Treasury Wine Estates sinks as weak demand in China; issues in the US prompt vague guidance downgrade

Treasury Wine Estates (ASX:TWE), best known for being the company that owns Penfolds (if that’s the type of thing on your radar), has plunged nearly -12% after underscoring its expectations that FY26 won’t be a record year to remember.

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Largely due to weakness in China, which heavily involves for TWE the apparent declining availability of its wines at ‘large-scale banqueting occasions,’ the company has downgraded FY26 guidance, but didn’t give a clear number.

“TWE no longer believes it is appropriate to retain the Penfolds guidance for low to mid double-digit EBITS growth in F26 and approximately 15% EBITS growth in F27,” TWE wrote.

While Treasury now rushes to send wine to other key markets ex-China in response, it’s also struggling in California, where distribution issues have been blamed (read: their distro partner closed operations in September). A new partner, Breakthru Beverage Group, is presumably offering a less compelling deal.

HotCopper users didn’t particularly respond well to the company’s latest update, and especially not given it’s dropped on a day where the entire market now roils at a mini April 2, 2.0. (That could, perhaps, have been part of TWE’s strategy.)

At least one user voiced an opinion that the price could sink to as low as $3/sh, though it’s not clear what methodology they used.

Still, that kind of statement reflects just how badly this update from the company has perhaps shaken sentiment, at least in the minds of some.

TWE last traded at $6.16/sh.

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