Keurig Dr Pepper Inc.

Previous wording

Our actual financial performance could differ materially from those projected in the forward-looking statements due to a variety of factors, including the inherent uncertainty of estimates, forecasts, and projections; global economic uncertainty or economic downturns; tariffs or the imposition of new tariffs, trade wars, barriers, or restrictions, sanctions, geopolitical disturbances and conflicts, or threats of such actions and related uncertainty; the risk that our financial performance may be better or worse than anticipated; risks related to the completion of the Separation in the anticipated timeframe, or at all; our incurrence of significant debt or our entry into other funding alternatives, in each case, which funded the acquisition of JDE Peet's, which may result in dilution to our stockholders or introduce complexity to our capital structure; additional risks associated with the JDE Peet's Acquisition and those geographies, countries, and associated governments where JDE Peet's currently operates; our ability to successfully integrate JDE Peet's into our business, or that such integration may be more difficult, time-consuming, or costly than expected; constraints on management's attention to operating and growing our business during the execution of the integration of JDE Peet's and the Separation; the potential downgrade of our credit ratings as a result of debt incurred and/or assumed in connection with the JDE Peet's Acquisition; the possibility of negative impacts on business relationships in connection with the JDE Peet's Acquisition and the Separation; the risk that the Separation incurs significant additional costs; the risk of potential litigation and regulatory actions; negative effects of the JDE Peet's Acquisition and pendency of the Separation on our share price; and the ability to achieve the anticipated strategic and financial benefits from the Separation. Given these uncertainties, you should not put undue reliance on any forward-looking statements. All of the forward-looking statements are qualified in their entirety by reference to the factors discussed under "Risk Factors" in Part II, Item 1A of this Quarterly Report on Form 10-Q, as well as our subsequent filings with the SEC. Forward-looking statements represent our estimates and assumptions only as of the date that they were made. We do not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, after the date of this Quarterly Report on Form 10-Q, except to the extent required by applicable securities laws.

Current wording

Our actual financial performance could differ materially from those projected in the forward-looking statements due to a variety of factors, including the inherent uncertainty of estimates, forecasts, and projections; global economic uncertainty or economic downturns; tariffs or the imposition of new tariffs, trade wars, barriers, or restrictions, sanctions, geopolitical disturbances and conflicts, or threats of such actions and related uncertainty; the risk that our financial performance may be better or worse than anticipated; risks related to the completion of the Separation in the anticipated timeframe, or at all; our incurrence of significant debt or our entry into other funding alternatives, in each case, in connection with the JDE Peet's Acquisition, which may result in dilution to our stockholders or introduce complexity to our capital structure; additional risks associated with the JDE Peet's Acquisition and those geographies, countries, and associated governments where JDE Peet's currently operates; our ability to successfully integrate JDE Peet's into our business, or that such integration may be more difficult, time-consuming, or costly than expected; constraints on management's attention to operating and growing our business during the execution of the integration of JDE Peet's and the Separation; the potential downgrade of our credit ratings as a result of debt incurred and/or assumed in connection with the JDE Peet's Acquisition; the possibility of negative impacts on business relationships in connection with the JDE Peet's Acquisition and the Separation; the risk that the Separation incurs significant additional costs; the risk of potential litigation and regulatory actions; negative effects of the JDE Peet's Acquisition and pendency of the Separation on our share price; and the ability to achieve the anticipated strategic and financial benefits from the Separation. Given these uncertainties, you should not put undue reliance on any forward-looking statements. All of the forward-looking statements are qualified in their entirety by reference to the factors discussed under "Risk Factors" in Part I, Item 1A of our Annual Report, as updated by Part II, Item 1A of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, as well as our subsequent filings with the SEC. Forward-looking statements represent our estimates and assumptions only as of the date that they were made. We do not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, after the date of this Quarterly Report on Form 10-Q, except to the extent required by applicable securities laws.

Previous wording

During the first six months of 2026, we completed a series of transactions in order to obtain funding for the consideration of the JDE Peet's Acquisition:

Current wording

During the first nine months of 2026, we completed a series of transactions in order to obtain funding for the consideration of the JDE Peet's Acquisition:

Previous wording

•Senior Unsecured Notes of approximately $6 billion

Current wording

•Maple Notes of approximately $6 billion

Previous wording

We have incurred acquisition, integration, and financing costs associated with the acquisition of JDE Peet's and planned Separation, which include costs to obtain proceeds to close the JDE Peet's acquisition and costs to manage the FX risk associated with the purchase price. These costs were primarily recorded to Selling, general, and administrative expenses, Interest expense, net, and Other expense (income), net, and aggregated to a pre-tax impact of approximately $624 million during the first six months of 2026.

Current wording

We have incurred acquisition, integration, and financing costs associated with the acquisition of JDE Peet's and planned Separation, which include costs to obtain proceeds to close the JDE Peet's acquisition and costs to manage the FX risk associated with the purchase price. These costs were primarily recorded to Selling, general, and administrative expenses, Interest expense, net, and Other expense (income), net, and aggregated to a pre-tax impact of approximately $756 million during the first nine months of 2026.

Previous wording

(1)The JDE Peet’s Acquisition contributed 67.3% of the volume / mix growth in the quarter.

Current wording

(1)The JDE Peet’s Acquisition contributed 61.5 percentage points of the volume / mix growth in the quarter.

Previous wording

SG&A expenses increased 76.8% to $2,397 million for the second quarter of 2026, as compared to $1,356 million for the second quarter of 2025, primarily driven by the inclusion of JDE Peet’s SG&A expenses (53 percentage points) and transaction and integration costs associated with the JDE Peet’s Acquisition and the Separation (20 percentage points).

Current wording

SG&A expenses increased 59.0% to $2,137 million for the third quarter of 2026, as compared to $1,344 million for the third quarter of 2025, primarily driven by the inclusion of JDE Peet’s SG&A expenses (51 percentage points) and transaction and integration costs associated with the JDE Peet's Acquisition and the Separation (5 percentage points).

Previous wording

Income from operations decreased 30.1% to $628 million for the second quarter of 2026, as compared to $898 million for the second quarter of 2025, as increased gross profit was outpaced by increased SG&A and other operating expenses.

Current wording

Income from operations increased 34.0% to $1,333 million for the third quarter of 2026, as compared to $995 million for the third quarter of 2025, as increased gross profit more than offset increased SG&A and other operating expenses.

Previous wording

Interest expense, net was $336 million for the second quarter of 2026, as compared to $180 million for the second quarter of 2025, driven by increased debt and higher financing costs, including debt acquired in the JDE Peet's Acquisition.

Current wording

Interest expense, net increased 152.1% to $474 million for the third quarter of 2026, as compared to $188 million for the third quarter of 2025, driven by increased debt and higher financing costs, including debt acquired in the JDE Peet's Acquisition (91 percentage points) and unfavorable unrealized mark-to-market activity compared to the prior year quarter (63 percentage points).

Previous wording

Net income was $210 million for the second quarter of 2026, as compared to $547 million for the second quarter of 2025, driven by reduced income from operations, increased interest expense, and the increased effective tax rate. Net income attributable to KDP was $142 million for the second quarter of 2026, including the dilutive impact of $68 million of net income attributable to non-controlling interests in the current quarter, primarily the Pod Manufacturing JV.

Current wording

Net income was $952 million for the third quarter of 2026, as compared to $662 million for the third quarter of 2025, driven by the gain on the sale of our investment in Chobani, increased income from operations, and a lower effective tax rate, partially offset by increased interest expense. Net income attributable to KDP was $882 million for the third quarter of 2026, including the dilutive impact of $70 million of net income attributable to non-controlling interests in the current quarter, primarily the Pod Manufacturing JV.

Previous wording

Diluted EPS was $0.04 per diluted share for the second quarter of 2026 as compared to $0.40 in the second quarter of 2025, driven by reduced net income attributable to KDP and dividends allocated to preferred shareholders. Refer to Note 6 of the Notes to our Unaudited Consolidated Financial Statements for the computation of diluted EPS.

Current wording

Diluted EPS was $0.59 per diluted share for the third quarter of 2026 as compared to $0.49 in the third quarter of 2025, driven by increased net income attributable to KDP, partially offset by net income allocated to Preferred Investors. Refer to Note 6 of the Notes to our Unaudited Condensed Consolidated Financial Statements for the computation of diluted EPS.

Previous wording

The following tables provide certain results of operations for our reportable segments for the second quarter of 2026 and 2025.

Current wording

The following tables provide certain results of operations for our reportable segments for the third quarter of 2026 and 2025.

Previous wording

(1)As we acquired JDE Peet’s on April 1, 2026, comparative information is not applicable for the second quarter of 2025.

Current wording

(1)As we acquired JDE Peet’s on April 1, 2026, comparative information is not applicable for the third quarter of 2025.

Previous wording

Sales volume increased 2.4% in the second quarter of 2026, led by growth in energy and sports hydration drinks, partially offset by declines in the balance of our portfolio.

Current wording

Sales volume increased 3.2% in the third quarter of 2026, led by growth in energy, sports hydration drinks, and carbonated soft drinks, partially offset by declines in our still portfolio.

Previous wording

Net sales increased 10.0% to $2,925 million for the second quarter of 2026, driven by volume / mix growth and higher net price realization.

Current wording

Net sales increased 10.9% to $3,033 million for the third quarter of 2026, driven by volume / mix growth and higher net price realization.

Previous wording

Income from operations increased 14.9% to $857 million for the second quarter of 2026. This performance was led by the benefit to gross profit of net sales growth (21 percentage points) and a favorable comparison to Ghost integration expenses in the second quarter of 2025 (3 percentage points), partially offset by a net unfavorable change in ingredients, materials, and productivity, inclusive of tariffs (5 percentage points) and increased transportation and warehousing expenses (2 percentage points).

Current wording

Income from operations increased 2.2% to $820 million for the third quarter of 2026. This performance was led by the benefit to gross profit of net sales growth (19 percentage points), partially offset by a net unfavorable impact of the Chobani transactions (6 percentage points) and increased transportation and warehousing costs (4 percentage points), labor costs associated with SG&A activities (3 percentage points), and manufacturing costs (2 percentage points).

Previous wording

Net sales decreased 3.2% to $918 million for the second quarter of 2026, led by unfavorable volume / mix, which was partially offset by favorable net price realization.

Current wording

Net sales increased 2.7% to $1,018 million for the third quarter of 2026, driven by favorable volume / mix, which was partially offset by unfavorable net price realization.

Previous wording

Net sales increased 19.6% to $664 million in the second quarter of 2026, reflecting favorable FX translation, volume / mix growth, and higher net price realization.

Current wording

Net sales increased 11.0% to $644 million in the third quarter of 2026, reflecting higher net price realization, favorable FX translation, and volume / mix growth.

Previous wording

Income from operations increased 6.3%, to $152 million for the second quarter of 2026, as the benefits from the gross profit impact of the higher net price realization and favorable net FX translation were partially offset by increased IEPS taxes in Mexico and a net unfavorable impact from changes in ingredients, materials, and productivity.

Current wording

Income from operations increased 3.3%, to $158 million for the third quarter of 2026, as the benefit from the gross profit impact of the higher net price realization was partially offset by increased IEPS taxes in Mexico and increased marketing investments.

Previous wording

JDE Peet’s sales volumes, net sales, and loss from operations were wholly incremental to KDP as a result of the JDE Peet’s Acquisition.

Current wording

JDE Peet’s sales volumes, net sales, and income from operations were wholly incremental to KDP as a result of the JDE Peet’s Acquisition.

Previous wording

(1)The JDE Peet’s Acquisition contributed 35.9% of the volume / mix growth in the quarter.

Current wording

(1)The JDE Peet’s Acquisition contributed 45.0 percentage points of the volume / mix growth in the first nine months of 2026.

Previous wording

Gross profit increased 21.8% to $5,164 million for the first six months of 2026. The benefits to gross profit of the JDE Peet’s Acquisition (24 percentage points) and legacy KDP net sales growth (11 percentage points) were partially offset by the impact of the JDE Peet’s inventory step-up recognized in cost of sales in the first six months of 2026 (7 percentage points) and a net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs (5 percentage points).

Current wording

Gross profit increased 32.1% to $8,689 million for the first nine months of 2026. The benefits to gross profit of the JDE Peet’s Acquisition (31 percentage points) and legacy KDP net sales growth (10 percentage points) were partially offset by the impact of the JDE Peet’s inventory step-up recognized in cost of sales in the first nine months of 2026 (5 percentage points) and a net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs and tariff refunds (2 percentage points).

Previous wording

SG&A expenses increased 46.7% to $3,739 million for the first six months of 2026, driven by the inclusion of JDE Peet’s SG&A expenses (28 percentage points), transaction and integration costs associated with the JDE Peet's Acquisition and the Separation (14 percentage points), and higher labor costs (2 percentage points).

Current wording

SG&A expenses increased 51.0% to $5,876 million for the first nine months of 2026, driven by the inclusion of JDE Peet’s SG&A expenses (36 percentage points) and transaction and integration costs associated with the JDE Peet's Acquisition and the Separation (11 percentage points).

Previous wording

Other operating expense (income), net was expense of $41 million for the first six months of 2026, as compared to income of $7 million for the first six months of 2025, primarily reflecting non-cash write-offs of certain intellectual property assets in the current year-to-date period.

Current wording

Other operating expense (income), net was expense of $96 million for the first nine months of 2026, as compared to income of $6 million for the first nine months of 2025, primarily reflecting non-cash write-offs of certain intellectual property assets and a net unfavorable impact of the Chobani transactions in the current year-to-date period. Refer to Note 13 of the Notes to our Unaudited Condensed Consolidated Financial Statements for further information about the Chobani transactions.

Previous wording

Income from operations decreased 18.5% to $1,384 million for the first six months of 2026, as increased gross profit was more than offset by higher SG&A and other operating expenses.

Current wording

Income from operations increased 0.9% to $2,717 million for the first nine months of 2026, as increased gross profit was mostly offset by higher SG&A and other operating expenses.

Previous wording

Interest expense, net increased 88.1% to $617 million for the first six months of 2026, driven by increased debt and higher financing costs, including debt acquired in the JDE Peet's Acquisition.

Current wording

Interest expense, net increased 111.4% to $1,091 million for the first nine months of 2026, driven by increased debt and higher financing costs, including debt acquired in the JDE Peet's Acquisition (83 percentage points) and unfavorable unrealized mark-to-market activity compared to the prior year period (27 percentage points).

Previous wording

Other (income) expense, net reflected expense of $105 million for the first six months of 2026, primarily driven by realized losses on FX forward contracts related to the funding of the JDE Peet’s Acquisition. This compared to income of $7 million in the first six months of 2025.

Current wording

Other expense (income), net reflected expense of $152 million for the first nine months of 2026, as compared to income of $52 million in the first nine months of 2025, primarily driven by unfavorable FX impacts.

Previous wording

The effective tax rate increased 470 bps to 27.5% for the first six months of 2026, compared to 22.8% in the first six months of 2025, primarily driven by a non-cash revaluation of state deferred tax liabilities as a result of the JDE Peet's Acquisition (420 bps), partially offset by discrete tax impacts associated with the completion of the JV Investment and the creation of the Pod Manufacturing JV (70 bps).

Current wording

The effective tax rate increased 100 bps to 23.6% for the first nine months of 2026, compared to 22.6% in the first nine months of 2025, primarily driven by a non-cash revaluation of state deferred tax liabilities as a result of the JDE Peet's Acquisition (150 bps) and an unfavorable comparison to the impact of purchased tax credits in the first nine months of 2025 (90 bps), partially offset by discrete tax impacts associated with the completion of the JV Investment and the creation of the Pod Manufacturing JV (110 bps).

Previous wording

Net income decreased 54.9% to $480 million for the first six months of 2026, driven by reduced income from operations, increased interest expense, and the increased effective tax rate. Net income attributable to KDP was $412 million for the first six months of 2026, including the dilutive impact of $68 million of net income attributable to non-controlling interests, primarily the Pod Manufacturing JV.

Current wording

Net income decreased 17.0% to $1,432 million for the first nine months of 2026, driven by increased interest expense and increased other expense, which was partially offset by the gain on the sale of our investment in Chobani. Net income attributable to KDP was $1,294 million for the first nine months of 2026, including the dilutive impact of $138 million of net income attributable to non-controlling interests, primarily the Pod Manufacturing JV.

Previous wording

Diluted EPS decreased 69.2% to $0.24 per diluted share for the first six months of 2026 as compared to $0.78 in the first six months of 2025, driven by reduced net income attributable to KDP and dividends allocated to preferred shareholders. Refer to Note 6 of the Notes to our Unaudited Consolidated Financial Statements for the computation of diluted EPS.

Current wording

Diluted EPS decreased 33.1% to $0.85 per diluted share for the first nine months of 2026 as compared to $1.27 in the first nine months of 2025, driven by reduced net income attributable to KDP and net income allocated to Preferred Investors. Refer to Note 6 of the Notes to our Unaudited Condensed Consolidated Financial Statements for the computation of diluted EPS.

Previous wording

The following tables provide certain results of operations for our reportable segments for the first six months of 2026 and 2025.

Current wording

The following tables provide certain results of operations for our reportable segments for the first nine months of 2026 and 2025.

Previous wording

(1)As we acquired JDE Peet’s on April 1, 2026, comparative information is not applicable for the first six months of 2025.

Current wording

(1)As we acquired JDE Peet’s on April 1, 2026, comparative information is not applicable for the first nine months of 2025.

Previous wording

Sales volume increased 1.0%, led by growth in energy and sports hydration drinks, partially offset by declines in the balance of our portfolio.

Current wording

Sales volume increased 1.7%, led by growth in energy and sports hydration drinks, partially offset by declines in the balance of our portfolio.

Previous wording

Net sales increased 10.9% to $5,524 million for the first six months of 2026, driven by volume / mix growth and higher net price realization.

Current wording

Net sales increased 10.9% to $8,557 million for the first nine months of 2026, driven by volume / mix growth and higher net price realization.

Previous wording

Income from operations increased 12.7% to $1,578 million for the first six months of 2026. This performance was driven by the gross profit impact of net sales growth (24 percentage points), which was partially offset by a net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs (7 percentage points), increased transportation and warehousing expenses (3 percentage points), and higher labor costs (2 percentage points).

Current wording

Income from operations increased 8.9% to $2,398 million for the first nine months of 2026. This performance was driven by the gross profit impact of net sales growth (22 percentage points), which was partially offset by a net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs and tariff refunds (4 percentage points), increased transportation and warehousing expenses (3 percentage points), higher labor costs (3 percentage points), and the net unfavorable impact to income from operations of the Chobani transactions (2 percentage points).

Previous wording

Appliance volume decreased 2.7%, reflecting price elasticity impacts. Coffee and related products volume decreased 9.7%, reflecting price elasticity impacts and single serve category softness.

Current wording

Appliance volume increased 5.4%, primarily reflecting a favorable comparison to retailer inventory management practices in the prior year. Coffee and related products volume decreased 6.7%, reflecting price elasticity impacts and single serve category softness.

Previous wording

Net sales decreased 2.7% to $1,775 million for the first six months of 2026, as higher net price realization was more than offset by unfavorable volume / mix.

Current wording

Net sales decreased 0.8% to $2,793 million for the first nine months of 2026, as higher net price realization was more than offset by unfavorable volume / mix.

Previous wording

Income from operations decreased 36.1% to $149 million for the second quarter of 2026, driven primarily by costs associated with the integration of JDE Peet’s and the Separation (22 percentage points), a net unfavorable change in ingredients, materials, and productivity, inclusive of tariffs (17 percentage points), and the gross profit impact of the decline in net sales (7 percentage points).

Current wording

Income from operations decreased 6.5% to $628 million for the first nine months of 2026, driven by costs associated with the integration of JDE Peet’s and the Separation (9 percentage points), the gross profit impact of the decline in net sales (4 percentage points), and a net unfavorable impact from changes in ingredients, materials, and productivity, inclusive of tariffs and tariff refunds (3 percentage points), partially offset by reduced manufacturing costs (3 percentage points) and the benefit to cost of sales of earned equity (2 percentage points).

Previous wording

Net sales increased 19.6% to $1,184 million in the first six months of 2026, reflecting favorable FX translation, higher net price realization, and favorable volume / mix.

Current wording

Net sales increased 16.4% to $1,828 million in the first nine months of 2026, reflecting favorable FX translation, higher net price realization, and favorable volume / mix.

Previous wording

Income from operations increased 1.7% to $237 million for the first six months of 2026, as the benefit from higher net price realization was partially offset by increased IEPS taxes in Mexico and a net unfavorable impact from changes in ingredients, materials, and productivity.

Current wording

Income from operations increased 2.3% to $395 million for the first nine months of 2026, as the benefit from higher net price realization was partially offset by increased IEPS taxes in Mexico, a net unfavorable impact from changes in ingredients, materials, and productivity, and increased marketing investments.

Previous wording

JDE Peet’s sales volumes, net sales, and loss from operations were wholly incremental to KDP as a result of the JDE Peet’s Acquisition.

Current wording

JDE Peet’s sales volumes, net sales, and income from operations were wholly incremental to KDP as a result of the JDE Peet’s Acquisition.