What changed in this filing

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Item 1. Financial Statements

2024-07-29 compared with 2024-05-02 · 361 added, 113 removed, 825 unchanged (36% of the section changed)

3 unchanged sentences

(In millions except per share data)

Three Months Ended

2024 March 31,

Three Months Ended Six Months Ended

2024 June 30,

2023 June 28,

2024 June 30,

Net Operating Revenues $ 12,363 $ 11,972 $ 23,663 $ 22,952

25 unchanged sentences

(In millions)

Three Months Ended

2024 March 31,

Three Months Ended Six Months Ended

2024 June 30,

2023 June 28,

2024 June 30,

Consolidated Net Income $ 2,401 $ 2,521 $ 5,586 $ 5,634

6 unchanged sentences

Comprehensive income (loss) attributable to noncontrolling interests 48 ( 101 ) 32 ( 170 )

Total Comprehensive Income Attributable to Shareowners of The Coca-Cola Company $ 2,948 $ 3,680

Total Comprehensive Income Attributable to Shareowners

of The Coca-Cola Company

$ 1,457 $ 2,852 $ 4,405 $ 6,532

Refer to Notes to Consolidated Financial Statements.

48 unchanged sentences

(In millions)

Three Months Ended

2024 March 31,

Six Months Ended

2024 June 30,

Operating Activities

48 unchanged sentences

In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included.

Operating results for the three months ended March 29, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

Operating results for the three and six months ended June 28, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

Sales of our ready-to-drink beverages are somewhat seasonal, with the second and third calendar quarters typically accounting for the highest sales volumes.

1 unchanged sentence

Each of our quarterly reporting periods, other than the fourth quarter, ends on the Friday closest to the last day of the corresponding quarterly calendar period.

The first quarter of 2024 and the first quarter of 2023 ended on March 29, 2024 and March 31, 2023, respectively.

The second quarter of 2024 and the second quarter of 2023 ended on June 28, 2024 and June 30, 2023, respectively.

Our fourth quarter and our fiscal year end on December 31 regardless of the day of the week on which December 31 falls.

10 unchanged sentences

We classify time deposits and other investments that are highly liquid and have maturities of three months or less at the date of purchase as cash equivalents or restricted cash equivalents, as applicable.

Restricted cash and restricted cash equivalents generally consist of amounts held by our captive insurance companies, which are included in the line item other noncurrent assets in our consolidated balance sheet, and when applicable, cash and cash equivalents related to assets held for sale are included in the line item prepaid expenses and other current assets in our consolidated balance sheets.

We manage our exposure to counterparty credit risk through specific minimum credit standards, diversification of counterparties and procedures to monitor our concentrations of credit risk.

19 unchanged sentences

ACQUISITIONS AND DIVESTITURES

Our Company’s acquisitions of businesses, equity method investments and nonmarketable securities totaled $ 8 million and $ 20 million during the three months ended March 29, 2024 and March 31, 2023, respectively.

Proceeds from disposals of businesses, equity method investments and nonmarketable securities during the three months ended March 29, 2024 totaled $ 2,893 million, which primarily related to the refranchising of the Company’s bottling operations that were classified as held for sale as of December 31, 2023.

Our Company’s acquisitions of businesses, equity method investments and nonmarketable securities totaled $ 25 million and $ 43 million during the six months ended June 28, 2024 and June 30, 2023, respectively.

Proceeds from disposals of businesses, equity method investments and nonmarketable securities during the six months ended June 28, 2024 totaled $ 2,907 million, which primarily related to the refranchising of the Company’s bottling operations that were classified as held for sale as of December 31, 2023.

Also included was the sale of our ownership interest in an equity method investee in Thailand for which we received cash proceeds of $ 728 million and recognized a net gain of $ 516 million, which was recorded in the line item other income (loss) — net in our consolidated statement of income.

Proceeds from disposals of businesses, equity method investments and nonmarketable securities during the three months ended March 31, 2023 totaled $ 319 million, which primarily related to the sale of our ownership interest in an equity method investee in Indonesia to Coca-Cola Europacific Partners plc (“CCEP”), an equity method investee, for which we received cash proceeds of $ 302 million and recognized a net gain of $ 12 million.

Proceeds from disposals of businesses, equity method investments and nonmarketable securities during the six months ended June 30, 2023 totaled $ 320 million, which primarily related to the sale of our ownership interest in an equity method investee in Indonesia to Coca-Cola Europacific Partners plc (“CCEP”), an equity method investee, for which we received cash proceeds of $ 302 million and recognized a net gain of $ 12 million.

The Company also refranchised its bottling operations in Vietnam in January 2023 and recognized a net gain of $ 439 million as a result of the sale.

6 unchanged sentences

These assets and liabilities were included in the Bottling Investments operating segment.

The Company refranchised its bottling operations in certain territories in India in January and February of 2024, for which we received net cash proceeds of $ 476 million and recognized a net gain of $ 293 million.

The Company refranchised its bottling operations in Bangladesh to Coca-Cola İçecek A.Ş.

23 unchanged sentences

NET OPERATING REVENUES

The following table presents net operating revenues disaggregated between the United States and International and further by line of business (in millions):

The following tables present net operating revenues disaggregated between the United States and International and further by line of business (in millions):

United States International Total

Three Months Ended March 29, 2024

Three Months Ended June 28, 2024

Concentrate operations $ 2,278 $ 5,216 $ 7,494

1 unchanged sentence

Total $ 4,740 $ 7,623 $ 12,363

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Concentrate operations $ 2,347 $ 4,703 $ 7,050

1 unchanged sentence

Total $ 4,302 $ 7,670 $ 11,972

United States International Total

Six Months Ended June 28, 2024

Concentrate operations $ 4,403 $ 9,746 $ 14,149

Finished product operations 4,455 5,059 9,514

Total $ 8,858 $ 14,805 $ 23,663

Six Months Ended June 30, 2023

Concentrate operations $ 4,336 $ 9,047 $ 13,383

Finished product operations 3,815 5,754 9,569

Total $ 8,151 $ 14,801 $ 22,952

Refer to Note 17 for disclosures of net operating revenues by operating segment and Corporate.

2 unchanged sentences

Fair Value with Changes Recognized in Income Measurement Alternative — No Readily Determinable Fair Value

March 29, 2024

June 28, 2024

Marketable securities $ 381 $ —

9 unchanged sentences

Three Months Ended

2024 March 31,

2024 June 30,

Net gains (losses) recognized during the period related to equity securities $ 52 $ 130

3 unchanged sentences

still held at the end of the period

Six Months Ended

2024 June 30,

Net gains (losses) recognized during the period related to equity securities $ 235 $ 255

Net gains (losses) recognized during the period related to equity securities sold

during the period

Net unrealized gains (losses) recognized during the period related to equity securities

still held at the end of the period

Debt Securities

2 unchanged sentences

Cost Gains Losses

March 29, 2024

June 28, 2024

Trading securities

12 unchanged sentences

The carrying values of our debt securities were included in the following line items in our consolidated balance sheets (in millions):

March 29, 2024 December 31, 2023

June 28, 2024 December 31, 2023

Trading Securities Available-for-Sale Securities Trading Securities Available-for-Sale Securities

3 unchanged sentences

Total debt securities $ 44 $ 1,539 $ 41 $ 1,134

The contractual maturities of these available-for-sale debt securities as of March 29, 2024 were as follows (in millions):

The contractual maturities of these available-for-sale debt securities as of June 28, 2024 were as follows (in millions):

Cost Estimated

6 unchanged sentences

The sale and/or maturity of available-for-sale debt securities resulted in the following realized activity (in millions):

Three Months Ended

2024 March 31,

Three Months Ended Six Months Ended

2024 June 30,

2023 June 28,

2024 June 30,

Gross gains $ 4 $ 2 $ 5 $ 2

6 unchanged sentences

The Company uses one of our consolidated captive insurance companies to reinsure group annuity insurance contracts that cover the obligations of certain of our European and Canadian pension plans.

This captive’s solvency capital funds included total equity and debt securities of $ 1,679 million and $ 1,643 million as of March 29, 2024 and December 31, 2023, respectively, which were classified in the line item other noncurrent assets in our consolidated balance sheets because the assets were not available to satisfy our current obligations.

This captive’s solvency capital funds included total equity and debt securities of $ 1,877 million and $ 1,643 million as of June 28, 2024 and December 31, 2023, respectively, which were classified in the line item other noncurrent assets in our consolidated balance sheets because the assets were not available to satisfy our current obligations.

Inventories consisted of the following (in millions):

11 unchanged sentences

Foreign currency contracts Other noncurrent assets 38 13

Interest rate contracts Prepaid expenses and other current assets 7 —

Interest rate contracts Other noncurrent assets 14 50

17 unchanged sentences

Commodity contracts Prepaid expenses and other current assets 6 5

Commodity contracts Other noncurrent assets 1 —

Other derivative instruments Prepaid expenses and other current assets 1 4

14 unchanged sentences

If a downgrade in the credit rating of a counterparty were to occur, we have provisions requiring collateral for substantially all of our transactions.

To mitigate presettlement risk, minimum credit standards become more stringent as the duration of the derivative financial instrument increases.

To mitigate pre-settlement risk, minimum credit standards become more stringent as the duration of the derivative financial instrument increases.

In addition, the Company’s master netting agreements reduce credit risk by permitting the Company to net settle for transactions with the same counterparty.

16 unchanged sentences

dollar weakens, the increase in the present value of future foreign currency cash flows is partially offset by losses in the fair value of the derivative instruments.

The total notional values of derivatives that were designated and qualified for the Company’s foreign currency cash flow hedging program were $ 9,145 million and $ 9,408 million as of March 29, 2024 and December 31, 2023, respectively.

The total notional values of derivatives that were designated and qualified for the Company’s foreign currency cash flow hedging program were $ 9,199 million and $ 9,408 million as of June 28, 2024 and December 31, 2023, respectively.

The Company uses cross-currency swaps to hedge the changes in cash flows of certain of its foreign currency denominated debt and other monetary assets or liabilities due to fluctuations in foreign currency exchange rates.

1 unchanged sentence

The changes in fair values of the cross-currency swap derivatives are recorded in AOCI with an immediate reclassification into earnings for the changes in fair values attributable to fluctuations in foreign currency exchange rates.

The total notional value of derivatives that were designated as cash flow hedges for the Company’s foreign currency denominated assets and liabilities was $ 958 million as of both March 29, 2024 and December 31, 2023.

The total notional values of derivatives that were designated as cash flow hedges for the Company’s foreign currency denominated assets and liabilities were $ 557 million and $ 958 million as of June 28, 2024 and December 31, 2023, respectively.

The Company has entered into commodity futures contracts and other derivative instruments on various commodities to mitigate the price risk associated with forecasted purchases of materials used in our manufacturing process.

1 unchanged sentence

The objective of this hedging program is to reduce the variability of cash flows associated with future purchases of certain commodities.

The total notional values of derivatives that were designated and qualified for this program were $ 32 million and $ 54 million as of March 29, 2024 and December 31, 2023, respectively.

The total notional values of derivatives that were designated and qualified for this program were $ 28 million and $ 54 million as of June 28, 2024 and December 31, 2023, respectively.

Our Company monitors our mix of short-term debt and long-term debt regularly.

We manage our risk to interest rate fluctuations through the use of derivative financial instruments.

We manage our risk related to interest rate fluctuations through the use of derivative financial instruments.

From time to time, the Company has entered into interest rate swap agreements and has designated these instruments as part of the Company’s interest rate cash flow hedging program.

The objective of this hedging program is to mitigate the risk of adverse changes in benchmark interest rates on the Company’s future interest payments.

The total notional values of derivatives that were designated and qualified for this program were $ 1,150 million and $ 750 million as of March 29, 2024 and December 31, 2023, respectively.

The following table presents the pretax impact that changes in the fair values of derivatives designated as cash flow hedges had on other comprehensive income (“OCI”), AOCI and earnings (in millions):

The total notional values of derivatives that were designated and qualified for this program were $ 1,250 million and $ 750 million as of June 28, 2024 and December 31, 2023, respectively.

The following tables present the pretax impact that changes in the fair values of derivatives designated as cash flow hedges had on other comprehensive income (“OCI”), AOCI and earnings (in millions):

in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Reclassified from AOCI into Income

Three Months Ended March 29, 2024

Three Months Ended June 28, 2024

Foreign currency contracts $ 160 Net operating revenues $ ( 1 )

5 unchanged sentences

Total $ 158 $ 4

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Foreign currency contracts $ ( 22 ) Net operating revenues $ ( 7 )

3 unchanged sentences

Commodity contracts ( 9 ) Cost of goods sold ( 3 )

As of March 29, 2024, the Company estimates that it will reclassify into earnings during the next 12 months net losses of $ 17 million from the pretax amount recorded in AOCI as the anticipated cash flows occur.

Total $ 4 $ ( 4 )

in OCI Location of Gain (Loss) Recognized in Income Gain (Loss) Reclassified from AOCI into Income

Six Months Ended June 28, 2024

Foreign currency contracts $ 208 Net operating revenues $ ( 18 )

Foreign currency contracts 20 Cost of goods sold 9

Foreign currency contracts — Interest expense ( 2 )

Foreign currency contracts ( 24 ) Other income (loss) — net ( 26 )

Commodity contracts ( 2 ) Cost of goods sold ( 3 )

Interest rate contracts 2 Interest expense —

Total $ 204 $ ( 40 )

Six Months Ended June 30, 2023

Foreign currency contracts $ ( 58 ) Net operating revenues $ ( 6 )

Foreign currency contracts 17 Cost of goods sold 8

Foreign currency contracts — Interest expense ( 2 )

Foreign currency contracts 9 Other income (loss) — net 3

Commodity contracts ( 11 ) Cost of goods sold ( 6 )

$ ( 43 ) $ ( 3 )

As of June 28, 2024, the Company estimates that it will reclassify into earnings during the next 12 months net gains of $ 132 million from the pretax amount recorded in AOCI as the anticipated cash flows occur.

Fair Value Hedging Strategy

4 unchanged sentences

When a derivative is no longer designated as a fair value hedge for any reason, including termination and maturity, the remaining unamortized difference between the carrying value of the hedged item at that time and the face value of the hedged item is amortized to earnings over the remaining life of the hedged item, or immediately if the hedged item has matured or has been extinguished.

The total notional values of derivatives that were designated and qualified as fair value hedges of this type were $ 12,958 million and $ 13,693 million as of March 29, 2024 and December 31, 2023, respectively.

The following table summarizes the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on earnings (in millions):

The total notional values of derivatives that were designated and

qualified as fair value hedges of this type were $ 12,898 million and $ 13,693 million as of June 28, 2024 and December 31, 2023, respectively.

The following tables summarize the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on earnings (in millions):

Hedging Instruments and Hedged Items Location of Gain (Loss) Recognized in Income Gain (Loss)

1 unchanged sentence

Three Months Ended

2024 March 31,

2024 June 30,

Interest rate contracts Interest expense $ ( 19 ) $ ( 102 )

1 unchanged sentence

Net impact of fair value hedging instruments $ 1 $ 29

Hedging Instruments and Hedged Items Location of Gain (Loss) Recognized in Income Gain (Loss)

Recognized in Income

Six Months Ended

2024 June 30,

Interest rate contracts Interest expense $ ( 164 ) $ 106

Fixed-rate debt Interest expense 167 ( 91 )

Net impact of fair value hedging instruments $ 3 $ 15

The following table summarizes the amounts recorded in our consolidated balance sheets related to hedged items in fair value hedging relationships (in millions):

2 unchanged sentences

Hedged Items Included in the Carrying Values of Hedged Items Remaining for Which Hedge Accounting Has Been Discontinued

Balance Sheet Location of Hedged Items March 29,

Balance Sheet Location of Hedged Items June 28,

2024 December 31,

2023 March 29,

2023 June 28,

2024 December 31,

2023 March 29,

2023 June 28,

2024 December 31,

2 unchanged sentences

1 Cumulative amount of fair value hedging adjustments does not include changes due to foreign currency exchange rate fluctuations.

In June 2023, the Company amended the terms of its interest rate swap agreements to implement a forward-looking interest rate based on the Secured Overnight Financing Rate (“SOFR”) in place of the London Interbank Offered Rate (“LIBOR”).

In June 2023, the Company amended the terms of its interest rate swap agreements to implement a forward-looking interest rate based on the Secured Overnight Financing Rate in place of the London Interbank Offered Rate.

Since the interest rate swap agreements were affected by reference rate reform, the Company applied the expedients and exceptions provided to preserve the past presentation of its derivatives without de-designating the existing hedging relationships.

7 unchanged sentences

Notional Values Gain (Loss) Recognized in OCI

as of Three Months Ended

as of Three Months Ended Six Months Ended

2024 December 31,

2023 March 29,

2024 March 31,

2023 June 28,

2024 June 30,

2023 June 28,

2024 June 30,

Foreign currency contracts $ 360 $ 150 $ 22 $ ( 1 ) $ 24 $ ( 1 )

1 unchanged sentence

Total $ 12,969 $ 12,587 $ 107 $ ( 81 ) $ 381 $ ( 235 )

The Company reclassified a gain of $ 3 million related to net investment hedges from AOCI into earnings during the three months ended March 29, 2024.

The Company did not reclassify any gains or losses during the three months ended March 31, 2023.

In addition, the Company did not have any ineffectiveness related to net investment hedges during the three months ended March 29, 2024 and March 31, 2023.

The Company reclassified a gain of $ 3 million related to net investment hedges from AOCI into earnings during the six months ended June 28, 2024.

The Company did not reclassify any gains or losses during the three months ended June 28, 2024 nor the three and six months ended June 30, 2023.

In addition, the Company did not have any ineffectiveness related to net investment hedges during the three and six months ended June 28, 2024 and June 30, 2023.

The cash inflows and outflows associated with the Company’s derivative contracts designated as net investment hedges are classified in the line item other investing activities in our consolidated statement of cash flows.

5 unchanged sentences

The changes in the fair values of economic hedges used to offset those monetary assets and liabilities are immediately recognized in earnings in the line item other income (loss) — net in our consolidated statement of income.

In addition, we use foreign currency economic hedges to minimize the variability in cash flows associated with fluctuations in foreign currency exchange rates, including those related

to certain acquisition and divestiture activities.

In addition, we use foreign currency economic hedges to minimize the variability in cash flows associated with fluctuations in foreign currency exchange rates, including those related to certain acquisition and divestiture activities.

The changes in the fair values of economic hedges used to offset the variability in U.S.

dollar net cash flows are immediately recognized in earnings in the line items net operating revenues, cost of goods sold or other income (loss) — net in our consolidated statement of income, as applicable.

The total notional values of derivatives related to our foreign currency economic hedges were $ 6,023 million and $ 6,989 million as of March 29, 2024 and December 31, 2023, respectively.

The total notional values of derivatives related to our foreign currency economic hedges were $ 7,570 million and $ 6,989 million as of June 28, 2024 and December 31, 2023, respectively.

The Company uses interest rate contracts as economic hedges to minimize exposure to changes in the fair value of fixed-rate debt that result from fluctuations in benchmark interest rates.

As of March 29, 2024 and December 31, 2023, we did not have any interest rate contracts used as economic hedges.

As of June 28, 2024 and December 31, 2023, we did not have any interest rate contracts used as economic hedges.

The Company also uses certain derivatives as economic hedges to mitigate the price risk associated with the purchase of materials used in the manufacturing process and vehicle fuel.

The changes in the fair values of these economic hedges are immediately recognized in earnings in the line items net operating revenues, cost of goods sold, or selling, general and administrative expenses in our consolidated statement of income, as applicable.

The total notional values of derivatives related to our economic hedges of this type were $ 305 million and $ 325 million as of March 29, 2024 and December 31, 2023, respectively.

The following table presents the pretax impact that changes in the fair values of derivatives not designated as hedging instruments had on earnings (in millions):

The total notional values of derivatives related to our economic hedges of this type were $ 303 million and $ 325 million as of June 28, 2024 and December 31, 2023, respectively.

The following tables present the pretax impact that changes in the fair values of derivatives not designated as hedging instruments had on earnings (in millions):

Derivatives Not Designated as Hedging Instruments Location of Gain (Loss) Recognized in Income Gain (Loss)

1 unchanged sentence

Three Months Ended

2024 March 31,

2024 June 30,

Foreign currency contracts Net operating revenues $ 58 $ ( 10 )

4 unchanged sentences

Total $ ( 103 ) $ ( 59 )

Derivatives Not Designated as Hedging Instruments Location of Gain (Loss) Recognized in Income Gain (Loss)

Recognized in Income

Six Months Ended

2024 June 30,

Foreign currency contracts Net operating revenues $ 119 $ ( 17 )

Foreign currency contracts Cost of goods sold ( 8 ) 51

Foreign currency contracts Other income (loss) — net ( 58 ) —

Commodity contracts Cost of goods sold ( 68 ) ( 130 )

Other derivative instruments Selling, general and administrative expenses 12 4

Total $ ( 3 ) $ ( 92 )

SUPPLY CHAIN FINANCE PROGRAM

4 unchanged sentences

The suppliers sell goods or services, as applicable, to the Company and issue the associated invoices to the Company based on the agreed-upon contractual terms.

Then, if they are participating in the SCF program, our suppliers, at their sole discretion, determine which invoices, if any, they want to sell to the financial institutions.

Our suppliers’ voluntary inclusion of invoices in the SCF program has no bearing on our payment terms.

Then, if they are participating in the SCF program, our suppliers sell their invoices to the financial institutions.

Our suppliers’ voluntary participation in the SCF program has no bearing on our payment terms.

No guarantees are provided by the Company or any of our subsidiaries under the SCF program.

2 unchanged sentences

All activity related to amounts due to suppliers that elected to participate in the SCF program is reflected within the operating activities section of our consolidated statement of cash flows.

As of March 29, 2024 and December 31, 2023, the amount of obligations outstanding that the Company has confirmed as valid to the financial institutions under the SCF program was $ 1,181 million and $ 1,421 million, respectively.

As of June 28, 2024 and December 31, 2023, the amount of obligations outstanding that the Company has confirmed as valid to the financial institutions under the SCF program was $ 1,352 million and $ 1,421 million, respectively.

DEBT AND BORROWING ARRANGEMENTS

Loans and notes payable consist primarily of commercial paper issued in the United States.

As of March 29, 2024 and December 31, 2023, we had $ 5,722 million and $ 4,209 million, respectively, in outstanding commercial paper borrowings.

As of June 28, 2024 and December 31, 2023, we had $ 3,502 million and $ 4,209 million, respectively, in outstanding commercial paper borrowings.

During 2024, the Company issued fixed interest rate U.S.

dollar- and euro-denominated debt of $ 3,000 million and € 1,000 million, respectively, with maturity dates ranging from 2032 to 2064 and interest rates ranging from 3.125 % to 5.400 %.

The carrying value of this debt as of June 28, 2024 was $ 4,017 million.

COMMITMENTS AND CONTINGENCIES

As of March 29, 2024, we were contingently liable for guarantees of indebtedness owed by third parties of $ 762 million, of which $ 85 million was related to variable interest entities.

As of June 28, 2024, we were contingently liable for guarantees of indebtedness owed by third parties of $ 811 million, of which $ 84 million was related to variable interest entities.

Our guarantees are primarily related to third-party customers, bottlers and vendors and have arisen through the normal course of business.

7 unchanged sentences

We establish reserves for specific legal proceedings when we determine that the likelihood of an unfavorable outcome is probable and the amount of loss can be reasonably estimated.

Management has also identified certain other legal matters where we believe an unfavorable outcome is reasonably possible and/or for which no estimate of possible losses can be made.

Management has also identified certain other legal matters where we believe an unfavorable outcome is reasonably possible and/or for which no

estimate of possible losses can be made.

Management believes that the total liabilities of the Company that may arise as a result of currently pending legal proceedings (excluding tax audit claims) will not have a material adverse effect on the Company taken as a whole.

30 unchanged sentences

parent company in reliance upon the Closing Agreement should continue to be allowed to offset royalties, including those that would become payable to the Company in accordance with the Opinion.

On November 8, 2023, the Tax Court issued a supplemental opinion (together with the original Tax Court opinion, “Opinions”), siding with the IRS in concluding both that the blocked-income regulations apply to the Company’s operations and that the Tax Court opinion in 3M Co.

On November 8, 2023, the Tax Court issued a supplemental opinion (together with the original Tax Court opinion, “Opinions”), siding with the IRS in concluding both that certain U.S.

tax regulations (known as the blocked-income regulations) that address the effect of certain Brazilian legal restrictions on royalty payments by the Company’s licensee in Brazil apply to the Company’s operations and that the Tax Court opinion in 3M Co.

Commissioner (February 9, 2023) controlled as to the validity of those regulations.

1 unchanged sentence

Moreover, the Company believes that the retroactive imposition of such tax liability using a calculation methodology different from that previously agreed upon by the IRS and the Company, and audited by the IRS for over a decade, is unconstitutional.

The Company intends to assert its claims on appeal and vigorously defend its position.

The Company intends to assert its

claims on appeal and vigorously defend its position.

In addition, for its litigation with the IRS and for purposes of its appeal of the Tax Court decision, the Company is currently evaluating the implications of several significant administrative law cases recently decided by the U.S.

Supreme Court, most notably Loper Bright v.

Raimondo , which overruled Chevron U.S.A., Inc.

NRDC (“ Chevron ”).

Since 1984, Chevron had required that courts defer to agency interpretations of statutes and agency action.

EPA and Garland v.

Cargill , two of the recent decisions, the U.S.

Supreme Court demonstrated how courts are to rule on agency interpretations and actions without the deference previously required by Chevron.

In determining the amount of tax reserve to be recorded as of December 31, 2020, the Company completed the required two-step evaluation process prescribed by Accounting Standards Codification 740, Accounting for Income Taxes .

6 unchanged sentences

parent company by its foreign licensees, in reliance upon the Closing Agreement, that would be recharacterized as royalties in accordance with the Opinions and the Company’s analysis.

The Company’s conclusion that it is more likely than not the Company’s tax positions will ultimately be sustained on appeal is unchanged as of March 29, 2024.

The Company’s conclusion that it is more likely than not the Company’s tax positions will ultimately be sustained on appeal is unchanged as of June 28, 2024.

However, we updated our calculation of the methodologies we believe the federal courts could ultimately order to be used in calculating the Company’s tax.

As a result of the application of the required probability analysis to these updated calculations and the accrual of interest through the current reporting period, we updated our tax reserve as of March 29, 2024 to $ 447 million.

While the Company strongly disagrees with the IRS’ positions and the portions of the Opinions affirming such positions, it is possible that some portion or all of the adjustment proposed by the IRS and sustained by the Tax Court could ultimately be upheld.

5 unchanged sentences

Additional income tax and interest would continue to accrue until the time any such potential liability, or portion thereof, were to be paid.

The Company estimates the impact of the continued application of the Tax Court Methodology for the three months ended March 29, 2024 would increase the potential aggregate incremental tax and interest liability by approximately $ 500 million.

The Company estimates the impact of the continued application of the Tax Court Methodology for the three and six months ended June 28, 2024 would increase the potential aggregate incremental tax and interest liability by approximately $ 500 million and $ 1.0 billion, respectively.

We currently project the continued application of the Tax Court Methodology in future years, assuming similar facts and circumstances as of December 31, 2023, would result in an incremental annual tax liability that would increase the Company’s effective tax rate by approximately 3.5 %.

3 unchanged sentences

Court of Appeals for the Eleventh Circuit.

The IRS will then seek to collect, and the Company expects to pay, any additional tax related to the 2007 through 2009 tax years reflected in the Tax Court decision (and interest thereon).

The Company currently estimates that the payment to be made at that time related to the 2007 through 2009 tax years, which is included in the above estimate of the potential aggregate incremental tax and interest liability, would be approximately $ 5.9 billion (including interest accrued through March 29, 2024), plus any additional interest accrued through the time of payment.

The IRS will then seek to collect any additional tax related to the 2007 through 2009 tax years reflected in the Tax Court decision (and interest thereon).

The Company expects to pay such amounts at some point between the issuance of the Tax Court decision and the date the amounts are due pursuant to the notice of collection from the IRS.

The Company currently estimates that the payment to be made at that time related to the 2007 through 2009 tax years, which is included in the above estimate of the potential aggregate incremental tax and interest liability, would be approximately $ 6.0 billion (including interest accrued through June 28, 2024), plus any additional interest accrued through the time of payment.

Some or all of this amount, plus accrued interest, would be refunded if the Company were to prevail on appeal.

4 unchanged sentences

Our reserves for the Company’s self-insured losses are estimated using actuarial methods and assumptions of the insurance industry, adjusted for our specific expectations based on our claims history.

Our self-insurance reserves totaled $ 187 million and $ 197 million as of March 29, 2024 and December 31, 2023, respectively.

Our self-insurance reserves totaled $ 175 million and $ 197 million as of June 28, 2024 and December 31, 2023, respectively.

OTHER COMPREHENSIVE INCOME

9 unchanged sentences

The following table summarizes the allocation of total comprehensive income between shareowners of The Coca-Cola Company and noncontrolling interests (in millions):

Three Months Ended March 29, 2024

Six Months Ended June 28, 2024

Shareowners of

6 unchanged sentences

Net change in unrealized gains (losses) on available-for-sale debt securities 2

( 22 ) — ( 22 )

Net change in pension and other postretirement benefit liabilities 23 — 23

3 unchanged sentences

The following tables present OCI attributable to shareowners of The Coca-Cola Company, including our proportionate share of equity method investees’ OCI (in millions):

Three Months Ended March 29, 2024 Before-Tax Amount Income Tax After-Tax Amount

Three Months Ended June 28, 2024 Before-Tax Amount Income Tax After-Tax Amount

Foreign currency translation adjustments:

Translation adjustments arising during the period $ ( 1,109 ) $ 127 $ ( 982 )

Gains (losses) on intra-entity transactions that are of a long-term investment nature ( 170 ) — ( 170 )

Gains (losses) on net investment hedges arising during the period 1

107 ( 27 ) 80

Net foreign currency translation adjustments $ ( 1,172 ) $ 100 $ ( 1,072 )

Gains (losses) arising during the period $ 156 $ ( 35 ) $ 121

Reclassification adjustments recognized in net income ( 4 ) 1 ( 3 )

Net gains (losses) on derivatives 1

$ 152 $ ( 34 ) $ 118

Available-for-sale debt securities:

Unrealized gains (losses) arising during the period $ ( 38 ) $ 13 $ ( 25 )

Reclassification adjustments recognized in net income ( 2 ) — ( 2 )

Net change in unrealized gains (losses) on available-for-sale debt securities 2

$ ( 40 ) $ 13 $ ( 27 )

Pension and other postretirement benefit liabilities:

Net pension and other postretirement benefit liabilities arising during the period $ 4 $ 6 $ 10

Reclassification adjustments recognized in net income 23 ( 6 ) 17

Net change in pension and other postretirement benefit liabilities $ 27 $ — $ 27

Other comprehensive income (loss) attributable to shareowners of The Coca-Cola

Company $ ( 1,033 ) $ 79 $ ( 954 )

1 Refer to Note 6 for additional information related to the net gains or losses on derivative instruments.

2 Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.

Six Months Ended June 28, 2024 Before-Tax Amount Income Tax After-Tax Amount

Foreign currency translation adjustments:

Translation adjustments arising during the period $ ( 1,143 ) $ 92 $ ( 1,051 )

Reclassification adjustments recognized in net income 103 — 103

Gains (losses) on intra-entity transactions that are of a long-term investment nature ( 688 ) — ( 688 )

7 unchanged sentences

Available-for-sale debt securities:

Unrealized gains (losses) arising during the period $ ( 38 ) $ 13 $ ( 25 )

Reclassification adjustments recognized in net income 4 ( 1 ) 3

9 unchanged sentences

2 Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.

Three Months Ended March 31, 2023 Before-Tax Amount Income Tax After-Tax Amount

Three Months Ended June 30, 2023 Before-Tax Amount Income Tax After-Tax Amount

Foreign currency translation adjustments:

Translation adjustments arising during the period $ 300 $ ( 63 ) $ 237

Gains (losses) on intra-entity transactions that are of a long-term investment nature 151 — 151

Gains (losses) on net investment hedges arising during the period 1

( 81 ) 20 ( 61 )

Net foreign currency translation adjustments $ 370 $ ( 43 ) $ 327

Gains (losses) arising during the period $ ( 31 ) $ 3 $ ( 28 )

Reclassification adjustments recognized in net income 4 ( 1 ) 3

Net gains (losses) on derivatives 1

$ ( 27 ) $ 2 $ ( 25 )

Available-for-sale debt securities:

Unrealized gains (losses) arising during the period $ 4 $ ( 3 ) $ 1

Reclassification adjustments recognized in net income ( 1 ) 1 —

Net change in unrealized gains (losses) on available-for-sale debt securities 2

$ 3 $ ( 2 ) $ 1

Pension and other postretirement benefit liabilities:

Net pension and other postretirement benefit liabilities arising during the period $ ( 11 ) $ ( 4 ) $ ( 15 )

Reclassification adjustments recognized in net income 22 ( 5 ) 17

Net change in pension and other postretirement benefit liabilities $ 11 $ ( 9 ) $ 2

Other comprehensive income (loss) attributable to shareowners of The Coca-Cola

Company $ 357 $ ( 52 ) $ 305

1 Refer to Note 6 for additional information related to the net gains or losses on derivative instruments.

2 Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.

Six Months Ended June 30, 2023 Before-Tax Amount Income Tax After-Tax Amount

Foreign currency translation adjustments:

Translation adjustments arising during the period $ 737 $ ( 154 ) $ 583

Reclassification adjustments recognized in net income 101 — 101

Gains (losses) on intra-entity transactions that are of a long-term investment nature 443 — 443

21 unchanged sentences

Amount Reclassified from AOCI

Description of AOCI Component Financial Statement Line Item Three Months Ended March 29, 2024

Description of AOCI Component Financial Statement Line Item Three Months Ended June 28, 2024 Six Months Ended June 28, 2024

Foreign currency translation adjustments:

26 unchanged sentences

Refer to Note 2.

2 Related to the refranchising of our bottling operations in the Philippines and Bangladesh.

2 Primarily related to the refranchising of our bottling operations in the Philippines and Bangladesh.

Refer to Note 2.

2 unchanged sentences

Shareowners of The Coca-Cola Company

Three Months Ended March 29, 2024 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

Three Months Ended June 28, 2024 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

March 29, 2024 4,308 $ 27,946 $ 74,868 $ ( 14,504 ) $ 1,760 $ 19,321 $ ( 55,016 ) $ 1,517

Comprehensive income (loss) — 1,505 2,411 ( 954 ) — — — 48

Dividends paid/payable to

shareowners of The Coca-Cola

Company ($ 0.485 per share)

— ( 2,090 ) ( 2,090 ) — — — — —

Dividends paid to noncontrolling

— ( 7 ) — — — — — ( 7 )

Purchases of treasury stock ( 3 ) ( 156 ) — — — — ( 156 ) —

Impact related to stock-based

compensation plans 4 213 — — — 147 66 —

June 28, 2024 4,309 $ 27,411 $ 75,189 $ ( 15,458 ) $ 1,760 $ 19,468 $ ( 55,106 ) $ 1,558

Shareowners of The Coca-Cola Company

Six Months Ended June 28, 2024 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

December 31, 2023 4,308 $ 27,480 $ 73,782 $ ( 14,275 ) $ 1,760 $ 19,209 $ ( 54,535 ) $ 1,539

11 unchanged sentences

compensation plans 14 465 — — — 259 206 —

June 28, 2024 4,309 $ 27,411 $ 75,189 $ ( 15,458 ) $ 1,760 $ 19,468 $ ( 55,106 ) $ 1,558

Shareowners of The Coca-Cola Company

Three Months Ended June 30, 2023 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

March 31, 2023 4,325 $ 26,868 $ 72,137 $ ( 14,322 ) $ 1,760 $ 18,889 $ ( 53,247 ) $ 1,651

Comprehensive income (loss) — 2,751 2,547 305 — — — ( 101 )

Dividends paid/payable to

shareowners of The Coca-Cola

Company ($ 0.46 per share)

— ( 1,989 ) ( 1,989 ) — — — — —

Dividends paid to noncontrolling

interests — ( 9 ) — — — — — ( 9 )

Acquisition of interests held by

noncontrolling owners — ( 22 ) — — — ( 20 ) — ( 2 )

Purchases of treasury stock ( 4 ) ( 230 ) — — — — ( 230 ) —

Impact related to stock-based

compensation plans 3 183 — — — 124 59 —

June 30, 2023 4,324 $ 27,552 $ 72,695 $ ( 14,017 ) $ 1,760 $ 18,993 $ ( 53,418 ) $ 1,539

Shareowners of The Coca-Cola Company

Three Months Ended March 31, 2023 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

Six Months Ended June 30, 2023 Common Shares Outstanding Total Reinvested Earnings Accumulated Other Comprehensive Income (Loss) Common Stock Capital Surplus Treasury Stock Non-controlling Interests

December 31, 2022 4,328 $ 25,826 $ 71,019 $ ( 14,895 ) $ 1,760 $ 18,822 $ ( 52,601 ) $ 1,721

6 unchanged sentences

interests — ( 13 ) — — — — — ( 13 )

Acquisition of interests held by noncontrolling owners

— ( 22 ) — — — ( 20 ) — ( 2 )

Purchases of treasury stock ( 16 ) ( 979 ) — — — — ( 979 ) —

2 unchanged sentences

Other activities — — — — — ( 3 ) — 3

March 31, 2023 4,325 $ 26,868 $ 72,137 $ ( 14,322 ) $ 1,760 $ 18,889 $ ( 53,247 ) $ 1,651

June 30, 2023 4,324 $ 27,552 $ 72,695 $ ( 14,017 ) $ 1,760 $ 18,993 $ ( 53,418 ) $ 1,539

SIGNIFICANT OPERATING AND NONOPERATING ITEMS

Other Operating Charges

During the three months ended March 29, 2024, the Company recorded other operating charges of $ 1,573 million.

These charges primarily consisted of $ 765 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of fairlife, LLC (“fairlife”) in 2020, $ 760 million related to the impairment of our BodyArmor trademark and $ 36 million related to the Company’s productivity and reinvestment program.

In addition, other operating charges included $ 7 million for transaction costs related to the refranchising of our bottling operations in certain territories in India, $ 4 million for the amortization of noncompete agreements related to the BA Sports Nutrition, LLC (“BodyArmor”) acquisition in 2021 and $ 1 million related to tax litigation expense.

During the three months ended March 31, 2023, the Company recorded other operating charges of $ 111 million.

These charges primarily consisted of $ 62 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 27 million related to the Company’s productivity and reinvestment program and $ 18 million related to the restructuring of our North America operating unit.

In addition, other operating charges included $ 4 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

During the three months ended June 28, 2024, the Company recorded other operating charges of $ 1,370 million.

These charges primarily consisted of $ 1,337 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of fairlife, LLC (“fairlife”) in 2020, $ 32 million related to the Company’s productivity and reinvestment program and $ 3 million for the amortization of noncompete agreements related to the BA Sports Nutrition, LLC (“BodyArmor”) acquisition in 2021.

These charges were partially offset by a net benefit of $ 2 million related to a revision of management’s estimates for tax litigation expense.

During the six months ended June 28, 2024, the Company recorded other operating charges of $ 2,943 million.

These charges primarily consisted of $ 2,102 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of fairlife, $ 760 million related to the impairment of our BodyArmor trademark and $ 68 million related to the Company’s productivity and reinvestment program.

In addition, other operating charges included $ 7 million of transaction costs related to the refranchising of our bottling operations in certain territories in India and $ 7 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

These charges were partially offset by a net benefit of $ 1 million related to a revision of management’s estimates for tax litigation expense.

During the three months ended June 30, 2023, the Company recorded other operating charges of $ 1,338 million.

These charges primarily consisted of $ 1,262 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 35 million related to the discontinuation of certain manufacturing operations in Asia

Pacific and $ 24 million related to the Company’s productivity and reinvestment program.

In addition, other operating charges included $ 8 million related to the restructuring of our North America operating unit, $ 6 million related to tax litigation expense and $ 3 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

During the six months ended June 30, 2023, the Company recorded other operating charges of $ 1,449 million.

These charges primarily consisted of $ 1,324 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 51 million related to the Company’s productivity and reinvestment program and $ 35 million related to the discontinuation of certain manufacturing operations in Asia Pacific.

In addition, other operating charges included $ 26 million related to the restructuring of our North America operating unit, $ 7 million for the amortization of noncompete agreements related to the BodyArmor acquisition and $ 6 million related to tax litigation expense.

Refer to Note 2 for additional information on the refranchising of our bottling operations in certain territories in India.

5 unchanged sentences

Equity Income (Loss) — Net

During the three months ended March 29, 2024 and March 31, 2023, the Company recorded net charges of $ 25 million and $ 82 million, respectively.

During the three and six months ended June 28, 2024, the Company recorded net charges of $ 24 million and $ 49 million, respectively.

During the three and six months ended June 30, 2023, the Company recorded net charges of $ 2 million and $ 84 million, respectively.

These amounts represent the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

1 unchanged sentence

Other Income (Loss) — Net

During the three months ended March 29, 2024, the Company recognized net gains of $ 599 million and $ 293 million related to the refranchising of our bottling operations in the Philippines and certain territories in India, respectively.

During the three months ended June 28, 2024, the Company recognized a net gain of $ 50 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities and an other-than-temporary impairment charge of $ 34 million related to an equity method investee in Latin America.

During the six months ended June 28, 2024, the Company recognized net gains of $ 599 million and $ 290 million related to the refranchising of our bottling operations in the Philippines and certain territories in India, respectively.

The Company also recognized a net gain of $ 516 million related to the sale of our ownership interest in an equity method investee in Thailand.

Additionally, the Company recognized a net gain of $ 228 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

The Company recorded a loss of $ 7 million related to post-closing adjustments for the refranchising of our bottling operations in Vietnam in 2023.

During the three months ended March 31, 2023, the Company recognized a net gain of $ 439 million related to the refranchising of our bottling operations in Vietnam.

These gains were partially offset by an other-than-temporary impairment charge of $ 34 million related to an equity method investee in Latin America and a loss of $ 7 million related to post-closing adjustments for the refranchising of our bottling operations in Vietnam in 2023.

During the three months ended June 30, 2023, the Company recognized a net gain of $ 127 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

During the six months ended June 30, 2023, the Company recognized a net gain of $ 439 million related to the refranchising of our bottling operations in Vietnam.

Additionally, the Company recognized a net gain of $ 240 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

1 unchanged sentence

Refer to Note 4 for additional information on equity and debt securities.

Refer to Note 16 for additional information on the other-than-temporary impairment charge.

Refer to Note 17 for the impact these items had on our operating segments and Corporate.

4 unchanged sentences

The remaining initiatives included in this program, which are primarily designed to further simplify and standardize our organization, will be completed in 2024.

During the three months ended March 29, 2024 and March 31, 2023, the Company incurred expenses of $ 36 million and $ 27 million, respectively, related to our productivity and reinvestment program.

During the three and six months ended June 28, 2024, the Company incurred expenses of $ 32 million and $ 68 million, respectively, and during the three and six months ended June 30, 2023 incurred expenses of $ 24 million and $ 51 million, respectively, related to our productivity and reinvestment program.

These expenses primarily included internal and external costs associated with the implementation of the program’s initiatives and were recorded in the line item other operating charges in our consolidated statements of income.

4 unchanged sentences

The evolved operating structure brought together all bottler-related components (franchise leadership, commercial leadership, digital, governance and technical innovation) and helped streamline how we work.

During the three months ended March 31, 2023, the Company incurred expenses of $ 18 million related to this program.

These expenses primarily included severance costs and were recorded in the line item other operating charges in our consolidated statement of income.

During the three and six months ended June 30, 2023, the Company incurred expenses of $ 8 million and $ 26 million, respectively, related to this program.

These expenses primarily included severance costs and were recorded in the line item other operating charges in our consolidated statements of income.

The Company has incurred total pretax expenses of $ 65 million related to this program since it commenced.

5 unchanged sentences

Three Months Ended

2024 March 31,

2023 March 29,

2024 March 31,

2024 June 30,

2023 June 28,

2024 June 30,

Service cost $ 26 $ 23 $ 1 $ 1

6 unchanged sentences

1 The weighted-average expected long-term rates of return on plan assets used in computing 2024 net periodic benefit cost (income) were 7.00 % for pension plans and 4.50 % for other postretirement benefit plans.

All of the amounts in the table above, other than service cost, were recorded in the line item other income (loss) — net in our consolidated statements of income.

During the three months ended March 29, 2024, the Company contributed $ 6 million to our pension trusts, offset by a $ 44 million transfer of surplus international plan assets from pension trusts to general assets of the Company.

Pension Plans Other Postretirement

Benefit Plans

Six Months Ended

2024 June 30,

2023 June 28,

2024 June 30,

Service cost $ 53 $ 47 $ 2 $ 2

Interest cost 154 162 9 14

Expected return on plan assets 1

( 235 ) ( 238 ) ( 4 ) ( 7 )

Amortization of prior service cost (credit) 1 1 ( 2 ) ( 2 )

Amortization of net actuarial loss (gain) 51 48 ( 2 ) ( 3 )

Net periodic benefit cost (income) $ 24 $ 20 $ 3 $ 4

All of the amounts in the tables above, other than service cost, were recorded in the line item other income (loss) — net in our consolidated statements of income.

During the six months ended June 28, 2024, the Company contributed $ 16 million to our pension trusts, offset by a $ 44 million transfer of surplus international plan assets from pension trusts to general assets of the Company.

We anticipate making additional contributions of approximately $ 19 million during the remainder of 2024.

The Company contributed $ 5 million to our pension trusts during the three months ended March 31, 2023.

The Company recorded income taxes of $ 687 million ( 17.7 % effective tax rate) and $ 940 million ( 23.2 % effective tax rate) during the three months ended March 29, 2024 and March 31, 2023, respectively.

The Company’s effective tax rates for the three months ended March 29, 2024 and March 31, 2023 vary from the statutory U.S.

The Company contributed $ 23 million to our pension trusts during the six months ended June 30, 2023.

The Company recorded income taxes of $ 627 million ( 20.7 % effective tax rate) and $ 359 million ( 12.5 % effective tax rate) during the three months ended June 28, 2024 and June 30, 2023, respectively.

The Company recorded income taxes of

$ 1,314 million ( 19.0 % effective tax rate) and $ 1,299 million ( 18.7 % effective tax rate) during the six months ended June 28, 2024 and June 30, 2023, respectively.

The Company’s effective tax rates for the three and six months ended June 28, 2024 and June 30, 2023 vary from the statutory U.S.

federal tax rate of 21.0 % primarily due to the tax impact of significant operating and nonoperating items, as described in Note 12, along with the tax benefits of having significant earnings generated outside of the United States and significant earnings generated in investments accounted for under the equity method, both of which are generally taxed at rates lower than the statutory U.S.

federal tax rate.

The Company’s effective tax rates for the three and six months ended June 28, 2024 included $ 119 million and $ 60 million, respectively, of net tax expense related to various discrete tax items, including the resolution of certain foreign tax matters.

The Company’s effective tax rates for the three and six months ended June 30, 2023 included $ 120 million and $ 125 million, respectively, of net tax benefits related to various discrete tax items, including a change in tax law in a certain foreign jurisdiction.

On November 18, 2020, the Tax Court issued the Opinion regarding the Company’s 2015 litigation with the IRS involving transfer pricing tax adjustments in which it predominantly sided with the IRS.

6 unchanged sentences

The following tables summarize assets and liabilities measured at fair value on a recurring basis (in millions):

March 29, 2024 Level 1 Level 2 Level 3 Other 3

June 28, 2024 Level 1 Level 2 Level 3 Other 3

Equity securities with readily determinable values 1

19 unchanged sentences

We are required to remeasure this liability to fair value quarterly, with any changes in the fair value recorded in income until the final milestone payment is made.

6 The Company is not obligated to return any cash collateral it has netted against its derivative position.

6 The Company is obligated to return $ 4 million in cash collateral it has netted against its derivative position.

7 The Company has the right to reclaim $ 1,065 million in cash collateral it has netted against its derivative position.

31 unchanged sentences

Refer to Note 6 for additional information related to the composition of our derivatives portfolio.

Gross realized and unrealized gains and losses on Level 3 assets and liabilities, excluding the contingent consideration liability, were not significant for the three months ended March 29, 2024 and March 31, 2023.

Gross realized and unrealized gains and losses on Level 3 assets and liabilities, excluding the contingent consideration liability, were not significant for the three and six months ended June 28, 2024 and June 30, 2023.

The Company recognizes transfers between levels within the hierarchy as of the beginning of the reporting period.

Gross transfers between levels within the hierarchy were not significant for the three months ended March 29, 2024 and March 31, 2023.

Gross transfers between levels within the hierarchy were not significant for the three and six months ended June 28, 2024 and June 30, 2023.

Nonrecurring Fair Value Measurements

During the three months ended March 29, 2024, the Company recorded an asset impairment charge of $ 760 million related to our BodyArmor trademark in North America, which was primarily driven by revised projections of future operating results and higher discount rates resulting from changes in macroeconomic conditions since the acquisition date.

During the three and six months ended June 28, 2024, the Company recorded an other-than-temporary impairment charge of $ 34 million related to an equity method investee in Latin America.

This impairment charge was derived using Level 3 inputs and was primarily driven by revised projections of future operating results.

During the six months ended June 28, 2024, the Company recorded an asset impairment charge of $ 760 million related to our BodyArmor trademark in North America, which was primarily driven by revised projections of future operating results and higher discount rates resulting from changes in macroeconomic conditions since the acquisition date.

The fair value of this trademark was derived using discounted cash flow analyses based on Level 3 inputs.

1 unchanged sentence

The remaining carrying value of the trademark is $ 3,400 million.

We did not recognize any gains or losses on assets measured at fair value on a nonrecurring basis during the three months ended March 31, 2023.

During the three and six months ended June 30, 2023, the Company recorded an asset impairment charge of $ 25 million related to the discontinuation of certain manufacturing operations in Asia Pacific.

This impairment charge was derived using Level 3 inputs and was primarily driven by management’s best estimate of the potential proceeds from the disposal of the related assets.

Other Fair Value Disclosures

2 unchanged sentences

Where quoted prices are not available, the fair value is estimated using discounted cash flows and market-based expectations for interest rates, credit risk and the contractual terms of the debt instruments.

As of March 29, 2024, the carrying value and fair value of our long-term debt, including the current portion, were $ 36,496 million and $ 31,883 million, respectively.

As of June 28, 2024, the

carrying value and fair value of our long-term debt, including the current portion, were $ 40,024 million and $ 35,137 million, respectively.

As of December 31, 2023, the carrying value and fair value of our long-term debt, including the current portion, were $ 37,507 million and $ 33,445 million, respectively.

5 unchanged sentences

Investments Corporate Eliminations Consolidated

As of and for the Three Months Ended March 29, 2024

As of and for the Three Months Ended June 28, 2024

Net operating revenues:

10 unchanged sentences

As of and for the Three Months

Ended March 31, 2023

Ended June 30, 2023

Net operating revenues:

16 unchanged sentences

1 Principally equity method investments and other investments in bottling companies.

2 Property, plant and equipment — net in India represented 13 % and 12 % of consolidated property, plant and equipment — net as of March 29, 2024 and December 31, 2023, respectively.

3 Property, plant and equipment — net in the Philippines represented 10 % of consolidated property, plant and equipment — net as of March 31, 2023.

2 Property, plant and equipment — net in India represented 14 %, 10 % and 12 % of consolidated property, plant and equipment — net as of June 28, 2024, June 30, 2023 and December 31, 2023, respectively.

3 Property, plant and equipment — net in the Philippines represented 10 % of consolidated property, plant and equipment — net as of June 30, 2023.

As of December 31, 2023, the Company’s bottling operations in the Philippines met the criteria to be classified as held for sale.

Refer to Note 2.

During the three months ended March 29, 2024, the results of our operating segments and Corporate were impacted by the following items:

During the three months ended June 28, 2024, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) and income (loss) before income taxes were reduced by $ 1,337 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 16.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 32 million for Corporate due to the Company’s productivity and reinvestment program.

Refer to Note 13.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 7 million for North America due to the restructuring of our manufacturing operations in the United States.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 3 million for Corporate due to charges related to our acquisition of BodyArmor.

Refer to Note 12.

• Income (loss) before income taxes was increased by $ 50 million for Corporate due to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

Refer to Note 4.

• Income (loss) before income taxes was reduced by $ 34 million for Latin America due to an other-than-temporary impairment charge related to an equity method investee.

Refer to Note 16.

• Income (loss) before income taxes was reduced by $ 21 million for Bottling Investments and $ 3 million for Latin America due to the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

During the three months ended June 30, 2023, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) and income (loss) before income taxes were reduced by $ 1,262 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 16.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 35 million for Asia Pacific due to the discontinuation of certain manufacturing operations.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 25 million for Corporate due to the Company’s productivity and reinvestment program.

Operating income (loss) and income (loss) before income taxes were increased by $ 1 million for North America due to the refinement of previously established accruals related to the Company’s productivity and reinvestment program.

Refer to Note 13.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 8 million for North America due to the restructuring of our North America operating unit.

Refer to Note 13.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 6 million for Corporate related to tax litigation expense.

Refer to Note 9.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 5 million for North America due to the restructuring of our manufacturing operations in the United States.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 3 million for Corporate due to charges related to our acquisition of BodyArmor.

Refer to Note 12.

• Income (loss) before income taxes was increased by $ 127 million for Corporate due to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

Refer to Note 4.

• Income (loss) before income taxes was reduced by $ 2 million for Bottling Investments due to the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

Europe, Middle East & Africa Latin

America North

America Asia Pacific Global Ventures Bottling

Investments Corporate Eliminations Consolidated

Six Months Ended June 28, 2024

Net operating revenues:

Third party $ 3,960 $ 3,177 $ 8,980 $ 2,639 $ 1,498 $ 3,352 $ 57 $ — $ 23,663

Intersegment 352 — 6 342 — 4 — ( 704 ) —

Total net operating revenues 4,312 3,177 8,986 2,981 1,498 3,356 57 ( 704 ) 23,663

Operating income (loss) 2,332 1,862 1,757 1,301 147 254 ( 2,880 ) — 4,773

Income (loss) before income taxes 2,356 1,834 1,779 1,306 150 972 ( 1,497 ) — 6,900

Six Months Ended June 30, 2023

Net operating revenues:

Third party $ 3,874 $ 2,764 $ 8,267 $ 2,534 $ 1,472 $ 3,986 $ 55 $ — $ 22,952

Intersegment 338 — 4 404 — 2 — ( 748 ) —

Total net operating revenues 4,212 2,764 8,271 2,938 1,472 3,988 55 ( 748 ) 22,952

Operating income (loss) 2,268 1,650 2,249 1,236 129 261 ( 2,025 ) — 5,768

Income (loss) before income taxes 2,289 1,657 2,268 1,098 135 1,081 ( 1,595 ) — 6,933

During the six months ended June 28, 2024, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) and income (loss) before income taxes were reduced by $ 2,102 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 16.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 760 million for North America due to the impairment of our BodyArmor trademark.

2 unchanged sentences

Refer to Note 13.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 10 million for North America due to the restructuring of our manufacturing operations in the United States.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 7 million for Corporate due to transaction costs related to the refranchising of our bottling operations in certain territories in India.

6 unchanged sentences

Refer to Note 2.

• Income (loss) before income taxes was increased by $ 293 million for Corporate due to the refranchising of our bottling operations in certain territories in India.

• Income (loss) before income taxes was increased by $ 290 million for Corporate due to the refranchising of our bottling operations in certain territories in India, including the impact of post-closing adjustments.

Refer to Note 2.

1 unchanged sentence

Refer to Note 4.

• Income (loss) before income taxes was reduced by $ 23 million for Bottling Investments and $ 2 million for Corporate due to the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

• Income (loss) before income taxes was reduced by $ 44 million for Bottling Investments, $ 3 million for Latin America and $ 2 million for Corporate due to the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

• Income (loss) before income taxes was reduced by $ 34 million for Latin America due to an other-than-temporary impairment charge related to an equity method investee.

Refer to Note 16.

• Income (loss) before income taxes was reduced by $ 7 million for Corporate related to post-closing adjustments for the refranchising of our bottling operations in Vietnam.

Refer to Note 2.

During the three months ended March 31, 2023, the results of our operating segments and Corporate were impacted by the following items:

During the six months ended June 30, 2023, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) and income (loss) before income taxes were reduced by $ 1,324 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

1 unchanged sentence

• Operating income (loss) and income (loss) before income taxes were reduced by $ 52 million for Corporate due to the Company’s productivity and reinvestment program.

Refer to Note 13.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 35 million for Asia Pacific due to the discontinuation of certain manufacturing operations.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 26 million for North America due to the restructuring of our North America operating unit.

3 unchanged sentences

Refer to Note 12.

• Operating income (loss) and income (loss) before income taxes were reduced by $ 6 million for Corporate related to tax litigation expense.

Refer to Note 9.

• Income (loss) before income taxes was increased by $ 439 million for Corporate due to the refranchising of our bottling operations in Vietnam.

4 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements