Constellation Brands, Inc.

Credit and liquidity · Liquidity and cash flow constraints

If we experience reduced access to credit or higher future interest rates to refinance our maturing indebtedness, to incur additional indebtedness, or on our variable interest rate exposures, it could increase our overall interest expense and adversely affect our liquidity and capital resources.

Market and investment · Interest rate and yield curve risk

We are exposed to risks associated with interest rate fluctuations, including for our variable interest rate debt, and disruption or volatility in the credit markets. The current interest rate environment is elevated relative to the interest rates on certain of our outstanding indebtedness that will be maturing over the next several years.

International and currency · International operations and emerging markets

We have production facilities in the U.S., Mexico, New Zealand, and Italy and employees in various countries, and our products are sold in numerous countries. The countries in which we operate impose duties, excise taxes, and/or other taxes on beverage alcohol products.

Capital structure and performance · Dividend policy and capital allocation

Our capital allocation strategy contemplates quarterly cash dividends and periodic share repurchases under our share repurchase program. However, we are not required to declare dividends or to make any share repurchases under our share repurchase program. We may discontinue, limit, suspend, delay, or decrease our dividends and share repurchases at any time without prior notice.

Strategic execution · Joint venture and partnership risks

We have acquired or retained ownership interests in companies which we do not control, such as our joint venture to operate the Glass Plant, our interest in Canopy, and investments made through our corporate venture capital function. Our joint venture partners or the other parties that hold or may hold the remaining ownership interests in companies which we do not control may at any time have economic, business, or legal interests or goals that are inconsistent with our goals.

Strategic execution · Merger acquisition and divestiture risks

From time to time, we acquire businesses, assets, or securities of companies that we believe will provide a strategic fit with our business. If the financial performance of our business, as supplemented by the assets and businesses acquired, does not meet our expectations, it may make it more difficult for us to service our debt obligations and our results of operations may fail to meet market expectations.

Market position and competition · Industry consolidation and market concentration

the consolidation of distributors, wholesalers, retailers, suppliers, and other beverage companies; the decision of existing or potential Customers or consumers to purchase competitors' products instead of ours, including due to competitive pricing pressures.

Market position and competition · Market cyclicality and demand volatility

a general decline in beverage alcohol consumption or changes in consumer preferences away from our products, including due to consumer dietary preference changes, weight loss regimens, pharmaceuticals, or consumers substituting legalized cannabis or hemp-derived or similar products in lieu of beverage alcohol; consumer spending shifts, including to other consumer discretionary sectors, such as online gambling.

Strategic execution · Strategic transformation and turnaround risks

We are seeking to continue to unlock cost savings through a wide range of initiatives and restructuring actions, including the 2025 Restructuring Initiative, and we may institute additional cost savings, restructuring, and efficiency measures in the future. We may not achieve the full anticipated amounts or efficiencies from our cost savings, restructuring, and efficiency initiatives.

Customer and revenue · Revenue concentration in specific products or segments

Our business depends upon consumers' consumption of our products, and sales of our beer brands in the U.S. represent the vast majority of our business. Consumer preferences, behaviors, perception, and sentiment may shift due to a variety of factors, including changes in taste preferences and leisure, dining, and beverage purchasing and consumption patterns.

Natural and catastrophic events · Force majeure and business interruption

A prolonged closure or restriction of the border between the U.S. and Mexico, particularly at key product and supply crossing points, could result in temporary or longer-term disruptions of sales, consumption, and trade patterns, supply chains, production processes, and/or operations.

Natural and catastrophic events · Pandemic and public health crises

Communicable disease outbreaks, such as the COVID-19 pandemic, and other widespread public health crises have resulted and in the future could result in disruptions and damage to our business caused by potential negative consumer purchasing behavior and reduced consumption as well as disruption to our supply chains, production processes, and operations.

Natural and catastrophic events · Climate change and environmental impact

There has been much public discussion related to concerns that GHGs may have an adverse impact on global temperatures, weather patterns, and the frequency and severity of extreme weather and natural disasters. Severe weather events and natural disasters, such as our experiences with wildfires, drought, and/or flooding in California and Oregon, severe winter storms in California, Texas, or Mexico, or late frosts or flooding in New Zealand, and climate change may negatively affect agricultural productivity.

Digital transformation and innovation · Artificial intelligence and automation

the recent proliferation and rapid evolution of AI technologies, including generative AI, machine learning, and agentic AI, has resulted in new challenges, including business, legal and regulatory, and ethical considerations and uncertainty. For example, the use of AI technologies without adequate safeguards could produce flawed or inaccurate recommendations, suggestions, or outcomes or other unintended results or potential vulnerabilities or expose us to liability or adverse legal or regulatory consequences.

Tax and financial reporting · Financial reporting and accounting standards

U.S. tax changes or changes in how international corporations are taxed, including changes from the OB3 Act, in how existing tax laws are interpreted or enforced, or to accounting standards, elections, or assertions as well as to our accounting policies, could have a material adverse effect on our business, liquidity, financial condition, and/or results of operations.

Legal and litigation · Product liability and warranty claims

In addition, we have been and could continue to be exposed to claims or lawsuits relating to product liability, marketing or sales practices, including product labeling, false advertising, privacy, website accessibility, and other matters.

Data and privacy · Data protection and privacy laws

allegations that we, or persons currently or formerly employed by or associated with us, have allegedly or actually violated applicable laws or regulations, including those related to safety, employment, discrimination, harassment, whistleblowing, privacy and data protection, corporate citizenship, improper business practices, or cybersecurity.

Core operations · Operational disruption and business continuity

We are dependent on our breweries to fulfill our beer brands' production requirements. Modular capacity addition activities continue at our breweries, with initial production at the Veracruz Brewery expected to commence around the middle of Fiscal 2027. These activities are subject to risks of completion delays, cost overruns, and asset impairments.

Project and contract management · Project execution and delivery risks

Modular capacity addition activities continue at our breweries, with initial production at the Veracruz Brewery expected to commence around the middle of Fiscal 2027. These activities are subject to risks of completion delays, cost overruns, and asset impairments, such as the prior asset impairments at the canceled Mexicali Brewery and, more recently, at the Obregón Brewery.

Organizational and management · Leadership and management changes

Nicholas Fink became our President and Chief Executive Officer on April 13, 2026. Our future performance will depend, in part, on the successful transition of Mr. Fink as our new President and Chief Executive Officer. Leadership transitions and the onboarding process can be inherently difficult to manage, will take time, and could result in changes in our business strategy, operations, processes, and workforce.