The U.S. craft beer sector continues to struggle in an industry downturn, as the number of operating craft breweries declined by 2.9% to 9,578 in 2025, according to the Brewers Association’s 2025 Annual Craft Brewing Industry Production Report, which was updated on May 29.

Microbreweries had the largest decline of 4.4% to 1,994 businesses, taprooms dropped by 2.7% to 3,784, brewpubs fell 2.5% to 3,525, and regional breweries slightly declined by 0.4% to 275 units, the report said.

Craft brewer openings decline

New brewery openings plummeted to 300 in 2025, compared to 518 in 2024. Closures also declined to 481, compared to 591 in 2024.

Certain craft brewers are choosing to file for bankruptcy protection to restructure debt and avoid closing down their businesses.

Hi Sign Brewing files for Chapter 11 bankruptcy to reorganize its business.

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Hi Sign Brewing files for bankruptcy

Beloved Texas-based craft brewery Hi Sign Brewing LLC filed for Chapter 11 bankruptcy to reorganize its business, according to PacerMonitor.

The Austin, Texas, brewing company filed its petition in the U.S. Bankruptcy Court for the Western District of Texas in Austin on May 31, listing up to $50,000 in assets and up to $1 million in liabilities.

Hi Sign Brewing did not state a reason for filing for bankruptcy in its petition.

The craft brewery continues to operate while its bankruptcy case proceeds, as it filed a motion to use its cash collateral.

The debtor’s largest creditors included the U.S. Small Business Administration, owed over $601,000; First Citizens Bank, owed over $148,000; Amplify Federal Credit Union, owed over $73,000; Capital One, owed over $28,000; American Express, owed over $28,000; and JPMorgan Chase Bank, owed over $19,000, according to court papers.

Hi Sign Brewing was founded in 2017 by former U.S. Marine Mark Phillippe, who named the brewery after a favorite family vacation spot in Montana off Hi Sign Road.

The brewery and taproom relocated in 2022 to the east side of town on Shady Lane near Austin-Bergstrom International Airport.

Hi Sign’s most popular beer is its Violet Blueberry Blonde at 5.1% ABV, according to its website. Other popular beers include El Berto Mexican Lager (4.5% ABV), Wooderson West Coast IPA (6.5% ABV), Holly St. Haze Juicy Hazy IPA (6.9% ABV), Shamus Red Ale (5.2% ABV), and Eastside Pilsner (4.7% ABV).

The brewery’s beers are available at 506 locations in the Austin area, including bars, restaurants, liquor stores, and major supermarkets, according to the “Beer Finder” page on its website.

Hi Sign hopes its sales will increase and buck the industry trend of declining sales.

Craft brewery sales decline

Craft brewer volume sales declined by 4% in 2025, while retail dollar sales decreased by 2.8% to $28 billion, which accounts for 24.8% of the $113 billion U.S. beer market, the Brewers Association report said.

The reason for dollar sales declines below volume declines was price increases and slightly stronger onsite sales growth versus distribution, according to the report.

The struggling craft beer industry reported a 4% decline in craft production in 2025, the report said.

The good news for the craft beer industry is that it outperformed the overall beer category, which declined 5.7% by volume in 2025.

Brewer production drops

The industry report listed 60% of craft breweries reporting production declines, 39% reporting growth, and only 1% claiming no change in production.

The declines included microbreweries reporting an 8.9% decline, regional breweries dropping 4.1%, taprooms declining 3.9%, and brewpubs down 1.7%.

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