The party’s winding down for alcohol companies as America’s drinking habits hit a sobering milestone. US alcohol consumption per person plunged 3% last year as younger generations embraced moderation and health warnings, marking the steepest decline since Prohibition ended a century ago. This trend has investors questioning whether alcohol faces the same fate as tobacco, with consumption now sitting at its lowest level since 1962 — down 20% from its 1980s peak.

• Global drink stocks have tumbled nearly 8% from 12 months to February, with alcohol shares now trading at significant discounts compared to other consumer goods sectors.
• Weight-loss drugs like Wegovy and Ozempic could further dampen demand, with studies showing they might reduce alcohol abuse by up to 50%.

The brutal reality: Brown-Forman’s ($BF.B) CEO Lawson Whiting blames economic pressures rather than health concerns for younger Americans’ reduced alcohol spending, noting, “If you’re 21, 22, 23 years old and you’re just coming out of college… your pocketbook is in serious strain.” Yet, cultural shifts seem more permanent, with 41% of drinkers aware of alcohol’s cancer risks planning to reduce their consumption, indicating that health concerns are weakening its social prominence. This trend is further supported by legislative changes such as Ireland’s new cancer warning labels on alcoholic products starting in May 2025 and the WHO’s global push for similar measures. For an industry accustomed to steady growth, sobriety’s trendiness represents a reality that even the most premium spirits can’t quickly distill away.