Cheaper tequila, canned cocktails top selling liquors in 2025

The U.S. alcohol industry had another sobering year in 2025.

Spirits supplier revenue fell 2.2% to $36.4 billion for the year, according to new data by industry trade group the Distilled Spirits Council of the United States (DISCUS). The decline came as economic pressure and weaker consumer confidence weighed on discretionary spending.

“While total U.S. spirits sales edged down 2.2% in 2025, the spirits industry remains resilient,” said Chris Swonger, DISCUS CEO and president, in a statement.

Overall volumes for the year rose 1.9% to 318.1 million 9-liter cases, indicating growing demand. But the revenue decline suggests that while Americans are still drinking, they are also trading down — opting for lower-priced spirits and pulling back on premium purchases.

Nearly every major spirits category posted revenue declines. Vodka sales fell 3% to $7 billion. Sales of tequila and mezcal — the industry’s fastest growing segment for several years now — slipped 4.1% to $6.4 billion. American whiskey and cordials revenue dipped 0.9% and 3.2%, respectively.

The exception was in convenience and value.

Sales of premixed cocktails, including spirits–based ready-to-drink beverages, surged over 16% compared to the year prior, reaching $3.8 billion. The category, known as RTD, has more than doubled its market share since 2021 as consumers gravitate toward a lower price point.

Within tequila, the shift has also been toward more affordable bottles, as macro headwinds make consumers rethink splurges on premium brands. Volume in the lowest tequila/mezcal price point the trade group tracks grew 6.5% in 2025, along with a 2.8% climb in the next tier higher. Volume for whiskey, vodka, rum and gin all fell at those price points.

As consumers move toward more affordable spirits, companies like Diageo and Brown-Forman may be best positioned, as they have the most exposure to lower-priced tequila and the fast-growing RTD category. Diageo owns Casamigos tequila and has built out a sizable portfolio of spirit-based RTDs, while Brown-Forman controls key mixed price tequila brands like El Jimador.

On the other hand, beer-heavy players like AB InBev and Molson Coors have minimal tequila exposure, although they have been expanding their RTD portfolios. Modelo and Corona owner Constellation Brands in a unique position with both beer and tequila exposure, but a smaller RTD footprint.

Overall, the beverage alcohol market has softened after years of pandemic-fueled growth, and DISCUS’ new data reinforces that normalization is now turning into contraction.

“The companies that have started to report are posting weak numbers but no worse than expected,” said Trevor Stirling, Bernstein…