Is American Whiskey Really Declining? Brown-Forman Argues Demand is Still Strong

The rapid growth period for American whiskey may have come to an end in recent years.

But does that mean the category is over?

According to Lawson Whiting, CEO of Brown-Forman, owner of Jack Daniel’s and Woodford Reserve, the answer is no.

In his assessment following the first quarter results of the company's fiscal year 2027, Whiting argued that the pessimism regarding the future of American whiskey has gone too far. He believes that while cost and inventory issues are real, consumer interest remains strong; particularly, visits to distilleries and premium tasting experiences indicate that demand has not completely disappeared. The Spirits Business reported Whiting's perspective in a news article dated September 4, 2026, titled "US whiskey demise exaggerated."

The executive's statement is naturally Brown-Forman's own view regarding its category.

However, when read alongside market data, a more interesting picture emerges:

American whiskey is declining; however, demand is not disappearing. The structure of the market is changing.

The U.S. alcoholic beverage market is indeed shrinking

IWSR's 2025 U.S. data clearly shows the pressure in the alcoholic beverage sector.

The total beverage alcohol volume shrank by 5% in 2025.

Beer volume decreased by 5%, wine by 6%, and the spirits category by 4%.

The RTD category only fell by 1% overall while spirits-based RTDs grew by 14%.

According to IWSR research, the most common reason U.S. consumers are drinking less is not health, but cost.

31% of respondents cite economic pressure as the reason for consuming less alcohol.

This distinction is important.

Because consumers are not abandoning the category entirely, but rather becoming more selective with their spending.

IWSR also notes that during the same period, the super-premium price segment grew by 1% in volume. The ability of the high price segment to remain positive while the total market shrinks does not support the thesis that "everyone is switching to cheaper products."

Whiskey sales flat at Brown-Forman, RTD growing

Brown-Forman's first quarter results for the fiscal year 2027, announced on September 2, show a similar change.

The company's total net sales fell by 1% to $911 million.

According to Reuters, net sales in the U.S. decreased by 3%.

While whiskey portfolio sales remained generally flat, the RTD segment grew by 20%; tequila sales fell by 12%.

The message these figures convey is significant.

Brown-Forman's consumers are not completely abandoning alcoholic beverages.

But the format they purchase may change.

Instead of a full bottle of whiskey, they may opt for a ready-to-drink cocktail.

Instead of classic products, they may choose flavored innovations.

Instead of large bottles, they may prefer more accessible packaging.

In terms of bar programs, this does not simply mean "reducing the whiskey shelf."

Consumers can enter the same spirit category through different usage forms.

Jack Daniel’s struggles, Woodford Reserve more resilient

The company's fiscal year 2026 results also showed varying performances within the portfolio.

Brown-Forman's total whiskey net sales increased by 3%; organic growth was 1%.

This growth was supported by the launch of Jack Daniel’s Tennessee Blackberry and the performance of Woodford Reserve in the U.S.

In contrast, classic Jack Daniel’s Tennessee Whiskey sales declined.

While the company's reported net sales fell by 7% nationwide, they remained flat on an organic basis. Portfolio changes, distributor transitions, and the expiration of previous agreements affected the reported figures.

Therefore, the conclusion that "Jack Daniel’s is declining, American whiskey is finished" is overly simplistic.

It is not possible to evaluate the entire category based on the performance of a single brand.

American whiskey still ahead of tequila

One of Whiting's most striking arguments is the category comparison.

The CEO states that, according to Nielsen data, American whiskey remains one of the strongest major categories in the U.S. spirits market; tequila has recently declined more.

According to the company's statements during the investor meeting, while American whiskey sales trends are weak, tequila is now performing a few points lower.

This is significant.

In recent years, tequila has been seen as one of the strongest growth stories in the U.S. beverage sector.

If tequila is also under pressure, the issue may not be solely related to whiskey.

A broader consumer budget, moderation trends, and high-priced spirits spending may also be influential.

Indeed, in Brown-Forman's first quarter, the tequila portfolio declined in double digits on an organic basis. Herradura was particularly affected by U.S. volumes and price pressures.

Premiumization is not over, but has become more selective

One of the key drivers of American whiskey's growth over the past 15 years has been premiumization.

The bourbon and rye categories have grown not only in volume but also by moving into higher price segments.

According to IWSR's long-term analysis, the retail sales value of American whiskey at premium and above price levels has grown approximately three times faster than standard and below segments. In 2021, the volume of premium-and-above whiskey surpassed that of standard-and-below for the first time.

The current difference is that consumers no longer automatically pay more for every premium product.

IWSR's 2025 assessment indicates that consumers are scrutinizing the price-quality ratio more carefully.

In other words, premiumization is not ending.

There needs to be a stronger justification to be premium.

This has important implications for bars and restaurants.

It is possible to offer a $25 whiskey pour on the menu.

However, the customer needs to understand the product's story,

age,

production difference,

rarity,

or its value in the experience.

Simply placing an expensive bottle on the shelf is not premiumization.

Distillery tourism as a different demand indicator

Whiting emphasizes that interest in American whiskey continues, particularly highlighting visitors to the Kentucky Bourbon Trail and the company's distilleries.

According to the CEO, demand for high-priced and special tasting programs remains strong.

This data alone does not prove that U.S. whiskey retail sales are recovering.

Distillery visitors represent a smaller and more engaged segment.

However, it may indicate that cultural interest in the category continues.

Whiskey is no longer just a product sold in a bottle.

Distillery tour.

Tasting.

Limited release.

Bar experience.

Cocktail.

Collector's item.

All of these represent different revenue streams within the same category economy.

It does not have to be a contradiction if a brand's retail volume declines while experiencing high demand on the experiential side.

The real problem may be inventory

One of the current problems facing the American and Scotch whisky industries is production decisions made years before today's consumption.

Because whiskey is aged, producers cannot produce today based on today's demand and sell tomorrow.

When production was increased a few years ago with high growth expectations, if demand slows, it can lead to a large aging inventory in storage.

Brown-Forman management openly acknowledges the inventory pressure in the current sector.

According to information provided by Whiting during the investor meeting, new barrel fillings in the U.S. whiskey sector decreased by about 30% in the 2025 calendar year; a similar or larger production cut is expected in 2026.

This is an important signal of normalization.

Producers may not be reducing production because they believe demand has completely ended, but rather to bring future supply closer to current consumption levels.

However, the results of this adjustment will not be quick.

Balancing aged whiskey inventory may take years.

Discount wars could further strain the category

Another risk for whiskey producers is to resort to aggressive price discounts in the face of high inventory.

Brown-Forman's approach, for now, is to maintain price discipline.

Whiting notes that pricing in the U.S. whiskey category has generally remained relatively rational, and they have maintained about a 1% price increase on Jack Daniel’s Black Label.

The logic behind this strategy is clear.

If a whiskey producer quickly reduces excess inventory through discounts, it may create volume in the short term.

However, it could erode the premium price perception built over many years.

The same problem applies to bars.

Continuously selling discounted premium whiskey could lower the category's value.

A stronger solution could be to make the price's value visible through usage areas such as;

flights,

food pairing,

premium highball,

special cocktails,

tasting events.

RTD growth does not have to be a competitor to whiskey

One of the strongest areas in Brown-Forman's recent results is RTD.

In the fiscal year 2026, the company's RTD portfolio grew by 11%; organic growth was 7%.

In the first quarter of the fiscal year 2027, RTD growth reached 20%.

This development may be interpreted as a threat from the perspective of whiskey bars.

However, the same consumer may use different formats at different times.

RTD at home.

Highball at a restaurant.

Premium whiskey at a cocktail bar.

Tasting at a distillery.

Here, the main change is not in the spirit category but in the consumption occasion.

Bar businesses also need to think about category management not just through bottle brands but through usage moments.

Turkey is one of the growing markets for Brown-Forman

There is also an important detail in Brown-Forman's fiscal year 2026 results from the perspective of StaffMag.

The company's net sales in emerging markets grew by 14%, with organic growth of 12%.

The company stated that this growth was particularly supported by the Jack Daniel’s family in Turkey, the United Arab Emirates, and Brazil.

This indicates that the slowdown in the category in the U.S. is not being experienced in the same way across all markets.

For Turkey, this represents an important commercial signal based on producer data.

However, since Brown-Forman does not disclose the sales volume or growth percentage in Turkey on a country basis, it cannot be concluded that "Turkey's Jack Daniel’s sales grew by X%".

Nonetheless, the specific mention of Turkey as one of the markets driving growth by the company is noteworthy for the bar and premium spirits segment.

What does this mean for bar businesses in Turkey?

It is not correct to accept the decline in spirits volume in the U.S. as a trend experienced in the same way in Turkey.

Market structures, tax systems, pricing, and consumption culture differ.

However, the transformation in American whiskey carries some common lessons for bar managers in Turkey.

First, category management is not just about holding stock.

A more selective portfolio that creates different usage areas, rather than 20 bourbon bottles at similar prices, may be more efficient.

Second, there is a need for premium product service training.

If bartenders cannot explain the product's;

production technique,

flavor difference,

why it is used in cocktails,

and the price difference,

it becomes difficult to justify the premium price.

Third, the rise of RTD and low-alcohol trends does not necessitate removing classic whiskey from the menu.

But it requires acknowledging that neat service is not the only consumption form for the whiskey category.

Highball, sessionable cocktails, and smaller tasting services could be entry points for new consumers.

Stafflink's perspective

In our view, Lawson Whiting's assessment that "the death of American whiskey is exaggerated" is not entirely incorrect; however, it should be read carefully as a company defense.

The market is indeed contracting.

According to IWSR, U.S. spirits volume fell by 4% in 2025.

Brown-Forman's U.S. sales are also under pressure.

The classic Jack Daniel’s volume is struggling, and the sector faces an inventory problem.

However, there are also other indicators.

The super-premium segment is resilient.

Interest in distillery experiences continues.

RTD is growing.

Premium products like Woodford Reserve can perform better.

In some emerging markets like Turkey, the company is growing.

Therefore, the problem in the whiskey sector may not be that consumers have completely lost interest in the category.

The more accurate question is:

Which whiskey will consumers continue to pay for, at what price, and in what usage occasion?

The main variable that bars and distributors will manage in the coming period will be this selectivity rather than volume.