MGP Reported Another massive Drop in Whiskey Sales

MGP, one of the biggest contract distilleries in the country and a major producer of rye whiskey, just reported a drop in whiskey sales of nearly 60 percent over the second quarter of 2026. That is clearly very bad news, although not entirely unexpected given the current state of the whiskey industry and the trajectory that the company has been on over the past couple of years.

If you’re unfamiliar, MGP is the former Seagrams distillery located in Lawrenceburg, Indiana that makes whiskey for brands like Bulleit Rye, WhistlePig, Brother’s Bond, and Dickel Rye. In 2021, it purchased Luxco, incorporating several of its brands into the fold along with a pair of Kentucky distilleries. It also rebranded its main operation as Ross & Squibb, which encompasses Remus Bourbon and Rossville Union Rye. And in 2023, MGP acquired Penelope Bourbon, which was founded a few years before that and sources its whiskey almost entirely from MGP (it just launched its first widely available Kentucky bourbon).

MGP divides its business up into a few sectors, including Branded Spirits and Distilling Solutions. The latter is the contract distillation wing of the business, and according to a recent sales call its sales fell by 42 percent year over year to $29.2 million, and gross profit decreased by 40 percent to $11.3 million. Overall, what the distillery calls “brown goods sales” decreased by a staggering 59 percent compared to the prior year’s quarter, which president and CEO Julie Francis attributed to the current glut in the whiskey market. The distillery is trying to offset this with some other avenues of revenue, including including selling more aged and private label whiskey, as well as increasing its warehouse services which comprises about 30 percent of Distilling Solutions’ sales (an increase from the previous year).

There was some good news for MGP, however, on the Branded Spirits side, which saw a 3 percent rise in sales. That was spearheaded by a five percent uptick in sales of the distillery’s “premium-plus” brands, including the aforementioned Penelope Bourbon, Yellowstone, and the high-proof grain alcohol Everclear (specifically, Penelope sales rose by 13 percent, Yellowstone by 54 percent, and Everclear by 13 percent).

The news over the past few years, as we’ve previously reported, has not been great for MGP. This past spring, it made the decision to pause production at the two Kentucky distilleries it acquired when it bought Luxco, Lux Row Distillers and Limestone Branch, a move that followed last fall’s news of sagging sales. The company is keeping a positive outlook, however. “Our second-quarter results are a reflection of our efforts to drive long-term growth across all three of our businesses and to deliver value creation, even as we continue to navigate a challenging industry backdrop,” said Francis in a statement. “As we move through the second half of 2026, we will maintain our strategic road map and drive our key growth initiatives, while prioritizing our best opportunities for growth, taking decisive actions and executing with discipline.”