Keurig Dr Pepper(US:KDP) ZACKS·2025-10-28 18:51Core Insights - Keurig Dr Pepper Inc. (KDP) reported a strong performance in Q3 2025, with both sales and earnings improving year over year, leading to a 7.6% increase in share price following the announcement [1][10]. Financial Performance - KDP's net sales reached $4.31 billion, a 10.7% increase year over year, surpassing the Zacks Consensus Estimate of $4.14 billion [4][10]. - Adjusted earnings per share (EPS) were 54 cents, reflecting a 5.9% year-over-year growth, driven by higher adjusted operating income and gains from minority investments [5][10]. - Adjusted gross profit rose 7.9% to $2.35 billion, while the adjusted gross margin decreased by 100 basis points to 55% [5][10]. - Adjusted operating income increased by 3.9% to $1.09 billion, with an adjusted operating margin of 25.3%, down 170 basis points year over year [6][10]. Segment Performance - U.S. Refreshment Beverages segment net sales grew 14.4% to $2.73 billion, supported by market share gains in carbonated soft drinks, energy drinks, and sports hydration [7][10]. - U.S. Coffee segment net sales increased 1.5% to $991 million, primarily due to favorable pricing, despite a 4% decline in volume/mix [9][10]. - International segment net sales rose 10.5% to $580 million, driven by strong performance in mineral water in Mexico and single-serve coffee in Canada [12][10]. Strategic Outlook - KDP is focused on strengthening its core business and preparing for transformation, including the acquisition of JDE Peet's and a planned separation into two pure-play companies [3][10]. - The company raised its 2025 net sales outlook to high-single-digit growth, while maintaining its EPS guidance in the same range [16][10].