Coca-Cola Q4 Earnings Beat Estimates, Stock Falls on Revenues Miss

Core Insights - The Coca-Cola Company (KO) reported fourth-quarter 2025 results with earnings per share (EPS) exceeding estimates while revenues fell short of expectations, reflecting strong business momentum and effective pricing strategies [1][4][6] Financial Performance - Comparable EPS for Q4 was 58 cents, a 6% increase year-over-year, surpassing the Zacks Consensus Estimate of 57 cents, although currency translations negatively impacted EPS by 5 percentage points [2][6] - Revenues reached $11.8 billion, a 2% year-over-year growth, but missed the Zacks Consensus Estimate of $12.05 billion; organic revenues increased by 5% driven by growth across most segments [3][6] - Operating income rose 32% year-over-year to $1.84 billion, while comparable operating income increased by 5.6% to $2.89 billion, with a notable impact from currency headwinds [13] Volume and Pricing Dynamics - Concentrate sales improved by 4% year-over-year, with a 1% increase in price/mix attributed to pricing actions, although partially offset by an unfavorable mix [7][8] - Total unit case volume rose by 1% year-over-year, with significant growth in Brazil, the United States, and Japan [8] Segment Performance - North America reported a 4% increase in revenues, while EMEA saw a 5% rise; however, Latin America experienced a 2% decline [12] - The sparkling soft drinks category remained flat year-over-year, with Coca-Cola Zero Sugar growing by 13% across all segments [9] Margin Analysis - The operating margin contracted to 15.6% from 23.5% in the prior year, while the comparable operating margin expanded to 24.4% [14] Future Guidance - For 2026, Coca-Cola anticipates organic revenue growth of 4-5% and comparable EPS growth of 7-8% from the $3.00 reported in 2025, factoring in currency tailwinds and impacts from acquisitions [15][16]