BOSTON BEER CO INC
For the period ended Mar 29, 2025. Filed Apr 24, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 29, 2025 · Filed Apr 24, 2025
SAM$220.64-1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-28; filed 2024-10-24.
0000950170-24-117090
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-29; filed 2025-04-24.
0000950170-25-058094
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 50 previous paragraphs and 33 current paragraphs.
11 unchanged; 14 reworded; 8 added; 22 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 previous and 1 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
Net revenue. Net revenue increased by $27.8 million, or 6.5%, to $453.9 million for the thirteen weeks ended March 29, 2025, as compared to $426.1 million for the thirteen weeks ended March 30, 2024 primarily due to increased sales volume impacts of $22.7 million, and increased pricing impacts of $5.9 million.
Current report
Volume. Total shipment volume increased by 5.3% to 1,677,000 barrels for the thirteen weeks ended March 29, 2025, as compared to 1,592,000 barrels for the thirteen weeks ended March 30, 2024, primarily due to increases in Sun Cruiser, Hard MTN Dew and Twisted Tea brands partially offset by declines in the Truly brand.
Current report
The Company believes distributor inventory as of March 29, 2025 was at an appropriate level for each of its brands and averaged approximately five weeks on hand compared to four weeks on hand at the end of the fourth quarter of 2024 and four and a half weeks at the end of the first quarter of 2024.
Current report
Advertising, promotional, and selling expenses. Advertising, promotional and selling expenses increased by $17.3 million, or 14.4%, to $137.5 million for the thirteen weeks ended March 29, 2025, as compared to $120.3 million for the thirteen weeks ended March 30, 2024. Brand and selling costs increased by $15.7 million primarily due to increased investments in media and local marketing, and freight to distributors increased by $1.6 million primarily due to increased shipment volumes.
Current report
Impairment of brewery assets. There was no impairment of brewery assets during the thirteen weeks ended March 29, 2025.
Current report
There were no material changes to the Company’s critical accounting policies during the three-month period ended March 29, 2025.
Current report
MARKET CONDITIONS AND TRENDS
Current report
Based on the information currently available and tariff programs announced by the U.S. government as of April 2, 2025, the Company estimates tariffs will have an unfavorable cost impact for the full year 2025 of approximately $20 to $30 million or $1.25 to $1.90 earnings per diluted share. These estimates include an unfavorable gross margin impact of between 50 to 100 basis points.
Removed paragraphs (22)
Previous report
Net revenue. Net revenue increased by $3.9 million, or 0.6%, to $605.5 million for the thirteen weeks ended September 28, 2024, as compared to $601.6 million for the thirteen weeks ended September 30, 2023 primarily as a result of price increases of $11.2 million and lower returns of $3.2 million, partially offset by lower shipment volume of $11.4 million.
Previous report
Volume. Total shipment volume decreased by 1.9% to 2,243,000 barrels for the thirteen weeks ended September 28, 2024, as compared to 2,286,000 barrels for the thirteen weeks ended September 30, 2023, reflecting decreases in the Company’s Truly, Dogfish Head, Samuel Adams and Angry Orchard brands, partially offset by increases in its Twisted Tea, Sun Cruiser and Hard Mountain Dew brands.
Previous report
The Company believes distributor inventory as of September 28, 2024 averaged approximately five and a half weeks on hand which was slightly higher than the Company’s target level of four to five weeks. The Company expects that distributor inventory will return to target levels during the fourth quarter.
Previous report
Advertising, promotional, and selling expenses. Advertising, promotional and selling expenses decreased by $4.6 million, or 3.0%, to $148.0 million for the thirteen weeks ended September 28, 2024, as compared to $152.6 million for the thirteen weeks ended September 30, 2023, primarily due to decreased freight to distributors of $2.8 million from improved efficiencies and lower volumes. Brand and selling costs decreased $1.8 million, primarily due to lower salaries and benefit costs.
Previous report
General and administrative expenses. General and administrative expenses increased by $1.6 million, or 3.7%, to $43.8 million for the thirteen weeks ended September 28, 2024, as compared to $42.2 million for the thirteen weeks ended September 30, 2023, primarily due increased professional fees.
Previous report
Impairment of intangible assets. Impairment of intangible assets reflects a $42.6 million non-cash impairment charge recorded primarily for the Dogfish Head brand, taken as a result of the Company’s annual impairment analysis as of September 1, 2024. The impairment determination was primarily based on the latest forecasts of brand performance which has been below projections made on the acquisition date. In the third quarter of 2023, the Company recorded an impairment charge of $16.4 million for the Dogfish Head brand.
Previous report
Impairment of brewery assets. Impairment of brewery assets of $0.02 million decreased by $1.9 million from the comparable period of 2023, due to lower write-offs of equipment at Company-owned breweries.
Previous report
Thirty-Nine Weeks Ended September 28, 2024 compared to Thirty-Nine Weeks Ended September 30, 2023
Previous report
Net revenue. Net revenue decreased by $4.3 million, or 0.3%, to $1.611 billion for the thirty-nine weeks ended September 28, 2024, as compared to $1.615 billion for the thirty-nine weeks ended September 30, 2023, primarily as a result of lower shipment volume of $46.4 million, partially offset by price increases of $31.8 million and lower returns of $11.5 million.
Previous report
Volume. Total shipment volume decreased by 2.9% to 5,997,000 barrels for the thirty-nine weeks ended September 28, 2024, as compared to 6,175,000 barrels for the thirty-nine weeks ended September 30, 2023, reflecting decreases in the Company’s Truly, Hard Mountain Dew, Samuel Adams, Dogfish Head and Angry Orchard brands, partially offset by increases in its Twisted Tea and Sun Cruiser brands.
Previous report
Inflationary impacts of $11.7 million consist primarily of increased internal brewery costs of $6.5 million and material costs of $5.2 million.
Previous report
Gross profit. Gross profit was $122.23 per barrel for the thirty-nine weeks ended September 28, 2024, as compared to $114.09 per barrel for the thirty-nine weeks ended September 30, 2023.
Previous report
Advertising, promotional, and selling expenses. Advertising, promotional and selling expenses decreased by $14.9 million, or 3.5%, to $412.5 million for the thirty-nine weeks ended September 28, 2024, as compared to $427.4 million for thirty-nine weeks ended September 30, 2023, primarily due to decreased freight to distributors of $9.2 million from lower rates and volumes. Brand and selling costs decreased $5.7 million primarily due to lower consulting costs.
Previous report
Impairment of intangible assets. Impairment of intangible assets reflects a $42.6 million non-cash impairment charge recorded primarily for the Dogfish Head brand, taken as a result of the Company’s annual impairment analysis as of September 1, 2024. The impairment determination was primarily based on the latest forecasts of brand performance which has been below projections made on the acquisition date. In the third quarter of 2023, the Company recorded an impairment charge of $16.4 million for the Dogfish Head brand.
Previous report
Impairment of brewery assets. Impairment of brewery assets of $3.8 million decreased by $0.2 million from the comparable period of 2023, due to lower write-offs of equipment at Company-owned breweries.
Previous report
Income tax provision. The Company’s effective tax rate of 30.3% increased from 28.4% in the prior year. The increased effective tax rate is due to higher non-deductible compensation primarily related to Chief Executive Officer transition costs.
Previous report
Valuation of Goodwill and Indefinite Lived Intangible Assets
Previous report
The Company has recorded intangible assets with indefinite lives and goodwill for which impairment testing is required at least annually or more frequently if events or circumstances indicate that these assets might be impaired. The Company performs its annual impairment tests and re-evaluates the useful lives of other intangible assets with indefinite lives at the annual impairment test measurement date in the third quarter of each fiscal year or when circumstances arise that indicate a possible impairment or change in useful life might exist.
Previous report
Significant judgement is required to estimate the fair value of the Dogfish Head trademark. Accordingly, the Company obtains the assistance of third-party valuation specialists as part of the impairment evaluation. In estimating the fair value of the trademark, management must make assumptions and projections regarding future cash flows based upon future revenues, the market-based royalty rate, the discount rate, and the after-tax royalty savings expected from ownership of the trademark. The assumptions and projections used in the estimate of fair value are consistent with recent trends and represent the projections used in Company’s current strategic operating plans which include reductions in revenues from the Dogfish Head beer products. These assumptions reflect management’s estimates of future economic and competitive conditions and consider many factors including macroeconomic conditions, industry growth rates, and competitive activities and are, therefore, subject to change as a result of changing market conditions. Beginning in the fourth quarter of 2024, the Company will change the indefinite useful life of the Dogfish Head trademark asset and begin amortizing the remaining $14.4 million balance over an estimated useful life of 10 years.
Previous report
The Company performed a sensitivity analysis on its significant assumptions used in the Dogfish Head trademark fair value calculation and determined the following:
Previous report
A decrease in the annual forecasted revenue growth rate of 1.0% would result in a 4.9% decrease to the current fair value of $14.4 million.
Previous report
A decrease in the discount rate of 1.5% would result in a 8.3% increase to the current fair value of $14.4 million and an increase in the discount rate of 1.5% would result in a 6.9% decrease to the current fair value of $14.4 million.
Reworded paragraphs (14)
Previous wording
The following is a discussion of the significant factors affecting the consolidated operating results, financial condition and liquidity and cash flows of the Company for the thirteen and thirty-nine week periods ended September 28, 2024, as compared to the thirteen and thirty-nine week period ended September 30, 2023. This discussion should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements of the Company and Notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023.
Current wording
The following is a discussion of the significant factors affecting the consolidated operating results, financial condition and liquidity and cash flows of the Company for the thirteen week periods ended March 29, 2025, as compared to the thirteen week period ended March 30, 2024. This discussion should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements of the Company and Notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2024.
Previous wording
Net revenue per barrel. Net revenue per barrel increased by 2.6% to $269.94 per barrel for the thirteen weeks ended September 28, 2024, as compared to $263.14 per barrel for the comparable period in 2023, primarily due to price increases and lower returns.
Current wording
Net revenue per barrel. Net revenue per barrel increased by 1.2% to $270.64 per barrel for the thirteen weeks ended March 29, 2025, as compared to $267.55 per barrel for the comparable period in 2024, primarily due to pricing.
Previous wording
Cost of goods sold. Cost of goods sold was $145.00 per barrel for the thirteen weeks ended September 28, 2024, as compared to $143.01 per barrel for the thirteen weeks ended September 30, 2023. The 2024 increase in cost of goods sold of $1.99, or 1.4% per barrel was primarily due to increases in inventory obsolescence of $7.6 million, or $3.39 per barrel, and inflationary impacts of $3.5 million, or $1.56 per barrel, partially offset by contract renegotiations and recipe optimization savings of $6.3 million, or $2.81 per barrel.
Current wording
Cost of goods sold. Cost of goods sold was $139.90 per barrel for the thirteen weeks ended March 29, 2025, as compared to $150.53 per barrel for the thirteen weeks ended March 30, 2024. The 2025 decrease in cost of goods sold of $10.63, or 7.1% per barrel was primarily due to contract renegotiations and recipe optimization savings of $9.9 million, or $5.91 per barrel, improved brewery efficiencies of $9.9 million, or $5.91 per barrel, decreases in inventory obsolescence of $2.4 million, or $1.43 per barrel, and lower third-party production payment amortization of $1.6 million, or $0.98 per barrel, partially offset by inflationary impacts of $6.1 million, or $3.64 per barrel.
Previous wording
Inflationary impacts of $3.5 million consist primarily of increased internal brewery costs of $1.8 million and increased material costs of $1.7 million.
Current wording
Inflationary impacts of $6.1 million consist primarily of increased raw material costs of $4.2 million and increased internal brewery costs of $1.9 million.
Previous wording
Gross profit. Gross profit was $124.94 per barrel for the thirteen weeks ended September 28, 2024, as compared to $120.13 per barrel for the thirteen weeks ended September 30, 2023.
Current wording
Gross profit. Gross profit was $130.74 per barrel for the thirteen weeks ended March 29, 2025, as compared to $117.02 per barrel for the thirteen weeks ended March 30, 2024.
Previous wording
Advertising, promotional and selling expenses were 24.4% of net revenue, or $65.98 per barrel, for the thirteen weeks ended September 28, 2024, as compared to 25.4% of net revenue, or $66.74 per barrel, for the thirteen weeks ended September 30, 2023. This decrease per barrel is primarily due to advertising, promotional, and selling expenses decreasing at a higher rate than the decrease in shipments. The Company invests in advertising and promotional campaigns that it believes will be effective, but there is no guarantee that such investments will generate sales growth.
Current wording
Advertising, promotional and selling expenses were 30.3% of net revenue, or $82.01 per barrel, for the thirteen weeks ended March 29, 2025, as compared to 28.2% of net revenue, or $75.53 per barrel, for the thirteen weeks ended March 30, 2024. This increase per barrel is primarily due to increased investments in media and local marketing. The Company invests in advertising and promotional campaigns that it believes will be effective, but there is no guarantee that such investments will generate sales growth.
Previous wording
General and administrative expenses. General and administrative expenses increased by $11.4 million, or 8.7%, to $142.2 million for the thirty-nine weeks ended September 28, 2024, as compared to $130.8 million for the thirty-nine weeks ended September 30, 2023, primarily due to higher salaries and benefits costs, resulting from Chief Executive Officer transition costs recorded in the first quarter and inflation costs.
Current wording
General and administrative expenses. General and administrative expenses decreased by $2.4 million, or 4.8%, to $48.0 million for the thirteen weeks ended March 29, 2025, as compared to $50.4 million for the thirteen weeks ended March 30, 2024, primarily due to Chief Executive Officer transition costs incurred in the first quarter of 2024.
Previous wording
Income tax provision. The Company's effective tax rate of 31.7% increased from 29.3% in the prior year. The increased effective tax rate is due to increased non-deductible compensation and the impact of the impairment charge which resulted in lower pre-tax income compared to the prior year.
Current wording
Income tax provision. The Company's effective tax rate of 31.9% decreased from 33.0% in the prior year. The lower rate in the first quarter of 2025 was due to a decrease in the negative impact of non-deductible stock compensation expense.
Previous wording
Cash decreased to $255.6 million as of September 28, 2024 from $298.5 million as of December 30, 2023, primarily reflecting repurchases of the Company's Class A common stock, a note receivable issued, purchases of property, plant, and equipment, and payments of tax withholdings on stock-based payment awards and investment shares, partially offset by net cash provided by operating activities.
Current wording
Cash decreased to $152.5 million as of March 29, 2025 from $211.8 million as of December 28, 2024, primarily reflecting repurchases of the Company's Class A common stock, and purchases of property, plant, and equipment, partially offset by net cash provided by operating activities.
Previous wording
Cash provided by operating activities for the thirty-nine weeks ended September 28, 2024 was comprised of net income of $98.5 million and non-cash items of $118.4 million, partially offset by a net increase in operating assets and liabilities of $9.9 million. Cash provided by operating activities for the thirty-nine weeks ended September 30, 2023 was comprised of net income of $94.4 million, non-cash items of $94.7 million, and a net decrease in operating assets and liabilities of $43.3 million. The decrease in cash provided by operating activities for the thirty-nine weeks ended September 28, 2024 compared to September 30, 2023 is primarily due to lower inventory reduction compared to the prior year, partially offset by higher net income.
Current wording
Cash provided by operating activities for the thirteen weeks ended March 29, 2025 was comprised of net income of $24.4 million and non-cash items of $15.0 million, partially offset by a net outflows for operating assets and liabilities of $37.5 million. Cash used in operating activities for the thirteen weeks ended March 30, 2024 was comprised of net income of $12.6 million and non-cash items of $32.8 million, offset by net outflows for operating assets and liabilities of $50.3 million. The increase in cash provided by operating activities for the thirteen weeks ended March 29, 2025 compared to March 30, 2024 is primarily due to higher net income.
Previous wording
The Company used $72.7 million in investing activities during the thirty-nine weeks ended September 28, 2024, as compared to $47.1 million during the thirty-nine weeks ended September 30, 2023. The increase in investing activity cash outflows is due to a $20.0 million note receivable issued. For both periods, capital investments were made mostly in the Company’s breweries to drive efficiencies and cost reductions and support product innovation and future growth.
Current wording
The Company used $9.8 million in investing activities during the thirteen weeks ended March 29, 2025, as compared to $35.7 million during the thirteen weeks ended March 30, 2024. The decrease in investing activity cash outflows is due to a $20.0 million note receivable issued in the prior year. For both periods, capital investments were made mostly in the Company’s breweries to drive efficiencies and cost reductions and support product innovation and future growth.
Previous wording
Cash used in financing activities was $177.1 million during the thirty-nine weeks ended September 28, 2024, as compared to $55.1 million during the thirty-nine weeks ended September 30, 2023. The $122.0 million increase in financing activity cash outflows in 2024 compared to 2023 is primarily due to higher repurchases of the Company's Class A common stock in the current period.
Current wording
Cash used in financing activities was $51.4 million during the thirteen weeks ended March 29, 2025, as compared to $52.4 million during the thirteen weeks ended March 30, 2024. The financing activity cash outflows in 2025 and 2024 comprised mostly of the repurchases of the Company's Class A common stock in the period.
Previous wording
During the period from December 31, 2023 through October 18, 2024, the Company repurchased and subsequently retired 647,728 shares of its Class A Common Stock for an aggregate purchase price of $190.9 million. On October 2, 2024, the Board of Directors authorized an increase in the share buyback expenditure limit set for the program from $1.2 billion to $1.6 billion. As of October 18, 2024, the Company had repurchased a cumulative total of approximately 14.7 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.1 billion and had approximately $476 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors.
Current wording
During the period from December 29, 2024 through April 18, 2025, the Company repurchased and subsequently retired 248,109 shares of its Class A Common Stock for an aggregate purchase price of $60.5 million. As of April 18, 2025, the Company had repurchased a cumulative total of approximately 15.1 million shares of its Class A Common Stock for an aggregate purchase price of approximately $1.2 billion and had approximately $367 million remaining on the $1.6 billion stock repurchase expenditure limit set by the Board of Directors.
Previous wording
The Company expects that its cash balance as of September 28, 2024 of $255.6 million, along with its projected future operating cash flow and its unused line of credit balance of $150.0 million, will be sufficient to fund future cash requirements. The Company’s $150.0 million credit facility has a term not scheduled to expire until December 16, 2027. As of the date of this filing, the Company was not in violation of any of its covenants to the lender under the credit facility.
Current wording
The Company expects that its cash balance as of March 29, 2025 of $152.5 million, along with its projected future operating cash flow and its unused line of credit balance of $150.0 million, will be sufficient to fund future cash requirements. The Company’s $150.0 million credit facility has a term not scheduled to expire until December 16, 2027. As of the date of this filing, the Company was not in violation of any of its covenants to the lender under the credit facility.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Net revenue per barrel. Net revenue per barrel increased by 2.7% to $268.57 per barrel for the thirty-nine weeks ended September 28, 2024, as compared to $261.53 per barrel for the comparable period in 2023, primarily due to price increases and lower returns.
Previous report — wording carried elsewhere
Cost of goods sold. Cost of goods sold was $146.34 per barrel for the thirty-nine weeks ended September 28, 2024, as compared to $147.44 per barrel for the thirty-nine weeks ended September 30, 2023. The 2024 decrease in cost of goods sold of $1.10, or 0.7%, per barrel was primarily due to contract renegotiations and recipe optimization savings of $16.7 million, or $2.78 per barrel, partially offset by inflationary impacts of $11.7 million, or $1.95 per barrel.
Previous report — wording carried elsewhere
Advertising, promotional and selling expenses were 25.6% of net revenue, or $68.78 per barrel, for the thirty-nine weeks ended September 28, 2024, as compared to 26.5% of net revenue, or $69.21 per barrel, for the thirty-nine weeks ended September 30, 2023. This decrease per barrel is primarily due to advertising, promotional, and selling expenses decreasing at a higher rate than the decrease in shipments. The Company invests in advertising and promotional campaigns that it believes will be effective, but there is no guarantee that such investments will generate sales growth.