Global drinks giant Diageo is preparing for a sweeping round of job cuts as newly appointed chief executive Sir Dave Lewis accelerates a restructuring aimed at reviving growth after several years of weakening spirits demand.

According to multiple media reports, Lewis has instructed senior executives to reduce headcount and operating costs across their divisions, with non-revenue-generating functions expected to bear the brunt of the cuts. Rather than imposing a fixed number of redundancies, the former Tesco chief has reportedly assigned cost-reduction targets to each business unit, leaving executives to determine where savings will come from.

Diageo, the world’s largest spirits producer and owner of brands including Johnnie Walker, Don Julio, Tanqueray, Smirnoff and Guinness, employs nearly 30,000 people worldwide. Reports suggest details of the restructuring are now emerging across several markets, with around 150 roles expected to be eliminated in Ireland alone.

The restructuring marks Lewis’s first major strategic move since taking over the company in January following the departure of Debra Crew. In the six months since his arrival, Diageo has already seen a series of senior leadership changes, including the departures of regional heads overseeing Great Britain, North America and Africa, as well as the group’s chief human resources officer.

The company has said previously that it intends to redesign its operating model to create “a more competitive Diageo” and will provide investors with a more detailed strategic update during its Capital Markets Day on 6 August.

The restructuring comes after one of the most challenging periods in Diageo’s recent history.

In February, the company halved its interim dividend, cut earnings guidance and acknowledged that demand had weakened significantly, particularly in North America, its largest market, and China. Organic net sales declined 2.8% during the first half of fiscal 2026, while North American spirits sales fell more than 9%, reflecting weaker consumer spending, retailer inventory reductions and slowing demand for premium spirits.

Lewis has argued that the company’s challenges extend beyond temporary economic weakness. While acknowledging softer consumer demand, he has also pointed to pricing, portfolio positioning and execution as areas requiring fundamental change. Reports indicate the new strategy will place greater emphasis on more affordable products and ready-to-drink cocktails alongside continued investment in core premium brands.

Diageo’s restructuring reflects broader pressures confronting the global alcohol industry, which has struggled to regain momentum after the post-pandemic premiumisation boom faded.

Across many mature markets, consumers are drinking less frequently while becoming increasingly value-conscious. Inflation, higher living costs and elevated interest rates have squeezed discretionary spending, prompting many consumers to trade down, reduce purchase frequency or switch to lower-priced brands.

North America, long the industry’s engine of premium spirits growth, has become a particular concern. Retailers have spent much of the past two years reducing excess inventories accumulated during the pandemic, while demand for premium tequila, American whiskey and Scotch has softened.

China, another key growth market for international spirits producers, has also remained subdued. Weak consumer confidence, a sluggish property sector and more cautious discretionary spending have weighed on imported spirits and wine, while changing consumption occasions including fewer lavish banquets and corporate entertaining have further dampened demand.

The slowdown is not unique to Diageo. Pernod Ricard has repeatedly lowered its outlook amid weaker demand in China and the United States, while Rémy Cointreau has faced sharp declines in Cognac sales due to slowing Chinese consumption and ongoing trade tensions. Even brewers have been forced to adapt: Heineken recently appointed its first external chief executive as it seeks to reinvigorate growth following weaker beer volumes and rising cost pressures.