Shifting Tides in Beer Consumption

In a recent interview, Carlsberg A/S’s Chief Executive Jacob Aarup-Andersen highlighted a stark polarization in beer drinking habits driven by persistent cost-of-living pressures. Consumers are increasingly opting for either high-end premium beers or budget-friendly economy options, leaving mainstream core brands in a precarious position. “People look either for the premium brand or the economy brand. So what will get squeezed… is actually the core brands in the middle,” Aarup-Andersen told CNBC on August 15, 2025. This trend comes as global beer volumes continue to decline, with Carlsberg reporting a 1.7% drop in organic volumes for the first half of the year, underscoring broader industry challenges.

The brewer’s half-year results, released amid economic uncertainty, showed organic operating profit growth of 2.3%, slightly beating expectations but still reflecting squeezed margins. Revenue came in at 45.86 billion Danish kroner, just shy of analyst forecasts, as consumers in key markets like Europe and Asia tightened their belts. Aarup-Andersen noted no signs of consumer recovery in the second half of 2025, pointing to inflation and geopolitical tensions as ongoing drags on spending.

Premium Push and Economy Squeeze: Navigating Polarized Markets

Despite the volume slump, Carlsberg has seen resilience in its premium and alcohol-free segments, which grew by 4% and 7% respectively in the first half. This shift aligns with a global move toward moderation, where non-alcoholic beers are gaining traction across generations. As Aarup-Andersen explained in a June 2025 interview with Bloomberg, “Moderation is a theme that’s here to stay,” with no-alcohol options emerging as the fastest-growing category, appealing not just to Gen Z but to a broad demographic seeking healthier alternatives.

Industry peers echo these sentiments. Anheuser-Busch InBev NV reported a slight sales decline, while Heineken NV emphasized its global strength amid slowdowns. According to a report from Archyde on August 15, 2025, brewers are adapting by focusing on premium products to offset volume losses, though overall beer sales dips signal consumers “tightening their belts.” In China, a critical market for Carlsberg, the CEO anticipates another year of market decline in 2025, as shared in a November 2024 discussion with Just Drinks, compounding pressures from local competition and economic headwinds.

Cost Pressures and Pricing Strategies: A Delicate Balance

To counter these trends, Carlsberg plans modest price hikes, following a pattern seen in markets like Malaysia, where the company announced increases starting September 1, 2025, to protect margins amid flat sales, as reported by Malay Mail on August 13, 2025. This echoes earlier warnings from the brewer; in 2023, former CEO Cees ‘t Hart cautioned that inflation could impact sales, per Reuters, a concern that has materialized as price increases risk further alienating cost-sensitive consumers.

Social media sentiment on X reflects these shifts, with posts highlighting declining alcohol consumption globally. One user noted German beer production at a 30-year low, down 6.3% year-over-year, while another pointed to Russia’s 15% drop in alcohol sales from December 2024 to March 2025, attributing it to Gen Z preferences for soda over beer. Such trends suggest a cultural pivot away from traditional drinking, amplifying the squeeze on mid-tier brands.

Outlook for 2025: Optimism Tempered by Caution

Looking ahead, Carlsberg raised its full-year organic operating profit growth guidance to 3% to 6%, up from 1% to 5%, buoyed by strong performances in premium and non-alcoholic lines. Yet, the CEO remains cautious, forecasting no improvement in consumer environments, as detailed in the company’s August 14, 2025, earnings release covered by Global Drinks Intel. This adjustment follows a February 2025 report from Reuters, where the brewer initially projected higher-than-expected growth, only to face ongoing volatility.

Broader data supports this downbeat view: Per capita beer consumption figures shared on X show Czechia leading at 128 liters annually, but overall global demand is waning amid economic strains. In Kenya, excise revenue from beer fell 5.8% in the fiscal year ended June 2025, due to illegal trade and reduced buying power, as posted by users on the platform. For industry insiders, these patterns signal a need for innovation—expanding into Asia and bolstering no-alcohol portfolios—to weather the storm.

Strategic Adaptations: Beyond Beer and Into the Future

Carlsberg’s strategy includes geographic expansion and product diversification, with a focus on Asia despite China’s projected decline. The CEO’s December 2023 comments to Yahoo Finance indicated continued price hikes to offset losses from its seized Russian business, a move that has helped stabilize finances but risks volume erosion.

Ultimately, as cost pressures persist into 2025, brewers like Carlsberg must navigate a bifurcated market where premium indulgence and economical choices dominate. With alcohol-free options surging—evident in a 2022 X post warning of CO2 shortages impacting production in Poland—the industry faces a pivotal moment. Insiders watch closely as these habits reshape portfolios, potentially heralding a new era of moderated, value-driven consumption that could redefine brewing for decades.