When it rains, it pours, the old saying goes, but unfortunately for the U.S.'s biggest brewers, beer drinkers aren't pouring as many of their pints as they once did. Instead, they've turned to craft beer and, increasingly, Mexican imports.

Going flat

In its third-quarter earnings report last month, Anheuser-Busch InBev (NYSE:BUD) saw its own production and sales fall. The megabrewer said North American volumes fell over 6% to 31.9 million hectoliters, while revenues were down 5% to $4.3 billion. Year to date, they're down almost 4% and 2.5%, respectively, suggesting the downturn is accelerating.

Budweiser beer bottles

Image source: Anheuser-Busch InBev.

In particular, global Budweiser sales were down 2.2% in the third quarter, but if you removed U.S. sales from the picture, they were actually up 4.4%.

Similarly, Molson Coors (NYSE:TAP) also reported a decline in volumes and sales in the U.S. for its Miller Lite brand, though global volumes inched ahead 0.7% for the period. The brand was, however, able to gain market share in the U.S. premium light beer segment, the 12th consecutive quarter it had done so.

A beer belly

While big beers like Budweiser and Miller Lite continue to see sales slide, craft beer, which despite the decline in its growth rate is still actually growing, now represents over 12% of the total U.S. beer market. The industry trade group Brewers Association says there are now more than 6,000 breweries operating in the U.S., more than at any time in the country's history, and 95% of them are regional and craft breweries.

But the megabrewers are still that -- mega. The Brewers Association's annual list of the biggest brewing companies in the U.S., based on beer sales volume, not surprisingly found Anheuser-Busch, MillerCoors, and Pabst Blue Ribbon to be the three biggest brewers, though D.G. Yuengling & Son reprised its position as the largest craft brewer and the fourth-largest brewer overall.

And when it comes to 2016 dollar sales, the market researchers at IRI found the biggest brands were the usual suspects, too.


2016 Dollar Sales

2016 Case Sales

Bud Light

$5.97 billion

288.1 million

Coors Light

$2.43 billion

117.9 million


$2.08 billion

98.8 million

Miller Lite

$2.05 billion

100.5 million

Data source: IRI.

Tastes great, less filling

What might not have been expected, however, was the enduring popularity of Miller Lite after MillerCoors was sold as part of Anheuser-Busch's acquisition of SABMiller last year. As noted earlier, although sales have continued to ebb away here in the U.S., management has hinted that Miller Lite was on the rise and was "on track to become the number three beer in America."

Pouring Miller Lite from tap into glass

Image source: Molson Coors.

And now it's achieved that distinction, though it's more due to Budweiser falling faster than Miller Lite. At a recent area conference for business executives hosted by the Milwaukee Business Journal, the news site reported MillerCoors CEO Gavin Hattersley announced Miller Lite had finally surpassed Budweiser as the third-largest beer. It still has a long way to go before it catches up to No. 2 Coors Light, let alone top-ranked Bud Light, but the achievement is significant nonetheless.

It also suggests Miller Lite may yet move higher. Nielsen data shows Bud Light sales falling by 5.7% over the first nine months of 2017, while Coors Light was down 3.4%. Miller Lite, falling at the much slower rate of just 1.7%, can actually gain position simply by attrition.

This means that although light beer is now solidly the most favored type of beer in the U.S., it is a rapidly shrinking pool. As super-premium beers, wine, and spirits all gain ascendance, Miller Lite might end up king of the mini-keg rather than the beer barrel.

Rich Duprey 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.