Global Wine Industry Faces Another Challenging Year in 2025
Global wine sales experienced another decline in 2025. Revenue fell to approximately $74.3 billion from $75.5 billion the previous year. This continues a downward trajectory that began after 2020.
Signs of Stabilization Emerge Despite Ongoing Challenges
Rob McMillan, founder of the wine group at Silicon Valley Bank, offers cautious optimism. He predicts sales declines may slow this year. The industry could reach a "bumpy bottom" in 2027-28 before gradually recovering.
McMillan points to encouraging data. Certain wine varieties show stronger retail sales than wholesale depletion. These include Cabernet Sauvignon, Pinot Noir, red-wine blends, Chardonnay, Sauvignon Blanc, and Pinot Grigio.
"Retailers actually have a chance to right size, and that will lead to more sales from the wholesalers," McMillan explains. He notes that while sales remained negative for both retailers and wholesalers in 2025, the declines were "less negative." He calls this "the first real green shoot" for the industry.
A Divided Industry: Premium vs. Mainstream Wines
The SVB report reveals a growing divide within the wine industry. Approximately 60% of the market depends on wines selling for under $12 per bottle. This segment faces long-term decline due to demographic shifts.
Younger consumers have more beverage options today. They increasingly choose craft beers, spirits, and cannabis over cheaper wines.
Premium wines priced at $20 and above perform better. However, even this segment struggled in 2025. Inflation, changing discretionary spending, and reduced affluent consumer spending impacted sales.
The strongest performers are producers of top-tier wines. These wineries excel at direct-to-consumer marketing and hospitality. They effectively attract and retain high-end customers.
"There is a growing divide characterized by the separation between wineries that adapt and those that remain tethered to the previous era of strong growth," the report states.
Corporate Strategy Reflects Market Realities
Constellation Brands, the only major publicly traded U.S. wine company, demonstrates this divergence. In June 2025, the company sold its mainstream wine brands. These included Woodbridge, Meiomi, and SIMI.
The company retained premium brands selling wines priced at $15 or more. These include Robert Mondavi Winery, To Kalon Vineyard Co., Mount Veeder, and the Prisoner Wine Co. Some of these producers offer bottles exceeding $100.
RBC Capital commented on this strategy in a January 2026 report. "Shedding the mainstream wine brands should help improve consistency of results," the firm noted. RBC maintains an "outperform" rating on Constellation shares.
Demographic Challenges and Opportunities
McMillan first warned about changing consumer preferences in 2019. He predicted the industry's growth since 1994 would stall. Younger consumers altered their drinking habits. Wine-loving baby boomers also reduced consumption.
"We've lost roughly 20% off the top and it's going to be a very long time before we see that come back," McMillan cautions. He urges producers not to become complacent.
However, demographic shifts may eventually help. More people will enter the "wine-friendly" age bracket of 30 to 45 in coming years.
Private Labels Offer Quality and Value
Another positive development involves private label wines. Retailers like Total Wine & More, Costco Wholesale, and Kroger now offer high-quality wines under their own brands.
In some cases, these retailers bottle wines from prestigious appellations. Consumers can taste wines from Napa's Rutherford appellation for $20 instead of $75 to $100.
"This is by far the best consuming market for consumers that there's ever been," McMillan says. He advises wine buyers to seek out private labels with specific appellations.
Affordable access to quality wine may create new wine enthusiasts. This could help revitalize the industry over time.
