Keurig Dr Pepper Inc.
For the period ended Dec 31, 2025. Filed Feb 24, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 24, 2026
KDP$36.63-0.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0001418135-25-000013
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-24.
0001418135-26-000016
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 170 previous paragraphs and 164 current paragraphs.
104 unchanged; 35 reworded; 25 added; 31 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 16 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
Sales Volumes
Current report
Net Sales Drivers
Current report
(1)The acquisition of GHOST contributed 3.8 percentage points to our consolidated volume / mix growth for the year ended December 31, 2025.
Current report
SG&A expenses increased $338 million, or 6.7%, to $5,351 million for the year ended December 31, 2025 compared to $5,013 million in the prior year, primarily driven by increased transportation and warehousing expenses (4 percentage points), costs associated with the JDE Peet's Acquisition and Separation (2 percentage points), and higher labor costs (2 percentage points).
Current report
Other operating (income) expense, net reflected a favorable change of $212 million for the year ended December 31, 2025, primarily driven by the favorable comparison of the $225 million termination fee associated with ABI incurred in the prior year. Refer to Note 4 of the Notes to our Consolidated Financial Statements for further information.
Current report
Income from operations increased $984 million, or 38.0%, to $3,575 million for the year ended December 31, 2025 compared to $2,591 million in the prior year, driven by the favorable comparison of our non-cash impairment charges for goodwill and intangible assets compared to the prior year, increased gross profit, and the favorable comparison to the termination fee associated with ABI incurred in the prior year. These benefits were partially offset by increased SG&A expenses.
Current report
Other expense (income), net reflected an unfavorable change of $192 million for the year ended December 31, 2025, primarily driven by an increase of $214 million in our mandatory redemption liability for GHOST.
Current report
Net income increased $638 million, or 44.3%, to $2,079 million for the year ended December 31, 2025, primarily driven by increased income from operations, partially offset by the increase in our mandatory redemption liability for GHOST.
Current report
Sales Volumes
Current report
Net Sales Drivers
Current report
(1)The acquisition of GHOST contributed 6.2 percentage points to our volume / mix growth in U.S. Refreshment Beverages for the year ended December 31, 2025.
Current report
Sales volume increased 0.7% for the year ended December 31, 2025, led by growth in our energy portfolio, including the acquisition of GHOST, and in carbonated soft drinks. These benefits were partially offset by softness in our still beverages portfolio.
Current report
Net sales increased 11.9% to $10,439 million for the year ended December 31, 2025, led by volume / mix growth, including a benefit from the acquisition of GHOST, as well as higher net price realization.
Current report
Income from operations increased 56.5% to $2,939 million for the year ended December 31, 2025. This performance was led by the favorable comparison of our non-cash impairment charges for goodwill and intangible assets compared to the prior year (34 percentage points), the gross profit impact of net sales growth (32 percentage points), and the favorable comparison of the termination fee associated with ABI incurred in the prior year (12 percentage points). These benefits were partially offset by increased transportation and warehousing expenses (8 percentage points) and higher labor costs (5 percentage points).
Current report
Appliance volume decreased 19.9%, reflecting price elasticity impacts, category softness, and continued retailer inventory management. K-Cup pod volume decreased 4.8%, reflecting price elasticity impacts.
Current report
Net sales increased 0.6% to $3,990 million for the year ended December 31, 2025, driven by higher net price realization, partially offset by unfavorable volume / mix.
Current report
Income from operations decreased 10.8% to $962 million for the year ended December 31, 2025, driven by a net unfavorable change in ingredients, materials, and productivity, inclusive of tariffs (22 percentage points), partially offset by the benefit of net sales growth (11 percentage points).
Current report
LRB sales volume increased 2.3%. Appliance volumes decreased 1.7%, and K-Cup pod volumes increased 2.0%.
Current report
Income from operations increased 0.2% to $546 million for the year ended December 31, 2025, reflecting the benefit from the gross profit impact of net sales growth (17 percentage points), which was mostly offset by a net unfavorable impact from changes in ingredients, materials, and productivity (10 percentage points) and increased transportation and warehousing expenses (7 percentage points).
Current report
Credit Ratings
Current report
As a result of our announcement of the JDE Peet's Acquisition and the corresponding financing arrangements anticipated for the transaction, Moody's and S&P have revised their outlook on our credit ratings. On August 25, 2025, Moody's placed KDP ratings under review for downgrade, and S&P has placed KDP on CreditWatch Negative.
Current report
Equity Method Investments
Current report
JDE Peet's Acquisition
Current report
We entered into various transactions in order to finance the JDE Peet's Acquisition, including the Bridge Credit Agreement and Delayed Draw Term Loan Agreement. Refer to Note 5 of the Notes to our Consolidated Financial Statements for additional information on these borrowing arrangements. We additionally entered into the JV Transaction Agreement, under which the JV Investors will make a minority investment into the Pod Manufacturing JV for an aggregate purchase price of $4 billion. We also entered into the Preferred Investment Agreement, under which we will issue and sell 4.5 million shares of Convertible Preferred Stock for an aggregate purchase price of $4.5 billion. These transactions are expected to be completed substantially concurrently with the closing of the JDE Peet's Acquisition. Refer to Note 3 and Note 22 of the Notes to our Consolidated Financial Statements for additional information. We may issue additional debt securities and pursue other financing options, as warranted.
Current report
•Financing and other funding arrangements entered into in connection to the JDE Peet's Acquisition;
Removed paragraphs (31)
Previous report
KDP operates as an integrated brand owner, manufacturer, and distributor. We believe our integrated business model strengthens our route-to-market and provides opportunities for net sales and profit growth through the alignment of the economic interests of our brand ownership and our manufacturing and distribution businesses through both our DSD system and our WD system. We market and sell our products to retailers, including supermarkets, mass merchandisers, club stores, pure-play e-commerce retailers, and office superstores; to restaurants, hotel chains, office product and coffee distributors, and partner brand owners; and directly to consumers through our website. Our integrated business model enables us to be more flexible and responsive to the changing needs of our large retail customers and allows us to more fully leverage our scale and reduce costs by creating greater geographic manufacturing and distribution coverage.
Previous report
Key Events During and Subsequent to the Fourth Quarter of 2024
Previous report
On October 23, 2024, we entered into a definitive agreement with GHOST, and certain other parties named therein, to acquire a controlling interest in GHOST. Founded in 2016, GHOST is a lifestyle sports nutrition business with a portfolio anchored by GHOST Energy, a leading ready-to-drink energy brand.
Previous report
Under the terms of the agreement, we initially purchased a 60% stake in GHOST for aggregate consideration of approximately $1 billion on December 31, 2024. We also entered into an agreement requiring us to purchase the remaining equity interests in GHOST in 2028. The initial payment was funded primarily by proceeds drawn from the Term Loan Agreement. We also executed an agreement with GHOST and ABI which transfers the distribution rights for GHOST products from ABI to us, effective March 3, 2025, for a termination payment to ABI of $225 million which will be paid during the first quarter of 2025. Refer to Note 4 of the Notes to our Consolidated Financial Statements for additional information.
Previous report
On January 31, 2025, we repaid the amount outstanding under the Term Loan Agreement using proceeds from commercial paper.
Previous report
We eliminate from our financial results all intercompany transactions between entities included in our consolidated financial statements and the intercompany transactions with our equity method investees.
Previous report
Sales Volume. The following table provides the change in sales volume compared to the prior year:
Previous report
Net Sales. Net sales increased $537 million, or 3.6%, to $15,351 million for the year ended December 31, 2024 compared to $14,814 million in the prior year. This performance reflected volume/mix growth of 2.7% and favorable net price realization of 1.2%, slightly offset by unfavorable impacts from FX translation of 0.3%.
Previous report
Selling, General and Administrative Expenses. SG&A expenses increased $101 million, or 2.1%, to $5,013 million for the year ended December 31, 2024 compared to $4,912 million in the prior year, led by increases in transportation and warehousing expenses (2 percentage points) and people costs (1 percentage point), partially offset by reduced costs associated with productivity projects (1 percentage point).
Previous report
Other operating expense (income), net. Other operating (expense) income, net reflected an unfavorable change of $233 million for the year ended December 31, 2024, primarily driven by the accrued $225 million termination fee associated with ABI. Refer to Note 4 of the Notes to our Consolidated Financial Statements for further information.
Previous report
Income from Operations. Income from operations decreased $601 million, or 18.8%, to $2,591 million for the year ended December 31, 2024 compared to $3,192 million in the prior year, as our increase in gross profit (14 percentage points) was more than offset by the impacts of our non-cash impairment charges for goodwill and other intangible assets (22 percentage points) and the accrued termination fee associated with ABI (7 percentage points).
Previous report
Net Income. Net income decreased $740 million, or 33.9%, to $1,441 million for the year ended December 31, 2024 as compared to $2,181 million in the prior year.
Previous report
The following table provides selected information about our U.S. Refreshment Beverages segment’s results:
Previous report
Sales Volume. Sales volumes for the year ended December 31, 2024 increased approximately 1.0% compared to the prior year period. Growth in carbonated soft drinks and the contributions from partnerships, such as Electrolit and C4, was partially offset by softness in our still beverages portfolio.
Previous report
Net Sales. Net sales increased 5.8% to $9,331 million in the year ended December 31, 2024, compared to $8,821 million in the prior year period, driven by favorable net price realization of 3.1% and volume/mix growth of 2.7%.
Previous report
Income from Operations. Income from operations decreased $605 million, or 24.4%, to $1,878 million for the year ended December 31, 2024 compared to $2,483 million for the prior year period. This decrease was primarily driven by the non-cash goodwill and intangible impairment charges (29 percentage points) and the accrued termination fee associated with ABI (9 percentage points). Other drivers include the benefit to gross profit of net sales growth (13 percentage points), a net benefit from changes in ingredients, materials, and productivity (3 percentage points), and earned equity from the achievement of milestones associated with certain distribution agreements (3 percentage points), partially offset by increased transportation and warehousing expenses (3 percentage points).
Previous report
The following table provides selected information about our U.S. Coffee segment’s results:
Previous report
Sales Volume. K-Cup pod volume was flat for the year ended December 31, 2024 compared to the prior year period. Appliance volume increased 7.3% in the year ended December 31, 2024, driven by Keurig market share momentum and improving coffeemaker category trends.
Previous report
Net Sales. Net sales decreased 2.6% to $3,967 million for the year ended December 31, 2024 compared to $4,071 million in the prior year period, driven by unfavorable net price realization of 3.6%, partially offset by volume/mix growth of 1.0%.
Previous report
Income from Operations. Income from operations decreased $79 million, or 6.8%, to $1,079 million for the year ended December 31, 2024, compared to $1,158 million in the prior year period, driven by the gross profit impact of the net sales decrease (11 percentage points), partially offset by a net benefit from changes in ingredients, materials, and productivity (3 percentage points).
Previous report
The following table provides selected information about our International segment’s results:
Previous report
Sales Volume. The following table provides the percentage change in sales volumes for the International segment compared to the prior year period:
Previous report
Income from Operations. Income from operations increased $70 million, or 14.7%, to $545 million for the year ended December 31, 2024 compared to $475 million in the prior year period. This performance reflected the gross profit impact of volume/mix growth and higher net price realization (25 percentage points) and a net benefit from changes in ingredients, materials, and productivity (5 percentage points), partially offset by increased transportation and warehousing expenses (5 percentage points) and higher marketing investment (5 percentage points).
Previous report
Cash Conversion Cycle
Previous report
Our cash conversion cycle is defined as DIO and DSO less DPO. The calculation of each component of the cash conversion cycle is provided below:
Previous report
The following table summarizes our cash conversion cycle:
Previous report
Our cash conversion cycle increased 20 days to approximately 12 days as of December 31, 2024 as compared to (8) days as of December 31, 2023, which was primarily driven by the decrease in DPO, reflecting the reduction of payment terms for certain suppliers.
Previous report
Accounts Payable Program
Previous report
We work with our suppliers to optimize our terms and conditions, which includes payment terms. Excluding our suppliers who require cash at date of purchase or sale, our current payment terms with our suppliers generally range from 10 to 360 days. We also enter into agreements with third party administrators to allow participating suppliers to track payment obligations from us, and, if voluntarily elected by the supplier, sell payment obligations from us to financial institutions. Suppliers can sell one or more of our payment obligations at their sole discretion and our rights and obligations to our suppliers are not impacted. We have no economic interest in a supplier’s decision to enter into these agreements and no direct financial relationship with the financial institutions. Our obligations to our suppliers, including amounts due and scheduled payment terms, are not impacted. Refer to Note 2 of the Notes to our Consolidated Financial Statements for additional information on our obligations to participating suppliers.
Previous report
Debt Ratings
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Investments in Unconsolidated Affiliates
Reworded paragraphs (35)
Previous wording
KDP is a leading beverage company in North America that manufactures, markets, distributes and sells hot and cold beverages and single serve brewing systems. We have a broad portfolio of iconic beverage brands, including Keurig, Dr Pepper, Canada Dry, Mott's, A&W, Peñafiel, Snapple, 7UP, Green Mountain Coffee Roasters, GHOST, Clamato, Core Hydration, and The Original Donut Shop. KDP has some of the most recognized beverage brands in North America, with significant consumer awareness levels and long histories that evoke strong emotional connections with consumers. We offer more than 125 owned, licensed, and partner brands, available nearly everywhere people shop and consume beverages through our sales and distribution network.
Current wording
KDP is a leading beverage company in North America that manufactures, markets, distributes, and sells hot and cold beverages and single serve brewing systems. We have a broad portfolio of iconic beverage brands, including Dr Pepper, Canada Dry, Mott's, A&W, Peñafiel, GHOST, 7UP, Snapple, Green Mountain Coffee Roasters, Clamato, The Original Donut Shop, and Core Hydration, as well as the Keurig brewing system. Our beverage brands are some of the most recognized beverage brands in North America, with significant consumer awareness levels and long histories that evoke strong emotional connections with consumers. We offer more than 125 owned, licensed, and partner brands, supported by powerful distribution capabilities.
Previous wording
•The U.S. Refreshment Beverages segment reflects sales in the U.S. from the manufacture and distribution of branded concentrates, syrup, and finished beverages, including the sales of our own brands and third-party brands, to third-party bottlers, distributors, and retailers.
Current wording
•The U.S. Refreshment Beverages segment reflects sales in the U.S. from the manufacture and distribution of branded concentrates, syrups, finished beverages, and other consumables, including the sales of our own brands and third-party brands, to third-party bottlers, distributors, and retailers.
Previous wording
We believe the North American beverage market is influenced by certain key trends and uncertainties. Refer to Item 1A, Risk Factors, as well as the Uncertainties and Trends Affecting Liquidity and Capital Resources section below, for more information about risks and uncertainties facing us.
Current wording
Refer to Item 1A, Risk Factors, as well as the Uncertainties and Trends Affecting Liquidity and Capital Resources section below, for more information about risks and uncertainties facing us.
Previous wording
Refer to Note 6 of the Notes to our Consolidated Financial Statements and Item 7A, Quantitative and Qualitative Disclosures About Market Risk for management's discussion of how we manage our exposure to commodity risk.
Current wording
Refer to Note 7 of the Notes to our Consolidated Financial Statements and Item 7A, Quantitative and Qualitative Disclosures About Market Risk for management's discussion of how we manage our exposure to foreign exchange risk, interest rate risk, and commodity risk.
Previous wording
Gross Profit. Gross profit increased $449 million, or 5.6%, to $8,529 million for the year ended December 31, 2024 compared to $8,080 million in the prior year. This performance primarily reflected the gross profit impact of net sales growth (3 percentage points), a net benefit from changes in ingredients, materials, and productivity (2 percentage points), and earned equity from the achievement of milestones associated with certain distribution agreements (1 percentage point), partially offset by net increases in other manufacturing costs (1 percentage point).
Current wording
Gross profit increased $470 million, or 5.5%, to $8,999 million for the year ended December 31, 2025 compared to $8,529 million in the prior year. This performance primarily reflected the gross profit impact of net sales growth (9 percentage points), partially offset by the net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs (4 percentage points).
Previous wording
Impairment of Goodwill. Impairment of goodwill reflected a non-cash impairment charge of $306 million within the U.S. Warehouse Direct reporting unit in the U.S. Refreshment Beverages segment. Refer to Note 5 of the Notes to our Consolidated Financial Statements for further information.
Current wording
Impairment of goodwill in the prior year reflected a non-cash impairment charge of $306 million within the U.S. Warehouse Direct reporting unit in the U.S. Refreshment Beverages segment. Refer to Note 6 of the Notes to our Consolidated Financial Statements for further information.
Previous wording
Impairment of Other Intangible Assets. Impairment of intangible assets reflected non-cash impairment charges of $412 million for intangible brand assets, primarily led by Snapple. Refer to Note 5 of the Notes to our Consolidated Financial Statements for further information.
Current wording
Impairment of intangible assets decreased $334 million to $78 million, driven by the favorable comparison of non-cash impairment charges for intangible brand assets compared to the prior year. Refer to Note 6 of the Notes to our Consolidated Financial Statements for further information.
Previous wording
Interest Expense, Net. Interest expense, net increased $239 million, or 48.2%, to $735 million for the year ended December 31, 2024 compared to $496 million for the prior year, primarily driven by increased debt and higher financing costs (32 percentage points) and an unfavorable year-over-year change in unrealized mark-to-market activity (17 percentage points).
Current wording
Interest expense, net increased $19 million, or 2.6%, to $754 million for the year ended December 31, 2025 compared to $735 million for the prior year, primarily driven by increased debt and higher financing costs (12 percentage points), which were mostly offset by a favorable year-over-year change in unrealized mark-to-market activity (10 percentage points).
Previous wording
Effective Tax Rate. The effective tax rate increased 380 bps to 24.7% for the year ended December 31, 2024, compared to 20.9% in the prior year, primarily driven by the impact of our non-cash goodwill impairment charge (270 bps) and the unfavorable comparison to the prior year tax benefit received from a non-cash adjustment (100 bps).
Current wording
The effective tax rate decreased 210 bps to 22.6% for the year ended December 31, 2025, compared to 24.7% in the prior year, primarily driven by the favorable comparison of the tax impact of our non-cash goodwill impairment charge in the prior year (230 bps).
Previous wording
Diluted EPS. Diluted EPS decreased 32.3% to $1.05 per diluted share as compared to $1.55 in the prior year.
Current wording
Diluted EPS increased 45.7% to $1.53 per diluted share as compared to $1.05 in the prior year.
Previous wording
The following tables set forth net sales and income from operations for our reportable segments for the years ended December 31, 2024 and 2023, as well as the other amounts necessary to reconcile our total segment results to our consolidated results presented in accordance with U.S. GAAP:
Current wording
The following tables provide certain results of operations for our reportable segments for the years ended December 31, 2025 and 2024:
Previous wording
Net Sales. Net sales increased 6.8% to $2,053 million in the year ended December 31, 2024, compared to $1,922 million in the prior year period, reflecting volume/mix growth of 6.2% and higher net price realization of 3.0%, partially offset by unfavorable FX translation of 2.4%.
Current wording
Net sales increased 5.9% to $2,174 million in the year ended December 31, 2025, reflecting higher net price realization and volume / mix growth, partially offset by unfavorable FX translation.
Previous wording
We believe our financial condition and liquidity remain strong. We continue to manage all aspects of our business, including, but not limited to, monitoring the financial health of our customers, suppliers, and other third-party relationships, implementing gross margin enhancement strategies through our productivity initiatives, and developing new opportunities for growth such as innovation and agreements with partners to distribute brands that are accretive to our portfolio.
Current wording
We believe our financial condition and liquidity remain strong. We manage all aspects of our business, including monitoring the financial health of our customers, suppliers, and other third-party relationships, implementing gross margin enhancement strategies through our productivity initiatives, and developing new opportunities for growth such as innovation and agreements with partners to distribute brands that are accretive to our portfolio.
Previous wording
Cash generated by our foreign operations is generally repatriated to the U.S. periodically as working capital funding requirements, where allowed. We do not expect restrictions or taxes on repatriation of cash held outside the U.S. to have a material effect on our overall business, liquidity, financial condition, or results of operations for the foreseeable future.
Current wording
Cash generated by our foreign operations is generally repatriated to the U.S. periodically. We do not expect restrictions or taxes on repatriation of cash held outside the U.S. to have a material effect on our overall business, liquidity, financial condition, or results of operations for the foreseeable future.
Previous wording
Our principal sources of liquidity are our existing cash and cash equivalents, cash generated from our operations, and borrowing capacity currently available under our Revolving Credit Agreement and our Term Loan Agreement. Additionally, we have an uncommitted commercial paper program where we can issue unsecured commercial paper notes on a private placement basis. Based on our current and anticipated level of operations, we believe that our operating cash flows will be sufficient to meet our anticipated obligations for the next twelve months and thereafter for the foreseeable future. To the extent that our operating cash flows are not sufficient to meet our liquidity needs, we may utilize cash on hand or amounts available under our financing arrangements, if necessary. At any time, and from time to time, we may seek additional deleveraging, refinancing, or liquidity enhancing transactions, including entering into transactions to repurchase or redeem outstanding indebtedness or otherwise seek transactions to reduce interest expense, extend debt maturities, and improve our capital and liquidity structure.
Current wording
Our principal sources of liquidity are our cash and cash equivalents, cash generated from our operations, and borrowing capacity currently available under our 2025 Revolving Credit Agreement. Additionally, we have an uncommitted commercial paper program where we can issue unsecured commercial paper notes on a private placement basis. Based on our current and anticipated level of operations, we believe that our operating cash flows will be sufficient to meet our anticipated obligations related to our normal course of business (excluding the impacts of the JDE Peet's Acquisition described below) for the next twelve months and thereafter for the foreseeable future. To the extent that our operating cash flows are not sufficient to meet our liquidity needs, we may utilize cash on hand or amounts available under our financing arrangements. From time to time, we may seek additional deleveraging, refinancing, or liquidity enhancing transactions, including entering into transactions to repurchase or redeem outstanding indebtedness or otherwise seek transactions to reduce interest expense, extend debt maturities, and improve our capital and liquidity structure.
Previous wording
Net cash provided by operating activities increased $890 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023, driven by the favorable comparison in working capital versus the prior year period.
Current wording
Net cash provided by operating activities decreased $228 million for the year ended December 31, 2025, as compared to the year ended December 31, 2024. The decrease was driven by the unfavorable comparison in working capital, partially offset by a higher net income adjusted for non-cash items in the current period.
Previous wording
Our capital allocation priorities are investing to grow our business both organically and inorganically, continuing to strengthen our balance sheet, and returning cash to shareholders through regular quarterly dividends and opportunistic share repurchases. We dynamically adjust our cash deployment plans based on the specific opportunities available in a given period, but over time we allocate capital to balance each of these priorities.
Current wording
Our capital allocation priorities are investing to grow our business both organically and inorganically, strengthening our balance sheet, and returning cash to shareholders through regular quarterly dividends. We dynamically adjust our cash deployment plans based on the specific opportunities available in a given period, but over time we allocate capital to balance each of these priorities.
Previous wording
We have declared total dividends of $0.89 per share and $0.83 per share for the years ended December 31, 2024 and 2023, respectively.
Current wording
We have declared total dividends of $0.92 per share and $0.89 per share for the years ended December 31, 2025 and 2024, respectively.
Previous wording
We have invested in the expansion of our DSD network through transactions with strategic independent bottlers or third-party brand ownership companies to enhance competitive distribution scale. From time to time, we additionally acquire brand ownership companies to expand our portfolio. These transactions could be accounted for either as an acquisition of a business or as an asset acquisition, if the majority of the transaction price represents the acquisition of a single intangible asset. During the year ended December 31, 2024, we completed several acquisitions. Refer to Note 4 of the Notes to our Consolidated Financial Statements for further information about these acquisitions. Purchases of intangible assets were $59 million and $56 million for the years ended December 31, 2024 and 2023, respectively.
Current wording
From time to time, we acquire brand ownership companies to expand our portfolio. We also invest in the expansion of our DSD network through transactions with strategic independent bottlers or third-party brand ownership companies to enhance competitive distribution scale. These transactions could be accounted for either as an acquisition of a business or, if the majority of the transaction price represents the acquisition of a single intangible asset, as an asset acquisition. In the second quarter of 2025, we completed the Dyla acquisition. Refer to Note 4 of the Notes to our Consolidated Financial Statements for additional information. Purchases of intangible assets were $17 million and $59 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
Purchases of property, plant, and equipment were $563 million and $425 million for the years ended December 31, 2024 and 2023, respectively.
Current wording
Purchases of property, plant, and equipment were $486 million and $563 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
Capital expenditures, which includes both purchases of property, plant, and equipment and amounts included in accounts payable and accrued expenses, for the years ended December 31, 2024 and 2023, primarily related to investments in manufacturing capabilities, both in the U.S. and internationally. Capital expenditures included in accounts payable and accrued expenses were $220 million and $276 million for the years ended December 31, 2024 and 2023, respectively, which primarily related to these investments.
Current wording
Capital expenditures, which includes both purchases of property, plant, and equipment and amounts included in accounts payable and accrued expenses, primarily related to investments in manufacturing capabilities, both in the U.S. and internationally, for the years ended December 31, 2025 and 2024. Capital expenditures included in accounts payable and accrued expenses were $204 million and $220 million for the years ended December 31, 2025 and 2024, respectively, which primarily related to these investments.
Previous wording
Our Board authorized a four-year share repurchase program, ending December 31, 2025, of up to $4 billion of our outstanding common stock. Repurchases and retirements of common stock, including payments on our share excise tax obligation, were $1,110 million and $706 million during the years ended December 31, 2024 and 2023, respectively. As of December 31, 2024, $1,810 million remained available for repurchase under the authorized share repurchase program.
Current wording
Our Board authorized a four-year share repurchase program of up to $4 billion of our outstanding common stock, which ended on December 31, 2025. Repurchases and retirements of common stock, including payments on our share excise tax obligation, were $9 million and $1,110 million during the years ended December 31, 2025 and 2024, respectively.
Previous wording
From time to time, we invest in beverage startup companies or in brand ownership companies to grow our presence in certain product categories, or enter into various licensing and distribution agreements to expand our product portfolio. Our investments generally involve acquiring a minority interest in equity securities of a company, in certain cases with a protected path to ownership at our future option. Investments in unconsolidated affiliates were $7 million and $316 million for the years ended December 31, 2024 and 2023, respectively.
Current wording
From time to time, we invest in beverage startup companies or in brand ownership companies to grow our presence in certain product categories, or enter into various licensing and distribution agreements to expand our product portfolio. Our investments generally involve acquiring a minority interest in equity securities of a company, in certain cases with a protected path to ownership at our future option.
Previous wording
Disruptions in financial and credit markets, including those caused by global economic uncertainty and fluctuations in interest rates, may impact our ability to manage normal commercial relationships with our customers, suppliers, and creditors. These disruptions could have a negative impact on the ability of our customers to timely pay their obligations to us, thus reducing our cash flow, or the ability of our vendors to timely supply materials.
Current wording
Disruptions in financial and credit markets, including those caused by inflation, global economic uncertainty or economic downturns, fluctuations in interest rates, or the imposition of new tariffs or changes to existing tariffs, trade wars, barriers or restrictions, or threats of such actions, and related uncertainty, may impact our ability to manage normal commercial relationships with our customers, suppliers, and creditors, and may also impact our ability to access liquidity through financial markets in a timely and cost-effective manner. These disruptions could have a negative impact on the ability of our customers to timely pay their obligations to us, thus reducing our cash flow, or the ability of our vendors to timely supply materials.
Previous wording
•U.S. Refreshment Beverages (reporting units: U.S. Beverage Concentrates, U.S. Warehouse Direct, and Direct Store Delivery)
Current wording
•U.S. Refreshment Beverages (reporting units: U.S. Beverage Concentrates, U.S. Warehouse Direct, Direct Store Delivery, and GHOST)
Previous wording
(1)Goodwill attributed to the U.S. WD reporting unit was impaired by the amount its carrying value exceeded its fair value.
Current wording
(1)Goodwill attributed to the U.S. WD reporting units was impaired during the year ended December 31, 2024.
Previous wording
(2)Indefinite lived brand assets, led primarily by Snapple for the year ended December 31, 2024, and Bai for the year ended December 31, 2022, were impaired to bring the respective carrying value equal to its fair value.
Current wording
(2)Indefinite lived brand assets were impaired during the years ended December 31, 2025 and 2024 to bring the respective carrying values equal to their fair values.
Previous wording
For goodwill, holding all other assumptions in the analysis constant, including the revenue and profit performance assumption, the effect of a 0.50% increase in the discount rate used to determine the fair value of the reporting units as of October 1, 2024, would result in additional non-cash impairment charges of $198 million to our U.S. WD reporting unit, but would not change our conclusion on any other reporting units.
Current wording
For goodwill, holding all other assumptions in the analysis constant, including the revenue and profit performance assumption, the effect of a 0.50% increase in the discount rate used to determine the fair value of the reporting units as of October 1, 2025, would not result in any impairment charges on any of our reporting units.
Previous wording
For the indefinite-lived priority brand assets quantitatively assessed, holding all other assumptions in the analysis constant, including the revenue and profit performance assumption, the effect of a 0.50% increase in the discount rate used to determine the fair value of those assets as of October 1, 2024, would impact the amount of headroom over the carrying value of the following assets as follows (in millions):
Current wording
For the indefinite lived priority brand assets quantitatively assessed, holding all other assumptions in the analysis constant, including the revenue and profit performance assumption, the effect of a 0.50% increase in the discount rate used to determine the fair value of those assets as of October 1, 2025, would impact the amount of headroom over the carrying value of those assets as follows:
Previous wording
For goodwill, holding all other assumptions in the analysis constant, including the discrete period revenue and profit performance assumptions as well as the discount rates, the effect of a 0.50% decrease in the long-term growth rate used to determine the fair value of the reporting units as of October 1, 2024, would result in additional non-cash impairment charges of $147 million to our U.S. WD reporting unit, but would not change our conclusion on any other reporting units.
Current wording
For goodwill, holding all other assumptions in the analysis constant, including the discrete period revenue and profit performance assumptions as well as the discount rates, the effect of a 0.50% decrease in the long-term growth rate used to determine the fair value of the reporting units as of October 1, 2025, would not result in any impairment charges on any of our reporting units.
Previous wording
For the indefinite-lived priority brand assets quantitatively assessed, holding all other assumptions in the analysis constant, including the discrete period revenue and profit performance assumptions as well as the discount rates, the effect of a 0.50% decrease in the long-term revenue growth rate used to determine the fair value of those assets as of October 1, 2024, would impact the amount of headroom over the carrying value of the following assets as follows (in millions):
Current wording
For the indefinite lived priority brand assets quantitatively assessed, holding all other assumptions in the analysis constant, including the discrete period revenue and profit performance assumptions as well as the discount rates, the effect of a 0.50% decrease in the long-term revenue growth rate used to determine the fair value of those assets as of October 1, 2025, would impact the amount of headroom over the carrying value of those assets as follows:
Previous wording
A 10% change in the accrual for our customer incentives, sales returns and marketing programs would have affected our income from operations by $52 million for the year ended December 31, 2024.
Current wording
A 10% change in the accrual for our customer incentives, sales returns, and marketing programs would have affected our income from operations by $53 million for the year ended December 31, 2025.
Previous wording
The application of the purchase method of accounting for business combinations requires management to make significant estimates and assumptions in the determination of the fair value of assets acquired and liabilities assumed, in order to properly allocate purchase price consideration between assets that are depreciated and amortized from goodwill. The fair value assigned to tangible and intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. Significant assumptions and estimates include, but are not limited to, the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, and the cost savings expected to be derived from acquiring an asset, if applicable.
Current wording
The application of the purchase method of accounting for business combinations requires management to make significant estimates and assumptions in the determination of the fair value of assets acquired and liabilities assumed, in order to properly allocate purchase price consideration between assets that are depreciated and amortized from goodwill. The fair value assigned to tangible and intangible assets acquired and liabilities assumed are based on management's estimates and assumptions, as well as other information compiled by management, including valuations that utilize customary valuation procedures and techniques. Significant assumptions and estimates include the cash flows that an asset is expected to generate in the future, the appropriate weighted-average cost of capital, and the cost savings expected to be derived from acquiring an asset, if applicable.
Previous wording
(1)Includes $115 million and $56 million of intercompany receivables due to the Parent and Guarantors from the Non-Guarantors as of December 31, 2024 and December 31, 2023, respectively.
Current wording
(1)Includes $8 million and $115 million of intercompany receivables due to the Parent and Guarantors from the Non-Guarantors as of December 31, 2025 and December 31, 2024, respectively.
Previous wording
(2)Includes $1,997 million and $1,399 million of intercompany payables due to the Non-Guarantors from the Parent and Guarantors as of December 31, 2024 and December 31, 2023, respectively.
Current wording
(2)Includes $2,610 million and $1,997 million of intercompany payables due to the Non-Guarantors from the Parent and Guarantors as of December 31, 2025 and December 31, 2024, respectively.