Overview
Since the Report − 0.5%
Revenue grew 7.4% year over year, EPS beat the estimate by 4.6%; the stock fell 0.7% in its first reaction.
- RevenueQ3
- $13.38B
- Estimate $12.92B · 3.6% Beat
- EPSAdjusted
- $0.91
- Estimate $0.87 · 4.6% Beat
Verdict
BUYCoca-Cola beat third-quarter estimates by 3.6% on revenue and 4.6% on earnings, and raised its full-year target for the third time. The stock is still down 0.7% intraday, because the new earnings target sits close to the $3.30 the market already expected. Next, watch North American volume and the 2027 Africa refranchising.
Close on Report DayOct 27
$92.07▼ 0.7%Report-Day Move
- Market Cap(Today)
- ≈ $394 B
- 1Y Return(At Report)
- + 32%
- P/E(At Today's Price · $3.32 · Trailing 12M)
- 27.6
- PEG(Company Guidance 2026)
- 2.51
- Net Margin(Trailing 12M)
- 28.6%
Earnings Summary
In 30 Seconds- Revenue of $13.38 billion beat estimates by 3.6%, and adjusted EPS of $0.91 beat by 4.6%.
- The company raised its full-year earnings growth target to at least 11%, just 0.9% above market expectations.
- Shares were down 0.7% intraday; after a 32% one-year rally, the new target did not surprise.
The Numbers
Organic Revenue Growth
7%
Concentrate Sales 7% · Price/Mix 1%
Unit Case Volume
▲ 5%
Zero Sugar 16% · North America Flat
Comparable Operating Margin
32.9%
Year Ago 31.9% · 1.0 Point Expansion
Stock Reaction
−0.7%
Intraday 12:39 ET; Updated This Evening
Quarterly Revenue ($ Billion)
12.46
Q3 25 · $12.5 B
11.82
Q4 25 · $11.8 B · QoQ − 5.1%
12.47
Q1 26 · $12.5 B · QoQ + 5.5%
13.38
Q2 26 · $13.4 B · QoQ + 7.3%
13.38
Q3 26 · $13.4 B · QoQ 0.0% · YoY + 7.4%
- Q3 25
- Q4 25
- Q1 26
- Q2 26
- Q3 26
Q4 2026 Company Guidance
- Adjusted EPS (2026)3.33 $
At Least 11% Growth · 2025 Base $3.00 · Prior 9–10% · Market Expectation 3.30In Line ✓
- Organic Revenue Growth (2026)5%
At Least 5% · Prior About 5% · Six Fewer Days in Q4
- Free Cash Flow (2026)13 billion
At Least 13.0 · Prior About 12.4Raised 4.8% ▲
- Effective Tax Rate (2026)19.7%
Prior 19.9% · Includes Non-Recurring BenefitsLowered 0.2 Point
- CCBA Sale Impact on 2027 Revenue-8 points
EPS Impact −2 Points · Positive for Margins
How to Read the Chart
The blue band is the company's low-high range; its length shows how much room the company left itself. The black triangle and the line beneath it mark where the market expected, and the notch in the band is the range's midpoint. The triangle appears only where a market expectation is known. When the company gave a single number rather than a range and no market expectation is known, that row gets no band at all: there is no length to measure and no position to compare. Axis is ±1.0% around the midpoint.
Segment and KPI Data
Revenue by Segment
- North America$5.39 BShare 39.8%▲ 2.5% YoY
- Europe, Middle East & Africa$3.10 BShare 22.9%▲ 3.6% YoY
- Latin America$1.96 BShare 14.5%▲ 24.5% YoY
- Asia Pacific$1.56 BShare 11.5%▲ 3.8% YoY
- Bottling Investments$1.52 BShare 11.3%▲ 13.2% YoY
Key Metrics
Unit Case Volume Growth
5.0%
Press Release
Organic Revenue Growth
7.0%
Press Release
Coca-Cola Zero Sugar Volume Growth
16.0%
Press Release
Free Cash Flow (Nine Months)
$11.4 B
Press Release
Operating Cash Flow (Nine Months)
$12.5 B
Press Release
Shares are computed over the segment total: $13.5 B. The segment total differs from consolidated revenue ($13.4 B); the company's eliminations and other lines are not in this table. Source: Press Release.
Metrics come only from the company's own filings; each one names the document it was taken from.
“Our third quarter results reinforce the continued strength of The Coca-Cola system. We are acting with speed and discipline, enabling us to deliver strong results in an uneven environment. While every market is different, three themes were consistent. One, affordability is working. Two, both zero sugar and original taste are recruiting consumers. And three, execution and local relevance are helping us win.”
- Affordable Packaging
- Zero Sugar Growth
- 22 Quarters of Share Gains
Summary and Review
Summary
Coca-Cola reported third-quarter revenue of $13.38 billion. That is up 7.4% year over year and 3.6% above the Zacks estimate. Adjusted earnings per share came in at $0.91 against a $0.87 estimate, a 4.6% beat. The company lifted its full-year earnings growth target from 9-10% to at least 11%. That implies $3.33 per share, only 0.9% above the $3.30 market expectation. Organic revenue grew 7%, and the full-year target moved to at least 5%.
The stock opened 2% below the prior close, then recovered most of the loss. As of 12:39 p.m. ET it was down 0.7%. The market did not read this report as a growth story. Shares have risen 32% over the past year and sit just 3.9% below the average analyst target. At this price, a fresh surprise is hard to come by. Flat volume in North America also left a question mark.
The quarter scores 73 with a positive view, because the revenue and earnings gates are open and the guidance gate is in line. Growth sources broadened: volume rose 5%, so pricing is no longer the only engine. Comparable operating margin widened 1.0 point to 32.9%. Two caveats remain. Price/mix grew only 1%, and the 2027 Africa bottling sale will cut revenue by 8 points.
Full Review
Volume is back at the center of growth.
Unit case volume rose 5% year over year. India, China, Mexico and Brazil led the gains. Coca-Cola Zero Sugar volume grew 16%, with growth in every geographic segment. In India, all of the top ten brands grew at double digits. Sparkling drinks grew 5% and water 8%, while sports drinks fell 3%. Concentrate sales rose 7%, two points ahead of volume. The gap reflects shipment timing. CFO John Murphy said he expects slight destocking in the fourth quarter. As a result, concentrate sales should trail volume slightly for the full year. Separating such timing effects matters on earnings day; the how to read earnings day guide explains it.
Mix effects ate most of the price increase.
Price/mix grew only 1%. According to the earnings call, pricing contributed four points. Unfavorable geographic and category mix took back three of them. Fast-growing India and Africa carry lower revenue per case. Regional gaps are wide. In Latin America, price/mix rose 7% and segment revenue jumped 24.5% to $1.96 billion. In Asia Pacific, price/mix fell 2%. North America revenue rose 2.5% to $5.39 billion, but volume was flat. CEO Henrique Braun blamed the timing of the July 4 holiday. He said volume improved sequentially each month of the quarter. The company still gained value share in the region.
Margins widened, partly thanks to currency.
Comparable operating margin reached 32.9%. A year earlier it was 31.9%, so it widened by 1.0 point. The reconciliation table in the release shows 0.6 point of that came from currency. Underlying operating margin, excluding currency and divestitures, rose from 32.1% to 32.3%. That is only 0.2 point. Comparable gross margin rose about 1.7 points. Meanwhile, the company increased marketing spending and kept investing in consumer recruitment and digital tools. Murphy also said logistics and transportation costs are rising. The expected 19.7% tax rate for the year includes benefits that will not repeat. So the 2027 earnings base looks less comfortable than this year's.
Cash is strong; the balance sheet awaits a ruling.
Operations generated $12.47 billion of cash over nine months. After capital spending, free cash flow was $11.41 billion. In the same period last year, it was $2.42 billion. The company raised its full-year free cash flow target from about $12.4 billion to at least $13.0 billion. That is a 4.8% upward revision. Net debt stands at 1.3 times EBITDA, below the company's target range of 2 to 2.5 times. Murphy said they are managing the balance sheet carefully while awaiting a court decision in the IRS dispute. The cash flow guide explains how to read cash generation.
For 2027, watch one line: unit case volume.
If the sale of Africa bottler CCBA closes in the fourth quarter, it will weigh 8 points on 2027 revenue and 2 points on earnings per share. In return, the company expects better margins and returns on capital. Currency is also a slight headwind for 2027. Headline revenue will shrink in 2027, so readers will need to focus on organic growth. In the next report, look at one line: unit case volume. If volume stays above 3%, the growth story holds. If it falls below 2%, with price/mix already weak, this year's momentum came from summer events.
Looking Ahead
Strengths and Risks
6 Strengths · 6 RisksStrengths
6- Unit case volume rose 5%, and growth did not depend on a single region.
- Coca-Cola Zero Sugar volume grew 16%, rising in every geographic segment.
- The company gained value share for the 22nd consecutive quarter.
- The full-year earnings growth target rose from 9-10% to at least 11%.
- Nine-month free cash flow reached $11.41 billion.
- Latin America revenue rose 24.5% year over year to $1.96 billion.
Risks
6- Price/mix grew only 1%Unfavorable mix erased three of the four pricing points.
- North American volume was flat, with water, sports drinks and tea declining.
- Currency supplied 0.6 point of margin expansion and is expected to turn slightly negative in 2027.
- The CCBA sale will weigh 8 points on 2027 revenue and 2 points on EPS.
- An adverse ruling in the ongoing IRS dispute could pressure cash.
- The company lost value share in France and the United Kingdom.
What to Watch
5- The CCBA sale is expected to close in Q4 2026, subject to regulatory approvals.
- The company will give 2027 guidance with fourth-quarter results in February 2027.
- The fourth quarter has six fewer days, and slight destocking is expected.
- A potential IPO of the bottling operations in India is under review.
- A court decision in the ongoing IRS dispute is still pending.
Upcoming Earnings
To Understand This