Wholesalers say U.S. wine and spirits sales entered the holidays on steadier footing

U.S. wine and spirits sales are entering the holiday season on steadier footing than earlier this year, but wholesalers do not expect a broader rebound in demand. The Wine & Spirits Wholesalers of America said Tuesday that its SipSource holiday outlook points to slower declines rather than renewed growth, a signal that could shape how beverage companies set holiday orders, manage inventories and plan shelf space into 2027.

The outlook, presented by SipSource analysts in Washington, is based on depletion data reported directly by wholesalers. It shows core spirits volume fell 2.5% in the latest three months from a year earlier, an improvement from the 4.1% decline recorded over the past 12 months. Wine remained under heavier pressure, with 12-month volume down 8.0%.

SipSource said both categories are now moving into easier year-over-year comparisons after a weak 2025 holiday season, when spirits volume fell 5.5% and wine volume dropped 9.4%. That softer base may help fourth-quarter results look better than they did earlier in the year, even if overall category growth does not return.

“The holidays will be good for some parts of the business and harder for others,” SipSource analyst Danny Brager said in comments released with the outlook. “We’re seeing real signs of stabilization, and the soft comparisons of year ago should work in our favor this quarter. But consumers are being far more selective with their spending, and until economic conditions improve, we don’t expect that to change.”

The report points to a market that is dividing more sharply by segment, price and package format. In spirits, several categories posted recent gains. Over the latest three months, Irish whiskey volume rose 6.6%, tequila increased 2.5%, and cordials and liqueurs gained 1.4%. U.S. whiskey, rum and gin were still down, but their declines were less severe than their 12-month trends.

Wine showed a narrower set of bright spots. Champagne, Prosecco and sauvignon blanc continued to lead the category, according to SipSource. Among wines priced at $9 and above, 12-month revenue increased 8.1% for white blends, 6.4% for malbec and 4.5% for sauvignon blanc. At the other end of the market, merlot revenue fell 12.4%, zinfandel was down 8.7%, and red blends declined 8.2%.

The price mix also continues to shift. SipSource said wines priced at $16 and above are holding up better than lower-priced bottles, while value wines below $13 remain the biggest drag on the category. Analysts said the gap between volume and revenue trends in higher price tiers likely reflects more discounting, suggesting shoppers are still buying but are looking harder for deals.

Where people are buying is also changing. Bars and restaurants are still outperforming retail stores, even though revenue is falling in both channels. In the 12 months through September, on-premise wine and spirits revenue declined 2.5%, compared with a 5.6% drop in off-premise sales. Lodging, recreation and transportation venues were the strongest parts of the on-premise business, while convenience stores led the off-premise channel.

Consumers are also moving toward smaller package sizes, especially in spirits. Off-premise revenue for bottles and cans under 750 milliliters rose 8.1% over the past year, while revenue for 750 milliliters and larger sizes fell 6.1%. SipSource said that shift was driven largely by ready-to-drink cocktails and could matter during the holiday period, when smaller formats often appeal as lower-cost gifts or impulse purchases.

Ready-to-drink products remain one of the strongest areas in beverage alcohol, though growth has slowed from the sharp gains seen in recent years. SipSource said RTDs now represent a $14 billion off-premise business and are large enough to be tracked as a fourth category alongside beer, wine and spirits. Spirits-based RTD sales reached $4 billion over the latest 52 weeks, up from $1 billion in 2021, according to NIQ data cited in the outlook.

Dollar sales for spirits RTDs increased 23.1% over the latest 52 weeks, but the pace cooled to 16.6% over the latest 13 weeks. The segment is also changing quickly at the brand level. SipSource said 11 of the top 30 spirits brands by volume are now RTDs, and 60% of today’s top 15 RTD brands were not on that list in 2021.

For producers, distributors and retailers, the holiday season is likely to be less about chasing broad demand growth and more about placing tighter bets on the parts of the market still moving. The outlook suggests more caution around large formats and lower-priced wine, while reinforcing demand for premium wine segments, selected spirits categories and smaller RTD-linked packages.

SipSource analysts said that dynamic is already feeding into decisions beyond the holiday quarter. They expect retailers to keep tightening shelf space and businesses across all three tiers of the alcohol system to continue trimming inventories. Wholesale inventories were down 4.5% from a year earlier, but the inventory-to-sales ratio stood at 1.63, still well above the 1.13 typical from 1992 to 2006.

“Holiday 2026 is going to tell us a lot about 2027,” SipSource analyst Dale Stratton said. “The economy is the single biggest wild card. Moderation, wellness and a more choiceful consumer are all part of the picture, and the businesses that understand those occasions will be best positioned to succeed.”

Francis Creighton, WSWA’s president and chief executive, said the industry is relying on current wholesaler data to make decisions in a difficult market. “The numbers are difficult, but clear data helps the industry make better decisions about what comes next,” he said.

SipSource said its figures reflect wholesale depletions across on- and off-premise channels through September, excluding control states overseen by the National Alcohol Beverage Control Association. The group said its platform covers about 70% of wholesale volume across all 50 states. RTD and package-size figures came from off-premise scan data for the 52 weeks ended Oct. 3, while the inventory figures were drawn from the U.S. Census Bureau’s Monthly Wholesale Trade Report through August.