["Business Strategy and the Environment, Volume 35, Issue 4, Page 5823-5840, May 2026. ", "\nABSTRACT\nThis paper investigates the economic impact of long‐run climatic conditions on Italian wine farms by applying a Ricardian framework to 1431 firms from the 2022 RICA‐FADN survey. We combine farm‐level revenues with viticulture‐specific agroclimatic indicators to assess how climate stress shapes profitability across 77 Italian NUTS3 provinces. Results reveal a significant non‐linear relationship between temperature, precipitation and net revenue per hectare, with stronger negative effects beyond thermal thresholds, particularly in Southern Italy. We further analyse the moderating role of EU subsidies, showing that while public support buffers short‐term losses, it may also weaken incentives for long‐term adaptation. Forward‐looking simulations under mild (+0.5°C), moderate (+1°C) and severe (+1.5°C) warming scenarios indicate potential revenue declines of up to −50 € per hectare by 2030 in the absence of adaptation. Policy implications highlight the need to align subsidy design with climate resilience, promote irrigation and varietal innovation and strengthen adaptation incentives in Mediterranean viticulture.\n"]