Ambev S.A. (ABEV) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call highlights strong financial performance with a significant net income and an increase in EPS. The company is focused on product innovation and market expansion, particularly in Brazil, which is a positive indicator. The Q&A section reveals management's confidence in overcoming headwinds and maintaining profitability. Although there are some uncertainties, the strategic focus on the FIFA World Cup and digital growth initiatives suggest a positive outlook. Overall, the sentiment leans towards a positive market reaction.
Key Financial Performance
GMV (Gross Merchandise Value) for BEES marketplace Full year GMV grew 70%, driven by 3P expansion and gross margin up 3.5 percentage points versus last year, reinforcing both relevance and improving economics.
GMV for Zé Delivery Zé Delivery closed 2025 with BRL 4.7 billion in GMV, up 13% versus last year, with 67 million orders and 27 million yearly active users, up 11% versus last year.
Consolidated normalized EBITDA margin Expanded by 50 basis points, reaching 33.4%, driven by net revenue per hectoliter growth of 7.5%, financial discipline, and efficient resource allocation.
Brazil Beer EBITDA margin Expanded by 110 basis points, marking the third consecutive year of margin expansion.
Shareholder returns Approximately BRL 20 billion in shareholder returns in 2025, the highest in history, through BRL 13.2 billion in dividends, BRL 4.2 billion in interest on capital, and a new BRL 2.5 billion in share buyback program.
Net revenue per hectoliter Grew by 7.5%, supported by stronger brands, revenue management strategy, and continued premiumization across the portfolio.
Cash COGS per hectoliter for Brazil Beer Increased by 6.1% in 2025, at the lowest quartile of guidance, despite cost headwinds and operational deleveraging.
Net financial expenses Almost BRL 4 billion, mainly due to FX variation losses related to foreign currency-denominated assets and BRL appreciation, coupled with expenses related to sourcing U.S. dollars in Bolivia.
Effective tax rate 17.7% for the year, reflecting one-off effects such as the Barbados divestment and partial reversal of tax liabilities.
Stated net income Almost BRL 16 billion, with stated EPS increasing 8.2% year-on-year, while normalized EPS increased by 2%.
Cash flow from operating activities Totaled BRL 24.5 billion, BRL 1.6 billion lower than last year, mainly due to softer volumes impacting working capital.
Cash flow consumed in investing activities Approximately BRL 5 billion, mainly driven by CapEx investment broadly in line with last year.
Cash flow consumed in financing activities Amounted to BRL 26.8 billion, driven by shareholder payouts and the completion of the 2024 share buyback program.
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Operating Highlights
Premium, balanced choices, and nonalcohol beer segments: Led category expansion in 2025, with premium and super premium volumes increasing by high teens. Balanced choices brands grew by high 60s, and nonalcohol grew around 30%.
Flavored beers: Built adjacencies and elevated the core segment through innovation and investments.
Brazil Beer market: Premium and super premium volumes increased by high teens, and the company closed the year as leaders in the segment. Nonalcohol beer grew around 30%, contributing to incremental occasions.
Argentina market: Macro environment improved with lower inflation and less FX volatility, but consumption recovery is slower than expected. Sequential performance improved in 2025.
Dominican Republic market: Consumption environment improved sequentially, with beer gaining share of alcoholic beverages and Presidente's brand health reaching all-time highs.
Canada market: Outperformed both beer and beyond beer industries, supported by beer mega brands and beyond beer momentum.
BEES marketplace: Full year GMV grew 70%, driven by 3P expansion, with gross margin up 3.5 percentage points.
Zé Delivery: Achieved all-time high performance with BRL 4.7 billion in GMV, 67 million orders, and 27 million yearly active users, consolidating its position as a major convenience platform in Brazil.
EBITDA margin: Expanded consolidated organic EBITDA margin by 50 basis points, marking the third consecutive year of margin expansion.
Capital allocation: Announced BRL 20 billion in shareholder returns, the highest in company history, including dividends, interest on capital, and a share buyback program.
Operational efficiencies: Focused on resource allocation, revenue management, productivity, and expense governance to sustain brand investment and profitability.
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Risk or Challenges
Volume Pressure: Volumes were pressured by the environment, indicating challenges in maintaining or growing sales volume due to external factors.
Cyclical Headwinds: The company faced cyclical and occasion-driven headwinds in 2025, impacting beer consumption frequency and overall demand.
Macroeconomic Challenges in Argentina: The macroeconomic environment in Argentina, including slower-than-expected consumption recovery, weighed on results.
Weather-Related Disruptions: Weather-related disruptions in the Dominican Republic affected consumption and performance in Q4.
Commodity Price Pressures: Anticipated cost pressures in 2026, particularly from aluminum prices, are expected to impact Brazil Beer cash COGS per hectoliter.
Foreign Exchange Volatility: FX variation losses related to foreign currency-denominated assets and BRL appreciation impacted financial expenses.
Softness in Core Beer Segment: The core beer segment faced softness due to its higher reliance on out-of-home socialization, which was impacted by cyclical factors.
Supply Chain and Cost Management: Operational deleveraging associated with lower volumes and cost headwinds posed challenges to maintaining profitability.
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Guidance & Outlook
Revenue and Margin Projections: For 2026, Ambev expects Brazil Beer cash COGS per hectoliter to increase between 4.5% and 7.5%, driven by commodity prices, particularly aluminum, and portfolio mix. Despite these cost pressures, the company aims to expand consolidated margins over time.
Market Trends and Socialization: 2026 is anticipated to be a promising year for socialization, with events like Carnival and the FIFA World Cup creating opportunities for increased beer consumption. Additionally, a holiday-rich calendar in Brazil is expected to provide more occasions for socialization.
Category Growth and Consumer Trends: Ambev sees significant growth potential in the beer category, supported by favorable demographics in Latin America and opportunities to expand through out-of-home and at-home occasions. The company plans to focus on premium, balanced choices, and nonalcoholic segments to drive growth.
Digital and Technological Advancements: The BEES marketplace is expected to continue scaling, with a focus on enhancing execution at the point of sale and embedding digital tools for better activation and portfolio recommendations. Zé Delivery is also positioned to grow, targeting young adult consumers and leveraging its innovation loop.
Capital Allocation and Shareholder Returns: Ambev remains committed to reinvesting in organic growth, maintaining a disciplined approach to M&A, and returning excess cash to shareholders. In 2025, the company returned approximately 90% of its operating cash flow to shareholders and plans to sustain this approach in 2026.
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Shareholder Return Plan
Dividends: Ambev announced approximately BRL 20 billion in shareholder returns in 2025, which includes BRL 13.2 billion in dividends.
Interest on Capital: BRL 4.2 billion was allocated to interest on capital as part of the shareholder returns.
Share Buyback Program: A new BRL 2.5 billion share buyback program was announced in 2025.
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Key Q&A
Q:Can you unpack the factors behind the December beer volume growth in Brazil? Was it all weather-related or were there other favorable shifts?
A:The December beer volume growth in Brazil was driven by improved weather conditions after an unseasonably cold and long winter caused by the La Nina phenomenon. This weather improvement, combined with market share gains, resulted in low single-digit sell-out data growth in December.
Q:Can you comment on the trends in January for Brazil beer volumes?
A:The weather impact in January was neutral year-over-year, which is important for the company, but no specific volume trends were disclosed.
Q:What were the exact decisions behind the volume decline in Brazil NAB, and what can we expect for volumes in 2026?
A:The volume decline in Brazil NAB was attributed to revenue management strategies. For 2026, the company aims to continue focusing on margin expansion and has provided a guidance of 4.5% to 7.5% cost growth, which is broadly in line with 2025.
Q:How are you thinking about sustaining and improving profitability in 2026, especially regarding hedging and additional efficiencies?
A:The company plans to continue working on cost efficiencies and margin expansion. They have provided a cost guidance of 4.5% to 7.5% for 2026, considering pressures from commodities like aluminum and portfolio mix. They aim to leverage their strategies and hedging to manage these challenges.
Q:What is your approach towards dividends in 2026? Will they be concentrated towards the end of the year or distributed quarterly?
A:The company will continue to have quarterly discussions on dividends, considering cash position and generation. While no specific guidance was provided, they aim to balance organic growth, selective M&A, and sustainable shareholder returns.
Q:How do you view the performance of core brands versus premium brands in Brazil, and what is the potential for core brands?
A:Core brands remain significant due to their accessibility for the majority of the population in Brazil. The company is working to keep core brands relevant through innovations like Skol Zero Zero. Premium brands have shown faster growth, but core brands still play a meaningful role in the portfolio.
Q:What is the sustainability of SG&A dilution going forward, and how does it relate to past investments in innovation?
A:The company believes the portfolio is stronger now due to past investments in innovation. SG&A dilution is expected to continue as they reap the benefits of these investments and focus on cost efficiencies.
Q:What is the potential impact of GLP-1 drugs on the company's portfolio, and how are you preparing for it?
A:The company has not observed any meaningful impact from GLP-1 drugs but is monitoring the trend. They are diversifying their portfolio with zero alcohol, functional beers, and sweet-flavored beers to address emerging consumer needs.
Q:What is your pricing strategy for 2026, and how do you balance accessibility and profitability?
A:The pricing strategy aims to balance accessibility for consumers and profitability for the company. They are leveraging a complete portfolio and digital tools like BEES to execute revenue management effectively and offset cost pressures.
Q:How should we think about mix and volume growth for Brazil beer in 2026, especially during the World Cup?
A:The company expects a favorable backdrop with events like the World Cup and more holidays. They aim to use their portfolio strength and digital tools to drive mix and volume growth while managing cost pressures.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details on January beer volume trends, the exact timing of dividend distributions in 2026, and the potential long-term impact of GLP-1 drugs on the portfolio. Additionally, their responses on pricing strategy and volume growth were broad and lacked precise data or actionable insights.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Ambev
BEES
BRL cash
BRL shareholder
COGS hectoliter
Member Executive
Pillar
SGA
activation
activity BRL
cash COGS
category premium
choice
commitment
confidence
consumer beer
consumption environment
context
core segment
development
disruption
dynamic
efficiency
hectoliter marketplace
high
marketplace product
muscle
nonalcohol
passion
point sale
pressure
program BRL
proof point
recovery
resource allocation
return
season
share beverage
share gain
socialization
softness
ABEV Transcript
Ambev S.A. (ABEV) Q4 2025 Earnings Call Transcript
Positive2-13
The earnings call highlights strong financial performance with a significant net income and an increase in EPS. The company is focused on product innovation and market expansion, particularly in Brazil, which is a positive indicator. The Q&A section reveals management's confidence in overcoming headwinds and maintaining profitability. Although there are some uncertainties, the strategic focus on the FIFA World Cup and digital growth initiatives suggest a positive outlook. Overall, the sentiment leans towards a positive market reaction.
Ambev S.A. (ABEV) Q3 2025 Earnings Call Transcript
Positive10-30
The earnings call reflects a positive sentiment with strong financial performance, including revenue and EPS growth. Despite challenges in Brazil, the company is optimistic about brand momentum and upcoming opportunities. The Q&A session highlighted effective cost management and strategic initiatives, with successful expansion in premium segments. Although there are regional challenges, the overall outlook remains positive with expectations of margin improvements and sustained growth in digital platforms.
Ambev S.A. (ABEV) Q2 2025 Earnings Call Transcript
Positive7-31
The earnings call summary and Q&A indicate positive financial performance with a 15% net income improvement and a double-digit growth in the Premium segment. Despite challenges like weather impacts in Brazil and a decline in cash flow, management's confidence in recovery and margin improvements is reassuring. The marketplace's GMV growth and strategic partnerships further bolster sentiment. While some uncertainties exist, the overall outlook, including a dividend announcement and continued brand strength, suggests a positive stock price movement within the 2% to 8% range.
Ambev S.A. (ABEV) Q1 2025 Earnings Call Transcript
Unknown5-8
The earnings call presents a mixed picture. Positive factors include high-single-digit net revenue growth, gross margin expansion, and a strong share buyback program. However, challenges such as a high effective tax rate, FX losses, and unclear guidance on key issues like price increases and CapEx temper enthusiasm. The Q&A section reveals some analyst concerns about management's vague responses, particularly regarding Brazil's pricing strategy and Skol's trajectory. Given these mixed signals and the absence of a market cap to gauge volatility, a neutral stock price movement is predicted.
ABEV Slides
ABEV Report
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