Diageo (LSE: DGE), the global drinks giant behind Guinness, Johnnie Walker, and Smirnoff, has announced the sudden departure of CEO Debra Crew after just over two years in charge. The decision comes as the company’s shares have plummeted 46% since she took the helm in June 2023, significantly underperforming the FTSE 100’s 17% gain in the same period.
Why Was Crew Forced Out?
The board’s move follows a disastrous run for Diageo, with:
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Slumping alcohol sales as younger consumers drink less
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A collapse in Latin American demand, a key growth market
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Investor frustration over weak leadership and strategy
Finance chief Nik Jhangiani will serve as interim CEO while the board searches for a permanent replacement.
A Perfect Storm of Challenges
Diageo has faced multiple headwinds:
1. Changing Consumer Habits
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Younger adults are drinking less, with Gen Z embracing sobriety trends (BBC)
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The post-pandemic spirits boom has faded, hurting premium brands
2. Latin American Crisis
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Overstocking issues led to a sales crash in Mexico and Brazil
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Analysts say Diageo was “oblivious to shifting trends”
3. Weight-Loss Drug Fears
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Terry Smith, a top investor, sold his stake, warning that drugs like Ozempic could reduce alcohol demand (Financial Times)
What’s Next for Diageo?
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Cost-cutting plan: The firm aims to save £373M by selling non-core brands
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Guinness sale rumors: Crew denied reports of an £8B deal, but analysts speculate it could happen
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US tariff risks: New duties on Mexican tequila & Canadian whisky could further dent profits
Expert Take: “Diageo Looks Lost”
Dan Coatsworth of AJ Bell said:
“The new CEO must bring fresh energy. Diageo’s leadership seemed adrift, and investors lost confidence.”
Broader Alcohol Industry Struggles
Diageo isn’t alone—Pernod Ricard (Jameson) and Remy Cointreau have also seen sales slump as drinkers cut back.
Key Questions for the Next CEO
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Can they revive growth in key markets?
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Will Diageo sell Guinness to raise cash?
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How will they adapt to sober-curious trends?
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