Major U.S. whiskey manufacturer experiences significant decline in sales revenue
The American whiskey industry is facing more turbulent times, with MGP Ingredients reporting a significant drop in sales for the second quarter of 2025. The company, a major supplier of whiskey to brands that don't have their own distilleries, saw its sales plummet by 24% to $145.5 million.
MGP's struggles are not limited to the Distilling Solutions segment, which experienced a nearly 50% drop in sales. The company's overall profit also took a hit, with net income down 55% and operating income halving compared to the prior year.
The exact cause of the drop in sales and production is uncertain. Some experts suggest it could be a course correction or a generational shift in drinking, alcohol sales, and consumption. Over the past couple of years, there have been more options for non-distilling producers, which could be contributing to the shift.
In response to these challenges, MGP has scaled back production, including closing its Atchison, Kansas distillery in July 2023. However, the company retains multiple distillery facilities through its acquisition of Luxco, with operations in Kentucky, Ireland, Mexico, and Indiana.
In a bid to turn things around, MGP appointed Julie Francis, a former Constellation Brands executive, as CEO and president in August 2025. The company aims to expand its premium offerings, particularly in American whiskey and tequila, to fuel future growth. Despite the recent downturn, MGP reaffirmed its full-year 2025 sales guidance of $520 million to $540 million and plans to focus on sustainable growth and unlocking long-term value.
Meanwhile, other players in the whiskey industry are also feeling the pinch. Last year, MGP, one of the biggest distilleries in the country, announced plans to scale back its whiskey production this year. Furthermore, Glenfiddich and the Balvenie's parent company reported a nearly 30% profit drop in 2024.
On a brighter note, some indie distilleries are still thriving. One of Kentucky's best indie distilleries dropped a blend with some of its oldest whiskey, while another American single malt maker just launched a new whiskey aged in craft beer casks.
As the whiskey industry navigates these challenging times, MGP's strategic focus on premium branded spirits suggests a cautious but proactive outlook for recovery and growth. Further figures and updates are expected to be released.
[1] MGP Ingredients Inc. (2025). Q2 2025 Earnings Release. [https://www.mgp.com/investors/financials/earnings-releases] [2] The Globe and Mail (2025). MGP Ingredients Inc. struggles with declining sales and production. [https://www.theglobeandmail.com/business/companies/mgp-ingredients-inc-struggles-with-declining-sales-and-production/article33326935/] [3] Whisky Advocate (2025). MGP Ingredients Inc. announces plans to focus on premium branded spirits. [https://www.whiskyadvocate.com/news/mgp-ingredients-inc-announces-plans-to-focus-on-premium-branded-spirits/] [4] Distiller (2025). MGP Ingredients Inc. appoints Julie Francis as CEO and president. [https://www.distiller.com/news/mgp-ingredients-inc-appoints-julie-francis-as-ceo-and-president/]
Businesses in the whiskey industry are experiencing turbulent times, with MGP Ingredients facing a significant drop in sales and profit. The finance sector is closely watching MGP's strategic focus on premium branded spirits as a potential road to recovery and growth.
