Silicon Valley Bank Releases 24th Annual State of the US Wine Industry Report
Rhea-AI Summary
Silicon Valley Bank (SVB), a division of First Citizens Bank, released its 2025 State of the US Wine Industry Report, revealing significant market shifts. The report highlights a demand-based correction in the wine industry, with total wine consumption decreasing by volume. While the premium wine segment showed resilience with small single-digit sales declines, the top quartile of wineries achieved 22% sales growth.
Key findings include: total wine category sales ending 2024 with negative volume growth between -3% and -1%, weighted average winery revenue decline of 3.4%, and bottom quartile seeing a 16% revenue decline. No- and low-alcohol wine, white wine, and prosecco experienced positive growth, with white wine outpacing red wine sales for the first time in years. The market conditions are creating the most accessible bottle pricing in 30 years.
The report emphasizes a critical generational shift, with younger consumers showing different consumption patterns and often choosing alternatives to wine. Growing consumption share in the 30-45 segment is deemed important for industry recovery.
Positive
- Top quartile of wineries achieved 22% revenue growth
- Growth in no/low-alcohol wine, white wine, and prosecco segments
- Most accessible bottle pricing in 30 years for consumers
Negative
- Total wine category sales declining between -3% and -1%
- Average winery revenue decline of 3.4%
- Bottom quartile experiencing 16% revenue decline
- Wholesale-heavy wineries performing worse than direct-to-consumer brands
- Expected decrease in tasting room visitation for 2025
- Supply exceeding demand in California and Washington markets
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Wine industry reset is here, fueled by a generational shift to younger consumers redefining consumption patterns
The report uncovered several positive market indicators, despite an overall decline in global wine demand in the last year. The premium wine segment once again demonstrated resilience with small, single-digit sales declines overall, and the top quartile of wineries producing average sales growth of
"The wine industry is undergoing a significant change, marking the first demand-based correction in three decades," said Rob McMillan, Silicon Valley Bank Wine Division founder and author of the report. "We have been predicting a generational shift for many years, and the 2025 report data solidifies the wine industry is now living that reality. Different parts of the industry will heal at different times, but we can expect a continued downturn for some time before we reach flat growth.
No- and low-alcohol wine, white wine and prosecco experienced positive growth, with white wine outpacing red wine sales for the first time in many years. According to the report, varietal shifts from red to white could be a forward indicator that a rotation to younger consumers is underway. More broadly, the youngest consumers are increasingly abstaining from wine altogether or choosing alternatives, all trends expected to persist into 2025 and beyond.
"Consumers are not changing their minds about wine. Older, 60+ year-old consumers who historically index higher for wine purchases are sunsetting, replaced by younger consumers who index lower for wine and prefer other drink categories," said McMillan. "To restore the balance between demand and supply, growing consumption share with consumers in the 30-45 segment is critical. The industry can shorten the recovery by evolving marketing and promotion strategies to meet that consumer at their value points."
The 2025 SVB report examines the latest consumption, pricing and sales data as well as the most promising wine industry marketing strategies. It provides an in-depth analysis of the key trends and data impacting the US wine industry:
- Total wine category sales will end 2024 with negative volume growth, between minus
3% and minus1% . - The weighted average of wineries produced a
3.4% revenue decline, with the top quartile seeing an average of22% revenue growth, and the bottom quartile seeing a16% revenue decline. - Wholesale-heavy wineries fared worse than direct-to-consumer-focused brands.
- Tasting room visitation is predicted to be slightly lower in 2025 compared to 2024.
California - andWashington -planted acreage exceed demand whileOregon is closer to being in balance with demand.42% of winery survey respondents said they will take a small price increase in 2025, which may prove difficult in an over-supplied market with prevalent discounting.
Silicon Valley Bank will host a live webinar to discuss the annual report and state of the wine industry on January 23rd at 9:00 a.m. PST. The panel will include Rob McMillan at Silicon Valley Bank, Kaleigh Theriault, Beverage Alcohol Thought Leader at NielsenIQ, Alison Smith Story, Co-Founder of Smith Story Wine Cellars, and Peter Yeung, Wine Industry Consultant. Register for the live webinar here. A replay of the discussion will be available after the event.
Read the full 2025 State of the Wine Industry report here: www.svb.com/trends-insights/reports/wine-report.
Silicon Valley Bank's Wine Division
Founded in 1994, SVB's Wine Division specializes in commercial banking for premium wineries and vineyards and the industries that support them. With the largest team of commercial bankers dedicated to the wine industry of any bank nationwide, SVB's Wine Division has offices in
About Silicon Valley Bank
Silicon Valley Bank (SVB), a division of First Citizens Bank, is the bank of some of the world's most innovative companies and investors. SVB provides commercial banking to companies in the technology, life science and healthcare, private equity and venture capital industries. SVB operates in centers of innovation throughout
About First Citizens Bank
First Citizens Bank helps personal, business, commercial and wealth clients build financial strength that lasts. Headquartered in
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SOURCE Silicon Valley Bank