Coca-Cola Raises 2026 Guidance After Third-Quarter Revenue Grows 7%

Coca-Cola raised its 2026 profit and cash-flow forecasts on Tuesday after third-quarter net revenue grew 7% to $13.38 billion, supported by stronger global beverage sales and continued growth in its flagship soft drinks.

The company now expects comparable earnings per share to increase at least 11% for the year, above its previous forecast of 9% to 10%. It also lifted its free cash flow outlook to at least $13 billion, from approximately $12.4 billion, giving investors a higher target for both adjusted earnings and cash generation.

Global unit case volume rose 5% in the quarter, led by sales in India, China, Mexico and Brazil. Operating income increased 12%, and reported earnings per share climbed 8% to 93 cents. Those gains provided the backdrop for management’s more optimistic full-year forecast, though growth varied considerably by region.

Full-Year Earnings and Cash Flow Targets Move Higher

In its October 27 earnings release, Coca-Cola also raised its organic revenue outlook to at least 5% growth from approximately 5%. Organic revenue excludes currency movements and the effect of acquisitions and divestitures, making it useful for comparing performance across periods.

The change in the earnings forecast is more substantial. Comparable currency-neutral EPS growth, excluding acquisitions and divestitures, is now expected to reach at least 9%, compared with the earlier range of 7% to 8%. That measure strips out exchange-rate effects and changes in the company’s business portfolio, providing a different view of the underlying earnings trajectory.

Coca-Cola’s forecast for comparable EPS growth of at least 11% includes an estimated three-percentage-point benefit from currency and an approximately one-point drag from acquisitions and divestitures. Those figures are assumptions built into the guidance rather than gains or losses already realized for the entire year.

The higher cash projection also has a specific operating basis. Coca-Cola now anticipates at least $15.2 billion in cash from operations, up from approximately $14.6 billion previously, with capital spending still projected at about $2.2 billion. Subtracting that spending produces the company’s free cash flow target of at least $13 billion. The forecast uses the company’s non-GAAP definition of free cash flow.

There is a portfolio assumption behind part of the outlook. The company expects its pending sale of bottling operations in Africa to close in the fourth quarter, subject to regulatory approvals. The expected timing affects estimates for acquisitions and divestitures, so a change in the closing schedule could affect how the final numbers compare with current guidance.

Zero Sugar and International Markets Lead Volume Gains

Sales volume was a central strength in the quarter. Coca-Cola reported 5% growth in its sparkling soft drink category, including a 5% increase for trademark Coca-Cola. Coca-Cola Zero Sugar stood out with 16% volume growth across its geographic operating segments, while Diet Coke and Coca-Cola Light together rose 6%.

Performance outside traditional soda was less uniform. Water volume advanced 8%, helping the broader water, sports, coffee and tea category grow 5%. Sports drinks declined 3%, however, as weakness in Asia Pacific outweighed gains elsewhere. The juice, value-added dairy and plant-based beverage category was flat overall.

The regional picture helps explain why global volume growth was stronger than in Coca-Cola’s biggest reported geographic revenue segment. North American unit case volume was unchanged from a year earlier, despite growth in trademark Coca-Cola, because of declines in water, sports, coffee and tea. North American net revenue increased 3%, with price and product mix providing a modest contribution.

By contrast, volume grew 6% in Latin America, where reported revenue jumped 25%. Organic revenue grew 16% in that region, and foreign exchange provided a substantial additional lift to the reported sales figure. The distinction matters: the region’s headline revenue growth was not solely the result of people buying more beverages.

Asia Pacific volume also grew 6%, even as price and mix declined 2%. Reported regional revenue rose 4%, held back in part by currency movements, while organic revenue grew 6%. In Europe, the Middle East and Africa, volume increased 5% and reported net revenue rose 4%.

These differences show the two forces affecting Coca-Cola’s reported sales: how many beverages are purchased and how much revenue the company records per unit after pricing, product mix, currency and business changes. Global organic revenue increased 7%, even though the geographic contributions were far from identical.

Profit Margins Improve as Costs Remain a Factor

Coca-Cola generated $4.47 billion in operating income during the quarter, compared with $3.98 billion a year earlier. Reported operating margin widened to 33.4% from 32.0%. On a comparable basis, operating margin improved to 32.9% from 31.9%, a gain of one percentage point.

Not all of the operating improvement reflected higher beverage demand. Coca-Cola identified currency benefits in its reported results, while noting that additional marketing spending and higher operating expenses partly offset organic revenue growth. Comparable currency-neutral operating income, which removes specified accounting and exchange-rate effects, rose 8% rather than the 12% increase reported under generally accepted accounting principles.

North America presented a more restrained picture than the consolidated results. Its operating income rose 5%, but the company cited higher input costs and operating expenses as offsets to organic growth and the timing of marketing investments. Elsewhere, Coca-Cola reported a 29% increase in Latin American operating income, which included a favorable currency effect.

Reported earnings per share of 93 cents were up from 86 cents in the year-earlier quarter. Comparable EPS, a separate non-GAAP measure that adjusts for specified items, rose 11% to 91 cents. The difference between the two figures is a reminder that Coca-Cola’s raised full-year earnings target refers to comparable results, not its reported GAAP EPS.

For the first nine months, net revenue reached $39.23 billion, up 9% from the same period of 2025. Cash generated by operations totaled $12.5 billion through the third quarter, while non-GAAP free cash flow reached $11.4 billion. That puts the higher full-year cash target in the context of cash already produced, although the company still has a full quarter of expenses, investment and operating activity ahead.

Coca-Cola said its fourth quarter will contain six fewer days than the comparable year-earlier period, following six extra days in the first quarter. It also provided preliminary assumptions for currency and portfolio effects in 2027 but stopped short of issuing full-year guidance for next year. That forecast is scheduled to come with its fourth-quarter earnings report.