Core Viewpoint - Coca-Cola has decided to abandon the sale of Costa Coffee due to bidders' offers not meeting expectations, marking a significant setback for the company [1][3]. Group 1: Sale Abandonment - Coca-Cola has terminated negotiations with remaining bidders for Costa Coffee as of December 2025, halting the auction process that had been ongoing for several months [3]. - Potential bidders included TDR Capital and Bain Capital, with discussions reportedly stalling over price disagreements [3][5]. - Coca-Cola's asking price for Costa Coffee was approximately £2 billion (around ¥18.7 billion), which is about half of the £3.9 billion it paid for the brand in 2018 [3][4]. Group 2: Financial Performance - Costa Coffee's revenue for 2024 was reported at £1.2 billion (approximately ¥11.2 billion), but the company experienced a significant operating loss of £13.5 million (around ¥1.25 billion), attributed to weak foot traffic and competition from lower-priced rivals [4]. - The company also recorded an impairment loss of £48.6 million (approximately ¥455 million) related to its operations in China, citing weaker-than-expected coffee demand in Shanghai [4]. Group 3: Future Considerations - There is speculation that Coca-Cola may revisit the sale of Costa Coffee in the medium term despite the current abandonment of the sale [3]. - The new CEO, Henrique Braun, will be responsible for determining the future strategy for Costa Coffee, with an emphasis on creating value for consumers [7][9]. - Coca-Cola has indicated that it will retain control over Costa Coffee's ready-to-drink products, which have shown strong sales growth in specific regions [5].

Core Insights - The CEO of Coca-Cola, James Quincey, predicts that macroeconomic conditions will continue to worsen, likening the situation to increasing rain rather than a decrease [1] - Coca-Cola is focusing on controllable aspects such as marketing, innovation, execution, and pricing to navigate the challenging economic landscape [1] Economic Outlook - Quincey notes that consumer sentiment remains weak, particularly among lower-income groups, but he believes it is not yet a dire situation [4] - The balance of favorable and unfavorable economic factors is shifting towards more headwinds as the company looks ahead to next year [4] Segmentation Strategy - Coca-Cola is implementing a segmentation strategy based on purchasing power to better understand consumer behavior and tailor marketing efforts [4][6] - The company has adjusted product sizes and pricing in response to consumer pressures, such as offering 400ml bottles at a lower price in China [6] Acquisition Strategy - Quincey emphasizes the importance of innovation and potential acquisitions to fill gaps in the product portfolio, especially in a tightening consumer environment [7] - Coca-Cola currently has 30 brands worth over $1 billion, with half acquired through mergers and acquisitions [7] Competitive Landscape - The beverage industry is experiencing increased competition from new startups, which may also become potential acquisition targets for Coca-Cola [9] - Despite the influx of new products, the high barriers to scaling remain a challenge for smaller companies [9] AI Integration - AI is seen as a tool to enhance understanding of consumer behavior and improve marketing strategies, with plans to launch new products based on AI insights in 2026 [10] - The company has already utilized AI for more efficient advertising and sales processes, indicating a significant potential for revenue growth [13] Internal Culture and Succession Planning - Quincey highlights the importance of maintaining a culture of dissatisfaction to drive continuous improvement and innovation within the company [16][18] - The company has been working on a succession plan to ensure a smooth transition when the time comes [18]