stockrowWhat it does
The Coca-Cola Company is a beverage company founded in 1892, headquartered in Atlanta and led by Chief Executive Officer James Quincey. It owns or licenses and markets beverage brands in five broad groups: Trademark Coca-Cola; sparkling flavors; water, sports, coffee and tea; juice, value-added dairy and plant-based beverages; and emerging beverages.
Its portfolio includes Coca-Cola, Sprite, Coca-Cola Zero Sugar, Fanta and Diet Coke/Coca-Cola Light, alongside brands such as BODYARMOR, Costa, Dasani, Powerade, Topo Chico, fairlife, Minute Maid and Simply. The company also participates in sales of certain Monster brands through distribution coordination arrangements.
The company sells beverages mainly through a system of independent bottlers, distributors, wholesalers and retailers, alongside its own bottling and distribution operations. Bottlers use company concentrates or syrups to make, package and sell finished drinks in authorized territories. The company also sells finished beverages itself in some markets, fountain syrups in the United States, and drinks directly to consumers through Costa retail stores.
Its products are sold in more than 200 countries and territories. Beverages carrying its owned or licensed trademarks account for 2.2 billion of an estimated 65 billion beverage servings consumed worldwide each day. The company operates through EMEA, Latin America, North America, Asia Pacific and Bottling Investments segments.
How it makes money
The company has two lines of business: concentrate operations and finished product operations. Its concentrate operations sell beverage concentrates, beverage bases, syrups, fountain syrups and some finished beverages to authorized bottlers. Bottlers combine concentrates or syrups with water and, depending on the drink, sweeteners; they then package finished beverages and sell them to retailers, wholesalers or other bottlers.
This model lets the company earn from branded inputs supplied to a broad bottler network rather than manufacturing every beverage itself. Bottlers are required to buy their full requirements for designated Company Trademark Beverage concentrates or syrups from the company or authorized suppliers. The company generally sets concentrate pricing and has implemented incidence-based concentrate pricing in most markets. That pricing considers factors including bottler pricing, sales channels and package mix.
Finished product operations sell sparkling soft drinks and other ready-to-drink beverages to retailers, distributors and wholesalers. They consist mainly of consolidated bottling and distribution operations within Bottling Investments, plus some non-bottling finished-product businesses in geographic segments. These operations generally generate higher revenue but lower gross profit margins than concentrate operations. Costa stores also sell drinks directly to consumers.
FY2025: the Coca-Cola system sold 33.8 billion unit cases; Q3 2026: unit cases grew 5% and organic revenue grew 7%. Management said on its third-quarter 2026 earnings call that it expects organic revenue growth of at least 5% for 2026 and comparable earnings-per-share growth of at least 11% versus $3 in 2025.
Customers and how it sells
The company’s immediate customers include authorized bottlers, retailers, fountain retailers, distributors, wholesalers and, through Costa stores, consumers. Bottlers typically sell finished products directly to retailers or through wholesalers and other bottlers. U.S. fountain customers include restaurants and convenience stores, which use fountain syrups and dispensing equipment to serve drinks for immediate consumption.
The company sells through independent bottlers as well as consolidated bottling and distribution operations in more than 200 countries and territories. Its five largest independent bottlers represented 44% of worldwide unit case volume in 2025. Coca-Cola FEMSA, Coca-Cola Europacific Partners, Coca-Cola HBC, Arca Continental and Swire Coca-Cola were the five largest independent bottlers by volume.
The United States represented 16% of worldwide unit case volume in 2025, while markets outside the United States represented 84%. Mexico, China, Brazil and India together accounted for 33% of worldwide unit case volume. Sparkling soft drinks represented 69% of worldwide volume, and Trademark Coca-Cola represented 47%.
One bottler accounted for 10.0% of revenue in FY2025. Management said on its third-quarter 2026 earnings call that an affordable single-serve package in Vietnam was available in more than 400,000 outlets.
Suppliers and costs
Water is a main ingredient in substantially all products. Other key inputs include sucrose, high-fructose corn syrup, nutritive and non-nutritive sweeteners, fruit juice and concentrate, milk, coffee, tea, PET, glass and aluminum packaging, beverage gases, energy and transportation. Agricultural inputs, packaging, labor and logistics are part of the cost structure for the company and its bottlers.
The company sources orange juice and concentrate from Florida and the Southern Hemisphere, with Brazil its primary sourcing location. Cutrale Citrus Juices U.S.A., Inc. is its primary supplier of orange juice from Florida and Brazil. fairlife purchases milk from dairy cooperatives, while Costa purchases certified green coffee through multiple suppliers. Sucralose is considered a critical raw material and is purchased mainly from suppliers in the United States and China.
Some packaging materials, including aluminum cans, are available from a limited number of suppliers. Management said on its third-quarter 2026 earnings call that aggregate cost pressures had risen because of logistics and transportation costs. The company expects its overall commodity exposure to remain manageable, while tea and coffee faced commodity pressure through 2026.
- Revenue$47.9B
- Cost of revenue−$18.4B
- Selling, general and administrative−$14.5B
- Other operating costs−$1.3B
- Operating income$13.8B
Competitive position
The commercial beverage industry includes global, regional, local and direct-to-consumer competitors across sparkling soft drinks, water, juice, coffee, tea, energy drinks, sports drinks, dairy, plant-based and functional beverages, as well as alcohol ready-to-drink beverages. PepsiCo is a primary competitor in many countries. Other named competitors include Nestlé, Keurig Dr Pepper, Danone, Suntory Beverage & Food, Anheuser-Busch InBev, Kirin Holdings, Heineken, Diageo and Red Bull.
Competition occurs through pricing, advertising, promotions, in-store displays, digital marketing, product and ingredient innovation, availability, packaging, vending and dispensing equipment, access to marketing assets, and protection and development of trademarks. The company also competes with retailers’ private-label beverages and smaller companies selling microbrands through e-commerce.
Management said on its third-quarter 2026 earnings call that the company gained value share globally for 22 consecutive quarters, but lost value share in several key Western European markets during the quarter.
Our reading: Brand recognition and loyalty are a meaningful moat because the company identifies its trademarks as important to the business, but consumer preferences and private-label alternatives can challenge those advantages.
Our reading: The bottler and distributor network is a meaningful moat because it provides broad physical availability across markets, although bottlers remain independent contractors and competitors can contest retail access and pricing.
Our reading: Marketing, digital capabilities and local execution support the company’s competitive position, but they require continuing investment as shopping moves toward e-commerce and consumer preferences change.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| PepsiCo, Inc. | Global commercial beverages, including many countries | High |
| Nestlé S.A. | Global commercial beverage categories | Medium |
| Keurig Dr Pepper Inc. | Commercial beverages | High |
| Danone S.A. | Commercial beverage categories | Medium |
| Suntory Beverage & Food Limited | Commercial beverage categories | Medium |
| Anheuser-Busch InBev | Alcohol ready-to-drink beverages | Medium |
| Kirin Holdings | Commercial beverage categories | Medium |
| Heineken N.V. | Alcohol ready-to-drink beverages | Medium |
Growth opportunities
The company’s growth approach centers on expanding its beverage portfolio, serving more consumption occasions, adding outlets, using package and price options for affordability and premiumization, and increasing execution through its bottler system. It is investing in brands, marketing, innovation, digital capabilities, revenue growth management, e-commerce and equipment that supports immediate consumption.
The company is expanding lower- and no-calorie choices, including Coca-Cola Zero Sugar and Coca-Cola Zero-Zero. Management said on its third-quarter 2026 earnings call that affordability, zero-sugar offerings, innovation and execution were supporting consumer recruitment in ASEAN and South Pacific. Management also said that BodyArmor Fit extended sports hydration with a sparkling, zero-sugar product and that fairlife was restoring product availability to meet demand in the United States and Canada.
The system added more than 600,000 outlets over the past year and placed more than 340,000 units of cold-drink equipment. In India, management said each of its top 10 brands grew double digits during the third quarter. In China, the company is building digital capabilities, immediate-consumption packages and digital-commerce channels despite subdued consumer spending.
Management expects at least $13 billion of free cash flow in 2026. It also expects the pending sale of Coca-Cola Beverages Africa to close during the fourth quarter, subject to regulatory approvals.
- $38.7BFY2021
- $43.0BFY2022
- $45.8BFY2023
- $47.1BFY2024
- $47.9BFY2025
Structural risks
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Economic, geopolitical and currency conditions can reduce consumer purchasing power, disrupt operations and supply chains, increase costs, and lead consumers to lower-priced products or private-label beverages.
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Competition can restrict price increases, increase marketing and customer-placement costs, and pressure market share. E-commerce can facilitate price comparison and challenge established routes to market.
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Changes in consumer preferences around health, calories, sweeteners, processing, ingredients, packaging and sustainability can reduce demand or require product reformulation, new packaging or marketing changes.
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Supply disruptions and cost volatility can affect agricultural commodities, sweeteners, juice, packaging, energy, transportation and labor. Water availability and quality are key challenges, while weather and citrus greening can affect orange juice supply.
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Retail consolidation, private-label expansion and the changing mix between physical retail, e-commerce and mobile commerce can increase buyer leverage or weaken customer relationships.
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The company is awaiting a court decision in its U.S. Internal Revenue Service dispute. It paid $6.0 billion in response to IRS invoices for 2007 through 2009 and estimates potential aggregate remaining incremental tax and interest liability for 2010 through 2025 of approximately $14 billion as of December 31, 2025.
Bottom line
Our reading
Our reading: Coca-Cola is principally a global branded-beverage and concentrate business, supported by a large independent bottler network and supplemented by lower-margin finished-product operations. Its business rests on trademarks, bottler distribution, marketing and local execution, while its results remain exposed to consumer affordability, input costs, retail power, changing health preferences and a material unresolved tax dispute. The company’s recent volume, organic-revenue and value-share gains show system momentum, but regional results and geopolitical conditions remain uneven.