have resumed growth—marking significant improvement compared to the sharp year-on-year decline seen previously. Behind the 25% revenue drop The 25% year-on-year decline in Pernod Ricard China’s Q1 revenue stems primarily from trade inventory adjustments—not from a sudden deterioration in end-consumer demand. By channel: Martell’s off-trade sales (e.g., supermarkets, liquor stores) have resumed growth, with successful Mid-Autumn marketing campaigns effectively driving consumer and channel engagement. In contrast, on-trade channels (e.g., restaurants, bars) remain under sustained pressure due to regulatory tightening. Martell is Pernod Ricard’s flagship brand in China. Ahead of the Mid-Autumn Festival, Martell launched the short film “The Aristocrat Returns,” and in early September hosted a Mid-Autumn banquet in Chaozhou-Shantou—a key market—continuing this theme to advance localized brand symbolism. Other brands also delivered strong support. The Glenlivet, Royal Salute, Knob Creek, and Auchentoshan performed notably well, partially offsetting pressure on Martell. Like peers across China’s wine and spirits industry, Pernod Ricard’s management has observed that Chinese consumers’ drinking habits are shifting “toward more private occasions,” with purchasing behavior migrating from on-trade to off-trade channels. Accordingly, Pernod Ricard has adjusted its channel mix and marketing approach in China—increasing digital (online) marketing investment to align with this evolving consumption trend.

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On October 16, the Lanzhou Alcoholic Beverage Industry Association issued a notice promoting the ‘Mass Brand Ambassador Model’ and the ‘Jiu Jie Hui New Retail’ digital platform among its council members and member retail enterprises. This model introduces a consumer referral reward mechanism and leverages digital management and intelligent split-payment tools to explore solutions for improving retail store profitability, retail sales velocity, and price inversion issues. The notice specifies that participating products must originate from well-known Gansu-based distilleries and cover baijiu, wine, huangjiu, and other categories—meeting criteria including controllable pricing, suitability for mass consumption, and sufficient margin for referral rewards. Manufacturers or distributors may organize unified store training, with association platform teams providing guidance on platform onboarding, product information upload, and ambassador recruitment; member retail enterprises may also independently onboard and list qualified products. (Lanzhou Alcoholic Beverage Industry Association) ▎Zhongya Zhibao Launches Longevity Banquet Edition San Bian Jiu On October 14, during the China Health Wine Industry Conference held at the 115th National Food & Wine Fair (Nanjing), Yantai Zhongya Zhibao Pharmaceutical Co., Ltd. launched the Zhongya Special San Bian Jiu (Longevity Banquet Edition). The new product has an alcohol content of 35% vol., targets longevity banquets and family gatherings, and carries the official health food ‘Blue Hat’ certification. (Yantai Zhongya Zhibao Pharmaceutical Co., Ltd.) ▎Huiquan Tea-Infused Craft Beer Launches On October 16, Huiquan Tea-Infused Craft Beer officially launched. Developed through a collaboration between Huiquan Brewery and Fujian’s emerging white tea brand ‘Master Bai,’ the beer infuses premium Fujian white tea into its brewing process, blending the fresh, ocean-and-mountain-inspired essence of the region. (Huiquan Brewery) ▎Jieqiang Launches Two Sparkling Wines Priced at RMB 9.9 On October 15, Jieqiang Group launched two sparkling wines under its ‘Bu Ji’ (‘No Rush’) series: Pineapple Sea Salt Flavor and Lychee Flavor—both at 3.8% alcohol by volume. According to the Jieqiang JOYMAX Member Mall, both new products are priced at RMB 9.9 per bottle. (Jieqiang Group) ▎Pernod Ricard’s Q1 Net Sales Down 6.3% On October 15, Pernod Ricard released its first-quarter results for fiscal year 2027 (July–September 2026): net sales totaled €2.234 billion, down 6.3% on a reported basis and 0.9% organically year-on-year; volume rose 6%, with strategic international brands up 2%. Net sales in the U.S. and China declined organically by 10% and 25%, respectively—both impacted by channel inventory adjustments; excluding these two markets, other markets grew organically by 4%. End-consumer retail sales in China have resumed growth. Martell’s off-trade sales rebounded amid Mid-Autumn marketing momentum, while on-trade channels continue facing regulatory tightening pressure; The Glenlivet, Royal Salute, Knob Creek, and Auchentoshan all delivered strong performance. By region: the Americas and Europe saw organic net sales declines of 9% and 6%, respectively; Asia & Rest of World grew 9%, with India up 19%; global travel retail declined 4%. Strategic international brands, strategic local brands, and specialty brands posted organic net sales changes of –1%, +6%, and –5%, respectively. The Group expects overall organic net sales for fiscal year 2027 to remain stable, with continued inventory adjustment pressures in the U.S. and China, and sustained growth in markets such as India; advertising and promotion spending will account for approximately 16% of net sales, with cost control and operational efficiency improvements supporting organic operating profit margin; digital transformation remains a top priority. The Group reaffirmed its target to reduce net debt-to-EBITDA ratio to below 3x by fiscal year 2029.

Pernod Ricard First Quarter Sales Fall Less Than Expected, Cautious Optimism on China

Oct 14, 2026

Pernod Ricard reported a 0.9% drop in Q1 sales, beating expectations despite declines in the US and China due to de-stocking. The company maintains its long-term growth targets while expressing cautious optimism regarding improving trends in China.

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Pernod Ricard First Quarter Sales Fall Less Than Expected, Cautious Optimism on China

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