Some of Pernod Ricard’s wide portfolio of brands in travel retail.

France’s Pernod Ricard – whose brands include Absolut vodka, Chivas Regal, Jameson Irish whiskey, Martell Cognac, and Perrier-Jouët Champagne – saw a big drop in global travel retail (GTR) revenue of -15% in its fiscal first quarter. However, the international spirits and champagne giant is confident that the channel will return to growth during the current FY26.

In the three months to September (Q1 26), Pernod Ricard suffered softness in Asia Pacific travel retail, notably in South Korea, which the company said “is impacted by weakness in the domestic market”. In China, a ray of hope emerged following the resolution of a Cognac anti-dumping investigation by China’s Ministry of Commerce in July.

“The suspension of Cognac sales in China duty-free has ended, with our sales expected to resume from Q2,” said the company in a statement. However, Pernod Ricard has said that there would now be an increased cost to operating in China, but the company is likely relieved that the extra costs arising from an agreed minimum price undertaking are significantly less than would have been the case otherwise.

Meanwhile, in European and Americas travel retail, the underlying performance in Q1 was strong over the summer while sales were impacted by phasing.

Pernod Ricard’s major markets under pressure

For the company as a whole, Pernod Ricard admitted it had “a slow start to the year” as had been expected. Sharp declines in China of -27% due to continued macroeconomic weakness, and in the US of -16%, led to Q1 organic net sales dropping by -7.6% overall (and reported by -14.3%), reaching €2.38 billion. The large discrepancy between organic and reported rates was mainly due to an unfavourable foreign exchange impact.

Pernod Ricard’s Q1 2026 results by region.

While the decline did not affect the group’s share price this week – most likely because the revenue drop was factored in – the company’s stock today (Tuesday) is down by almost -30% from a year ago.

Pernod Ricard expects improving trends in organic net sales in FY26, but skewed toward the second half. For the medium term (FY27-29), the company is projecting organic growth at +3% to +6% per year on average, with annual organic operating margin expansion. The margin targets will be supported by efficiencies of €1 billion from the current financial year until FY29 as part of a plan to optimise operations.

In an investor call, Hélène de Tissot, Executive Vice President Finance and Tech, said: “We will continue to invest (to ensure) our brands’ desirability, with sharp marketing allocations between markets and brands, and focus on innovation and experiences.”

READ MORE: PRGTR introduces The Chuan prestige whisky into global travel retail

READ MORE: Perrier-Jouët creates ‘House of Wonder’ experience for Paris and Miami airports