Beverage company Coca-Cola (NYSE: KO) missed Wall Street’s revenue expectations in Q4 CY2025 as sales rose 3.7% year on year to $11.82 billion. Its non-GAAP profit of $0.58 per share was 2.7% above analysts’ consensus estimates.
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Coca-Cola (KO) Q4 CY2025 Highlights:
- Revenue: $11.82 billion vs analyst estimates of $12 billion (3.7% year-on-year growth, 1.5% miss)
- Adjusted EPS: $0.58 vs analyst estimates of $0.56 (2.7% beat)
- Adjusted EBITDA: $2.15 billion vs analyst estimates of $3.19 billion (18.2% margin, 32.6% miss)
- Operating Margin: 15.6%, down from 23.8% in the same quarter last year
- Free Cash Flow Margin: 24.3%, down from 27.6% in the same quarter last year
- Organic Revenue rose 5% year on year (beat)
- Sales Volumes rose 1% year on year (2% in the same quarter last year)
- Market Capitalization: $335.4 billion
Company Overview
A pioneer and behemoth in carbonated soft drinks, Coca-Cola (NYSE: KO) is a storied beverage company best known for its flagship soda.
Revenue Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
With $48.07 billion in revenue over the past 12 months, Coca-Cola is one of the most widely recognized consumer staples companies. Its influence over consumers gives it negotiating leverage with distributors, enabling it to pick and choose where it sells its products (a luxury many don’t have). However, its scale is a double-edged sword because it’s harder to find incremental growth when your existing brands have penetrated most of the market. To expand meaningfully, Coca-Cola likely needs to tweak its prices, innovate with new products, or enter new markets.
As you can see below, Coca-Cola grew its sales at a sluggish 3.7% compounded annual growth rate over the last three years, but to its credit, consumers bought more of its products.
This quarter, Coca-Cola’s revenue grew by 3.7% year on year to $11.82 billion, falling short of Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 6% over the next 12 months, an acceleration versus the last three years. This projection is above the sector average and indicates its newer products will catalyze better top-line performance.
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Volume Growth
Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there’s a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.
To analyze whether Coca-Cola generated its growth from changes in price or volume, we can compare its volume growth to its organic revenue growth, which excludes non-fundamental impacts on company financials like mergers and currency fluctuations.
Over the last two years, Coca-Cola’s quarterly sales volumes have, on average, stayed about the same. This stability is normal as the quantity demanded for consumer staples products typically doesn’t see much volatility. The company’s flat volumes also indicate its average organic revenue growth of 8.9% was generated from price increases.
In Coca-Cola’s Q4 2025, sales volumes jumped 1% year on year. This result was an acceleration from its historical levels, certainly a positive signal.
Key Takeaways from Coca-Cola’s Q4 Results
It was good to see Coca-Cola meet analysts’ organic revenue expectations this quarter. We were also happy its gross margin narrowly outperformed Wall Street’s estimates. On the other hand, its EBITDA missed and its revenue fell slightly short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 3.8% to $75.01 immediately after reporting.
Coca-Cola didn’t show it’s best hand this quarter, but does that create an opportunity to buy the stock right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).
