Investors had high expectations heading into Constellation Brands' (NYSE:STZ) (NYSE:STZ-B) fiscal second-quarter earnings report in early October -- and the alcoholic beverage giant didn't disappoint. 

Sales ticked up by 3% while operating income soared 14%. Market share gains, meanwhile, helped convince management to boost its fiscal year outlook for the second straight time in 2017.

Below, we'll look beyond those headline results for the key investor takeaways in Constellation Brands' earnings report.

A flight of four different beers sitting on a bar.

Image source: Getty Images.

1. It's good to be premium

The beer industry is just barely expanding right now. Market titan Anheuser-Busch, for example, has seen its beer volumes rise by just 1% through the first half of fiscal 2017. And yet Constellation Brands' shipments are far outpacing that flat result thanks to sharp growth in the premium end of the industry. 

Constellation Brands is both driving, and benefiting from, this trend. In fact, the company was responsible for 60% of the growth in the high-end beer category last quarter. That segment expanded by 9% over the past six months and soaked up market share last quarter during the important summer selling season.

2. Winning with a deep bench

Constellation Brands' booming beer growth has recently been driven by the performance of the blockbuster Corona franchise, the country's best-selling premium import. This quarter showed off its deep bench of alcoholic beverage brands, though. Modelo, not Corona, led the beer portfolio higher by posting a 20% spike in consumption.

The company got solid contributions from other key franchises, too, including the Charles Smith wine brand. New brand launches also chipped in, as did Constellation Brands' latest acquisition, the Florida-based Funky Buddha craft brewery. 

Management highlighted its broad-based sales success in a press release, stressing that Constellation Brands was "the leader in the high-end of the U.S. beer market" and is "reaping the benefits of our wine and spirits premiumization efforts."

3. Cash is king

Add market share gains to rising prices and falling costs, and you have a recipe for head-turning earnings growth. That's what we see this quarter as profitability spiked by over 4 percentage points in the beer portfolio to pass 41% of sales. The wine segment managed a smaller uptick in operating margin, but it still expanded to just over 26% of sales. Stepping back, Constellation Brands' profit margin has now improved to over 30% of sales from the 20% mark in 2013. The spike has helped net income grow by 33% so far in 2017.

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BUD Operating Margin (TTM) data by YCharts.

Assuming sales growth stays strong, investors can expect additional profitability gains ahead. After all, the company is just starting to reap the financial benefits from its multiyear investments aimed at boosting its Mexican brewery capacity and adding efficiency to its glass production. That spending peaks at over $1 billion this fiscal year, as part of an $4-billion-plus total investment.

Capital spending should slow significantly from here, though. Constellation Brands is targeting over $1 billion in annual free cash flow beginning next year, compared to the $775 million it expects to generate in fiscal 2017. That will free up tons of cash that management can direct toward bigger beer and wine brand acquisitions, accelerated share repurchases, and a rising dividend.

Demitrios Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Anheuser-Busch InBev NV. The Motley Fool has a disclosure policy.