Craft beer is in decline, but maybe less so in Arizona
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The craft beer market continued its historic decline in 2025, but the brewers in Arizona may be less tapped out than their counterparts in other states, per an industry group.
Why it matters: The persistent downward trend is startling the once-booming industry and forcing brewers to rethink their business models and expand into non-beer beverages.
The big picture: Nationwide, the craft beer industry last year saw a 5.1% decrease in production and 2.9% contraction in U.S. breweries, a new report by the Brewers Association revealed.
Zoom in: Arizona is feeling the pinch too, and declines here are likely in line with national trends, said Andrew Bauman, deputy director of the Arizona Craft Brewers Guild.
- Volume is down, particularly at larger breweries that are more reliant on package sales, he told Axios.
Yes, but: Arizona hasn't been hit as hard because the vast majority of its breweries are smaller neighborhood establishments and most aren't heavily reliant on retail distribution, Bauman said.
- He noted that breweries and taprooms were the most resilient craft beer businesses, per the report.
- "Our breweries are places that you go to, not just a brand you see on the shelf. So that helps us a lot," Bauman said.
- And he added that we've seen expansion with local favorites like Greenwood Brewing, O.H.S.O. and Wren House.
State of beer: The total number of craft breweries nationwide fell to 9,578, as openings declined at a sharp rate and 481 closed shop in 2025, the report shows.
- The decrease in 2025 production is a new high outside the pandemic and follows a 4% slump in 2024.
What they're saying: "While it's probably premature to say the industry has settled into a 'new normal,' there are many indications that we are moving in that direction," Matt Gacioch, staff economist at the Brewers Association, said in a statement.
Zoom out: Craft beer outperformed the broader beer market, which experienced a 5.7% decline.
What we're watching: Gacioch sees room for cautious optimism as the industry moves toward a model that works.
- Breweries with strong brands and differentiated offerings are holding steady or expanding. And more breweries are moving in that direction, serving hard seltzers, canned cocktails and adding food to appeal to a broader consumer base.