What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-07-24 compared with 2025-05-01 · 249 added, 130 removed, 288 unchanged (57% of the section changed)

20 unchanged sentences

The decrease in fair value was primarily driven by the revised projections of future operating results as well as higher discount rates resulting from changes in macroeconomic conditions since the acquisition date.

As of March 28, 2025, the fair value of this trademark approximates its carrying value.

As of June 27, 2025, the fair value of this trademark approximates its carrying value.

If the near-term operating results of this trademark do not achieve our revised financial projections, or if the macroeconomic conditions change causing the discount rate to increase without an offsetting increase in the operating results, it is likely that we would be required to recognize an additional impairment charge.

4 unchanged sentences

While our operations are primarily local, we remain subject to global trade dynamics, which may impact certain components of our cost structure as well as the cost structures of our bottlers and our customers and may affect consumer sentiment across our markets.

The Global Ventures operating segment was established primarily to oversee the Company’s ownership of Costa, innocent and doğadan, as well as the fees earned pursuant to distribution coordination agreements between the Company and Monster.

In November 2024, we announced plans to sunset our Global Ventures operating segment to streamline and simplify our operating structure.

Effective January 1, 2025, the results of our Costa (excluding the ready-to-drink business), innocent and doğadan businesses are reported within the Company’s Europe, Middle East and Africa operating segment.

Costa’s ready-to-drink business and the fees related to Monster are reported in the respective geographic operating segments.

Our historical operating segment information disclosed below has been recast to reflect our current organizational structure.

Structural Changes, Acquired Brands and Newly Licensed Brands

5 unchanged sentences

Refer to the heading “Beverage Volume” below.

Concentrate sales volume represents the amount of concentrates, syrups, source waters and powders/minerals (in all instances expressed in unit case equivalents) sold by, or used in finished products sold by, the Company to its bottling partners or other customers.

For Costa non-ready-to-drink beverage products, concentrate sales volume represents the amount of beverages, primarily measured in number of transactions (in all instances expressed in unit case equivalents), sold by the Company to customers or consumers.

For Costa Limited (“Costa”) non-ready-to-drink beverage products, concentrate sales volume represents the amount of beverages, primarily measured in number of transactions (in all instances expressed in unit case equivalents), sold by the Company to customers or consumers.

Refer to the heading “Beverage Volume” below.

25 unchanged sentences

We generally do not consider the licensing of a brand to be a structural change.

In January, February and December 2024, the Company refranchised our bottling operations in certain territories in India, and in February 2024, the Company refranchised our bottling operations in Bangladesh and the Philippines.

The impact of each of these refranchisings has been included as a structural change in our analysis of net operating revenues on a consolidated basis as well as for the Bottling Investments and Asia Pacific operating segments for the three months ended March 28, 2025.

In January, February and December 2024 as well as May 2025, the Company refranchised our bottling operations in certain territories in India, and in February 2024, the Company refranchised our bottling operations in Bangladesh and the Philippines.

Beverage Volume

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Concentrate sales volume represents the amount of concentrates, syrups, source waters and powders/minerals (in all instances expressed in unit case equivalents) sold by, or used in finished beverages sold by, the Company to its bottling partners or other customers.

For Costa non-ready-to-drink beverage products, concentrate

sales volume represents the amount of beverages, primarily measured in number of transactions (in all instances expressed in unit case equivalents), sold by the Company to customers or consumers.

Unit case volume and concentrate sales volume growth rates are not necessarily equal during any given period.

4 unchanged sentences

Three Months Ended

March 28, 2025

June 27, 2025 Six Months Ended

June 27, 2025

Unit Cases 1,2,3

Concentrate Sales 4

Unit Cases 1,2,3

Concentrate Sales 4

Worldwide (1) % (1) % 1 % — %

14 unchanged sentences

As a result, the first quarter of 2025 had two fewer days when compared to the first quarter of 2024, and the fourth quarter of 2025 will have one additional day when compared to the fourth quarter of 2024.

5 After considering the impact of structural changes, unit case volume for Bottling Investments for the three months ended March 28, 2025 grew 1%.

6 After considering the impact of structural changes, concentrate sales volume for Asia Pacific for the three months ended March 28, 2025 grew 8%.

5 After considering the impact of structural changes, unit case volume for Bottling Investments for the three and six months ended June 27, 2025 decreased 2% and 1%, respectively.

6 After considering the impact of structural changes, concentrate sales volume for Asia Pacific for the six months ended June 27, 2025 grew 1%.

Unit Case Volume

Although a significant portion of our Company’s net operating revenues is not based directly on unit case volume, we believe unit case volume performance is one of the indicators of the underlying strength of the Coca-Cola system because it measures demand for our products at the consumer level.

Unit case volume in Europe, Middle East and Africa increased 3%, which included 3% growth in both Trademark Coca-Cola and sparkling flavors, 2% growth in water, sports, coffee and tea, as well as growth in energy drinks, partially offset by a 5% decline in juice, value-added dairy and plant-based beverages.

The operating segment’s volume performance included an increase in unit case volume of 11% in the Eurasia and Middle East operating unit, 1% in the Africa operating unit and growth in energy drinks, partially offset by a decline of 1% in the Europe operating unit.

Unit case volume in Latin America was even, which included 1% growth in both Trademark Coca-Cola and water, sports, coffee and tea, as well as growth in energy drinks, offset by a 4% decline in sparkling flavors.

Unit case volume in juice, value-added dairy and plant-based beverages was even.

The operating segment’s volume performance included 4% growth in Brazil and 17% growth in Argentina, offset by a decline of 3% in Mexico.

Unit case volume in North America decreased 3%, which included a 3% decline in Trademark Coca-Cola, a 6% decline in water, sports, coffee and tea, and a 1% decline in sparkling flavors, partially offset by growth in energy drinks.

Unit case volume in juice, value-added dairy and plant-based beverages was even.

Unit case volume in Asia Pacific increased 6%, which included 6% growth in sparkling flavors, 7% growth in water, sports, coffee and tea, 3% growth in Trademark Coca-Cola, 4% growth in juice, value-added dairy and plant-based beverages and growth in energy drinks.

The operating segment’s volume performance included 16% growth in the India and Southwest Asia operating unit, 6% growth in the Greater China and Mongolia operating unit, 1% growth in the Japan and South Korea operating unit and growth in energy drinks, partially offset by a decline of 2% in the ASEAN and South Pacific operating unit.

Unit case volume for Bottling Investments decreased 17%, driven by the impact of refranchising our bottling operations in the Philippines, Bangladesh and certain territories in India.

Three Months Ended June 27, 2025 versus Three Months Ended June 28, 2024

Unit case volume in Europe, Middle East and Africa increased 3%, which included 5% growth in sparkling flavors, 4% growth in water, sports, coffee and tea, and 1% growth in Trademark Coca-Cola, as well as growth in energy drinks, partially offset by a 3% decline in juice, value-added dairy and plant-based beverages.

The operating segment’s volume performance included an increase in unit case volume of 5% in the Eurasia and Middle East operating unit, 2% in the Africa operating unit and 1% in the Europe operating unit, as well as growth in energy drinks.

Unit case volume in Latin America decreased 2%, which included a 4% decline in water, sports, coffee and tea, a 1% decline in Trademark Coca-Cola and a 3% decline in sparkling flavors, partially offset by 1% growth in juice, value-added dairy and plant-based beverages and growth in energy drinks.

The operating segment’s volume performance included a decline of 6% in Mexico, partially offset by 14% growth in Argentina.

Unit case volume in North America decreased 1%, which included a 1% decline in Trademark Coca-Cola, a 3% decline in juice, value-added dairy and plant-based beverages and a 1% decline in water, sports, coffee and tea, partially offset by 1% growth in sparkling flavors and growth in energy drinks.

Unit case volume in Asia Pacific decreased 3%, which included a 7% decline in sparkling flavors, a 10% decline in juice, value-added dairy and plant-based beverages and a 2% decline in Trademark Coca-Cola, partially offset by 2% growth in water, sports, coffee and tea, as well as growth in energy drinks.

The operating segment’s volume performance included a decline of 6% in both the India and Southwest Asia and the ASEAN and South Pacific operating units, as well as a decline of 2% in the Japan and South Korea operating unit, partially offset by 1% growth in the Greater China and Mongolia operating unit and growth in energy drinks.

Unit case volume for Bottling Investments decreased 5%, driven by the impact of refranchising our bottling operations in certain territories in India and declines across most markets.

Six Months Ended June 27, 2025 versus Six Months Ended June 28, 2024

Unit case volume in Europe, Middle East and Africa increased 3%, which included 2% growth in Trademark Coca-Cola, 4% growth in sparkling flavors and 3% growth in water, sports, coffee and tea, as well as growth in energy drinks, partially offset by a 4% decline in juice, value-added dairy and plant-based beverages.

The operating segment’s volume performance included an increase in unit case volume of 8% in the Eurasia and Middle East operating unit, 2% in the Africa operating unit and growth in energy drinks.

Unit case volume in the Europe operating unit was even.

Unit case volume in Latin America decreased 1%, which included a 4% decline in sparkling flavors and a 2% decline in water, sports, coffee and tea, partially offset by 1% growth in juice, value-added dairy and plant-based beverages as well as growth in energy drinks.

Unit case volume in Trademark Coca-Cola was even.

The operating segment’s volume performance included a decline of 5% in Mexico, partially offset by 15% growth in Argentina and 2% growth in Brazil.

Unit case volume in North America decreased 2%, which included a 2% decline in Trademark Coca-Cola, a 3% decline in water, sports, coffee and tea, and a decline of 1% in juice, value-added dairy and plant-based beverages, partially offset by growth in energy drinks.

Unit case volume in sparkling flavors was even.

Unit case volume in Asia Pacific increased 1%, which included 4% growth in water, sports, coffee and tea and 1% growth in Trademark Coca-Cola, as well as growth in energy drinks, partially offset by a decline of 3% in juice, value-added dairy and plant-based beverages and a decline of 1% in sparkling flavors.

The operating segment’s volume performance included 3% growth in both the Greater China and Mongolia and the India and Southwest Asia operating units and growth in energy drinks, partially offset by a decline of 4% in the ASEAN and South Pacific operating unit and a decline of 1% in the Japan and South Korea operating unit.

Unit case volume for Bottling Investments decreased 12%, primarily driven by the impact of refranchising our bottling operations in the Philippines, Bangladesh and certain territories in India.

Concentrate Sales Volume

During the three months ended March 28, 2025, worldwide concentrate sales volume increased 1% and unit case volume increased 2% compared to the three months ended March 29, 2024.

During the three months ended June 27, 2025, both worldwide concentrate sales volume and unit case volume decreased 1% compared to the three months ended June 28, 2024.

During the six months ended June 27, 2025, worldwide concentrate sales volume was even and unit case volume increased 1% compared to the six months ended June 28, 2024.

Concentrate sales volume growth is calculated based on the amount sold during the reporting periods, which is impacted by the number of days.

Conversely, unit case volume growth is calculated based on average daily sales, which is not impacted by the number of days in the reporting periods.

The first quarter of 2025 had two fewer days when compared to the first quarter of 2024, which contributed to the differences between concentrate sales volume and unit case volume growth rates on a consolidated basis and for the individual operating segments.

Additionally, the differences between concentrate sales volume and unit case volume growth rates for the operating segments were impacted by the timing of concentrate shipments.

We expect the differences between concentrate sales volume and unit case volume growth rates to lessen over the remainder of the year.

We expect the differences between concentrate sales volume and unit case volume growth rates to be minimal on a full year basis.

Net Operating Revenues

During the three months ended March 28, 2025, net operating revenues were $11,129 million, compared to $11,300 million during the three months ended March 29, 2024, a decrease of $171 million, or 2%.

Three Months Ended June 27, 2025 versus Three Months Ended June 28, 2024

During the three months ended June 27, 2025, net operating revenues were $12,535 million, compared to $12,363 million during the three months ended June 28, 2024, an increase of $172 million, or 1%.

The following table illustrates, on a percentage basis, the estimated impact of the factors resulting in the increase (decrease) in net operating revenues on a consolidated basis and for each of our operating segments:

8 unchanged sentences

Certain rows may not add due to rounding.

1 Represents the percent change in net operating revenues attributable to the increase (decrease) in concentrate sales volume for our geographic operating segments after considering the impact of acquisitions and divestitures, if any.

1 Represents the percent change in net operating revenues attributable to the increase (decrease) in concentrate sales volume for our geographic operating segments (expressed in unit case equivalents) after considering the impact of acquisitions and divestitures, if any.

For our Bottling Investments operating segment, this represents the percent change in net operating revenues attributable to the increase (decrease) in unit case volume computed by comparing the total sales (rather than the average daily sales) in each of the corresponding periods after considering the impact of structural changes, if any.

14 unchanged sentences

• Latin America — favorable pricing initiatives, including inflationary pricing in Argentina, and favorable mix;

• North America — favorable pricing initiatives and favorable mix;

• Asia Pacific — unfavorable mix, partially offset by favorable pricing initiatives;

• Bottling Investments — favorable pricing initiatives, partially offset by unfavorable mix.

Fluctuations in foreign currency exchange rates unfavorably impacted our consolidated net operating revenues by 5%.

• North America — favorable pricing initiatives, partially offset by unfavorable mix;

• Asia Pacific — favorable pricing initiatives and favorable mix;

• Bottling Investments — favorable pricing initiatives, offset by unfavorable mix.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, unfavorably impacted our consolidated net operating revenues by 3%.

This unfavorable impact was primarily due to a stronger U.S.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, Argentine peso, Ethiopian birr, euro, Zimbabwe gold, and Nigerian naira, which had an unfavorable impact on our Latin America;

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, Argentine peso, Ethiopian birr and Turkish lira, which had an unfavorable impact on our Latin America;

Europe, Middle East and Africa;

and Bottling Investments operating segments.

The unfavorable impact of a stronger U.S.

dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S.

dollar compared to certain other foreign currencies, including the euro, British pound and Japanese yen, which had a favorable impact on our Europe, Middle East and Africa and Asia Pacific operating segments.

Refer to the heading “Liquidity, Capital Resources and Financial Position — Foreign Exchange” below.

4 unchanged sentences

Refer to the heading “Structural Changes, Acquired Brands and Newly Licensed Brands” above for additional information related to acquisitions and divestitures.

Six Months Ended June 27, 2025 versus Six Months Ended June 28, 2024

During the six months ended June 27, 2025, net operating revenues were $23,664 million, compared to $23,663 million during the six months ended June 28, 2024, an increase of $1 million.

Percent Change 2025 versus 2024

Price, Product & Geographic Mix Foreign Currency Fluctuations Acquisitions & Divestitures 2

Consolidated — % 5 % (4) % (1) % — %

Europe, Middle East & Africa 2 4 (3) — 3

Latin America (2) 15 (17) — (4)

North America (2) 5 — — 3

Asia Pacific 1 5 (4) (2) —

Bottling Investments (2) 2 (3) (11) (14)

Certain rows may not add due to rounding.

Our Bottling Investments operating segment data reflects unit case volume growth for consolidated bottlers only after considering the impact of structural changes, if any.

Refer to the heading “Beverage Volume” above.

2 Includes structural changes, if any.

Refer to the heading “Structural Changes, Acquired Brands and Newly Licensed Brands” above.

Refer to the heading “Beverage Volume” above for additional information related to changes in our unit case and concentrate sales volumes.

Price, product and geographic mix had a 5% favorable impact on our consolidated net operating revenues.

Price, product and geographic mix was impacted by a variety of factors and events including, but not limited to, the following:

• Europe, Middle East and Africa — favorable pricing initiatives, including inflationary pricing, partially offset by unfavorable mix;

• Latin America — favorable pricing initiatives, including inflationary pricing in Argentina, and favorable mix;

• North America — favorable pricing initiatives and favorable mix;

• Asia Pacific — favorable pricing initiatives and favorable mix;

• Bottling Investments — favorable pricing initiatives, partially offset by unfavorable mix.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, unfavorably impacted our consolidated net operating revenues by 4%.

This unfavorable impact was primarily due to a stronger U.S.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, Argentine peso, Ethiopian birr, and Turkish lira, which had an unfavorable impact on our Latin America;

Europe, Middle East and Africa;

and Bottling Investments operating segments.

The unfavorable impact of a stronger U.S.

dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S.

dollar compared to certain other foreign currencies, including the British pound, South African rand, Kenyan shilling and Japanese yen, which had a favorable impact on our Europe, Middle East and Africa;

Asia Pacific;

and Bottling Investments operating segments.

Refer to the heading “Liquidity, Capital Resources and Financial Position — Foreign Exchange” below.

Net operating revenue growth rates are impacted by sales volume;

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Management uses this measure in making financial, operating and planning decisions and in evaluating the Company’s performance.

Our gross profit margin increased to 62.6% for the three months ended March 28, 2025, compared to 62.5% for the three months ended March 29, 2024.

The increase was primarily due to the impact of favorable pricing initiatives and the refranchising of our bottling operations in the Philippines, Bangladesh and certain territories in India, partially offset by the unfavorable impact of foreign currency exchange rate fluctuations and higher commodity costs.

Our gross profit margin increased to 62.4% for the three months ended June 27, 2025, compared to 61.1% for the three months ended June 28, 2024.

Our gross profit margin increased to 62.5% for the six months ended June 27, 2025, compared to 61.8% for the six months ended June 28, 2024.

The increases were primarily due to the impact of favorable pricing initiatives and the refranchising of certain of our bottling operations, partially offset by the unfavorable impact of foreign currency exchange rate fluctuations and higher commodity costs.

Selling, General and Administrative Expenses

During the three months ended March 28, 2025, selling, general and administrative expenses was $3,234 million, compared to $3,351 million during the three months ended March 29, 2024, a decrease of $117 million, or 4%.

The decrease was primarily due to the refranchising of our bottling operations in the Philippines, Bangladesh and certain territories in India as well as an unfavorable foreign currency exchange rate impact of 3%.

Advertising expenses for the three months ended March 28, 2025 and March 29, 2024 were $1,089 million and $1,161 million, respectively.

As of March 28, 2025, we had $391 million of total unrecognized compensation cost related to nonvested stock-based compensation awards granted under our plans, which we expect to recognize over a weighted-average period of 2.0 years as stock-based compensation expense.

During the three months ended June 27, 2025, selling, general and administrative expenses were $3,470 million, compared to $3,549 million during the three months ended June 28, 2024, a decrease of $79 million, or 2%.

During the six months ended June 27, 2025, selling, general and administrative expenses were $6,704 million, compared to $6,900 million during the six months ended June 28, 2024, a decrease of $196 million, or 3%.

These decreases were primarily due to the refranchising of certain of our bottling operations as well as the timing of our marketing expenses.

During the six months ended June 27, 2025, foreign currency exchange rate fluctuations decreased selling, general and administrative expenses by 1%.

Advertising expenses for the three months ended June 27, 2025 and June 28, 2024 were $1,328 million and $1,400 million, respectively.

Advertising expenses for the six months ended June 27, 2025 and June 28, 2024 were $2,417 million and $2,561 million, respectively.

As of June 27, 2025, we had $334 million of total unrecognized compensation cost related to nonvested stock-based compensation awards granted under our plans, which we expect to recognize over a weighted-average period of 1.8 years as stock-based compensation expense.

This expected cost does not include the impact of any future stock-based compensation awards.

1 unchanged sentence

Other operating charges incurred by our operating segments and Corporate were as follows (in millions):

Three Months Ended

2025 March 29,

Three Months Ended Six Months Ended

2025 June 28,

2024 June 27,

2025 June 28,

Europe, Middle East & Africa $ — $ — $ — $ —

5 unchanged sentences

Total $ 71 $ 1,370 $ 144 $ 2,943

During the three months ended March 28, 2025, the Company recorded other operating charges of $73 million.

During the three months ended June 27, 2025, the Company recorded other operating charges of $71 million.

These charges primarily included $31 million related to the impairment of a trademark in Latin America, $28 million related to the Company’s productivity and reinvestment program, $7 million of 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 BodyArmor acquisition and $2 million related to tax litigation expense.

During the six months ended June 27, 2025, the Company recorded other operating charges of $144 million.

These charges consisted of $47 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of fairlife in 2020, which brought the total liability to $6,173 million and was paid in March 2025.

Additionally, other operating charges included $11 million related to the Company’s productivity and reinvestment program, $9 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $3 million for the amortization of noncompete agreements related to the BodyArmor acquisition and $3 million related to tax litigation expense.

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

Additionally, other operating charges included $39 million related to the Company’s productivity and reinvestment program, $31 million related to the impairment of a trademark in Latin America, $8 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $7 million for the amortization of noncompete agreements related

to the BodyArmor acquisition, $7 million of transaction costs related to the refranchising of our bottling operations in certain territories in India and $5 million related to tax litigation expense.

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

These charges consisted of $1,337 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of fairlife, $32 million related to the Company’s productivity and reinvestment program and $3 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

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 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 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 BodyArmor acquisition and $1 million related to tax litigation expense.

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.

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

1 unchanged sentence

Refer to Note 13 of Notes to Consolidated Financial Statements for additional information on the Company’s restructuring initiatives.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the fairlife acquisition and the BodyArmor impairment.

Refer to Note 17 of Notes to Consolidated Financial Statements for the impact these charges had on our operating segments and Corporate.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the fairlife acquisition and the impairments.

Refer to Note 17 of Notes to Consolidated Financial Statements for the impact certain of these charges had on our operating segments and Corporate.

Operating Income and Operating Margin

Information about our operating income contribution by operating segment and Corporate on a percentage basis is as follows:

Three Months Ended

2025 March 29,

Three Months Ended Six Months Ended

2025 June 28,

2024 June 27,

2025 June 28,

Europe, Middle East & Africa 31.0 % 48.7 % 30.1 % 49.5 %

9 unchanged sentences

Information about our operating margin on a consolidated basis and for each of our operating segments and Corporate is as follows:

Three Months Ended

2025 March 29,

Three Months Ended Six Months Ended

2025 June 28,

2024 June 27,

2025 June 28,

Consolidated 34.1 % 21.3 % 33.6 % 20.2 %

6 unchanged sentences

* Calculation is not meaningful.

During the three months ended March 28, 2025, operating income was $3,659 million, compared to $2,141 million during the three months ended March 29, 2024, an increase of $1,518 million, or 71%.

The increase was driven by an increase in concentrate sales volume of 1%, favorable pricing initiatives and lower other operating charges, partially offset by the impact of refranchising our bottling operations in the Philippines, Bangladesh and certain territories in India;

higher commodity costs;

and an unfavorable foreign currency exchange rate impact of 18%.

Fluctuations in foreign currency exchange rates unfavorably impacted consolidated operating income by 18% due to a stronger U.S.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, Argentine peso, euro, and Zimbabwe gold, which had an unfavorable impact on our Latin America and Europe, Middle East and Africa operating segments.

Three Months Ended June 27, 2025 versus Three Months Ended June 28, 2024

During the three months ended June 27, 2025, operating income was $4,280 million, compared to $2,632 million during the three months ended June 28, 2024, an increase of $1,648 million, or 63%.

The increase was driven by lower other operating charges, favorable pricing initiatives and lower selling, general and administrative expenses, partially offset by a decrease in concentrate sales volume of 1%, higher commodity costs and an unfavorable foreign currency exchange rate impact of 14%.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, unfavorably impacted consolidated operating income by 14% due to a stronger U.S.

dollar compared to certain foreign currencies, including the Mexican peso and Brazilian real, which had an unfavorable impact on our Latin America operating segment.

The unfavorable impact of a stronger U.S.

dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S.

dollar compared to certain other foreign currencies, including the euro and Japanese yen, which had a favorable impact on our Europe, Middle East and Africa and Asia Pacific operating segments.

Refer to the heading “Liquidity, Capital Resources and Financial Position — Foreign Exchange” below.

The Europe, Middle East and Africa operating segment reported operating income of $1,065 million and $1,080 million for the three months ended March 28, 2025 and March 29, 2024, respectively.

The decrease in operating income was primarily driven by higher commodity costs, increased marketing spending, higher operating expenses and an unfavorable foreign currency exchange rate impact of 9%, partially offset by an increase in concentrate sales volume of 1% and favorable pricing initiatives.

Latin America reported operating income of $904 million and $945 million for the three months ended March 28, 2025 and March 29, 2024, respectively.

The decrease in operating income was primarily driven by a decrease in concentrate sales volume of 3%, higher commodity costs and an unfavorable foreign currency exchange rate impact of 22%, partially offset by favorable pricing initiatives and lower operating expenses.

Operating income for North America for the three months ended March 28, 2025 and March 29, 2024 was $1,341 million and $497 million, respectively.

The increase in operating income was primarily driven by favorable pricing initiatives and lower other operating charges due to the impairment of our BodyArmor trademark in the prior year, partially offset by a decrease in concentrate sales volume of 4%, higher commodity costs, increased marketing spending, higher operating expenses and an unfavorable foreign currency exchange rate impact of 1%.

The Europe, Middle East and Africa operating segment reported operating income of $1,325 million and $1,282 million for the three months ended June 27, 2025 and June 28, 2024, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 2%, favorable pricing initiatives and lower operating expenses due to timing, partially offset by higher commodity costs, increased marketing spending and an unfavorable foreign currency exchange rate impact of 4%.

Latin America reported operating income of $957 million and $921 million for the three months ended June 27, 2025 and June 28, 2024, respectively.

The increase in operating income was primarily driven by favorable pricing initiatives, lower commodity costs and decreased marketing spending due to timing, partially offset by a decrease in concentrate sales volume of 1%, higher operating expenses, higher other operating charges and an unfavorable foreign currency exchange rate impact of 29%.

Operating income for North America for the three months ended June 27, 2025 and June 28, 2024 was $1,621 million and $1,376 million, respectively.

The increase in operating income was primarily driven by favorable pricing initiatives and lower operating expenses, partially offset by increased marketing spending and an unfavorable foreign currency exchange rate impact of 1%.

Asia Pacific’s operating income for the three months ended June 27, 2025 and June 28, 2024 was $647 million and $646 million, respectively.

The increase in operating income was primarily driven by favorable pricing initiatives, partially offset by a decrease in concentrate sales volume of 5%, higher commodity costs and an unfavorable foreign currency exchange rate impact of 8%.

Bottling Investments’ operating income for the three months ended June 27, 2025 and June 28, 2024 was $59 million and $98 million, respectively.

The decrease in operating income was primarily driven by the impact of refranchising our bottling operations in certain territories in India, a decrease in unit case volume of 2% , higher commodity costs and an unfavorable foreign currency exchange rate impact of 4%.

Corporate’s operating loss for the three months ended June 27, 2025 and June 28, 2024 was $329 million and $1,691 million, respectively.

Operating loss in 2025 decreased primarily as a result of lower other operating charges, primarily due to the prior year remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the fairlife acquisition.

Six Months Ended June 27, 2025 versus Six Months Ended June 28, 2024

During the six months ended June 27, 2025, operating income was $7,939 million, compared to $4,773 million during the six months ended June 28, 2024, an increase of $3,166 million, or 66%.

The increase was driven by lower other operating charges and favorable pricing initiatives, partially offset by higher commodity costs and an unfavorable foreign currency exchange rate impact of 16%.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, unfavorably impacted consolidated operating income by 16% due to a stronger U.S.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, Argentine peso, Zimbabwe gold, Ethiopian birr, and Turkish lira, which had an unfavorable impact on our Latin America;

Europe, Middle East and Africa;

and Bottling Investments operating segments.

The unfavorable impact of a stronger U.S.

dollar compared to the currencies listed above was partially offset by the impact of a weaker U.S.

dollar compared to certain other foreign currencies, including the Japanese yen, British pound, and South African rand, which had a favorable impact on our Asia Pacific;

Europe, Middle East and Africa;

and Bottling Investments operating segments.

Refer to the heading “Liquidity, Capital Resources and Financial Position — Foreign Exchange” below.

The Europe, Middle East and Africa operating segment reported operating income of $2,390 million and $2,362 million for the six months ended June 27, 2025 and June 28, 2024, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 2% and favorable pricing initiatives, partially offset by higher commodity costs, increased marketing spending and an unfavorable foreign currency exchange rate impact of 6%.

Latin America reported operating income of $1,861 million and $1,866 million for the six months ended June 27, 2025 and June 28, 2024, respectively.

The decrease in operating income was primarily driven by a decrease in concentrate sales volume of 2%, higher other operating charges and an unfavorable foreign currency exchange rate impact of 26%, partially offset by favorable pricing initiatives, lower commodity costs and lower marketing spending due to timing.

Operating income for North America for the six months ended June 27, 2025 and June 28, 2024 was $2,962 million and $1,873 million, respectively.

The increase in operating income was primarily driven by favorable pricing initiatives and lower other operating charges due to the impairment of our BodyArmor trademark in the prior year, partially offset by a decrease in concentrate sales volume of 2%, higher commodity costs, increased marketing spending and an unfavorable foreign currency exchange rate impact of 1%.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the impairment of our BodyArmor trademark.

Asia Pacific’s operating income for the three months ended March 28, 2025 and March 29, 2024 was $624 million and $657 million, respectively.

The decrease in operating income was primarily driven by the impact of structural changes, higher operating expenses and an unfavorable foreign currency exchange rate impact of 11%, partially offset by concentrate sales volume growth of 8%, lower commodity costs and lower marketing spending due to timing.

Bottling Investments’ operating income for the three months ended March 28, 2025 and March 29, 2024 was $119 million and $156 million, respectively.

The decrease in operating income was primarily driven by the impact of refranchising our bottling operations in the Philippines, Bangladesh and certain territories in India, higher commodity costs, higher operating expenses and an unfavorable foreign currency exchange rate impact of 4%, partially offset by favorable pricing initiatives.

Corporate’s operating loss for the three months ended March 28, 2025 and March 29, 2024 was $394 million and $1,194 million, respectively.

Operating loss in 2025 decreased primarily as a result of lower operating expenses and lower other operating charges, primarily due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Asia Pacific’s operating income for the six months ended June 27, 2025 and June 28, 2024 was $1,271 million and $1,303 million, respectively.

The decrease in operating income was primarily driven by the impact of structural changes, higher commodity costs, higher operating expenses and an unfavorable foreign currency exchange rate impact of 10%, partially offset by concentrate sales volume growth of 1%, favorable pricing initiatives and lower marketing spending due to timing.

Bottling Investments’ operating income for the six months ended June 27, 2025 and June 28, 2024 was $178 million and $254 million, respectively.

The decrease in operating income was primarily driven by the impact of refranchising our bottling operations in the Philippines, Bangladesh and certain territories in India, a decrease in unit case volume of 2%, higher commodity costs, higher operating expenses and an unfavorable foreign currency exchange rate impact of 4%, partially offset by favorable pricing initiatives.

Corporate’s operating loss for the six months ended June 27, 2025 and June 28, 2024 was $723 million and $2,885 million, respectively.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the fairlife acquisition.

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Interest Income

During the three months ended March 28, 2025, interest income was $180 million, compared to $246 million during the three months ended March 29, 2024, a decrease of $66 million, or 27%.

The decrease was primarily driven by lower average investment balances on our Corporate and certain international investments.

During the three months ended June 27, 2025, interest income was $188 million, compared to $275 million during the three months ended June 28, 2024, a decrease of $87 million, or 32%.

During the six months ended June 27, 2025, interest income was $368 million, compared to $521 million during the six months ended June 28, 2024, a decrease of $153 million, or 29%.

The decreases were primarily driven by lower average investment balances on our Corporate and certain international investments.

Interest Expense

During the three months ended March 28, 2025, interest expense was $387 million, compared to $382 million during the three months ended March 29, 2024, an increase of $5 million, or 1%.

The increase was primarily due to the impact of higher debt balances, partially offset by lower rates on derivative instruments compared to the prior year.

During the three months ended June 27, 2025, interest expense was $445 million, compared to $418 million during the three months ended June 28, 2024, an increase of $27 million, or 6%.

During the six months ended June 27, 2025, interest expense was $832 million, compared to $800 million during the six months ended June 28, 2024, an increase of $32 million, or 4%.

The increases were primarily due to the impact of higher debt balances, partially offset by lower rates on derivative instruments compared to the prior year.

Equity Income (Loss) — Net

During the three months ended March 28, 2025, equity income was $351 million, compared to equity income of $354 million during the three months ended March 29, 2024, a decrease of $3 million, or 1%.

During the three months ended June 27, 2025, equity income was $561 million, compared to equity income of $537 million during the three months ended June 28, 2024, an increase of $24 million, or 4%.

During the six months ended June 27, 2025, equity income was $912 million, compared to equity income of $891 million during the six months ended June 28, 2024, an increase of $21 million, or 2%.

Other Income (Loss) — Net

During the three months ended March 28, 2025, other income (loss) — net was income of $254 million.

The Company recognized a net gain of $331 million related to the sale of a portion of our ownership interest in CCEP, an impairment charge of $25 million related to an equity method investee in Latin America and a net loss of $19 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.

Additionally, the Company recognized net foreign currency exchange losses of $16 million, $24 million of costs related to our trade accounts receivable factoring program and dividend income of $55 million.

Other income (loss) — net also included expense of $33 million related to the non-service cost components of net periodic benefit cost, which included

charges of $25 million and $11 million for special termination benefits and a curtailment loss, respectively, related to non-U.S.

Three Months Ended June 27, 2025 versus Three Months Ended June 28, 2024

During the three months ended June 27, 2025, other income (loss) — net was income of $212 million.

The Company recognized a net gain of $163 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, a net gain of $102 million related to the refranchising of our bottling operations in certain territories in India and dividend income of $36 million.

Additionally, the Company recorded an other-than-temporary impairment charge of $40 million related to an equity method investee in Latin America, a charge of $28 million related to assets held for sale, $12 million of costs related to our trade accounts receivable factoring program and net foreign currency exchange losses of $4 million.

Other income (loss) — net also included income of $3 million related to the non-service cost components of net periodic benefit cost.

During the three months ended June 28, 2024, other income (loss) — net was income of $2 million.

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, dividend income of $48 million and income of $13 million related to the non-service cost components of net periodic benefit cost.

Other income (loss) — net also included net foreign currency exchange losses of $64 million, an other-than-temporary impairment charge of $34 million related to an equity method investee in Latin America and $29 million of costs related to our trade accounts receivable factoring program.

Refer to Note 4 of Notes to Consolidated Financial Statements for additional information on equity and debt securities.

Refer to Note 14 of Notes to Consolidated Financial Statements for additional information on net periodic benefit cost or income.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the impairment charges.

Six Months Ended June 27, 2025 versus Six Months Ended June 28, 2024

During the six months ended June 27, 2025, other income (loss) — net was income of $466 million.

The Company recognized a net gain of $331 million related to the sale of a portion of our ownership interest in CCEP, a net gain of $144 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, a net gain of $102 million related to the refranchising of our bottling operations in certain territories in India and dividend income of $91 million.

Additionally, the Company recorded other-than-temporary impairment charges of $40 million related to an equity method investee in Latin America and $25 million related to a joint venture in Latin America.

Other income (loss) — net also included $36 million of costs related to our trade accounts receivable factoring program, a charge of $28 million related to assets held for sale, net foreign currency exchange losses of $20 million and expense of $30 million related to the non-service cost components of net periodic benefit cost, which included charges of $25 million and $11 million for special termination benefits and a curtailment loss, respectively, related to non-U.S.

pension activity.

During the three months ended March 29, 2024, other income (loss) — net was income of $1,513 million.

During the six months ended June 28, 2024, other income (loss) — net was income of $1,515 million.

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 $178 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, recognized net foreign currency exchange losses of $68 million and recorded $22 million of costs related to our trade accounts receivable factoring program.

Other income (loss) — net also included income of $15 million related to the non-service cost components of net periodic benefit cost and dividend income of $25 million.

Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the sale of our ownership interest in CCEP, the sale of our ownership interest in an equity method investee in Thailand and the refranchising of our bottling operations.

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, dividend income of $73 million and income of $28 million related to the non-service cost components of net periodic benefit cost.

Other income (loss) — net also included net foreign currency exchange losses of $132 million, $51 million of costs related to our trade accounts receivable factoring program, 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.

Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on our divestiture activities.

Refer to Note 4 of Notes to Consolidated Financial Statements for additional information on equity and debt securities.

Refer to Note 14 of Notes to Consolidated Financial Statements for additional information on net periodic benefit cost or income.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the impairment charge.

The Company recorded income taxes of $722 million (17.8% effective tax rate) and $687 million (17.7% effective tax rate) during the three months ended March 28, 2025 and March 29, 2024, respectively.

The Company’s effective tax rates for the three months ended March 28, 2025 and March 29, 2024 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 of Notes to Consolidated Financial Statements, 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.

Refer to Note 16 of Notes to Consolidated Financial Statements for additional information on the impairment charges.

The Company recorded income taxes of $993 million (20.7% effective tax rate) and $627 million (20.7% effective tax rate) during the three months ended June 27, 2025 and June 28, 2024, respectively.

The Company recorded income taxes of $1,715 million (19.4% effective tax rate) and $1,314 million (19.0% effective tax rate) during the six months ended June 27, 2025 and June 28, 2024, respectively.

The Company’s effective tax rates for the three and six months ended June 27, 2025 and June 28, 2024 vary from the statutory U.S.

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 rate for the three months ended March 28, 2025 included $143 million of net tax benefits related to various discrete tax items, including net interest income of $53 million related to the IRS Tax Litigation Deposit recorded in the line item income taxes in our consolidated statement of income, in accordance with our accounting policy, and a tax benefit of $85 million related to a change in the Company’s indefinite reinvestment assertion for certain foreign entities.

The Company’s effective tax rates for the three and six months ended June 27, 2025 included $12 million and $155 million, respectively, of net tax benefits related to various discrete tax items, including net interest income of $54 million and $107 million, respectively, related to the IRS Tax Litigation Deposit recorded in the line item income taxes in our consolidated statements of income, in accordance with our accounting policy.

The Company’s effective tax rate for the six months ended June 27, 2025 also included a tax benefit of $85 million related to a change in the Company’s indefinite reinvestment assertion for certain foreign entities.

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.

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.

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Many jurisdictions have enacted legislation and adopted policies resulting from the Organization for Economic Co-operation and Development’s (“OECD”) Anti-Base Erosion and Profit Shifting project.

The OECD is currently coordinating a two-pillared project on behalf of the G20 and other participating countries which would grant additional taxing rights over profits earned by multinational enterprises to the countries in which their products are sold and services rendered.

The OECD is currently coordinating a two-pillared project on behalf of the Group of Twenty (G20) and other participating countries which would grant additional taxing rights over profits earned by multinational enterprises to the countries in which their products are sold and services rendered.

Pillar One would allow countries to reallocate a portion of profits earned by multinational businesses with an annual global revenue exceeding €20 billion and a profit margin of over 10% to applicable market jurisdictions.

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Numerous countries have enacted legislation that implemented certain aspects of Pillar Two effective January 1, 2024, while many others have indicated their intent to adopt, or have adopted, legislation effective in 2025.

On June 28, 2025, the Group of Seven (G7) released a statement announcing an understanding of a potential “side-by-side system” approach to the Pillar Two framework that would exclude U.S.-parented groups from certain Pillar Two provisions in recognition of existing U.S.

minimum tax rules.

The OECD and implementing countries are expected to continue to make further revisions to their legislation and release additional guidance.

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The Company regularly reviews its optimal mix of short-term and long-term debt.

The Company’s cash, cash equivalents, short-term investments and marketable securities totaled $13.8 billion as of March 28, 2025.

In addition to these funds, our commercial paper program, and our ability to issue long-term debt, we had $4.6 billion in unused backup lines of credit for general corporate purposes as of March 28, 2025.

The Company’s cash, cash equivalents, short-term investments and marketable securities totaled $14.3 billion as of June 27, 2025.

These backup lines of credit expire at various times through 2030.

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In these factoring arrangements, for ease of administration, the Company collects customer payments related to the factored receivables and remits those payments to the financial institutions.

The Company sold $5,034 million and $4,508 million of trade accounts receivables under this program during the three months ended March 28, 2025 and March 29, 2024, respectively.

The costs of factoring such receivables were $24 million and $22 million for the three months ended March 28, 2025 and March 29, 2024, respectively.

The Company sold $8,400 million and $10,021 million of trade accounts receivables under this program during the six months ended June 27, 2025 and June 28, 2024, respectively.

The costs of factoring such receivables were $36 million and $51 million for the six months ended June 27, 2025 and June 28, 2024, respectively.

The cash received from the financial institutions is reflected within the operating activities section of our consolidated statement of cash flows.

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That amount, plus interest earned, would be refunded in full or in part if the Company’s tax positions are ultimately sustained on appeal.

For the three months ended March 28, 2025, the Company recorded net interest income of $53 million related to this tax payment in the line item income taxes in our consolidated statement of income, in accordance with our accounting policy.

The payment of the IRS invoices and the related accrued interest were recorded in the line item other noncurrent assets in our consolidated balance sheets as of March 28, 2025 and December 31, 2024.

For the three and six months ended June 27, 2025, the Company recorded net interest income of $54 million and $107 million, respectively, related to this tax payment in the line item income taxes in our consolidated statements of income, in accordance with our accounting policy.

The payment of the IRS invoices and the related accrued interest were recorded in the line item other noncurrent assets in our consolidated balance sheets as of June 27, 2025 and December 31, 2024.

On October 22, 2024, the Company appealed the Tax Court’s decision to the U.S.

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While the Company believes that it is more likely than not that we will ultimately prevail in this litigation upon appeal, it is possible that all, or some portion of, the adjustments proposed by the IRS and sustained by the Tax Court could ultimately be upheld.

In that event, the Company would not receive a refund of the applicable portion or all of the $6.0 billion it paid in response to the IRS invoices issued in September 2024 and the related accrued interest receivable of $171 million as of March 28, 2025.

Additionally, the Company would likely be subject to significant additional liabilities for subsequent years, which could have a material adverse

impact on the Company’s financial position, results of operations and cash flows.

Additionally, the Company would likely be subject to significant additional liabilities for subsequent years, which could have a material adverse impact on the Company’s financial position, results of operations and cash flows.

The Company estimates that the potential aggregate remaining incremental tax and interest liability for the tax years 2010 through 2024 could be approximately $12 billion as of December 31, 2024.

Additional income tax and interest on any unpaid potential liabilities for the 2010 through 2024 tax years 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 methodology asserted by the IRS and affirmed in the Opinions for the three months ended March 28, 2025 would increase the potential aggregate incremental tax and interest liability by approximately $400 million.

The Company estimates the impact of the continued application of the methodology asserted by the IRS and affirmed in the Opinions for the three and six months ended June 27, 2025 would increase the potential aggregate incremental tax and interest liability by approximately $400 million and $800 million, respectively.

Refer to Note 9 of Notes to Consolidated Financial Statements for additional information on the tax litigation.

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Cash Flows from Operating Activities

Net cash used in operating activities during the three months ended March 28, 2025 was $5,202 million, and net cash provided by operating activities during the three months ended March 29, 2024 was $528 million, a decrease of $5,730 million.

The decrease was primarily driven by $6,069 million of the $6,173 million final milestone payment for fairlife that was made during the three months ended March 28, 2025, the prior year benefits of both the trade accounts receivable factoring program and the dividend payment from an equity method investee in Thailand, as well as the unfavorable impact due to foreign currency exchange rate fluctuations.

These items were partially offset by strong cash operating results and the timing of changes in working capital.

Net cash used in operating activities during the six months ended June 27, 2025 was $1,391 million, and net cash provided by operating activities during the six months ended June 28, 2024 was $4,113 million, a decrease of $5,504 million.

The decrease was primarily driven by $6,069 million of the $6,173 million final milestone payment for fairlife that was made during the six months ended June 27, 2025, the prior year benefits of both the trade accounts receivable factoring program and the dividend payment from an equity method investee in Thailand, higher net interest payments, as well as the unfavorable impact due to foreign currency exchange rate fluctuations.

These items were partially offset by strong cash operating results, lower tax payments, the transfer of surplus non-U.S.

plan assets from pension trusts to general assets of the Company and the timing of changes in working capital.

Cash Flows from Investing Activities

Net cash used in investing activities during the three months ended March 28, 2025 was $1,067 million, and net cash provided by investing activities during the three months ended March 29, 2024 was $330 million.

Net cash used in investing activities during the six months ended June 27, 2025 was $278 million, and net cash provided by investing activities during the six months ended June 28, 2024 was $997 million.

Purchases of Investments and Proceeds from Disposals of Investments

During the three months ended March 28, 2025, purchases of investments were $2,507 million and proceeds from disposals of investments were $1,005 million, resulting in a net cash outflow of $1,502 million.

During the three months ended March 29, 2024, purchases of investments were $2,552 million and proceeds from disposals of investments were $444 million, resulting in a net cash outflow of $2,108 million.

During the six months ended June 27, 2025, purchases of investments were $2,865 million and proceeds from disposals of investments were $2,201 million, resulting in a net cash outflow of $664 million.

During the six months ended June 28, 2024, purchases of investments were $3,827 million and proceeds from disposals of investments were $2,662 million, resulting in a net cash outflow of $1,165 million.

This activity primarily represents the purchases of, and proceeds from the disposals of, investments in marketable securities and short-term investments that were made as part of the Company’s overall cash management strategy.

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Proceeds from Disposals of Businesses, Equity Method Investments and Nonmarketable Securities

During the three months ended March 28, 2025 and March 29, 2024, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $748 million and $2,893 million, respectively.

The activity during the three months ended March 28, 2025 primarily related to the sale of a portion of our ownership interest in CCEP.

The activity during the three months ended March 29, 2024 primarily related to sales of our ownership interests in certain equity method investees and the refranchising of certain of our bottling operations.

During the six months ended June 27, 2025 and June 28, 2024, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $973 million and $2,907 million, respectively.

The activity during the six months ended June 27, 2025 primarily related to the sale of a portion of our ownership interest in CCEP and the refranchising of certain of our bottling operations.

The activity during the six months ended June 28, 2024 primarily related to sales of our ownership interests in certain equity method investees and the refranchising of certain of our bottling operations.

Refer to Note 2 of Notes to Consolidated Financial Statements.

Purchases of Property, Plant and Equipment

Purchases of property, plant and equipment during the three months ended March 28, 2025 and March 29, 2024 were $309 million and $370 million, respectively.

Purchases of property, plant and equipment during the six months ended June 27, 2025 and June 28, 2024 were $751 million and $792 million, respectively.

Other Investing Activities

During the six months ended June 27, 2025 and June 28, 2024, the total cash inflow was $124 million and $127 million, respectively.

The activity during the six months ended June 27, 2025 included $98 million related to the reimbursement of advanced payments made to finance the construction of leased assets.

The activity during the six months ended June 28, 2024 included the collection of $69 million of deferred proceeds related to the refranchising of our bottling operations in Vietnam.

Cash Flows from Financing Activities

Net cash provided by financing activities during the three months ended March 28, 2025 and March 29, 2024 was $3,432 million and $406 million, respectively.

Net cash provided by financing activities during the six months ended June 27, 2025 was $52 million, and net cash used in financing activities during the six months ended June 28, 2024 was $532 million.

Loans, Notes Payable and Long-Term Debt

During the three months ended March 28, 2025, the Company had issuances of debt of $5,436 million, which consisted of $3,917 million of net issuances of commercial paper and short-term debt with maturities of 90 days or less, $1,033 million of issuances of commercial paper and short-term debt with maturities greater than 90 days and long-term debt issuances of

$486 million, net of related discounts and issuance costs.

During the six months ended June 27, 2025, the Company had issuances of debt of $5,320 million, which consisted of $1,547 million of net issuances of commercial paper and short-term debt with maturities of 90 days or less, $3,205 million of issuances of commercial paper and short-term debt with maturities greater than 90 days and long-term debt issuances of $568 million, net of related discounts and issuance costs.

Refer to Note 8 of Notes to Consolidated Financial Statements for additional information.

The Company made payments of debt of $1,599 million during the three months ended March 28, 2025, which consisted of $1,047 million of payments related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $552 million.

During the three months ended March 29, 2024, the Company had issuances of debt of $2,285 million, which consisted of $2,221 million of issuances of commercial paper and short-term debt with maturities greater than 90 days and long-term debt issuances of $64 million, net of related discounts and issuance costs.

The Company made payments of debt of $1,366 million during the three months ended March 29, 2024, which consisted of $369 million of net payments of commercial paper and short-term debt with maturities of 90 days or less, payments of $408 million related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $589 million.

The Company made payments of debt of $2,630 million during the six months ended June 27, 2025, which consisted of $1,957 million of payments related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $673 million.

During the six months ended June 28, 2024, the Company had issuances of debt of $6,832 million, which consisted of $2,677 million of issuances of commercial paper and short-term debt with maturities greater than 90 days and long-term debt issuances of $4,155 million, net of related discounts and issuance costs.

The Company made payments of debt of $4,734 million during the six months ended June 28, 2024, which consisted of $1,117 million of net payments of commercial paper and short-term debt with maturities of 90 days or less, payments of $2,450 million related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $1,167 million.

Issuances of Stock

The issuances of stock during the three months ended March 28, 2025 and March 29, 2024 were related to the exercise of stock options by employees.

The issuances of stock during the six months ended June 27, 2025 and June 28, 2024 were related to the exercise of stock options by employees.

Purchases of Stock for Treasury

During the three months ended March 28, 2025, the total cash outflow for treasury stock purchases was $370 million.

During the six months ended June 27, 2025, the total cash outflow for treasury stock purchases was $472 million.

The Company repurchased 5.4 million shares of common stock under the share repurchase plan authorized by our Board of Directors.

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In addition to shares repurchased under the share repurchase plan, the Company’s treasury stock activity included shares surrendered to the Company to pay the exercise price and/or to satisfy tax withholding obligations in connection with so-called stock swap exercises of employee stock options and/or the vesting of restricted stock issued to employees.

The net impact of the Company’s issuances of stock and share repurchases during the three months ended March 28, 2025 resulted in a net cash outflow of $211 million.

During the three months ended March 29, 2024, the total cash outflow for treasury stock purchases was $702 million.

The net impact of the Company’s issuances of stock and share repurchases during the six months ended June 27, 2025 resulted in a net cash outflow of $249 million.

During the six months ended June 28, 2024, the total cash outflow for treasury stock purchases was $874 million.

The Company repurchased 12.9 million shares of common stock under the share repurchase plan authorized by our Board of Directors.

1 unchanged sentence

The net impact of the Company’s issuances of stock and share repurchases during the three months ended March 29, 2024 resulted in a net cash outflow of $412 million.

During the three months ended March 28, 2025 and March 29, 2024, the Company paid dividends of $89 million and $99 million, respectively.

As a result of the timing of our quarterly reporting periods as well as our dividend payment dates, the Company paid substantially all of the 2024 and 2025 first quarterly dividends in the second quarter of each year.

Our Board of Directors approved the Company’s regular quarterly dividend of $0.51 per share at its May 2025 meeting.

This dividend is payable on July 1, 2025 to shareowners of record as of the close of business on June 13, 2025.

The net impact of the Company’s issuances of stock and share repurchases during the six months ended June 28, 2024 resulted in a net cash outflow of $437 million.

During the six months ended June 27, 2025 and June 28, 2024, the Company paid dividends of $2,283 million and $2,184 million, respectively.

As a result of the timing of our quarterly reporting periods as well as our dividend payment dates, the Company paid substantially all of the 2024 and 2025 second quarterly dividends in the third quarter of each year.

Our Board of Directors approved the Company’s regular quarterly dividend of $0.51 per share at its July 2025 meeting.

This dividend is payable on October 1, 2025 to shareowners of record as of the close of business on September 15, 2025.

Other Financing Activities

During the three months ended March 28, 2025 and March 29, 2024, the total cash outflow for other financing activities was $105 million and $2 million, respectively.

The cash outflow during the three months ended March 28, 2025 included $104 million of the $6,173 million final milestone payment for fairlife.

During the six months ended June 27, 2025 and June 28, 2024, the total cash outflow for other financing activities was $106 million and $9 million, respectively.

The cash outflow during the six months ended June 27, 2025 included $104 million of the $6,173 million final milestone payment for fairlife.

Foreign Exchange

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Due to the geographic diversity of our operations, weakness in some currencies may be offset by strength in other currencies over time.

Our hedging activities are designed to mitigate, over time, a portion of the potentially unfavorable impact of exchange rate fluctuations on our net income.

Taking into account the effects of our hedging activities, the impact of

fluctuations in foreign currency exchange rates decreased our operating income for the three months ended March 28, 2025 by 18%.

Our hedging activities are designed to mitigate, over time, a portion of the impact of exchange rate fluctuations on our net income.

Taking into account the effects of our hedging activities, the impact of fluctuations in foreign currency exchange rates decreased our operating income for the three and six months ended June 27, 2025 by 14% and 16%, respectively.

Based on current spot rates and our hedging coverage in place, we expect foreign currency exchange rate fluctuations will have an unfavorable impact on operating income and cash flows from operating activities through the end of the year.

2 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 2. Management’s Discussion and Analysis