Diageo has stated that its reported net sales increased by 2.3% to $4.5bn in Q3, reflecting a positive hyperinflation adjustment.

The beverages firm, which owns brands including Guinness, Smirnoff and Captain Morgan, also recorded growth of 0.3% in its organic sales year-on-year in the three months to 31 March.

Diageo said this growth was delivered in Europe, Africa and Latin American and the Caribbean, with some benefit from the timing of Easter and advance sales ahead of the upcoming World Cup.

There was a decline in its North American division’s organic net sales, reflecting continued US spirits weakness, while its Asia Pacific net sales fell slightly with weakness in Chinese white spirits.

However, in the nine months to 31 March, its reported sales totalled $14.9bn, marking reductions of 2.2% and 1.9% in reported and organic year-on-year sales respectively.

Despite this, Diageo said that its Accelerate programme is on track to deliver around $300m in savings by the end of the 2026 fiscal year.

Chief executive officer at Diageo, Dave Lewis, stated: "We are pleased with the strong growth across Europe, LAC and Africa. North America remains our biggest challenge, where market conditions are soft and our offer needs to be more competitive. Actions are already underway to address this.

"Progress on the re-design of our new strategy and the shaping of a more competitive operating framework is well underway. We are on track to share a strategy update with shareholders alongside our fiscal 26 full-year results on 6 August 2026."

The firm said that while it is mindful of continued geopolitical uncertainty, including the impact of the Middle East conflict, it is reiterating its full-year guidance issued in its H1 results.

This includes a 2-3% drop in its organic net sales, while its free cash flow is set to increase by $300m to $3bn, including exceptional items related to Accelerate but excluding its $100m one-ff impact for inventory build at year-end.

Following the announcement, shares in Diageo increased by almost 6%.

Consumer staples analyst at Quilter Cheviot, Chris Beckett, described Diageo’s figures as "better than feared rather than outright strong".

He concluded: "The clear weak spot remains North America, where spirits volumes are under pressure, driven by category issues rather than brand relevance. Tequila has come off several years of strong growth and affordability pressures are pushing consumers to trade down, hitting bottled spirits in particular. Guinness continues to perform well in both the UK and North America, highlighting that this is not a universal demand problem.

"The appointment of Dave Lewis gives the group credible leadership and today's figures buy time to execute a turnaround focused on pricing architecture, competitiveness and brand investment, particularly in the US.

"Guidance was cut sharply in February, so reiterating it now sets a relatively low bar, pointing to modest sales declines and flat operating profit. That outlook is hardly exciting, but it is achievable. With the spirits market undergoing structural adjustment rather than collapse, Diageo’s portfolio and brand strength look more resilient than a 13x earnings multiple suggests."

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