This article was originally published in the May/June 2026 issue of The New Brewer under the headline “The Next Chapter.”

The craft beer story being written in the mainstream press today is generally not a positive one. A typical article charts the rise of craft brewing—and then provides a litany of reasons for why that era is over. While most of the stories contain accurate facts and figures, they are fundamentally a backward-looking view of how we got here.

The bigger story requires taking a look forward: not just at where we are, but where we might be going, or in some cases, are already going. The 2025 numbers don’t lie, but it’s important to add some context and perspective.

Let’s start with a term that has recently entered the economics lexicon: “vibecession.” Taken from TikTok economist Kyla Scanlon (yes, TikTok economist is now a real thing), the basics of the theory are simple: the numbers aren’t that bad, but the “vibes are off.” Those vibes then become a self-fulfilling prophecy.

Maybe it isn’t the best theory applied one-to-one to craft beer, but there are some parallels. No, last year’s numbers weren’t the best they’ve ever been, but a closer look reveals they aren’t as bad as they seem. The sky isn’t falling.

At the same time, the vibes do feel off. Maybe it’s the continued pace of innovation and increasing competition in intoxicating beverages. Or the constant articles about how no one drinks anymore (spoiler alert: they still do). It could be consumer confidence that was the lowest last year since the University of Michigan started tracking it in the 1970s. Or supply chains that refuse to settle down. Or the constant change of societal patterns and consumer preferences.

We get it: it’s tough out there. Whether you’re reading social media or the New York Times, the world (both for craft and in general) can feel dark and chaotic.

But as we wrote in our National Beer Day member toolkit, when you put down your phone and pick up a beer, the reality starts to look a bit better than the vibes. We won’t lie and pretend it was a banner year, but we’re starting to see that those who are fighting against the negative vibes and charting their own path are still finding success and creating some green shoots for the entire industry. Ignore the vibes, focus on what you do best, then repeat.

First: The Numbers

In our data set, the craft category was down 5% by volume in 2025. The number of operating craft breweries declined 2.9% over the past year. But category averages can be deceptive.

Cider has often been cited as a bright spot in beverage alcohol (and kudos to cideries for that). But while cider’s category growth numbers may correlate more highly with individual company success, it doesn’t fully define it. Our data suggests that 39% of craft breweries grew in 2025. That means there are more companies seeing growth in craft brewing (roughly 3,800) than there are total cideries in the United States (around 3,700 per IBISWorld). Ignore the vibes and there is plenty of success to point to.

Similarly, performance was far from uniform across the country in 2025. When the dust settled, the Census Bureau’s West Region had the lowest volume decline (–0.4%). The next best performing region was the Midwest (–2.1%), followed by the South (–6.1%) and the Northeast (–9.7%). However, when drilling deeper into census divisions, there was one that found a way to grow in this challenging environment. The top performer was the East North Central Division (+0.4%) consisting of Illinois, Indiana, Michigan, Ohio, and Wisconsin.

Another bright spot for the industry was hospitality breweries: brewpubs and taprooms. Overall, these breweries saw volumes decline by only 2.9%, which many likely offset by growing sales in food or other beverage alcohol. Brewpubs improved their beer trend to –2% volume compared to the year prior, while taprooms held steady at –4%.

Hospitality Breweries

Compared to beer sales at eating and drinking places generally, the hospitality-focused craft brewery model is shining. From NielsenIQ’s CGA dataset, we know that at eating establishments, overall beer sales were down 8% by volume, with craft sales down 10%. In drinking establishments, beer volume was down 6%, with craft down 9%. Combining the two types of businesses, draft volume was down 5% for beer overall and 10% for craft.

Clearly, something is working at craft businesses to buck these harsher trends in the on-premise.

With the exception of only contract/alternating proprietorships (which had a few star students pulling volume positive), brewpubs were the craft businesses that performed best in 2025. These breweries—which sell more than 25% of their beer onsite and offer a significant food menu—were able to make it through the gauntlet last year with just a 1.7% decline in production. The share of brewpubs increasing production (44%) outpaced the industry average by five percentage points. And while slightly more brewpubs closed than opened, the ratio of 1.4:1 was tied for the lowest closing-to-opening rate of any category.

For taprooms—a similarly onsite-focused model, but without significant food service—the year-over-year volume change was –3.9%. While still better than the industry overall, this lag behind brewpubs indicates that in 2025, consumers sought a more expansive menu. Taproom businesses growing production were slightly less common (38%), but again, had a relatively low closing-to-opening ratio (1.4:1).

The most successful taprooms and brewpubs are fighting larger societal trends that involve going out less. While total restaurant sales have grown in recent years, even accounting for inflation, much of this is driven by increasing off-premises consumption (including takeout, delivery, and drive-through). Data from Technomic shows that full-service restaurants got 12.1% of their total traffic from off-premises sales in 2019. In 2025, that was 35.4%. Limited-service restaurants went from 74.1% to 89.9% over that time period. If total traffic is up 10% since 2020, that suggests a significant decline in in-person traffic.

That figure lines up with a major shift in how Americans are spending their time. According to data from the U.S. Bureau of Labor Statistics’ American Time Use Survey, people aged 15 to 29 spent about 45% more time alone in 2023 than in 2010. In a world where you can sit on your couch and order anything with your phone, access any media ever created, or even try to find a date by swiping, why would you need to get off the couch and go down to the local taproom?

The answer, of course, is the community and experience found within those taprooms and brewpubs. If the gravity of the phone and the couch have increased, the force necessary to pull against it needs to increase— but clearly, it can still be done.

It’s not just craft brewers who are fighting to reintroduce consumers to the benefits of being social. From macro brewers and international soft drink companies pushing expensive ad campaigns to local businesses and public institutions vying to serve as viable third spaces, we are not alone in this effort. This challenging moment, when many businesses are staring down technology-induced consumer inertia, is also one of the industry’s greatest opportunities.

Technology is, as always, a blessing and a curse, and for operators it is increasingly being used to reduce friction in getting consumers through the door, as well as in the service experience once they’re there. It can produce efficiencies in operations that were unimaginable in the past. But consumers don’t want to feel like a number served by robots. The most successful hospitality businesses today are the ones able to pair personalized, human experiences with those efficiencies afforded by tech.

Distribution Breweries

For all the positives seen in hospitality-focused breweries, distributing breweries experienced another tough year. Breweries in distribution saw volume declines of 6.6%, with both regional and microbrewery numbers sliding even further than they did in 2024.

For the largest of the large craft breweries (producing more than 15,000 barrels annually), regionals experienced a volume drop of 5.9% in 2025. While faring worse than craft beer overall, regionals still outperformed micros—presumably due to economies of scale, national relationships, and more established and identifiable brands. This hypothesis is supported by the fact that the median production change for regionals was –2.7% while for micros it was –4.2%. In other words, the trends are not just being pulled by a few large breweries impacting overall numbers. As the brewery type with the fewest businesses, regionals had a higher- than-average rate of increasing volume (41%) and the lowest churn rate, with just 0.7% openings and 2.5% closings.

Northeast

Rank	Company	State	Sales (bbls)	% Change
1	D.G. Yuengling & Son Inc	PA	1,889,614	-25%
2	Boston Beer Company	MA	1,028,000	-7%
3	Athletic Brewing Company	CT	480,000	20%
4	Brooklyn Brewery	NY	321,312	-5%
5	F.X. Matt Brewing Co	NY	147,187	-7%
6	Fiddlehead Brewing	VT	116,893	8%
7	Narragansett Brewing Co	RI	110,225	-1%
8	Allagash Brewing Company	ME	107,763	-1%
9	Tröegs Brewing Co	PA	107,700	-2%
10	Barrel One Collective	MA	104,960	-16%

South

Rank	Company	State	Sales (bbls)	% Change
1	Gambrinus Company	TX	405,356	-11%
2	SweetWater Brewing Co	GA	313,347	24%
3	Artisanal Brewing Ventures	NC	238,697	-6%
4	Creature Comforts Brewing Co.	GA	94,865	10%
5	Cigar City Brewing	FL	94,566	31%
6	Abita Brewing Co.	LA	77,630	-13%
7	Saint Arnold Brewing Co	TX	66,238	2%
8	The Florida Brewery	FL	49,269	3%
9	New Realm Brewing	GA	41,178	9%
10	Highland Brewing Co	NC	37,113	8%

Mountain West

Rank	Company	State	Sales (bbls)	% Change
1	Oskar Blues Brewing	CO	181,348	-6%
2	Tivoli Brewing Company	CO	115,000	102%
3	Odell Brewing Co	CO	89,364	-9%
4	Montucky Cold Snacks	MT	42,149	-5%
5	Wilding Brands	CO	40,756	-14%
6	Santa Fe Brewing Co	NM	38,037	-8%
7	Pure Madness Brewery Group	WY	33,610	-12%
8	KettleHouse Brewing Co	MT	29,100	2%
9	Uinta Brewing Company	UT	28,343	-4%
10	Left Hand Brewing Company	CO	28,094	8%

North Central

Rank	Company	State	Sales (bbls)	% Change
1	Garage Beer Co	OH	220,000	193%
2	New Glarus Brewing Co	WI	218,407	-6%
3	Boulevard Brewing Co	MO	137,187	-6%
4	Rhinegeist Brewery	OH	113,568	-4%
5	August Schell Brewing Company	MN	103,650	-4%
6	Three Floyds Brewing	IN	102,998	-2%
7	Great Lakes Brewing Company	OH	101,546	-12%
8	Stevens Point Brewery	WI	100,000	-7%
9	BrewDog Brewing Company, LLC	OH	75,032	-16%
10	Revolution Brewing	IL	56,440	-9%

Pacific Northwest

Rank	Company	State	Sales (bbls)	% Change
1	Deschutes Brewery	OR	283,292	14%
2	Georgetown Brewing Co	WA	128,125	4%
3	10 Barrel Brewing Co	OR	102,107	-15%
4	Great Frontier Holdings	OR	92,042	3%
5	Alaskan Brewing Co.	AK	70,734	-14%
6	pFriem Family Brewers	OR	52,684	7%
7	Fremont Brewing	WA	43,507	-10%
8	Rogue Ales Brewery	OR	39,258	-14%
9	Mac & Jacks Brewery Inc	WA	38,271	-9%
10	Fort George Brewery	OR	36,916	7%

Pacific

Rank	Company	State	Sales (bbls)	% Change
1	Sierra Nevada Brewing Co	CA	1,036,995	-3%
2	Firestone Walker Brewing Co	CA	430,000	-10%
3	Gordon Biersch Brewing Co	CA	124,000	5%
4	Maui Brewing Company	HI	83,700	-6%
5	Kona Brewing Hawaii	HI	69,745	0%
6	Pizza Port	CA	54,161	3%
7	Russian River Brewing Co	CA	49,517	5%
8	BJ's Restaurants, Inc.	CA	46,926	6%
9	Coronado Brewing Co	CA	46,009	3%
10	Best Day Brewing	CA	44,036	52%

The most acute pain in 2025 was felt by the smaller (less than 15,000 barrels) distribution-focused breweries: microbreweries. Micros experienced an 8.9% decline in beer volume year over year, more than four percentage points lower than the craft average. Many micros have been on the cutting table through wholesaler and retailer rationalization. It certainly wasn’t an across-the-board decline, though, with 35% of microbreweries finding at least some growth in 2025, and the closure rate for the category (4.1%) faring better than the hospitality models.

The distribution landscape continues to be a competitive one, both within fuller-flavored beer, but also across wider beverage alcohol. Whereas a decade ago craft was the brightest spot of innovation, today there are numerous shiny objects for distributors and retailers looking to fill trucks and shelves, including ready-to-drink cocktails, hemp beverages, and a plethora of other “hard” beverages ranging from sports drinks to party punches. In a recent Bump Williams Consulting (BWC) survey, 75% of distributors had expanded their portfolio in the past five years, with 100% being open to more portfolio expansion.

Given the diversity of innovation and other new products, it is hard to summarize how they compete with craft for consumers and occasions. Most fill the same consumer demand buckets of flavor and variety—factors that were key underpinnings of craft growth. Some bring new attributes or target occasions that don’t overlap significantly with craft offerings.

What is clearer is that they compete directly for distributor attention and shelf space. The “leaky bucket” of light lager has become no less leaky in recent years, but the number of product categories it is leaking into has continued to increase. Brewers must continue to be highly aware of this involvement and understand where their brands fit as differentiated products for their distributors and retailers. Delighting the end drinker is still king, but to reach that consumer, distributing brewers must also understand what role their brands play for their direct customers (wholesalers). In the same BWC survey, 54% of distributors identified craft as a candidate for future category rationalization. Why should your brand make the cut?

The Importance of Differentiation

The brands surviving and thriving tend to be those that are truly differentiated. What does it mean to be differentiated? And why is that so critical?

To start, as markets mature, they get more efficient and competitive, requiring strategies and products to stand apart. Craft is no different. Twenty years ago, having an ale was unique. Then it was having an IPA. Then it was the type of IPA (hazy or imperial, for example). Today’s strategy requires an overlap of beer, channel, format, and more—e.g., 19.2-ounce double hazy IPA singles sold in convenience over a geography appropriate for your location and scale.

There are still style pockets that are growing. Pulling from NielsenIQ scan data (which does not include on-premise), the style subgroup that grew the most within BA craft in 2025 was pale lager (+8.9%). The next-fastest growth style was spice/herb beer (+8.6%), though notably this is a small category with a few winners having outsized impact. The third and final style grouping that experienced growth last year was hop water (+1.1%).

Among some of the largest style groupings, IPA (–3.1%), American wheat ale (–5.9%), golden ale (–6.6%), pale ale (–7.9%), and stout (–9.9%) were all down compared to 2024 volume. Though not a style, it’s worth mentioning that non-alcohol beer was up 18.7% by volume year over year. If you’re thinking about entering a style category because of its numbers, remember the lesson above that over time, you’ll need to stand out more and more to succeed.

But no product characteristic covers what arguably matters even more for small brewers to differentiate: what your company and brands stand for. The core of the craft brewing business involves something that isn’t just about business model or strategy. In consumer product goods, you have a binary choice: scale and compete on price, or differentiate so that someone is willing to pay more for your brand. If you read the economics literature on brewing from the 1970s and 1980s, it was headed in the first direction. Beer was just a widget and the successful firms were the ones that created the minimum viable scale and found optimal locations for their breweries. Yes, brands and marketing mattered, but within a narrow scope of other characteristics.

Craft entered the scene by offering the second path. It provided something new to the market. Craft’s superpower was the ability to be different and follow a new track driven by flavor and variety. Economics could be secondary because the drinker was willing to pay more for something that was different than the current market offerings. But in the world of choice consumers face today, flavor, variety, and even local aren’t necessarily differentiators. So what truly makes your company and brands stand out in the market?

Business model and efficiency still matter, but there is always a bigger fish. If you think you can compete on price against companies that have railcars rolling through their facilities, you might want to rethink your model. If there’s a theme in distribution success stories, it’s that they have an answer to the question, “Why should the drinker choose us?” And they are pursuing it with the same passion that has always driven the craft category.

The good news is that being an independent brewer allows you the total freedom to answer that question. And if you aren’t using that freedom in a way that aligns with your north star, what makes you think the customer will follow?

Distributing breweries face additional cost pressure challenges. Cost increases are of course not unique to distribution. Hospitality breweries have seen equal if not greater cost growth. But distribution is fundamentally a lower-margin, higher-volume business, and one that is nested in an environment with larger-scale players and lower overall inflation, meaning it is harder to pass those cost increases along to the customer.

One solution has been gaining scale through groups of various kinds, as detailed in the March/April 2026 issue of The New Brewer. The issue of unused capacity continues to haunt the industry. In 2025, we estimate that only 55% of total craft capacity was being used for brewing beer. While some of that capacity is invariably being used to produce beyond-beer products, it’s still a low-capacity utilization by most manufacturing standards. If it can be considered good news, this is the same capacity utilization as in 2024, indicating a stabilization in capacity vs. demand. Given the decline in production, a static ratio reflects capacity coming offline.

Cost, capacity, and competitive challenges are exerting enormous pressure on microbreweries and regionals, which, no matter their scale, remain small manufacturers in the wider context. The Brewers Association is engaging to the greatest extent possible to do what we can to lower costs in the political arena and will continue to tell your story and seek solutions on areas such as aluminum costs.

Closing Perspective

Cost of goods is just one of the many storm clouds that have gathered around the category for some time. The New York Times recently published an article titled “Craft Breweries Struggle as Sales and Appetites Wane.” It cites the usual suspects, some of which we have expanded upon above. At first blush, these challenges all feel new and pressing. But those who have been in craft for decades know this is not the case. A longtime member sent a companion NYT piece from 1997, which, if you update a few dates, names, and categories, covers much of the same ground: competition, changing consumers, changing distribution, and price pressures. It also closes on a positive note, highlighting several examples of breweries remaining confident as they bucked the trends and navigated the competition in their communities.

That was 30 years ago, and while we’ve returned to a similarly tough environment today, the general arc of those three decades has been undoubtedly positive. The closing optimistic anecdotes were ultimately more accurate than the general narrative.

Any fans of literature or film know the rise-reckoning-reinvention story arc. As an industry, we’ve established ourselves from humble beginnings before experiencing a meteoric rise greater than many of us could have imagined. After years of what many considered to be inevitable growth, the 2020s have been a reckoning at the individual and collective levels. We’ve experienced bumps and bruises that seemed impossible 10 years ago. We saw the same story in the late 1990s and early 2000s. Just as it was true back then, now is the time to realize that what got us here may not get us there. While the tactics may require change, the industry needs to refocus on its values to create an even more meaningful future.

Unlike the negative vibes of the media chapter where we began, the beginning of our next chapter includes the reminder that this community has weathered challenges before and emerged stronger and more resilient. There are ample signs that a similar reemergence cycle is coming, driven by the same entrepreneurial spirit and adaptation that have always been hallmarks of small brewers.

This storm, like those before it, will pass. Those prepared to weather it are already seeing sunshine on the other side.

Bart Watson is president & CEO and Matt Gacioch is staff economist for the Brewers Association.