Coca-Cola’s fourth quarter was marked by a modest year-on-year increase in sales, but revenue came in below Wall Street expectations, prompting a negative market reaction. Management attributed the results to mixed global consumer demand and challenging external environments, with CEO-elect Henrique Braun noting that "volume improved each month during the fourth quarter" despite flat growth for the year. The quarter also saw continued investments in product innovation and targeted marketing, particularly in North America and emerging markets.
Is now the time to buy KO? Find out in our full research report (it’s free for active Edge members).
Coca-Cola (KO) Q4 CY2025 Highlights:
- Revenue: $11.82 billion vs analyst estimates of $12 billion (3.6% year-on-year growth, 1.5% miss)
- Adjusted EPS: $0.58 vs analyst estimates of $0.56 (2.7% beat)
- Adjusted EBITDA: $3.12 billion vs analyst estimates of $3.19 billion (26.4% margin, 2.2% miss)
- Operating Margin: 15.6%, down from 23.8% in the same quarter last year
- Organic Revenue rose 5% year on year (beat)
- Sales Volumes rose 1% year on year (2% in the same quarter last year)
- Market Capitalization: $338.5 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Coca-Cola’s Q4 Earnings Call
- Dara Mohsenian (Morgan Stanley) asked about the balance between price/mix and volume for 2026. CEO James Quincey clarified that underlying pricing was 4% in Q4, and the company expects a more balanced volume and pricing mix next year, with price likely stronger in early quarters.
- Stephen Powers (Deutsche Bank) questioned the impact of macroeconomic "light drizzle" on 2026 growth. Quincey said that recoveries in India and China are needed for a full volume rebound and described the company's targets as "prudent" given current volatility.
- Lauren Lieberman (Barclays) inquired about North America’s margin sustainability. CFO John Murphy explained recent margin expansion was due to multiple levers, including supply chain and marketing, and expects modest further improvement, not a structural step-change.
- Christopher Carey (Wells Fargo) pressed on strategies for volatile markets like China and Mexico. Braun outlined the "all-weather strategy," leveraging strengths in resilient markets and applying local adjustments to offset headwinds from taxes and consumer softness.
- Andrea Teixeira (JPMorgan) asked about regulatory impacts, including SNAP changes in the U.S. and new Mexican taxes. Quincey described SNAP’s impact as "manageable," while Braun emphasized leveraging RGM (Revenue Growth Management) tools and marketing around the Mexico World Cup to offset tax headwinds.
Catalysts in Upcoming Quarters
In upcoming quarters, StockStory analysts will focus on (1) signs of volume and revenue recovery in key international markets such as India and China, (2) the effectiveness of digital and local innovation strategies in driving consumer engagement, and (3) how management navigates margin pressures from product mix and regional tax changes. Progress on expanding the billion-dollar brand portfolio and executing targeted marketing campaigns will also be critical markers.
Coca-Cola currently trades at $78.68, in line with $77.97 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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