Global Cognac shipments fell 15.1 percent in volume to 141 million bottles in 2025, with value dropping 25.3 percent to €2.24 billion according to BNIC data. North America recorded volume declines of 19.4 percent and value drops of 34 percent. The Far East, led by China Mainland, saw volume fall 20.5 percent and value 23.1 percent. These numbers reflect a year shaped by inventory adjustments, macro softness, and trade frictions. Brandy’s long aging cycles and deep cultural roots have provided a buffer that many shorter-cycle spirits lack. The decline has remained orderly rather than a demand collapse. It is a structural adjustment, not a structural crisis.
Leading Brands Navigate the Pressure
Hennessy, the undisputed global leader, faced clear headwinds from softer local demand in China Mainland and the United States. LVMH’s Wines and Spirits division posted an overall 5% organic decline in FY2025, with Cognac (primarily Hennessy) as a notable contributor. Yet the brand held its dominant position through steady performance in VS and VSOP expressions, strength in travel retail, and continued activation in non-traditional drinking settings. Its scale and distribution depth allowed it to absorb pressure without sharp market share erosion.
Rémy Martin’s Cognac business posted organic growth of 3.2 percent in its fiscal third quarter ended December 2025, driven by four consecutive quarters of positive performance in the Americas supported by improving depletions after inventory adjustments. Asia Pacific remained difficult at the ultra-premium level. Martell, under Pernod Ricard, showed stronger resilience in emerging markets, particularly South Africa, where it delivered solid growth through focused local execution and adapted pricing in the first half of fiscal 2026.
These performances highlight a clear shift. Heritage still provides a foundation in Brandy. Decades of aged stock and established equity offer protection. But that foundation is no longer enough on its own. The brands demonstrating the greatest composure are those actively converting static heritage into dynamic sell-out velocity through sharper channel work and more relevant consumer touchpoints.
Regional and Consumer Shifts
In North America, VSOP and more accessible Cognac expressions continued to find demand in cocktails and everyday shared settings, supported by cultural roots among core consumer groups amid broader premium fatigue. In China Mainland, exports remained under significant pressure throughout 2025 as a key contributor to the Far East weakness. July’s anti-dumping measures added further complexity, yet major producers including Hennessy, Martell, and Rémy Martin secured exemptions through minimum price commitments. This preserved a compliant business channel. Mid-tier urban occasions, ranging from restaurants to e-commerce, retained resilience among younger consumers seeking greater occasion flexibility.
Emerging markets delivered clearer growth pockets. Stronger performances in parts of Africa and Latin America came from local innovation, ready-to-drink extensions, and wider distribution reach. These regions reward brands that adapt formats and price points rather than rely solely on traditional prestige.
Consumer behaviour is changing across markets. Ultra-premium sipping has cooled as economic caution and moderation trends persist. Demand is moving toward multi-occasion flexibility. Younger drinkers seek Brandy in mixed drinks, casual shared moments, lighter everyday settings, and urban dining rather than formal ceremony. Brands that deliver versatility across these occasions are gaining traction.
Execution Becomes the Decisive Variable
This evolution makes execution the new test for the category. Leading players are focusing on inventory discipline to clear aged stock without damaging pricing. They are sharpening A&P spend toward high-velocity channels and joint business planning with distributors to improve sell-through. On-trade casual venues, modern off-trade, and e-commerce activations are where real momentum is appearing. Ready-to-drink extensions and cocktail-friendly innovations help bring Brandy into more frequent drinking moments.
The gap is widening between brands that treat heritage as a platform for velocity and those that lean too heavily on past equity. Static positioning is losing ground. Brands that translate legacy into relevant, repeatable consumption occasions are pulling ahead.
Brandy enters 2026 in a phase of selective resilience. Its long production cycles and cultural depth continue to give it advantages few other spirits categories enjoy. But sustained performance now depends on the ability to turn that heritage into faster, more flexible relevance. The strongest performers are already making the transition. The rest of the category will be judged by how quickly they follow.
