Nonalcoholic beer is poised to overtake ale as the world’s second-largest beer category by volume in 2025, according to new projections from beverage industry tracker IWSR.
Despite a 1% decline in overall beer consumption in 2024, the volume of nonalcoholic beer grew by 9% globally, continuing a growth trend that began accelerating in 2018. IWSR forecasts this upward trajectory will persist, with nonalcoholic beer projected to grow 8% annually through 2029. In contrast, ale is expected to see a 2% annual decline in volume over the same period.
Although nonalcoholic beer currently holds only about 2% of the global beer market, it is steadily gaining traction. Lager remains dominant, accounting for 92% of global volume, and continues to grow, albeit more slowly than its alcohol-free counterpart.
The rising demand for nonalcoholic beer is being driven in part by shifting consumer preferences, particularly among younger demographics. Millennials account for the largest share of no-alcohol drinkers, while Gen Z is consuming significantly less alcohol compared to previous generations at similar ages. These groups are embracing lifestyle trends such as the “sober curious” movement and the “damp lifestyle,” which emphasize moderation rather than abstinence.
Brewers have responded to this shift by improving the taste of zero-proof beers and launching nonalcoholic versions of well-known brands. Over the past five years, nearly every major brewer — including Diageo (Guinness), Heineken, and Anheuser-Busch InBev (Budweiser) — has entered the space with dedicated offerings.
Retail sales of nonalcoholic beer surpassed $17 billion globally in 2023, according to Bernstein. The largest markets were Germany, Spain, and Japan, while the United States ranked sixth by volume but lower when measured by market penetration.
In the U.S., a major contributor to the category’s expansion is Athletic Brewing, which became the top-selling nonalcoholic beer brand. Founded in 2018, the company grew its market share from 4% in 2021 to 17% in 2024, surpassing established offerings like Bud Zero and Heineken 0.0. Athletic Brewing was valued at approximately $800 million in its most recent funding round.
The category has also drawn the attention of celebrities. Actor Tom Holland introduced Bero, while retired NBA star Dwyane Wade partnered with AB InBev to launch Budweiser Zero. Actor and podcast host Dax Shepard debuted his own brand, Ted Segers, further underscoring the growing appeal of nonalcoholic beer in both consumer and investor circles.
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