Wine and spirits maker Brown-Forman (BF-B, BF-A) on Wednesday beat expectations for its fiscal year third quarter earnings and reiterated full-year guidance, but the stock fell 5% amid a challenging sales environment.

Despite ongoing challenges such as tariffs and barrel costs in the US, Canada, and Europe, the Jack Daniel’s maker is seeing strong growth in international markets like Mexico and Brazil.

In the US, alcohol consumption has dropped, as evidenced by a 1% year-to-date decline in US sales. Brown-Forman’s Canadian sales plummeted nearly 60% due to retailers in most provinces keeping US-made products off shelves in response to Trump’s tariffs.

However, the company called out emerging international markets, where sales overall rose 16%, and travel retail channels as bright spots.

“Our global footprint shows a clear divergence in consumer behavior,” CEO Lawson Whiting said on the earnings call. “While macro uncertainty continues to pressure discretionary spending in the US, in many developed markets, we see significantly stronger, more resilient consumer trends in key emerging international markets and the travel retail channel.”

Mexico and Brazil delivered double-digit sales growth of 15% and 20%, respectively. In Mexico, the company’s ready-to-drink products, in particular, are driving growth, with overall revenue up 8%. In Brazil, Brown-Forman is focused on boosting its super-premium whiskey portfolio, which also saw double-digit sales growth.

Brown-Forman reported earnings of $0.58 per share, up from $0.57 the prior year, beating the consensus of $0.47. Sales rose 2% to $1.06 billion, versus the Street’s estimate for $1 billion.