Bill Gates purchased tens of millions of dollars worth of Bud Light’s parent company in recent days in the midst of a lengthy boycott targeting the beleaguered beer brand, according to a filing.
The Bill and Melinda Gates Foundation Trust purchased 1.7 million shares of Anheuser-Busch, the parent company of Bud Light, worth around $95 million, according to a recent regulatory filing and TipRanks. Reports indicate that Mr. Gates purchased the shares in August, or months after a boycott was initiated against Bud Light after it decided to engage in a promotional campaign with a transgender activist.
For his part, Mr. Gates has not made any public statements about Bud Light, the boycott, or Anheuser-Busch. Neither has the beer giant.
The multi-billionaire Microsoft co-founder, who has previously stated that he’s “not a big beer drinker,” has purchased shares of other beer brands in recent months. He purchased about $1 billion worth of shares of Heineken Holding earlier this year, Reuters reported.
After Mr. Gates---who has drawn controversy for his meetings with controversial financier Jeffrey Epstein---purchased the shares, Morgan Stanley analyst Sarah Simon claimed that Anheuser-Busch InBev could return to “profitability growth” despite the boycott of its most successful brand.
“After successful execution through COVID, 2023 has seen ABI suffer substantial market share loss in the U.S., driven primarily by consumer boycotts of its Bud Light brand,” Ms. Simon wrote, according to TipRanks. “While this makes for very negative headlines, ABI’s exposure to emerging markets limits the impact of the US share loss. After one-off costs in 2023, we see profitability growth resuming in 2024, with strong cash flow growth driving leverage to the target 2.0x, allowing for both an increase in the payout ratio as well as the resumption of share buybacks from 2026. Current valuation fails to reflect this upside, in our view.”
After the boycott was initiated, Bud Lights sales have seen consecutive drops every single week. Anheuser-Busch’s U.S. division confirmed several weeks ago that it was laying off about 300 corporate employees.
The decline in sales of Bud Light, which lost its No. 1 spot to Modelo Especial this year, also put a dent in Anheuser-Busch InBev’s earnings, according to a report the company released early last month. The company said that its U.S. revenue fell by 10 percent in the second quarter due to the falling Bud Light sales.
According to sales figures, Bud Light, meanwhile, has appeared to pick up virtually no momentum before Labor Day. As of Aug. 13, Bud Light’s sales have dropped 28.1 percent year-over-year, as well as volume declines of 28 percent, according to data from Evercore ISI and Circana.
“Continued weakness begs the question of whether Anheuser-Busch InBev and/or its distributors will have to make significant structural changes to reduce their cost basis if trends don’t improve over the next few months,” Evercore ISI analyst Robert Ottenstein wrote in a recent note, Yahoo Finance reported.
As of Aug. 19, sales volumes of Bud Light at off-premise locations like grocery stores fell by 20.1 percent so far this year, as compared to the same period last year, according to Nielsen IQ sales data via Bump Williams Consulting. On a dollar basis, Bud Light sales were down 15.9 percent over the same period compared to a year earlier.
It all started when Bud Light sent a promotional beer can with transgender activist Dylan Mulvaney’s face on it, which the social media influencer then posted on TikTok and other websites. The backlash against the campaign was swift, with musician Kid Rock using cans of Bud Light as target practice.
Other conservative figures weighed in on the controversy, including President Donald Trump, who accused the firm of catering to left-wing pressure.
“It’s time to beat the Radical Left at their own game,” the former president wrote in a post on Truth Social in May. “Money does talk—Anheuser-Busch now understands that.”
Florida Gov. Ron DeSantis, meanwhile, called on the state’s pension fund manager to take legal action against Anheuser-Busch for its alleged “failure to remediate the problem and repair its relationship with millions of disaffected American consumers,” which will “financially harm the [State Board of Administration] and other shareholders.”
The governor suggested Anheuser-Busch breached its duties to shareholders by making promotional materials for the activist. In response, the beer giant said “Anheuser-Busch InBev takes our responsibility to our shareholders, employees, distributors, and customers seriously.”
As Bud Light’s boycott picked up steam earlier this year, conservatives and others started boycotting other brands, including Target, over their pro-LGBT stance. In May, Target confirmed that it pulled some LGBT items directed to children from its shelves after a widespread, social media-driven boycott of the company.
Some analysts recently said that more boycotts are sure to come due to those recent success stories.
“In a hyper-partisan environment, where it’s easy to inflame passions, people are eager to take their effort in some direction,” Maurice Schweitzer, a professor at the University of Pennsylvania’s Wharton School of Business, told ABC News in late August.
