Coca-Cola Q4 earnings: Why the outlook disappointed Wall Street

Yahoo Finance Video

Wed, February 11, 2026 at 12:08 AM GMT+9

In this video:

KO

-1.32%

Coca-Cola (KO) reported fourth quarter earnings results that narrowly beat analyst estimates. The company also issued a weaker-than-expected outlook for 2026 sales.

Yahoo Finance Senior Reporter Brooke DiPalma joins Morning Brief host Julie Hyman to break down the biggest takeaways from Coca-Cola’s earnings print.

To watch more expert insights and analysis on the latest market action, check out more Morning Brief.

Video Transcript

00:00 Speaker A

Coca-Cola, the bottom end of its full year sales outlook coming in below estimates. Still, the company seeing strength in its zero sugar soda. Senior reporter Brooke De Palma here with me with the biggest takeaways from the results. Um, and I was also interested to see the company’s been raising prices.

00:15 Speaker B

Yeah, the company has been raising prices specifically here in the US up about 4% for the quarter, but surprisingly, volume was actually up in the US about 1%.

00:23 Speaker A

So not a huge gain,

00:24 Speaker B

Not a huge gain, but still surprising when consumers really have been pushing back on higher prices quite broadly. But what we did see was that Wall Street really was quite upset about the outlook that they had put out. The company said that it expects organic revenue growth of about 4 to 5%. That was slightly below what Wall Street had expected of roughly 5%. And I asked uh James Quincy, outgoing CEO on the phone this morning, what exactly his response was to that outlook and he said this. He said quote, we’ve taken what we think is a realistic but prudent approach relative to a number of of international markets

01:05 Speaker A

Yeah.

01:05 Speaker B

we need to see improve through the course of 2026. Let’s drive the top line approach. Let’s drive the portfolio. Let’s get a balance of volume and price. And Julie, he mentioned some key markets that were also under pressure. That includes China, India, and Mexico where they actually implemented a soft drink tax. He said the the region sort needs to develop from there and really take this with stride. But also bringing it back here into the US as we were alluding to. We did see that unit case volume increase and so I asked him, what exactly is happening with the state of the US consumer? And this is what he said. There was strength in that Coke Zero, that zero sugar brand. He also said that diet Coke and protein their core life, uh core power rather, and Fair life are doing well for them. Also, hydration water brands doing well as well. That was pretty interesting. We also this GLP1 effect where about 25% of US households now have about one GLP1 user, which was surprising to me. He said that given they’re a total brand business, they’re well positioned. Also, I asked him about the K-shaped economy. I said, are you seeing it? And he sort of described the K-shaped economy to me, but he said, hey, total spending is up, but low-income consumers are looking for more value, you know, price pack architecture, these lingo keywords we’ve been hearing.

02:07 Speaker A

Price pack architecture?

02:08 Speaker B

That’s the jargon we’ve been hearing for years now.

02:11 Speaker A

That just means they want to buy something smaller for cheaper?

02:13 Speaker B

Exactly. Or or maybe they’re getting an eight pack as opposed to a 12 pack and they’re also going to the dollar store, the lower income consumer to shop for their Coca-Cola these days as well.

02:23 Speaker A

Interesting. Okay, so they’re not immune to that those kinds of pressures.

02:27 Speaker B

Yeah, they’re ultimately seeing consumers continuing to splurge on Coke. They’re saying that both high-income and low-income consumers are spending, but they’re just seeking out different options. And so they’re playing into this affordability conversation that’s happening right now.

02:40 Speaker A

Are you a Coca-Cola drinker? Do you buy this stuff?

02:42 Speaker B

I will admit, I am not a soda drinker, Julie.

02:44 Speaker A

Neither am I. Yeah. What about we know Brian Brian So is still on set with us. Brian.

02:47 Speaker C

I I have lots of things to say about this Coca-Cola and Pepsico quarter. Um I I like Coke. and I know executives are going to come on here and say,

02:54 Speaker A

but you like you like Coke the stock or Coke zero I like drinking Coke.

02:57 Speaker C

I like I like zero sugar. And I know uh executives won’t uh come out and say, oh, we love Coke or Pepsi. I’m here to tell you, Coke Zero is my soda. And I’m okay with. I do like to do Pepsi Probiotic, right.

03:04 Speaker B

But I wait, but I will say on that, Pepsi Probiotic, I asked him. I said, you know, your competitor is getting into this probiotic. Pepsico bought Poppy for $2 billion and acquisition closed earlier late earlier in 2025. And I said, how’s that simple, simply Poppy or simply pop uh probiotic soda. He said they’re still in the early innings of it. They’re taking lots of learnings. Doesn’t seem like it’s quite working as well for them. That’s something that consumers really want right now. They want like a prebiotic, probiotic soda brand. Doesn’t seem like Coca-Cola has been able to win over consumers with their option just yet.

03:32 Speaker C

Can I just add one thing? Um, so Ramona LaGuarda, Pepsico will continue to come on with me. I love the new snacks. I tried them out for the Super Bowl. I tried the Super Bowl. They came out with like these Doritos with no coloring and they still taste like they taste like Doritos. I tasted the cheese on my tongue. I think it was great.

03:43 Speaker A

Do they taste the same?

03:51 Speaker C

and Cool Ranch. It was just I tasted something that resembled cheese and I think it was great. I think it was great. This is innovation. Now you know why consumer staple stocks are trading at like highs again. This is the innovation we need Julie, I know you’re a big food person.

03:59 Speaker A

Well, it’s innovation, it’s forced innovation in that case, right? Because

04:01 Speaker B

Because consumers are speaking that out.

04:02 Speaker A

It’s consumers but it’s also the government now is putting their, you know, they’re encouraging, it’s not it’s voluntary, but they’re encouraging. they are encouraging these companies to abandon those those uh petroleum based dyes.

04:14 Speaker C

Thank you, RFK for my naked, no-colored new Doritos.

04:18 Speaker A

I got to try these. I didn’t even know they existed.

04:20 Speaker C

I’m sad, you don’t eat that stuff. Come on. You don’t eat that.

04:22 Speaker A

I like Doritos. I don’t drink soda. I do occasional I like an occasional Dorito. Right?

04:28 Speaker C

I like Wingstop.

04:30 Speaker A

We we’ll talk, you know how I feel about Wingstop. Okay.

04:32 Speaker C

Both stocks up more than 10% year to date.

04:35 Speaker A

Okay, there we go. Thank you Brooke.

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