Top 5 findings from the SVB Wine Report

Silicon Valley Bank’s 2026 wine industry report, which analyses the state of the US market, suggests we are entering a chapter “defined as much by challenge as by opportunity” but cautions producers that “this is not a cycle you can wait out”. Sarah Neish reports.

Silicon Valley Bank (SVB) released its 2026 ‘State of the US Wine Industry’ report today. A leading source of market trends in the wine sector, the report covers everything from plantings and private labels to tasting room attendance.

“We all need to be attentive to the factors that surround our business… But our primary goal is to offer more benchmarking and planning tools, unique street-level intelligence and ideas to help you adapt… and enhance your chances of success in 2026 and beyond,” said Rob McMillan, founder of the SVB wine division and author of the report.

Here, we delve into the latest findings.

1.More than US$1 billion wiped off value sales

The SVB report estimates that total industry sales for 2025 amounted to $74.3 billion, down from $75.5 billion in 2024. This represents a $1.2 billion drop year-on-year in the US wine sector.

Volumes, too, were down. In 2025 the US sold 329 million cases of wine. That’s 6.9 million fewer cases than the 335.9 million sold in 2024.

The report notes that the wine industry is going through “a multi-year demand correction”, which will see wine companies experience “both profit margin compression and higher levels of inventory”.

“I would caution believing anyone who suggests that 2026 will bring growth,” said report author McMillan. “That is just unsupported hope. The math isn’t there.”

However, all is not lost with McMillan stressing the good news that “the steepest part of the downturn appears to be waning.” He added that SVB expects “the decline in total market demand to improve in 2026, with the market bottoming out in 2027 through 2028, before returning to modest growth rates.”

That said, he cautioned: “This is not a cycle you can wait out. The wineries still demonstrating growth are not betting on a return to normal – they are fundamentally altering how they engage with the consumer, manage inventory, and are redefining their brand’s value proposition.”

2.Private label wines are a bright spot

According to the report, the vast amounts of high-quality bulk wine available is creating “compelling consumer value in private labels, where wine demand is growing in double digits.”

McMillan acknowledged that while SBV had expected “a discounting environment”, it hadn’t anticipated that much of this discounting would take place “in less obvious private label sales.”

Led by Total Wine and Costco, but also “extending into mainstream establishments like Kroger”, SVB maintains that private label discounting “is a positive form of discounting that attracts new value-seeking consumers, protects existing brand value and helps drain the ocean of bulk wine.”

Outside of private label, the report spurns discounting when it is used to drive volume rather than reinforce loyalty. “In a discount environment, lowering prices can align you with brands that are failing,” it says.

3.Oregon and Washington forecast biggest revenue growth for 2025

The US states of Oregon and Washington were among the only regions expecting to see year-on-year revenue growth when the financial year 2025 closes, of 6% and 5% respectively.

Comparatively, Virginia, Napa and Sonoma predict a more modest 2% climb, while Paso Robles anticipates 1% growth and Texas a drop of -3%.

In terms of winery size, SVB states that “being stuck in the middle – too big to take a DTC focus and too small to get distributors to sell your brand is something to be avoided.”

4. Appetite for acquisitions wanes

Fewer than one in five wineries which responded to the SVB survey expressed an active interest in buying facilities, vineyards or brands. Meanwhile, openness to selling has increased with 18% of respondents revealing that a winery sale within five years was “likely”.

“This mismatch—rising seller interest but fewer active buyers—suggests continued pressure on valuations for undifferentiated assets and greater opportunity for well-capitalised buyers who understand today’s demand realities,” the report says.

Last year, SVB reported that coastal wine properties maintained the highest asking prices, which is likely due to increasing consumer demand for fresher, cool-climate wines.

Read more about the biggest drinks acquisitions of 2025 here.

4.Informed approach to pricing is vital

Premium demand “remains viable”, according to the report, but it now requires “more persuasive value communication and/or hospitality-led differentiation rather than relying solely on price increases.”

Wines below $20 per bottle remain weak, reflecting the long-term downtrend in everyday table wine. Meanwhile, the $20–$29 and $100+ tiers show growth expectations — continuing the “hourglass” effect in consumer spending. “Rightly or wrongly, one concerning trend is that younger consumers are buying
wine more often as gifts instead of for personal consumption,” the report notes.

When it comes to tasting rooms, lowering tasting fees isn’t the strategy. “Don’t fall into the trap of thinking ‘if you lower the price, they will come’”, the report says.

“Wine country tourism is still vibrant, but how visitors behave has changed. They arrive with higher expectations, evolving preferences and a goal of
having fun—not volume tasting or bar-style service.” Wineries seeing tasting room success described a shift in mentality: “We stopped treating the tasting room like a bar and started treating it like a stage.”

5. More vines must be ripped out

SVB believes the US is still overplanted in most regions “which will lead to higher levels of uncontracted fruit at harvest and price reductions on the spot market in
2026.”

While grape prices are undoubtedly part of the thorny issue of unfilled grape contracts, in some cases, SVB says, even “lowering the price to zero isn’t sufficient to have all production under contract.”

Very few wineries increased their grape purchases in 2025, and several regions “left meaningful tonnage unharvested”. In California, the harvest estimate is below 2.2 million tons. “This was a production segment that could produce 4 million+ tons in a good year, which gives you an idea of the depth of over-planting and the current bubble the industry has to deal with,” says the report.

The upshot is that “more acreage will have to be removed, particularly in regions producing for less expensive brands.” Additionally, SVB states that there is too much planted acreage in specific premium varieties. “The time is becoming ripe when some growers in the best AVAs will find success experimenting with varieties that were successful decades ago and might appeal again as an entry priced premium wine.”

However, “that is not a license to rip up vines without a sales plan,” the report warns.

While some believe the short harvest of 2025 will help more growers find contracts in 2026 and beyond, SVB worries that “there isn’t sufficient pull-through today to reduce the inventory bubble at wholesale. Without reducing supply, producers aren’t going to contract for more fruit. The best we can say is the light harvest won’t make the situation worse.”

6. Do less but better

The producers showing the best financial performance are “prioritising fewer initiatives and executing them well”. This looks like fewer SKUs, clear messaging, and alignment of your team and brand, which is more likely to result in strong performance.

Part of this formula for success enjoyed by “the top 10%”, claims the SVB report, is a “retention-first mindset”, which prioritises existing customers and treats wine clubs as “core revenue engines”. SVB recommends “doubling down on loyalty programmes, rewarding and recognising tenure and renewing focus on under-engaged customers.”

Contrastingly, lower-performing wineries tended to report they are “trying more things,” relying on the return of traditional tourism, hosting large events and employing broad social outreach without measuring or tracking success.

Check out last year’s SVB’s State of the US Wine Industry analysis here.