Diageo’s new CEO to shake up operations as sales fall

Incoming Diageo CEO Dave Lewis believes he has identified opportunities to grow the drinks giant in the wake of “mixed” financial performance.

In the six months ending 31 December 2025 the Guinness-maker saw year on year net sales dip by 4% to $10.5b (£7.7b).

Operating profit also slid 1.2% to $3.1b (£2.3b).

The firm reported that growth in Europe, Latin America and the Caribbean and Africa was offset by weakness in North America and China.

Diageo blamed softer performance on pressure on disposable income impacting US spirits in North America, and the adverse impact of poor Chinese white spirits sales in Asia Pacific.

Therefore the drinks group lowered its forecast for its full 2026 financial year, predicting sales to drop a further 2-3% given further US weakness and slower Chinese white spirits sales in Asia Pacific.

Operating profit expectations were also revised downwards to be flat to up low-single-digit.

However, CEO Lewis, who joined the firm from healthcare company Haleon last November, said that despite the “mixed” financial performance, he can “already see significant opportunities for Diageo to act more decisively to enhance its competitiveness and broaden the portfolio offering leading to higher growth”.

He set out Diageo’s immediate priorities as focusing on its customers, building competitive category strategies, winning with “relevant brands” and redesigning the Diageo operating framework to drive sustainable returns.

Lewis cited creating more financial flexibility to “deliver on these opportunities”, with the board reducing shareholder dividends.

He added: “I am encouraged by the depth of the passion and pride that our people have for our brands across the business. This will be invaluable given the significant work ahead.”

In December 2025, Diageo agreed to sell its shareholding in East African Breweries and the Kenyan spirits business to Asahi Group, which should garner estimated net proceeds of $2.3b (£1.7b).

The firm previously sold the Sheridan’s liqueur brand to Portuguese beverage and alcohol company Casa Redondo in September 2025, after having offloaded Safari liqueur to the same firm in July 2024.

Last year, Diageo ruled out a sale of its Guinness brand following speculation it could offload its famous stout in a bid to revive growth. Around the same time it sold Cacique, the rum brand is has owned since 2003, to French spirits group La Martiniquaise-Bardinet.

In November 2024 it created the Diageo Luxury Company to streamline and refocus on the luxury sector.

Diageo owns more than 200 drinks brands, including Johnnie Walker, Baileys, Smirnoff, Captain Morgan, Casamigos and Guinness.