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Item 8. Financial Statements and Supplementary Data

2026-02-20 compared with 2025-02-20 · 361 added, 389 removed, 1960 unchanged (28% of the section changed)

81 unchanged sentences

Prepaid expenses and other current assets 2,433 2,998

Assets held for sale 5,342 131

Total Current Assets 31,044 25,997

12 unchanged sentences

Accrued income taxes 525 1,387

Liabilities held for sale 2,570 3

Total Current Liabilities 21,281 25,249

49 unchanged sentences

Dividends ( 8,779 ) ( 8,359 ) ( 7,952 )

Proceeds from sale of a noncontrolling interest 1,338 — —

Other financing activities ( 279 ) ( 31 ) ( 465 )

25 unchanged sentences

Stock-based compensation expense 266 273 233

Sale of subsidiary shares 420 — —

Acquisition of interests held by noncontrolling owners — — ( 20 )

20 unchanged sentences

Balance at beginning of year $ 1,516 $ 1,539 $ 1,721

Sale of subsidiary shares 644 — —

Net income attributable to noncontrolling interests 30 18 ( 11 )

1 unchanged sentence

Dividends paid to noncontrolling interests ( 25 ) ( 28 ) ( 25 )

Acquisition of interests held by noncontrolling owners — ( 2 ) —

Contributions by noncontrolling interests 13 — —

Net change in pension and other postretirement benefit liabilities ( 3 ) — —

Divestitures — ( 4 ) —

Acquisition of interests held by noncontrolling owners — — ( 2 )

Other activities — — 3

19 unchanged sentences

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S.

The accompanying consolidated financial statements have been prepared in accordance with U.S.

The preparation of our consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements and accompanying notes.

1 unchanged sentence

Furthermore, when testing assets for impairment in future periods, if management uses different assumptions or if different conditions occur, impairment charges may result.

Certain other amounts in the prior years’ consolidated financial statements and notes have been revised to conform to the current year presentation.

Principles of Consolidation

47 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.

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.

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.

6 unchanged sentences

Refer to Note 4.

2 Amounts include cash and cash equivalents related to assets held for sale, which are included in the line item prepaid expenses and other current assets in our consolidated balance sheets.

2 Amounts include cash and cash equivalents related to assets held for sale.

Refer to Note 2.

17 unchanged sentences

We record trade accounts receivable at net realizable value.

This value includes an appropriate allowance for estimated uncollectible accounts to reflect any expected loss on the trade accounts receivable balances and charged to the provision for doubtful accounts.

This value includes an appropriate allowance for estimated uncollectible accounts, which is charged to the provision for doubtful accounts, to reflect any expected loss on the trade accounts receivable balances.

We calculate this allowance based on available relevant information, in addition to historical loss information, the level of past-due accounts based on the contractual terms of the receivables, and our relationships with, and the economic status of, our bottling partners and customers.

7 unchanged sentences

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

Inventories consist primarily of raw materials and packaging (which include ingredients and supplies) and finished goods (which include concentrates and syrups in our concentrate operations and finished beverages in our finished product

Inventories are valued at the lower of cost or net realizable value.

42 unchanged sentences

Depreciation expense, including the depreciation expense of assets under finance leases, totaled $ 978 million, $ 997 million and $ 1,018 million in 2025, 2024 and 2023, respectively.

Amortization expense for leasehold improvements totaled $ 17 million, $ 14 million and $ 13 million in 2024, 2023 and 2022, respectively.

The following table summarizes our property, plant and equipment (in millions):

37 unchanged sentences

Our operating segments are primarily based on geographic responsibility, which is consistent with the way management runs our business.

Our geographic operating segments are generally subdivided into smaller geographic regions.

These geographic regions are our reporting units.

Our Global Ventures operating segment includes the results of our Costa Limited (“Costa”), innocent and doğadan businesses, as well as fees earned pursuant to distribution coordination agreements

between the Company and Monster Beverage Corporation (“Monster”), each of which is its own reporting unit.

Our geographic operating segments are generally subdivided into smaller geographic regions, which are reporting units.

The Bottling Investments operating segment includes all of our consolidated bottling operations, regardless of geographic location.

Generally, each consolidated bottling operation within our Bottling Investments operating segment is its own reporting unit.

Generally, each consolidated bottling operation within our Bottling Investments operating

segment is its own reporting unit.

Goodwill is assigned to the reporting unit or units that benefit from the synergies arising from each business combination.

5 unchanged sentences

Otherwise, the Company does not need to perform any further assessment.

Impairment charges related to intangible assets, including goodwill, are generally recorded in the line item other operating charges or, to the extent they relate to equity method investees, in the line item equity income (loss) — net in our consolidated statement of income.

Impairment charges related to intangible assets, including goodwill, are generally recorded in the line item other operating charges in our consolidated statement of income.

Contingencies

3 unchanged sentences

Refer to Note 12.

Noncontrolling Interests

In July 2025, we sold a 40 % noncontrolling interest in our bottling operations in India to a local partner for approximately $ 1.3 billion, which, net of direct costs, resulted in an increase to total equity of $ 1.1 billion.

As a result, 40 % of the subsidiary’s equity was allocated to the noncontrolling interest and the remaining amount was recorded in capital surplus.

Additionally, $ 226 million of foreign currency translation adjustments included in accumulated other comprehensive income (loss) (“AOCI”) were allocated to the noncontrolling interest.

Stock-Based Compensation

15 unchanged sentences

Deferred tax assets and liabilities are recognized for the tax consequences of temporary differences between the book basis and the tax basis of assets and liabilities.

The tax rate used to determine the deferred tax assets and liabilities is the enacted tax rate for the year and manner in which the differences are expected to reverse.

The tax rate used to determine the deferred tax assets and liabilities is the enacted tax rate for the year and manner in which the differences

are expected to reverse.

Valuation allowances are recorded to reduce deferred tax assets to the amount that will more likely than not be realized.

The Company is involved in various tax matters, with respect to some of which the outcome is uncertain.

We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that it becomes uncertain based

upon one of the following conditions:

We establish reserves to remove some or all of the tax benefit of any of our tax positions at the time we determine that it becomes uncertain based upon one of the following conditions:

(1) the tax position is not “more likely than not” to be sustained;

15 unchanged sentences

Generally, our foreign subsidiaries use the local currency as their functional currency.

Changes in the carrying values of these assets and liabilities attributable to fluctuations in spot rates are recognized in net foreign currency translation adjustments, a component of accumulated other comprehensive income (loss) (“AOCI”).

Changes in the carrying values of these assets and liabilities attributable to fluctuations in spot rates are recognized in net foreign currency translation adjustments, a component of AOCI.

Refer to Note 16.

4 unchanged sentences

Recently Issued Accounting Guidance

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures , which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The expanded annual disclosures are effective for our year ended December 31, 2024, and the expanded interim disclosures are effective in 2025 and will be applied retrospectively to all prior periods presented.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures (“ASU 2023-09”), which requires, among other things, additional disclosures primarily related to the income tax rate reconciliation and income taxes paid.

The expanded annual disclosures are effective for our year ended December 31, 2025 and will be applied prospectively.

Refer to Note 15.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , which requires, among other things, additional disclosures primarily related to the income tax rate reconciliation and income taxes paid.

The expanded annual disclosures are effective for our year ending December 31, 2025.

The Company is currently evaluating the impact that ASU 2023-09 will have on our consolidated financial statements and whether we will apply the standard prospectively or retrospectively.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) , which requires additional disclosures around specific expense categories in the notes to the financial statements.

4 unchanged sentences

Our Company’s acquisitions of businesses, equity method investments and nonmarketable securities totaled $ 461 million, $ 315 million and $ 62 million during 2025, 2024 and 2023, respectively.

In 2024, we invested $ 226 million in alternative energy limited partnerships.

The activity during 2025 included additional investments of $ 120 million in an equity method investee in Japan.

The activity during 2025 and 2024 included $ 306 million and $ 226 million, respectively, of investments in alternative energy limited partnerships.

Refer to Note 15 for additional information on these investments.

During 2024, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 3,485 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 net cash proceeds of $ 718 million and recognized a net gain of $ 506 million, including the impact of post-closing adjustments.

We also sold a portion of our interest in Coca-Cola Consolidated, Inc.

(“Coke Consolidated”), an equity method investee, to Coke Consolidated, for which we received cash proceeds of $ 554 million and recognized a net gain of $ 338 million.

Additionally, we refranchised our bottling operations in additional territories in India for which we received cash proceeds of $ 17 million and recognized a net gain of $ 13 million.

During 2023, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 430 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.

During 2025, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 3,567 million.

In March 2025, the Company sold a portion of our ownership interest in CCEP, an equity method investee, for which we received cash proceeds of $ 741 million and recognized a gain of $ 331 million.

In May 2025, the Company refranchised our bottling operations in certain territories in India that were held for sale as of December 31, 2024, for which we received cash proceeds of $ 218 million and recognized a gain of $ 102 million.

In October 2025, we sold our finished product operations in Nigeria, which were classified as held for sale, for which we received cash proceeds of $ 106 million.

In November 2025, we sold our ownership interest in Coke Consolidated, an equity method investee, to Coke Consolidated, for which we received cash proceeds of $ 2,392 million and recognized a gain of $ 1,952 million.

In December 2025, we received cash proceeds of $ 84 million from the substantial liquidation of a joint venture in China, resulting in a gain of $ 31 million.

During 2024, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 3,485 million.

The Company refranchised our bottling operations in certain territories in India in January and February 2024, for which we received cash proceeds of $ 474 million and recognized a gain of $ 290 million.

In February 2024, the Company refranchised our bottling operations in the Philippines to CCEP and a local business partner, for which we received cash proceeds of $ 1,652 million and recognized a gain of $ 595 million.

We also sold our ownership interest in an equity method investee in Thailand, for which we received cash proceeds of $ 718 million and recognized a gain of $ 506 million.

Additionally, the Company refranchised our bottling operations in Bangladesh to Coca-Cola İçecek A.Ş., an equity method investee, for which we received cash proceeds of $ 27 million and a note receivable of $ 29 million and recognized a loss of $ 18 million, primarily due to the related reclassification of net foreign currency translation adjustments to income.

During 2025, the Company recognized an additional loss of $ 14 million related to post-closing adjustments and a corresponding reduction in the outstanding note receivable balance.

In July 2024, we sold a portion of our ownership interest in Coke Consolidated to Coke Consolidated, for which we received cash proceeds of $ 554 million and recognized a gain of $ 338 million.

In December 2024, we refranchised our bottling operations in additional territories in India, for which we received cash proceeds of $ 17 million and recognized a gain of $ 13 million.

During 2023, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 430 million, which primarily related to the sale of our ownership interest in an equity method investee in Indonesia to CCEP, for which we received cash proceeds of $ 302 million and recognized a gain of $ 12 million.

Also included was the sale of our ownership interest in an equity method investee in Pakistan, for which we received cash proceeds of $ 100 million and a note receivable of $ 200 million.

We recognized a net gain of $ 82 million as a result of the sale.

During 2022, proceeds from disposals of businesses, equity method investments and nonmarketable securities totaled $ 458 million, which primarily related to the refranchising of our bottling operations in Cambodia.

We received net cash proceeds of $ 228 million and recognized a net gain of $ 153 million as a result of the refranchising.

Also included was the sale of our ownership interest in one of our equity method investees, for which we received cash proceeds of $ 123 million and recognized a net gain of $ 13 million.

All of the gains discussed above were recorded in the line item other income (loss) — net in our consolidated statements of income.

We recognized a gain of $ 82 million as a result of the sale.

In December 2022, the Company received cash proceeds of $ 823 million in advance of refranchising its bottling operations in Vietnam, which were refranchised in January 2023 and for which we recognized a gain of $ 439 million.

All of the gains and losses discussed above were recorded in the line item other income (loss) — net in our consolidated statements of income.

Assets and Liabilities Held for Sale

In August 2025, the Company’s finished product operations in Nigeria, which were included in the EMEA operating segment, met the criteria to be classified as held for sale.

As a result, we were required to record the related assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the estimated proceeds.

As there were significant negative net foreign currency translation adjustments that would be reclassified to income upon sale, the carrying amount of the assets held for sale (including the net foreign currency translation adjustments) exceeded the estimated proceeds, which required us to record an impairment loss in excess of the carrying amount of the assets held for sale (excluding the net foreign currency translation adjustments).

As a result, the Company recorded a charge of $ 393 million, which consisted of a $ 235 million charge to write off the carrying amount of the assets held for sale (excluding the net foreign currency translation adjustments) and a $ 158 million charge to accrue the remaining difference between the carrying amount (including the net foreign currency translation adjustments) and the estimated proceeds.

These charges were recorded in the line item other income (loss) — net in our consolidated statement of income.

The sale of these operations was completed in October 2025.

In October 2025, the Company entered into a definitive agreement to sell a portion of our interest in our bottling operations in Africa to CCHBC, an equity method investee.

Closing is subject to various regulatory approvals and is expected by the end of 2026, upon which we will deconsolidate these bottling operations.

We have also agreed to a separate option arrangement for CCHBC to acquire the Company’s remaining 25% ownership interest within a six-year period from closing.

As these operations met the criteria to be classified as held for sale, we were required to record the related assets and liabilities at the lower of carrying value or fair value less any costs to sell based on the estimated proceeds.

Due to the negative net foreign currency translation adjustments that will be reclassified to income upon sale, we were required to reduce the carrying amount of the assets held for sale, which resulted in an impairment charge of $ 1,274 million, which was recorded in the line item other income (loss) — net in our consolidated statement of income.

As of December 31, 2024, the Company’s bottling operations in certain territories in India met the criteria to be classified as held for sale.

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

As a result, we were required to record the related assets and liabilities at the lower of carrying value or fair value less any costs to sell.

As the fair values less any costs to sell exceeded the carrying values, the related assets and liabilities were recorded at their carrying values.

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 $ 474 million and recognized a net gain of $ 290 million, including the impact of post-closing adjustments.

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

(“CCI”), an equity method investee, in February 2024, for which we received net cash proceeds of $ 27 million and a note receivable of $ 29 million and recognized a net loss of $ 18 million, primarily due to the related reversal of cumulative translation adjustments.

Additionally, in February 2024, the Company refranchised its bottling operations in the Philippines to CCEP and a local business partner, for which we received net cash proceeds of $ 1,652 million and recognized a net gain of $ 595 million, including the impact of post-closing adjustments.

These gains and losses were recorded in the line item other income (loss) — net in our consolidated statement of income.

In December 2022, the Company received cash proceeds of $ 823 million in advance of refranchising its bottling operations in Vietnam, which was included in the line item other investing activities in our consolidated statement of cash flows for the year ended December 31, 2022.

The Company refranchised its bottling operations in Vietnam in January 2023 and recognized a net gain of $ 439 million as a result of the sale, which was recorded in the line item other income (loss) — net in our consolidated statement of income for the year ended December 31, 2023.

The following table presents information related to the major classes of assets and liabilities that were classified as held for sale and were included in the line items prepaid expenses and other current assets and accounts payable and accrued expenses, respectively, in our consolidated balance sheets (in millions):

The following table presents information related to the major classes of assets and liabilities that were classified as held for sale in our consolidated balance sheets (in millions):

December 31, 2025 2024

Cash, cash equivalents and short-term investments $ 178 $ —

Marketable securities

Trade accounts receivable, less allowances 389 —

2 unchanged sentences

Equity method investments

Other noncurrent assets — 51

Deferred income tax assets 46 —

Property, plant and equipment — net 1,964 108

Trademarks with indefinite lives 2 —

Goodwill 3,350 —

Other intangible assets

Other noncurrent assets 60 —

Allowance for reduction of assets held for sale ( 1,265 ) —

Assets held for sale $ 5,342 $ 131

1 unchanged sentence

Loans and notes payable

Current maturities of long-term debt 398 —

Accrued income taxes 5 —

7 unchanged sentences

Our concentrate operations typically generate net operating revenues by selling beverage concentrates, sometimes referred to as “beverage bases,” syrups, including fountain syrups, and certain finished beverages to authorized bottling operations (to which we typically refer as our “bottlers” or our “bottling partners”).

Our bottling partners either combine concentrates with still or sparkling water and sweeteners (depending on the product), or combine syrups with still or sparkling water, to produce finished beverages.

Our bottling partners combine concentrates with still or sparkling water and sweeteners (depending on the product), or combine syrups with still or sparkling water, to produce finished beverages.

The finished beverages are packaged in authorized containers, such as cans and refillable and nonrefillable glass and plastic bottles, bearing our trademarks or trademarks licensed to us and are then sold to retailers directly or, in some cases, through wholesalers or other bottlers.

In addition, outside the United States, our bottling partners are typically authorized to manufacture fountain syrups, using our concentrates, which they sell to fountain retailers for use in producing beverages for immediate consumption, or to authorized fountain wholesalers who in turn sell and distribute the fountain syrups to fountain retailers.

Our concentrate operations are included in our geographic operating segments and our Global Ventures operating segment.

Our concentrate operations are included in our geographic operating segments.

Our finished product operations generate net operating revenues by selling sparkling soft drinks and a variety of other finished beverages to retailers, or to distributors and wholesalers who in turn sell the beverages to retailers.

Generally, finished product operations generate higher net operating revenues but lower gross profit margins than concentrate operations.

Generally, finished product

operations generate higher net operating revenues but lower gross profit margins than concentrate operations.

These operations consist primarily of our consolidated bottling and distribution operations, which are included in our Bottling Investments operating segment.

In certain markets, the Company also operates non-bottling finished product operations in which we sell finished beverages to distributors and wholesalers that are generally not one of the Company’s bottling partners.

These operations are generally included in one of our geographic operating segments or our Global Ventures operating segment.

These operations are generally included in our geographic operating segments.

Additionally, we sell directly to consumers through retail stores operated by Costa.

These sales are included in our Global Ventures operating segment.

These sales are included in our EMEA operating segment, regardless of the physical location of the retail stores.

In the United States, we manufacture fountain syrups and sell them to fountain retailers, who use the fountain syrups to produce beverages for immediate consumption, or to authorized fountain wholesalers or bottling partners who in turn sell and distribute the fountain syrups to fountain retailers.

145 unchanged sentences

Derivatives can be designated as fair value hedges, cash flow hedges or hedges of net investments in foreign operations.

The changes in the fair values of derivatives that have been designated and qualify for fair value hedge accounting are recorded in the same line item in our consolidated statement of income as the changes in the fair values of the hedged items attributable to the risk being hedged.

The changes in the fair

values of derivatives that have been designated and qualify for fair value hedge accounting are recorded in the same line item in our consolidated statement of income as the changes in the fair values of the hedged items attributable to the risk being hedged.

The changes in the fair values of derivatives that have been designated and qualify as cash flow hedges or hedges of net investments in foreign operations are recorded in AOCI and are reclassified into the line item in our consolidated statement of income in which the hedged items are recorded in the same period the hedged items affect earnings.

7 unchanged sentences

The amounts exchanged are calculated by reference to the notional amounts and by other terms of the derivatives, such as interest rates, foreign currency exchange rates, commodity rates or other financial indices.

The Company does not view the fair

values of its derivatives in isolation but rather in relation to the fair values or cash flows of the underlying hedged transactions or other exposures.

The Company does not view the fair values of its derivatives in isolation but rather in relation to the fair values or cash flows of the underlying hedged transactions or other exposures.

Virtually all of our derivatives are straightforward over-the-counter instruments with liquid markets.

25 unchanged sentences

Commodity contracts Prepaid expenses and other current assets 7 7

Other derivative instruments Prepaid expenses and other current assets — 4

Commodity contracts Assets held for sale 3 —

Total assets $ 143 $ 167

1 unchanged sentence

Foreign currency contracts Other noncurrent liabilities 5 12

Foreign currency contracts Liabilities held for sale 5 —

Commodity contracts Accounts payable and accrued expenses 10 40

Commodity contracts Other noncurrent liabilities 1 —

Commodity contracts Liabilities held for sale 1 —

Other derivative instruments Accounts payable and accrued expenses 2 6

17 unchanged sentences

The changes in the fair values of derivatives designated as cash flow hedges are recorded in AOCI and are reclassified into the line item in our consolidated statement of income in which the hedged items are recorded in the same period the hedged items affect earnings.

The changes in fair values of hedges that are determined to be ineffective are immediately reclassified from AOCI into earnings.

The changes in fair values of hedges that are determined to be ineffective are immediately reclassified from AOCI into income.

The maximum length of time for which the Company hedges its exposure to the variability in future cash flows is typically three years .

10 unchanged sentences

For this hedging program, the Company recognizes in earnings each period the changes in carrying values of these foreign currency denominated assets and liabilities due to fluctuations in exchange rates.

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 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 December 31, 2024 and 2023, respectively.

The changes in fair values of the cross-currency swap derivatives are recorded in AOCI with an immediate reclassification into income 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 $ 557 million as of both December 31, 2025 and December 31, 2024.

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.

6 unchanged sentences

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 value of derivatives that were designated and qualified for the Company’s interest rate cash flow hedging program was $ 750 million as of December 31, 2023.

The total notional value of derivatives that was designated and qualified for the Company’s interest rate cash flow hedging program was $ 1,786 million as of December 31, 2025.

As of December 31, 2024, we did not have any interest rate swaps designated as a cash flow hedge.

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 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 income (in millions):

in OCI Financial Statement Line Item Impacted Gain (Loss)

12 unchanged sentences

Foreign currency contracts ( 18 ) Other income (loss) — net ( 45 )

Interest rate contracts ( 54 ) Interest expense ( 2 )

Commodity contracts 6 Cost of goods sold 1

6 unchanged sentences

Total $ ( 89 ) $ 10

As of December 31, 2024, the Company estimates that it will reclassify into earnings during the next 12 months net gains of $ 241 million from the pretax amount recorded in AOCI as the anticipated cash flows occur.

As of December 31, 2025, the Company estimates that it will reclassify into income during the next 12 months net losses of $ 184 million from the pretax amount recorded in AOCI as the anticipated cash flows occur.

Fair Value Hedging Strategy

5 unchanged sentences

The total notional values of derivatives that were designated and qualified as fair value hedges of this type were $ 13,674 million and $ 12,628 million as of December 31, 2025 and 2024, 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 following table summarizes the pretax impact that changes in the fair values of derivatives designated as fair value hedges had on income (in millions):

Hedging Instruments and Hedged Items Financial Statement Line Item Impacted Gain (Loss)

27 unchanged sentences

The Company uses forward contracts and a portion of its foreign currency denominated debt, a non-derivative financial instrument, to protect the value of our net investments in a number of foreign operations.

For derivative financial instruments that are designated and qualify as hedges of net investments in foreign operations, the changes in the fair values of the derivative financial instruments are recognized in net foreign currency translation adjustments, a component of AOCI, to offset the changes in the values of the net investments being hedged.

In 2025, the Company changed its method for assessing the effectiveness of derivative financial instruments designated as net investment hedges to include only the changes in fair value attributable to changes in foreign currency spot rates.

The changes in the fair values of the effective portion of the derivative financial instruments are recognized in net foreign currency translation adjustments, a component of AOCI, to offset the changes in the values of the net investments being hedged.

The initial value, and subsequent changes in fair value of the excluded component, are amortized into earnings over the life of the hedging instrument.

For non-derivative financial instruments that are designated and qualify as hedges of net investments in foreign operations, the changes in the carrying values of the designated portions of the non-derivative financial instruments due to fluctuations in foreign currency exchange rates are recorded in net foreign currency translation adjustments.

Any ineffective portions of net investment hedges are reclassified from AOCI into earnings during the period of change.

Any ineffective portions of net investment hedges are reclassified from AOCI into income during the period of change.

The following table summarizes the notional values and pretax impact of changes in the fair values of instruments designated as net investment hedges (in millions):

5 unchanged sentences

Total $ 16,065 $ 13,280 $ ( 1,770 ) $ 844 $ ( 382 )

The Company reclassified a gain of $ 3 million related to net investment hedges from AOCI into earnings during the year ended December 31, 2024.

The Company did not reclassify any gains or losses related to net investment hedges from AOCI into earnings during the years ended December 31, 2023 and 2022.

The Company reclassified gains of $ 3 million related to net investment hedges from AOCI into income during the year ended December 31, 2024.

The Company did not reclassify any gains or losses related to net investment hedges from AOCI into income during the years ended December 31, 2025 and 2023.

In addition, the Company did not have any ineffectiveness related to net investment hedges during the years ended December 31, 2025, 2024 and 2023.

15 unchanged sentences

The total notional values of derivatives related to our economic hedges of this type were $ 482 million and $ 328 million as of December 31, 2025 and 2024, 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 following table presents the pretax impact that changes in the fair values of derivatives not designated as hedging instruments had on income (in millions):

Derivatives Not Designated as Hedging Instruments Financial Statement Line Item Impacted Gain (Loss) Recognized in Income

18 unchanged sentences

AC Bebidas, S.

Coca-Cola FEMSA, S.A.B.

Coca-Cola HBC AG;

Coca-Cola FEMSA;

and Coca-Cola Bottlers Japan Holdings Inc.

35 unchanged sentences

Coca-Cola HBC AG 4,051 1,391 2,660

Coca-Cola Consolidated, Inc.

2,373 342 2,031

Coca-Cola Bottlers Japan Holdings Inc.

7 unchanged sentences

The following table provides information related to the carrying value of our goodwill by operating segment (in millions):

Europe, Middle East & Africa Latin

America North

America Asia Pacific Global Ventures Bottling

America Asia Pacific Bottling

Investments Total

1 unchanged sentence

Effect of foreign currency translation ( 107 ) ( 11 ) — ( 10 ) ( 84 ) ( 212 )

Impairment charges — — — — ( 6 ) ( 6 )

Divestitures — — — — ( 1 ) ( 1 )

— — — — — ( 231 ) ( 231 )

Balance at end of year $ 3,540 $ 215 $ 10,978 $ 407 $ 2,999 $ 18,139

1 unchanged sentence

Effect of foreign currency translation 311 12 — 2 396 721

Impairment charges — — — — — ( 6 ) ( 6 )

Divestitures and assets held for sale 1

( 8 ) — — — ( 3,361 ) ( 3,369 )

Balance at end of year $ 3,843 $ 227 $ 10,978 $ 409 $ 34 $ 15,491

1 The decrease in the Bottling Investments segment was a result of the Company’s bottling operations in the Philippines being classified as held for sale.

1 The decrease in the Bottling Investments segment was a result of the Company’s bottling operations in Africa being classified as held for sale.

Refer to Note 2.

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Accounts payable and accrued expenses $ 14,813 $ 21,712

1 Represents the fairlife, LLC (“fairlife”) contingent consideration liability.

As of December 31, 2023, this balance was $ 3,017 million and was recorded in the line item other noncurrent liabilities in our consolidated balance sheet.

Refer to Note 17.

2 Includes liabilities held for sale of $ 3 million and $ 719 million as of December 31, 2024 and 2023, respectively.

1 Represents the fairlife contingent consideration liability.

Refer to Note 17.

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Our current payment terms with the majority of our suppliers are 120 days.

Certain financial institutions offer a voluntary supply chain finance (“SCF”) program, which enables our suppliers, at their sole discretion, to sell their receivables from the Company to these financial institutions on a non-recourse basis at a rate that leverages our credit rating and thus may be more beneficial to them.

Certain financial institutions offer a voluntary SCF program, which enables our suppliers, at their sole discretion, to sell their receivables from the Company to these financial institutions on a non-recourse basis at a rate that leverages our credit rating and thus may be more beneficial to them.

The SCF program is available to suppliers of goods and services included in cost of goods sold and selling, general and administrative expenses in our consolidated statement of income.

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We have no economic interest in a supplier’s decision to participate in the SCF program, and we have no direct financial relationship with the financial institutions, as it relates to the SCF program.

Accordingly, amounts due to our suppliers that elected to participate in the SCF program are included in the line item accounts payable and accrued expenses in our consolidated balance sheet.

Accordingly, amounts due to our suppliers that elected to participate in the SCF program are included in the line items accounts payable and accrued expenses and liabilities held for sale in our consolidated balance sheet, as applicable.

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.

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Confirmed invoices paid ( 4,974 ) ( 5,196 )

Translation and other ( 12 ) —

Confirmed obligations outstanding at end of year $ 1,363 1

We have operating leases primarily for real estate, manufacturing and other equipment, vehicles and aircraft.

1 Includes $ 37 million of confirmed obligations outstanding at end of year related to our bottling operations in Africa that are currently held for sale.

Refer to Note 2.

We have operating leases primarily for real estate, manufacturing and other equipment, aircraft and vehicles.

Balance sheet information related to operating leases is as follows (in millions):

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3 The noncurrent portion of operating lease liabilities is included in the line item other noncurrent liabilities in our consolidated balance sheets.

We had operating lease costs of $ 362 million and $ 397 million for the years ended December 31, 2024 and 2023, respectively.

During 2024 and 2023, cash paid for amounts included in the measurement of operating lease liabilities was $ 359 million and $ 389 million, respectively.

Operating lease ROU assets obtained in exchange for operating lease obligations were $ 313 million and $ 328 million for the years ended December 31, 2024 and 2023, respectively.

We had operating lease costs of $ 405 million, $ 362 million and $ 397 million for the years ended December 31, 2025, 2024 and 2023, respectively.

During 2025, 2024 and 2023, cash paid for amounts included in the measurement of operating lease liabilities was $ 404 million, $ 359 million and $ 389 million, respectively.

Operating lease ROU assets obtained in exchange for operating lease obligations were $ 867 million, $ 313 million and $ 328 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Information associated with the measurement of our operating lease liabilities as of December 31, 2025 is as follows:

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dollar debentures due 2026-2098 767 4.8 778 4.8

Australian dollar notes due 2024 — — 374 2.7

Euro notes due 2026-2053 15,470 2.4 13,619 3.1

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Refer to Note 5 for a more detailed discussion on interest rate management.

2 As of December 31, 2024 and 2023, the amounts include $ 1,249 million and $ 1,211 million, respectively, of debt instruments related to our bottling operations in Africa due through 2027.

2 As of December 31, 2024, the amount includes $ 1,249 million of debt instruments related to our bottling operations in Africa.

As of December 31, 2025, the Company’s bottling operations in Africa met the criteria to be classified as held for sale.

As a result, the related debt balance as of December 31, 2025 was recorded in the line item liabilities held for sale in our consolidated balance sheet.

Refer to Note 2.

3 Amounts represent the changes in fair values due to changes in benchmark interest rates.

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Refer to Note 1 for additional information related to the Company’s maximum exposure to loss due to our involvement with VIEs.

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

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

These guarantees have various terms, and none of these guarantees is individually significant.

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Refer to Note 15.

On September 17, 2015, the Company received a Statutory Notice of Deficiency (“Notice”) from the United States Internal Revenue Service (“IRS”) seeking approximately $ 3.3 billion of additional federal income tax for years 2007 through 2009.

On September 17, 2015, the Company received a Notice from the IRS seeking approximately $ 3.3 billion of additional federal income tax for years 2007 through 2009.

In the Notice, the IRS stated its intent to reallocate over $ 9 billion of income to the U.S.

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parent company would report as compensation from its foreign licensees.

The Company and the IRS memorialized this accord in a closing agreement resolving that dispute (“Closing Agreement”).

The Company and the IRS memorialized this accord in the Closing Agreement resolving that dispute.

The Closing Agreement provided that, absent a change in material facts or circumstances or relevant federal tax law, in calculating the Company’s income taxes going forward, the Company would not be assessed penalties by the IRS for using the agreed-upon tax calculation methodology that the Company and the IRS agreed would be used for the 1987 through 1995 tax years.

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The matter remains subject to the IRS’ litigation designation, preventing the Company from any attempt to settle or otherwise mutually resolve the matter with the IRS.

The Company consequently initiated litigation by filing a petition in the U.S.

Tax Court (“Tax Court”) in December 2015, challenging the tax adjustments enumerated in the Notice.

The Company consequently initiated litigation by filing a petition in the Tax Court in December 2015, challenging the tax adjustments enumerated in the Notice.

Prior to trial, the IRS increased its transfer pricing adjustment by $ 385 million, resulting in an additional tax adjustment of $ 135 million.

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The trial was held in the Tax Court from March through May 2018, and final post-trial briefs were filed and exchanged in April 2019.

On November 18, 2020, the Tax Court issued an opinion (“Opinion”) in which it predominantly sided with the IRS but agreed with the Company that dividends previously paid by the foreign licensees to the U.S.

On November 18, 2020, the Tax Court issued the Opinion in which it predominantly sided with the IRS but agreed with the Company that dividends previously paid by the foreign licensees to the U.S.

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 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.

On November 8, 2023, the Tax Court issued a supplemental opinion, siding with the IRS in concluding both that certain U.S.

On October 1, 2025, the U.S.

Court of Appeals for the Eighth Circuit issued an opinion reversing the judgment of the Tax Court in the 3M case.

In its decision, the court concluded that the blocked-income regulation was inconsistent with IRC Section 482 and that the IRS therefore could not reallocate income from 3M’s subsidiary in Brazil to 3M in contravention of Brazilian restrictions on the payment of royalties.

Further, the U.S.

Court of Appeals for the Eighth Circuit specifically rejected the IRS’ argument that the ability of 3M’s subsidiary in Brazil to pay dividends, rather than royalties, meant that royalty income should not be treated as blocked.

Both of these conclusions are highly supportive of the Company’s position in its case and reinforce its prior conclusions.

The Company believes that the IRS and the Tax Court misinterpreted and misapplied the applicable regulations in reallocating income earned by the Company’s foreign licensees to increase the Company’s U.S.

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

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.

In addition, for its litigation with the IRS and for purposes of its appeal of the Tax Court decision, the Company continues to evaluate 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.

Raimondo , which overruled the Chevron case.

Since 1984, the Chevron case 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 .

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

On August 2, 2024, the Tax Court entered a decision reflecting additional federal income tax of $ 2.7 billion for the 2007 through 2009 tax years.

With applicable interest, the total liability for the 2007 through 2009 tax years resulting from the Tax Court’s decision is $ 6.0 billion, for which the IRS issued the Company invoices on September 3, 2024.

The Company paid those invoices (“IRS Tax Litigation Deposit”) on September 10, 2024, which stopped interest from accruing on the additional tax due for the 2007 through 2009 tax years.

The Company paid the IRS Tax Litigation Deposit on September 10, 2024, which stopped interest from accruing on the additional tax due for the 2007 through 2009 tax years.

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 year ended December 31, 2024, the Company recorded net interest income of $ 77 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 sheet as of December 31, 2024.

For the years ended December 31, 2025 and 2024, the Company recorded net interest income of $ 217 million and $ 77 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 December 31, 2025 and December 31, 2024.

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

Court of Appeals for the Eleventh Circuit.

The Company filed its principal appellate brief with the U.S.

Court of Appeals for the Eleventh Circuit on March 12, 2025.

The IRS filed its appellate brief on July 7, 2025.

The Company filed its reply brief on August 27, 2025.

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 .

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We concluded, based on the technical and legal merits of the Company’s tax positions, that it is more likely than not the Company’s tax positions will ultimately be sustained on appeal.

In addition, we considered a number of alternative transfer pricing methodologies, including the methodology asserted by the IRS and affirmed in the Opinions (“Tax Court Methodology”), that could be applied by the courts upon final resolution of the litigation.

In addition, we considered a number of alternative transfer pricing methodologies, including the Tax Court Methodology, that could be applied by the courts upon final resolution of the litigation.

Based on the required probability analysis, we determined the methodologies we believe the federal courts could ultimately order to be used in calculating the Company’s tax.

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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 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 $ 103 million as of December 31, 2024.

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 $ 385 million as of December 31, 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.

The Company calculated the potential impact of applying the Tax Court Methodology to reallocate income from foreign licensees potentially covered within the scope of the Opinions for the 2010 through 2024 tax years, assuming such methodology were to be ultimately upheld by the courts, and the IRS were to decide to apply that methodology to subsequent years, with

consent of the federal courts.

The Company calculated the potential impact of applying the Tax Court Methodology to reallocate income from foreign licensees potentially covered within the scope of the Opinions for the 2010 through 2025 tax years, assuming such methodology were to be ultimately upheld by the courts, and the IRS were to decide to apply that methodology to subsequent years, with consent of the federal courts.

This impact would include taxes and interest accrued through December 31, 2025.

The calculations incorporated the estimated impact of correlative adjustments to the previously accrued transition tax payable under the 2017 Tax Cuts and Jobs Act (“Tax Reform Act”).

The calculations incorporated the estimated impact of correlative adjustments to the previously accrued transition tax payable under the Tax Reform Act.

The Company estimates that the potential aggregate remaining incremental tax and interest liability for the tax years 2010 through 2025 could be approximately $ 14 billion as of December 31, 2025.

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Our Company grants long-term equity awards under its stock-based compensation plans to certain employees of the Company.

The Coca-Cola Company 2024 Equity Plan (“2024 Plan”) and the Global Employee Stock Purchase Plan (“GESPP”) were approved by shareowners on May 1, 2024.

Under the 2024 Plan, an aggregate initial reserve of 240 million shares of our common stock was approved to be issued through the grant of equity awards.

This reserve will be increased or may be adjusted as allowable under the 2024 Plan.

The 2024 Plan allows for grants of stock options, stock appreciation rights, performance share units, restricted stock, restricted stock units and other specified award types, including cash awards with performance-based vesting criteria.

As of December 31, 2024, there were 240 million initial reserve shares available to be granted under the 2024 Plan.

There was an additional 1 million shares available to be issued under the 2024 Plan through the reuse of shares and adjustments as allowable under the 2024 Plan.

Beginning in 2025, the 2024 Plan will be the only plan in use for equity awards.

Under the GESPP, a maximum of 15 million shares of our common stock was approved to be issued through the grant of matching share awards.

Effective May 1, 2024, shareowners approved The Coca-Cola Company 2024 Equity Plan (“2024 Plan”).

The 2024 Plan allows for grants of stock options, stock appreciation rights, performance share units, restricted stock, restricted stock units and other equity compensation awards.

Under the 2024 Plan, up to 240 million shares of our common stock may be issued through the grant of equity awards.

In addition to the shares under the 2024 Plan, certain shares of our common stock subject to certain outstanding awards under predecessor stock plans that expire, are canceled, or are forfeited, are available for issuance.

As of December 31, 2025, there were 230 million shares available to be granted under the 2024 Plan.

Effective May 1, 2024, shareowners approved the Global Employee Stock Purchase Plan (“GESPP”).

The GESPP provides for grants of matching share awards.

Under the GESPP, up to 15 million shares of our common stock may be issued through the grant of matching share awards.

As of December 31, 2025, there were 14 million shares available to be issued under the GESPP.

Total stock-based compensation expense was $ 279 million, $ 286 million and $ 251 million in 2025, 2024 and 2023, respectively.

In 2022, for certain employees who accepted voluntary separation from the Company as a result of the restructuring of our North America operating unit, the Company provided cash payments designed to offset the loss of certain equity awards and serve as a cash supplement to the employees upon the exercise of certain stock options.

The stock-based compensation expense in 2022 arising from the estimated cash payments was $ 5 million and was recorded in the line item other operating charges, and the remaining stock-based compensation expense of $ 356 million was recorded in the line item selling, general and administrative expenses in our consolidated statement of income.

Stock-based compensation expense in 2025 and 2024 was recorded in the line item selling, general and administrative expenses in our consolidated statements of income.

In 2023, the Company recorded stock-based compensation expense of $ 254 million in the line item selling, general and administrative expenses in our consolidated statement of income.

This was partially offset by $ 3 million related to the revision of management’s estimates arising from the settlement of the estimated cash payments recognized in 2022, which was recorded in the line item other operating charges in our consolidated statement of income.

All stock-based compensation expense in 2024 was recorded in the line item selling, general and administrative expenses in our consolidated statement of income.

Refer to Note 19 for additional information on the Company’s restructuring initiatives.

The total income tax benefit recognized in our consolidated statements of income related to total stock-based compensation expense was $ 47 million, $ 47 million and $ 40 million in 2025, 2024 and 2023, respectively.

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Vested and expected to vest 26 $ 55.62 5.3 years $ 375

Exercisable on December 31, 2024 22 $ 50.43 4.5 years $ 261

Exercisable on December 31, 2025

20 $ 52.69 4.4 years $ 336

The total intrinsic value of the stock options exercised was $ 144 million, $ 356 million and $ 268 million in 2025, 2024 and 2023, respectively.

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Performance-Based Share Unit Awards

Performance share unit awards require achievement of certain performance criteria, which are predefined by the Talent and Compensation Committee of our Board of Directors at the time of grant.

For performance share unit awards granted from 2019 through 2022, the performance criteria were equally weighted among net operating revenues, earnings per share and free cash flow over a predefined performance period of three years.

Performance share unit awards require achievement of certain performance criteria over a performance period of three years, which are predefined by the Talent and Compensation Committee of our Board of Directors at the time of grant.

Performance share unit awards will generally vest at the end of the respective performance period.

Performance share unit awards do not entitle participants to vote or receive dividends until the performance share units are settled in stock.

For performance share unit awards granted from 2020 through 2022, the performance criteria were equally weighted among net operating revenues, earnings per share and free cash flow.

For performance share unit awards granted to executives in 2022, and for performance share unit awards granted to all participants in 2023 and 2024, the performance criteria were weighted 30% for net operating revenues, 30% for earnings per share, 30% for free cash flow and 10% for environmental sustainability.

For performance share unit awards granted to all participants in 2025, the performance criteria were equally weighted among net operating revenues, earnings per share and free cash flow.

For purposes of these performance criteria, earnings per share is diluted net income per share;

free cash flow is net cash provided by operating activities less purchases of property, plant and equipment;

and environmental sustainability is comprised of predefined goals related to the Company’s packaging and water security strategies in place at the time of grant.

and environmental sustainability is composed of predefined goals related to the Company’s packaging and water security strategies in place at the time of grant.

These performance criteria are adjusted for certain items, if applicable, which are subject to Audit Committee approval.

The purpose of these adjustments is to ensure a consistent year-to-year comparison of the specific performance criteria.

Performance share unit awards granted to executives in 2019 through 2022 and performance share unit awards granted to all participants in 2023 and 2024 include a relative TSR modifier to determine the final number of performance share units earned.

The fair value of performance share units that include a TSR modifier is determined using a Monte Carlo valuation model.

For these awards, the

number of performance share units earned based on the certified achievement of the predefined performance criteria will be reduced or increased if the Company’s total shareowner return over the performance period relative to a predefined group of companies falls outside of a predefined range.

The fair value of performance share units that do not include a TSR modifier is the closing market price per share of the Company’s stock on the grant date less the present value of the expected dividends not received during the performance period.

The performance share unit awards will generally vest at the end of the respective performance period.

The purpose of these adjustments is to ensure a consistent year-to-year comparison of the specific

performance criteria.

Performance share unit awards granted to executives in 2020 through 2022 and performance share unit awards granted to all participants in 2023 through 2025 include a relative TSR modifier to determine the final number of performance share units earned.

For these awards, the number of performance share units earned based on the certified achievement of the predefined performance criteria will be reduced or increased if the Company’s total shareowner return over the performance period relative to a predefined group of companies falls outside of a predefined range.

The fair value of performance share units is the closing market price of the Company’s stock on the grant date less the present value of the expected dividends not received during the vesting period.

The fair value of performance share units that include a TSR modifier is determined based on a Monte Carlo valuation model for the TSR modifier component, which also takes into account the closing market price of the Company’s stock on the grant date less the present value of the expected dividends not received during the vesting period.

For performance share unit awards, in the event the certified results equal the predefined performance criteria, the number of performance share units earned will be equal to the target award.

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If the certified results fall below the minimum threshold, no performance share units will be earned.

Performance share unit awards do not entitle participants to vote or receive dividends until the performance share units are settled in stock.

In the reporting period it becomes probable that the minimum performance threshold specified in the performance share unit award will be achieved, we recognize compensation expense for the proportionate share of the total fair value of the performance share units related to the vesting period that has already lapsed for the performance share units expected to vest.

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Time-Based Restricted Stock, Time-Based Restricted Stock Unit Awards and Matching Share Awards

Restricted stock, restricted stock unit awards and matching share awards granted under the 2024 Equity Plan, the GESPP, and the 2014 Equity Plan do not entitle recipients to vote or receive dividends during the vesting period and will be forfeited in the event of the recipient’s termination of employment, except for certain circumstances such as death or disability.

Restricted stock and restricted stock unit awards generally vest over three years.

Matching share awards vest over one year.

Restricted stock, restricted stock unit awards and matching share awards do not entitle recipients to vote or receive dividends during the vesting period and will be forfeited in the event of the recipient’s termination of employment, except for certain circumstances such as death or disability.

The fair value of restricted stock, restricted stock units and matching share awards is the closing market price per share of the Company’s stock on the grant date less the present value of the expected dividends not received during the vesting period.

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Settlements ( 12 ) ( 9 ) — ( 92 ) 3

Other — — 3 —

Fair value of plan assets at end of year $ 6,523 $ 6,435 $ 67 $ 69

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2 A change in the weighted-average discount rate assumption was the primary driver of net actuarial loss (gain) during 2025 and 2024.

qualified pension plan, an increase in the discount rate resulted in an actuarial gain of $ 178 million during 2024, and a decrease in the discount rate resulted in an actuarial loss of $ 129 million during 2023.

qualified pension plan, a decrease in the discount rate resulted in an actuarial loss of $ 112 million during 2025, and an increase in the discount rate resulted in an actuarial gain of $ 178 million during 2024.

Additional drivers of net actuarial loss (gain) included other assumption updates and plan experience.

3 Settlements primarily related to the U.S.

qualified pension plan, which was amended in 2023 to provide lump sum payment options to all former employees.

qualified pension plan made $ 259 million of lump sum payments in 2023, causing a plan settlement, which resulted in recognition of a $ 76 million settlement loss related to the acceleration of existing unrecognized losses.

3 In 2024, the Company settled its U.S.

other postretirement benefit obligations such that core life insurance benefits will be funded by an insurance company beginning September 11, 2024 for the lifetime of certain retirees.

The transaction resulted in no change to underlying benefits or plan administration, but only to the future financing of the benefits.

Pursuant to the settlement, the Company transferred $ 92 million of plan assets and liabilities to an insurer and recognized a $ 19 million net settlement gain related to the acceleration of existing unrecognized gains.

5 In 2023, the Company settled its U.S.

post-65 other postretirement benefit obligations such that retiree reimbursement accounts will be funded by an insurance company beginning January 1, 2025 for the lifetime of certain retirees and their eligible dependents.

The transaction resulted in no change to underlying benefits or plan administration, but only to the future financing of the benefits.

The transaction resulted in no change to underlying benefits or plan administration, only a change to the future financing of the benefits.

6 Transfers represent $ 523 million of surplus international plan assets transferred from pension trusts to general assets of the Company.

4 The curtailment loss and special termination benefits were primarily related to the benefit uplifts provided by the Company to active participants pursuant to the group annuity purchase (“buy-in”) for a non-U.S.

defined benefit plan.

The Company intends to convert the buy-in to a buy-out in the future, at which time the insurer would assume full responsibility for the plan obligations.

5 Transfers represent $ 332 million and $ 523 million of surplus international plan assets transferred from pension trusts to general assets of the Company as of December 31, 2025 and 2024, respectively.

Pension and other postretirement benefit plan amounts recognized in our consolidated balance sheets were as follows (in millions):

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Hedge funds/limited partnerships 883 1,004 16 19

Real estate 341 367 — 9

Real assets 343 341 — —

Derivative financial instruments ( 2 ) — ( 7 ) ( 63 )

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Our target allocation for alternative investments is 31 %.

These alternative investments include hedge funds, reinsurance, private equity limited partnerships and real estate.

These alternative investments include hedge funds, reinsurance, private equity limited partnerships and real assets.

The objective of investing in alternative investments is to provide a higher rate of return than that which is typically available from publicly traded equity securities.

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Pension Plans

The long-term target allocation for 64 % of our international subsidiaries’ pension plan assets, primarily certain of our European and Canadian plans, is 58 % equity securities, 29 % fixed-income securities and 13 % other investments.

The actual allocation for the remaining 36 % of the Company’s international subsidiaries’ pension plan assets consisted of 39 % mutual, pooled and commingled funds;

For our non-U.S.

plans, the investment strategies vary greatly and are subject to the asset/liability profiles and local regulations of the plans in individual countries.

In 2025, due to changes in market conditions and needs of the plans, the Company modified the investment strategy for certain plans in Europe and Canada to reduce our funded status risk.

The plans represent 62 % of the Company’s international subsidiaries’ pension plan assets and consisted of 57 % cash and cash equivalents;

24 % fixed-income securities;

13 % insurance contracts;

and 6 % equity securities as of December 31, 2025.

The target allocation for the remaining 38 % of our non-U.S.

plans is broadly characterized as a mix of approximately 74 % fixed-income securities (including insurance contracts);

18 % mutual, pooled and commingled funds;

6 % equity securities;

and 2 % other investments as of December 31, 2025.

The investment strategies for our international subsidiaries’ pension plans vary greatly, and in some instances are influenced by local law.

None of our pension plans outside the United States is individually significant for separate disclosure.

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Settlement loss (gain) ( 3 ) ( 2 ) 81 4

( 1 ) ( 19 ) 4

Curtailment loss (gain) 11 3

( 1 ) — — — —

Special termination benefits 27 3

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Gains and losses in excess of the corridor are generally amortized over the average future working lifetime of the plan participants.

3 The curtailment loss and special termination benefits were primarily related to the benefit uplifts provided by the Company to active participants pursuant to the group annuity purchase (“buy-in”) for a non-U.S.

defined benefit plan.

The Company intends to convert the buy-in to a buy-out in the future, at which time the insurer would assume full responsibility for the plan obligations.

4 Settlements primarily related to the U.S.

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other postretirement benefit obligations such that core life insurance benefits will be funded by an insurance company beginning September 11, 2024 for the lifetime of certain retirees.

The transaction resulted in no change to underlying benefits or plan administration, but only to the future financing of the benefits.

The transaction resulted in no change to underlying benefits or plan administration, only a change to the future financing of the benefits.

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The transaction resulted in no change to underlying benefits or plan administration, but only to the future financing of the benefits.

The transaction resulted in no change to underlying benefits or plan administration, only a change to the future financing of the benefits.

Pursuant to the settlement, the Company transferred $ 187 million of plan assets and liabilities to an insurer and recognized a $ 14 million net settlement gain related to the acceleration of existing unrecognized gains.

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Divestitures — ( 6 ) — —

Other — — 3 —

Net foreign currency translation adjustments ( 32 ) 25 1 ( 2 )

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The annualized return since inception was 9.8 %.

The weighted-average assumptions for health care cost trend rates were as follows:

December 31, 2024 2023

Health care cost trend rate assumed for next year 9.00 % 8.50 %

Rate to which the trend rate is assumed to decline (the ultimate trend rate) 8.25 % 6.00 %

Year that the trend rate reaches the ultimate trend rate 2029 2029

We review external data and our own historical trends for health care costs to determine the health care cost trend rate assumptions.

The Company’s U.S.

postretirement health care benefits are primarily provided through plans with either a capped Company cost or a defined-dollar benefit.

This limits the effects of health care inflation on the Company.

We review external data and our own historical trends for health care costs to determine the trend rate assumptions, where applicable.

Given the design of our retiree health benefit plans, healthcare-cost trend rates no longer have a material impact on our financial condition or results of operations.

The expected benefit payments for our pension and other postretirement benefit plans for the 10 years succeeding December 31, 2025 are as follows (in millions):

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Total $ 15,998 $ 13,086 $ 12,952

1 The Company reclassified income before income taxes related to its Puerto Rico operations in 2024 and 2023 from United States to International to align with the jurisdictional disaggregation requirements of ASU 2023‑09.

Income taxes consisted of the following (in millions):

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Deferred ( 135 ) ( 78 ) 211 ( 2 )

We made income tax payments of $ 3,262 million, $ 2,580 million and $ 2,403 million in 2024, 2023 and 2022, respectively, which included $ 964 million, $ 723 million and $ 385 million, respectively, of the one-time transition tax required by the Tax Reform Act.

Net income tax payments after the prospective adoption of ASU 2023-09, as described in Note 1, consisted of the following (in millions):

Year Ended December 31, 2025

United States — federal 1

United States — state and local 127

International:

Other foreign 672

Total income taxes paid, net of refunds $ 2,873

1 The Company’s U.S.

federal payments were reduced by foreign tax credits, general business credits and prior year overpayments.

These general business credits include tax credits related to the Company’s investments in limited partnerships constructing, owning and operating alternative energy generation facilities in 2025.

We made income tax payments of $ 3,262 million and $ 2,580 million in 2024 and 2023, respectively, which included $ 964 million and $ 723 million, respectively, of the one-time transition tax required by the Tax Reform Act.

The 2024 amount does not include $ 6.0 billion paid in relation to invoices the IRS issued for the 2007 through 2009 tax years resulting from the Tax Court’s decision.

5 unchanged sentences

The Company expects to fulfill $ 32 million of unfunded commitments related to these investments in the first quarter of 2026.

Our effective tax rate reflects the tax benefits of having significant operations outside the United States, which are generally taxed at rates lower than the statutory U.S.

In 2024, the Company invested $ 226 million in limited partnerships that receive tax credits and other tax benefits by constructing, owning and operating alternative energy generation facilities.

During 2024, the Company received tax credits and other income tax benefits of $ 323 million and recognized amortization expense of $ 308 million related to these investments.

The amount of non-income tax-related activity and other returns related to these investments was not material during 2024.

As of December 31, 2024, the carrying value of these investments was $ 41 million.

The Company recorded $ 123 million of unfunded commitments related to these investments in the line item accounts payable and accrued expenses in our consolidated balance sheet as of December 31, 2024.

Our effective tax rate reflects the tax impact of having significant operations outside the United States, which are generally taxed at rates different than the statutory U.S.

federal tax rate.

5 unchanged sentences

In addition, our effective tax rate reflects the benefits of having significant earnings generated in investments accounted for under the equity method.

A reconciliation of the statutory U.S.

federal tax rate and our effective tax rate is as follows:

Also included in our effective tax rate is the tax impact associated with several countries enacting global minimum tax regulations.

The following table reconciles the income tax provision with the amount calculated using the 21.0% U.S.

federal statutory rate applied to pretax income, reflecting the adoption of ASU 2023-09 (amounts in millions):

Year Ended December 31, 2025

Amount Percent

Statutory U.S.

1 unchanged sentence

State and local income taxes — net of federal benefit 1

Foreign tax effects:

Tax rate differential ( 172 ) ( 1.1 )

Other 192 1.2

Tax rate differential 2

( 253 ) ( 1.6 )

Other jurisdictions 320 2.0

Effect of cross-border tax laws:

tax on foreign branches 2

Subpart F ( 315 ) ( 2.0 )

Other ( 92 ) ( 0.6 )

Tax credits ( 176 ) ( 1.1 )

Change in unrecognized tax benefits ( 204 ) ( 1.3 )

Equity income or loss ( 222 ) ( 1.4 )

Effective tax rate $ 2,861 17.9 %

1 State taxes in California, Florida and Minnesota comprised greater than 50% of the tax effect in this category.

2 This tax rate differential is offset in the U.S.

tax on foreign branches line item, which reflects the full U.S.

income tax expense of the same amount on income earned in Puerto Rico.

tax on foreign branches line item also includes impacts for other U.S.

The following table provides the disclosures required before adopting ASU 2023-09 and reconciles our effective tax rate with the U.S.

federal tax rate:

Year Ended December 31, 2024 2023

Statutory U.S.

federal tax rate 21.0 % 21.0 %

State and local income taxes — net of federal benefit 1.1 1.1

Earnings in jurisdictions taxed at rates different from the statutory U.S.

federal tax rate 1.0 1

( 0.3 ) ( 0.6 )

Equity income or loss ( 2.6 ) ( 2.1 )

5 unchanged sentences

Also includes a tax benefit of $ 88 million (or a 0.7 % impact on our effective tax rate) associated with the change in the Company’s indefinite reinvestment assertion for our Philippines and Bangladesh bottling operations.

As of December 31, 2024, we have not recorded incremental income taxes for additional outside basis differences of $ 9.3 billion in our investments in foreign subsidiaries, as these amounts continue to be indefinitely reinvested in foreign operations.

Determining the amount of unrecognized deferred tax liability related to any additional outside basis differences in these entities is not practicable.

As of December 31, 2025, we have not recorded incremental income taxes for additional outside basis differences in our investments in foreign subsidiaries, as these amounts continue to be indefinitely reinvested in foreign operations.

The Global Intangible Low-Taxed Income (“GILTI”) provisions of the Tax Reform Act require the Company to include in its U.S.

income tax return each foreign subsidiary’s earnings in excess of an allowable return on the foreign subsidiary’s tangible assets.

income tax return each foreign subsidiary’s earnings in excess of an allowable return on the foreign subsidiary’s tangible

An accounting policy election is available to either account for the tax effects of GILTI in the period that is subject to such taxes or to provide deferred taxes for book and tax basis differences that upon reversal may be subject to such taxes.

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Although the outcome of tax audits is always uncertain, the Company believes that adequate amounts of tax, including interest and penalties, have been provided for in accordance with the applicable accounting guidance.

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.

On November 8, 2023, the Tax Court issued a supplemental opinion, 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.

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

On August 2, 2024, the Tax Court entered a decision reflecting additional federal income tax of $ 2.7 billion for the 2007 through 2009 tax years.

With applicable interest, the total liability for the 2007 through 2009 tax years resulting from the Tax Court’s decision is $ 6.0 billion.

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

Court of Appeals for the Eleventh Circuit.

The Company strongly disagrees with the Opinions and intends to vigorously defend its positions.

We are currently in litigation with the IRS for tax years 2007 through 2009.

Refer to Note 12.

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If the Company were to prevail on all uncertain tax positions, the reversal of this accrual would be a benefit to the Company’s effective tax rate.

It is expected that the amount of unrecognized tax benefits will change in the next 12 months;

however, we do not expect any changes will have a significant impact on our consolidated statement of income or consolidated balance sheet.

These changes may be the result of settlements of ongoing audits, statutes of limitations expiring or final settlements in transfer pricing matters that are the subject of litigation.

Currently, an estimate of the range of the reasonably possible outcomes cannot be made.

The tax effects of temporary differences and carryforwards that give rise to deferred tax assets and liabilities consisted of the following (in millions):

19 unchanged sentences

Benefit plans ( 454 ) ( 441 )

Other ( 1,051 ) 1

( 1,096 ) ( 1,051 )

Total deferred tax liabilities $ ( 6,326 ) $ ( 6,988 )

4 unchanged sentences

Loss carryforwards of $ 340 million must be utilized within the next five years, and the remainder can be utilized over a period greater than five years.

In addition, we had $ 2,253 million of Internal Revenue Code 163(j) interest carryforwards, which will carryforward indefinitely.

In addition, we had $ 1,096 million of Internal Revenue Code 163(j) interest carryforwards, which will carry forward indefinitely.

As of December 31, 2025, we also had foreign tax credit carryforwards of $ 34 million, which must be utilized within the next ten years.

9 unchanged sentences

The Company believes that it will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheet.

In 2025, the Company recognized a net decrease of $ 97 million in its valuation allowances, primarily due to decreases in the deferred tax assets and related valuation allowances associated with the utilization of excess foreign tax credits.

was partially offset by increases in the deferred tax assets and related valuation allowances on a certain equity method investment and the changes in net operating losses in the normal course of business.

In 2024, the Company recognized a net increase of $ 89 million in its valuation allowances, primarily due to significant negative evidence on the utilization of excess foreign tax credits.

The increase was partially offset by decreases in the deferred tax assets

and related valuation allowances on a certain equity method investment and the changes in net operating losses in the normal course of business.

The increase was partially offset by decreases in the deferred tax assets and related valuation allowances on a certain equity method investment and the changes in net operating losses in the normal course of business.

In 2023, the Company recognized a net decrease of $ 28 million in its valuation allowances, primarily due to net decreases in the deferred tax assets and related valuation allowances on a certain equity method investment, certain excess foreign tax credit carryforwards and the changes in net operating losses in the normal course of business.

In 2022, the Company recognized a net increase of $ 23 million in its valuation allowances.

The increase was primarily due to significant negative evidence on the utilization of excess foreign tax credits generated in the current year.

The increase was also due to net increases in the deferred tax assets and related valuation allowances on certain equity method investments and the changes in net operating losses in the normal course of business.

OTHER COMPREHENSIVE INCOME

16 unchanged sentences

Net foreign currency translation adjustments 1

2,937 ( 69 ) 2,868

Net gains (losses) on derivatives 2

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

( 360 ) — ( 360 )

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

Net change in pension and other postretirement benefit liabilities 4

Total comprehensive income $ 15,819 $ ( 42 ) $ 15,777

1 Includes reclassification of $ 226 million of foreign currency translation adjustments from shareowners of The Coca-Cola Company to noncontrolling interests related to our bottling operations in India.

Refer to Note 1.

2 Refer to Note 5 for additional information related to the net gains or losses on derivative instruments.

9 unchanged sentences

( 1,770 ) 434 ( 1,336 )

Reclassification to noncontrolling interests 2

Net foreign currency translation adjustments $ 2,714 $ 223 $ 2,937

49 unchanged sentences

Net gains (losses) on derivatives 1

$ ( 204 ) $ 26 $ ( 178 )

Available-for-sale debt securities:

11 unchanged sentences

1 Refer to Note 5 for additional information related to the net gains or losses on derivative instruments.

2 Refer to Note 1 for additional information related to the noncontrolling interest in our bottling operations in India.

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

30 unchanged sentences

Consolidated net income $ 82

1 Related to the refranchising of our bottling operations in the Philippines and Bangladesh and the sale of our ownership interest in an equity method investee in Thailand.

1 Related to the sale of a portion of our ownership interest in CCEP.

Refer to Note 2.

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

2 Related primarily to the sale of our finished product operations in Nigeria.

Refer to Note 2 .

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Total assets $ 2,148 $ 2,502 $ 61 $ 143 $ ( 403 ) $ 4,451

Contingent consideration liability $ — $ — $ 6,126 5

$ — $ — $ 6,126

Derivatives 2

7 unchanged sentences

Refer to Note 5.

5 Represents the fair value of the remaining milestone payment related to our acquisition of fairlife in 2020, which is contingent on fairlife achieving certain financial targets through 2024 and is payable in 2025.

This milestone payment is based on agreed-upon formulas related to

fairlife’s operating results, the resulting value of which is not subject to a ceiling.

The fair value was determined using discounted cash flow analyses.

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.

5 The Company is obligated to return $ 48 million in cash collateral it has netted against its derivative position.

1 unchanged sentence

7 The Company’s derivative financial instruments were recorded at fair value in our consolidated balance sheet as follows:

$ 102 million in the line item prepaid expenses and other current assets, $ 117 million in the line item other noncurrent assets, and $ 22 million in the line item other noncurrent liabilities .

$ 3 million in the line item assets held for sale, $ 35 million in the line item other noncurrent assets, $ 5 million in the line item liabilities held for sale, and $ 90 million in the line item other noncurrent liabilities.

Refer to Note 5 for additional information related to the composition of our derivatives portfolio.

19 unchanged sentences

Refer to Note 5.

5 Represents the fair value of the remaining milestone payment related to our acquisition of fairlife, which is contingent on fairlife achieving certain financial targets through 2024 and, if achieved, is payable in 2025.

This milestone payment is based on agreed-upon formulas related to fairlife’s operating results, the resulting value of which is not subject to a ceiling.

The fair value was determined using a Monte Carlo valuation model.

The fair value was determined using discounted cash flow analyses.

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.

The Company made a milestone payment of $ 275 million during 2023.

6 The Company is obligated to return $ 12 million in cash collateral it had netted against its derivative position.

1 unchanged sentence

8 The Company’s derivative financial instruments were recorded at fair value in our consolidated balance sheet as follows:

$ 53 million in the line item other noncurrent assets and $ 192 million in the line item other noncurrent liabilities .

$ 102 million in the line item prepaid expenses and other current assets, $ 117 million in the line item other noncurrent assets and $ 22 million in the line item other noncurrent liabilities .

Refer to Note 5 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 years ended December 31, 2024 and 2023.

Gross realized and unrealized gains and losses on Level 3 assets and liabilities, excluding the contingent consideration liability in 2024, were not significant for the years ended December 31, 2025 and 2024.

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

6 unchanged sentences

Year Ended December 31, 2025 2024

Impairment of property, plant and equipment $ ( 63 ) 1

Other-than-temporary impairment charges ( 34 ) 2

Assets held for sale $ ( 1,537 ) 1

Impairment of intangible assets ( 1,033 ) 2,3,4

Other-than-temporary impairment charges ( 65 ) 5,6

Impairment of property, plant and equipment ( 12 ) 4

Total $ ( 2,647 ) $ ( 983 )

1 The Company recorded an asset impairment charge of $ 63 million during the year ended December 31, 2024 related to certain prototypes.

This impairment charge, which was calculated based on Level 3 inputs, was driven by management’s strategic decision to cease use of the assets.

This charge was recorded in the line item selling, general and administrative expenses in our consolidated statement of income.

2 The Company recorded an other-than-temporary impairment charge of $ 34 million during the year ended December 31, 2024 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.

This charge was recorded in the line item other income (loss) — net in our consolidated statement of income.

3 The Company recorded an asset impairment charge of $ 760 million during the year ended December 31, 2024 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.

This charge was recorded in the line item other operating charges in our consolidated statement of income.

1 The Company is required to record assets and liabilities that are held for sale at the lower of carrying value or fair value less any costs to sell based on the estimated proceeds.

During the year ended December 31, 2025, the Company recorded a charge of $ 1,274 million due to the impairment of assets related to our bottling operations in Africa becoming held for sale and was calculated based on Level 3 inputs.

Refer to Note 2.

The Company also recorded a charge of $ 235 million due to the write-off of assets related to the sale of our finished product operations in Nigeria and was calculated based on Level 3 inputs.

Refer to Note 2.

Additionally, the Company recorded a charge of $ 28 million due to the write-down of assets held for sale related to the refranchising of certain bottling operations in Ghana.

This charge, which was calculated based on Level 3 inputs, primarily related to property, plant and equipment.

These operations were sold in July 2025, resulting in an additional loss of $ 8 million.

These impairment charges were recorded in the line item other income (loss) — net in our consolidated statement of income.

2 During the years ended December 31, 2025 and 2024, the Company recorded asset impairment charges of $ 44 million and $ 126 million, respectively, related to a trademark in Latin America.

These impairment charges were derived using Level 3 inputs and were primarily driven by revised projections of future operating results and changes in macroeconomic conditions.

These charges were recorded in the line item other operating charges in our consolidated statements of income.

The remaining carrying value of the trademark is $ 42 million.

Additionally, the Company recorded an asset impairment charge of $ 126 million related to a trademark in Latin America, which was primarily driven by revised projections of future operating results and changes in macroeconomic conditions.

3 During the years ended December 31, 2025 and 2024, the Company recorded asset impairment charges of $ 960 million and $ 760 million, respectively, related to our BodyArmor trademark in North America.

The 2025 impairment charge was primarily driven by revised projections of future operating results, including a slowing of the projected long-term growth rate for the category, an intensifying competitive environment, and more focused innovation and international rollout plans.

The 2024 impairment charge 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.

This charge was recorded in the line item other operating charges in our consolidated statement of income.

These charges were recorded in the line item other operating charges in our consolidated statements of income.

The remaining carrying value of the trademark is $ 2,440 million.

4 The Company recorded an asset impairment charge of $ 25 million during the year ended December 31, 2023 related to the discontinuation of certain manufacturing operations in Asia Pacific.

Additionally, the Company recorded an asset impairment charge of $ 21 million during the year ended December 31, 2023 related to the restructuring of our manufacturing operations in the United States.

These charges, which were calculated based on Level 3 inputs, were primarily driven by management’s best estimate of the potential proceeds from the disposal of the related assets.

5 The Company recorded an other-than-temporary impairment charge of $ 39 million during the year ended December 31, 2023 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.

4 During the year ended December 31, 2025, the Company recorded an asset impairment charge of $ 29 million related to a trademark in Asia Pacific and an asset impairment charge of $ 12 million related to the fixed assets of this business.

These impairment charges were derived using Level 3 inputs and were primarily driven by revised projections of future operating results.

These charges were recorded in the line item other operating charges in our consolidated statement of income.

5 During the years ended December 31, 2025 and 2024, the Company recorded other-than-temporary impairment charges of $ 40 million and $ 34 million, respectively, related to an equity method investee in Latin America.

These impairment charges were derived using Level 3 inputs and were primarily driven by revised projections of future operating results.

These charges were recorded in the line item other income (loss) — net in our consolidated statements of income.

6 During the year ended December 31, 2025, the Company recorded an other-than-temporary impairment charge of $ 25 million related to a joint venture in Latin America.

This impairment charge was derived using Level 3 inputs and was due to the joint venture’s restructuring and planned liquidation.

This charge was recorded in the line item other income (loss) — net in our consolidated statement of income.

7 The Company recorded an asset impairment charge of $ 63 million during the year ended December 31, 2024 related to certain prototypes.

This impairment charge, which was calculated based on Level 3 inputs, was driven by management’s strategic decision to cease use of the assets.

This charge was recorded in the line item selling, general and administrative expenses in our consolidated statement of income.

Fair Value Measurements for Pension Plan Assets

24 unchanged sentences

899 — — — 1,023 5

Real estate — — — 341 6

Real assets — — — 343 6

343 — — — 341 6

7 unchanged sentences

3 Includes purchased annuity insurance contracts.

4 This class of assets primarily includes a mortgage-related fixed income securities fund, alternative investment funds and collective trust funds for qualified plans.

There are no liquidity restrictions on these investments.

4 This class of assets primarily includes alternative investment funds and collective trust funds for qualified plans.

These funds can be subject to monthly redemption restrictions, with a redemption notice period of up to 10 days prior to month end.

5 This class of assets includes hedge funds that can be subject to redemption restrictions, ranging from monthly to semiannually, with a redemption notice period of up to one year and/or initial lock-up periods of up to three years, and private equity funds that are primarily closed-end funds in which the Company’s investments are generally not eligible for redemption.

Distributions from these private equity funds will be received as the underlying assets are liquidated or distributed.

6 This class of assets includes funds invested in real estate, including a privately held real estate investment trust, a real estate commingled pension trust fund, infrastructure limited partnerships and commingled investment funds.

6 This class of assets includes funds invested in real assets, including a privately held real estate investment trust, a real estate commingled pension trust fund, infrastructure limited partnerships and commingled investment funds.

These funds seek current income and capital appreciation and can be subject to quarterly redemption restrictions, with a redemption notice period of up to 90 days.

1 unchanged sentence

These assets can be subject to a semiannual redemption, with a redemption notice period of 90 days, subject to certain gate restrictions.

8 This class of assets includes actively managed emerging markets equity funds and a collective trust fund for qualified plans, invested primarily in equity securities of companies in developing and emerging markets.

8 This class of assets primarily includes a mortgage-related fixed income securities fund, alternative investment funds and collective trust funds for qualified plans.

There are no liquidity restrictions on these investments.

1 unchanged sentence

Securities Fixed-Income Securities Other 1

Balance at beginning of year $ 27 $ 30 $ 300 $ 357

Balance as of January 1, 2024 $ 32 $ 27 $ 323 $ 382

Actual return on plan assets 1 2 8 11

Purchases, sales and settlements — net ( 3 ) ( 12 ) ( 2 ) ( 17 )

Transfers into (out of) Level 3 — net 4 — — 4

Net foreign currency translation adjustments — — ( 18 ) ( 18 )

Balance at end of year $ 32 $ 27 $ 323 $ 382

Balance at beginning of year $ 32 $ 27 $ 323 $ 382

Balance as of December 31, 2024 $ 30 $ 17 $ 311 $ 358

Actual return on plan assets ( 1 ) 1 7 7

Purchases, sales and settlements — net — ( 7 ) 216 209

Transfers into (out of) Level 3 — net — ( 2 ) — ( 2 )

Net foreign currency translation adjustments — — 42 42

Balance at end of year $ 30 $ 17 $ 311 $ 358

Balance as of December 31, 2025 $ 29 $ 9 $ 576 $ 614

1 Includes purchased annuity insurance contracts.

10 unchanged sentences

In 2025, the Company recorded other operating charges of $ 1,261 million.

These charges consisted of $ 3,109 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 760 million related to the impairment of our BodyArmor trademark, $ 133 million related to the Company’s productivity and reinvestment program and $ 126 million related to the impairment of a trademark in Latin America.

In addition, other operating charges included $ 15 million for the amortization of noncompete agreements related to the acquisition of BA Sports Nutrition, LLC (“BodyArmor”) in 2021, $ 13 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $ 7 million of transaction costs related to the refranchising of our bottling operations in certain territories in India and $ 2 million of transaction costs related to the sale of a portion of our interest in Coke Consolidated.

These charges consisted of $ 960 million related to the impairment of our BodyArmor trademark which impacted our North America operating segment, $ 97 million related to the Company’s productivity and reinvestment program, and $ 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 $ 44 million related to the impairment of a trademark in our Latin America operating segment, $ 41 million related to the impairment of a trademark and property, plant and equipment in our Asia Pacific operating segment and $ 35 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations.

In addition, other operating charges included $ 15 million for the amortization of noncompete agreements related to the BodyArmor acquisition in 2021, $ 12 million of transaction costs related to our divestiture activities and $ 10 million related to tax litigation expense.

In 2024, the Company recorded other operating charges of $ 4,163 million.

These charges consisted of $ 3,109 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 760 million related to the impairment of our BodyArmor trademark which impacted our North America operating segment, $ 133 million related to the Company’s productivity and reinvestment program and $ 126 million related to the impairment of a trademark that impacted our Latin America operating segment.

In addition, other operating charges included $ 15 million for the amortization of noncompete agreements related to the BodyArmor acquisition, $ 13 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations and $ 9 million of transaction costs related to our divestiture activities.

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

In 2023, the Company recorded other operating charges of $ 1,951 million.

These charges consisted of $ 1,702 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 164 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 $ 27 million related to the restructuring of our North America operating unit, $ 15 million for the amortization of noncompete agreements related to the BodyArmor acquisition and $ 8 million related to tax litigation expense.

In 2022, the Company recorded other operating charges of $ 1,215 million.

These charges primarily consisted of $ 1,000 million related to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition, $ 85 million related to the Company’s productivity and reinvestment program and $ 57 million related to the impairment of a trademark in Asia Pacific.

In addition, other operating charges included $ 38 million related to the restructuring of our North America operating unit and $ 38 million related to the BodyArmor acquisition, which included various transition and transaction costs, employee retention costs and the amortization of noncompete agreements, net of the reimbursement of distributor termination fees recorded in 2021.

These charges were partially offset by a net gain of $ 6 million due to revisions of management’s estimates related to the Company’s strategic realignment initiatives.

Refer to Note 2 for additional information on the refranchising of our bottling operations and the sale of a portion of our interest in Coke Consolidated.

Refer to Note 2 for additional information on our divestiture activities.

Refer to Note 12 for additional information related to the tax litigation.

Refer to Note 17 for additional information on fairlife and the impairment charges.

Refer to Note 19 for additional information on the Company’s restructuring initiatives.

Refer to Note 20 for the impact these charges had on our operating segments and Corporate.

Refer to Note 19 for additional information on the Company’s productivity and reinvestment program.

Other Nonoperating Items

3 unchanged sentences

Other Income (Loss) — Net

During 2024, the Company recognized a net gain of $ 595 million related to the refranchising of our bottling operations in the Philippines, including the impact of post-closing adjustments, and recognized a net gain of $ 506 million related to the sale of our ownership interest in an equity method investee in Thailand, including the impact of post-closing adjustments.

The Company also recognized a net gain of $ 338 million related to the sale of a portion of our interest in Coke Consolidated, a net gain of $ 303 million related to the refranchising of our bottling operations in certain territories in India, including the impact of post-closing adjustments, and a net gain of $ 290 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 2025, the Company recognized a gain of $ 1,952 million related to the sale of our ownership interest in Coke Consolidated, a net gain of $ 409 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 gain of $ 331 million related to the sale of a portion of our ownership interest in CCEP, a gain of $ 102 million related to the refranchising of our bottling operations in certain territories in India and a gain of $ 31 million related to the substantial liquidation of a joint venture in China.

The Company also recorded a charge of $ 1,274 million related to our bottling operations in Africa that became held for sale, a charge of $ 393 million related to the sale of our finished product operations in Nigeria, and 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.

Additionally, the Company recorded a charge of $ 36 million related to the refranchising of certain bottling operations in Ghana, and charges of $ 27 million and $ 11 million for special termination benefits and a curtailment loss, respectively, related to non-U.S.

pension activity.

During 2024, the Company recognized a gain of $ 595 million related to the refranchising of our bottling operations in the Philippines and recognized a gain of $ 506 million related to the sale of our ownership interest in an equity method investee in Thailand.

The Company also recognized a gain of $ 338 million related to the sale of a portion of our ownership interest in Coke Consolidated, a gain of $ 303 million related to the refranchising of our bottling operations in certain territories in India and a net gain of $ 290 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.

These gains were partially offset by an other-than-temporary impairment charge of $ 34 million related to an equity method investee in Latin America.

During 2023, the Company recognized a net gain of $ 439 million related to the refranchising of our bottling operations in Vietnam, a net gain of $ 289 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 a net gain of $ 94 million related to the sale of our ownership interests in our equity method investees in Pakistan and Indonesia.

During 2023, the Company recognized a gain of $ 439 million related to the refranchising of our bottling operations in Vietnam, a net gain of $ 289 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 a gain of $ 94 million related to the sale of our ownership interests in our equity method investees in Pakistan and Indonesia.

Additionally, the Company recorded charges of $ 67 million due to pension and other postretirement benefit plan settlement losses, an other-than-temporary impairment charge of $ 39 million related to an equity method investee in Latin America and charges of $ 32 million related to the restructuring of our manufacturing operations in the United States.

During 2022, the Company recorded a net gain of $ 153 million related to the refranchising of our bottling operations in Cambodia.

The Company also recorded a net loss of $ 371 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, an other-than-temporary impairment charge of $ 96 million related to an equity method investee in Russia, and a net loss of $ 24 million as a result of one of our equity method investees issuing additional shares of its stock.

Refer to Note 2 for additional information on our divestitures.

Refer to Note 2 for additional information on our divestiture activities and on our bottling operations held for sale in Africa.

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

Refer to Note 14 for additional information on pension and other postretirement benefit plan activity.

Refer to Note 17 for additional information on the restructuring of our manufacturing operations in the United States and the impairment charges.

Refer to Note 17 for additional information on the impairment charges and the bottling operations in Ghana.

RESTRUCTURING

North America Operating Unit Restructuring

In November 2022, the Company announced a restructuring program for our North America operating unit designed to better align its operating structure with its customers and bottlers.

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

The Company incurred pretax expenses of $ 27 million and $ 38 million during the years ended December 31, 2023 and 2022, respectively, related to this restructuring program.

These expenses were recorded in the line item other operating charges in our consolidated statements of income.

Refer to Note 20 for the impact these charges had on our operating segments and Corporate.

This restructuring program was substantially complete as of December 31, 2023, and remaining accrued amounts were paid in 2024.

Productivity and Reinvestment Program

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This program was expanded multiple times, with the last expansion occurring in April 2017.

While most of the initiatives included in this program were substantially completed by the end of 2024, certain initiatives, which are primarily designed to further simplify and standardize our organization, have been delayed and will be completed during 2025.

The Company has incurred total pretax expenses of $ 4,426 million related to our productivity and reinvestment program since it commenced.

As of December 31, 2025, we have substantially completed this program.

The Company incurred pretax expenses of $ 97 million, $ 133 million and $ 164 million during the years ended December 31, 2025, 2024 and 2023, respectively, related to this 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.

The Company has incurred total pretax expenses of $ 4,523 million related to this program since it commenced.

These expenses were recorded in the line items other operating charges and other income (loss) — net in our consolidated statements of income.

Refer to Note 20 for the impact these charges had on our operating segments and Corporate.

Outside services reported in the table below primarily include costs associated with outplacement and consulting activities.

Other direct costs reported in the table below include, among other items, internal and external costs associated with the development, communication, administration and implementation of these initiatives;

accelerated depreciation on certain fixed assets;

contract termination fees;

and relocation costs.

The following table summarizes the balance of accrued expenses related to these productivity and reinvestment initiatives and the changes in the accrued amounts (in millions):

Severance Pay

and Benefits Outside

Services Other

Direct Costs Total

Accrued balance at beginning of year $ 12 $ — $ 5 $ 17

Costs incurred ( 4 ) 81 8 85

Payments ( 2 ) ( 81 ) ( 11 ) ( 94 )

Noncash and exchange ( 2 ) — — ( 2 )

Accrued balance at end of year $ 4 $ — $ 2 $ 6

Accrued balance at beginning of year $ 4 $ — $ 2 $ 6

Costs incurred ( 1 ) 131 34 164

Payments — ( 124 ) ( 42 ) ( 166 )

Noncash and exchange — ( 7 ) 6 ( 1 )

Accrued balance at end of year $ 3 $ — $ — $ 3

Accrued balance at beginning of year $ 3 $ — $ — $ 3

Costs incurred — 60 73 133

Payments ( 3 ) ( 60 ) ( 72 ) ( 135 )

Accrued balance at end of year $ — $ — $ 1 $ 1

OPERATING SEGMENTS

Our organizational structure consists of the following operating segments:

Europe, Middle East and Africa;

Latin America;

North America;

Asia Pacific;

Global Ventures;

and Bottling Investments.

Our organizational structure consists of the following five operating segments:

EMEA, Latin America, North America, Asia Pacific, and Bottling Investments.

Our operating structure also includes Corporate, which consists of two components:

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The business of our Company is primarily nonalcoholic beverages.

Our geographic operating segments (Europe, Middle East and Africa;

Latin America;

North America;

and Asia Pacific) derive a majority of their revenues from the manufacture and sale of beverage concentrates and syrups and, in some cases, the sale of finished beverages.

Our Global Ventures operating segment includes the results of our Costa, innocent and doğadan businesses as well as fees earned pursuant to distribution coordination agreements between the Company and Monster.

Our geographic operating segments (EMEA, Latin America, North America and Asia Pacific) derive a majority of their revenues from the manufacture and sale of beverage concentrates and syrups and, in some cases, the sale of finished beverages.

Our EMEA operating segment also includes the results of the Costa business (excluding the ready-to-drink business), regardless of the location of the retail stores.

The results of Costa’s ready-to-drink business and the fees related to Monster are reported within the applicable geographic operating segments.

Our Bottling Investments operating segment is composed of our consolidated bottling operations, regardless of the geographic location of the bottler.

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Information about total assets by segment is not disclosed because such information is not regularly provided to, or used by, our CODM.

Geographic Data

Geographic and Customer Data

The following table provides information related to our net operating revenues (in millions):

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Net operating revenues $ 47,941 $ 47,061 $ 45,754

For the year ended December 31, 2025, one bottler accounted for 10 % of our net operating revenues, which are reflected in our EMEA and Asia Pacific operating segments.

No bottlers or customers represented 10% or more of our net operating revenues for the years ended December 31, 2024 and 2023.

The following table provides information related to our property, plant and equipment — net (in millions):

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Information about our Company’s operations by operating segment and Corporate is as follows (in millions):

Middle East & Africa Latin

America North

America Asia Pacific Global Ventures Bottling

Investments Corporate Eliminations Consolidated

America Asia Pacific Bottling

Investments Operating Segments Total Corporate Eliminations Consolidated

Year Ended December 31, 2025

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Third party $ 10,833 $ 6,331 $ 19,579 $ 5,328 $ 5,726 $ 47,797 $ 144 $ — $ 47,941

$ 3,129 $ 6,215 $ 97 $ — $ 47,061

Intersegment 680 3 7 310 9 1,009 — ( 1,009 ) —

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Cost of goods sold 3,294 1,109 9,438 1,788 3,948 19,577 ( 171 ) ( 1,009 ) 18,397

Selling, general and

administrative expenses

2,234 1,454 3,958 1,733 1,402 1,476 2,325 — 14,582

Selling, general and administrative expenses 3,921 1,439 4,118 1,767 1,361 12,606 1,915 — 14,521

Other operating charges — 44 960 41 — 1,045 216 — 1,261

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Cost of goods sold 3,083 1,099 9,595 1,689 4,251 19,717 ( 229 ) ( 1,164 ) 18,324

Selling, general and

administrative expenses

2,231 1,358 3,522 1,780 1,341 1,667 2,073 — 13,972

Selling, general and administrative expenses 3,620 1,454 3,958 1,749 1,476 12,257 2,325 — 14,582

Other operating charges — 126 760 — — 886 3,277 — 4,163

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Depreciation and amortization 181 29 325 45 319 899 176 — 1,075

Middle East & Africa Latin

America North

America Asia Pacific Global Ventures Bottling

Investments Corporate Eliminations Consolidated

America Asia Pacific Bottling

Investments Operating Segments Total Corporate Eliminations Consolidated

Year Ended December 31, 2023

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Cost of goods sold 2,970 1,040 8,791 1,644 5,615 20,060 ( 107 ) ( 1,433 ) 18,520

Selling, general and

administrative expenses

2,070 1,168 3,216 1,679 1,324 1,740 1,683 — 12,880

Selling, general and administrative expenses 3,545 1,358 3,522 1,806 1,667 11,898 2,074 — 13,972

Other operating charges — — 26 35 — 61 1,890 — 1,951

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Refer to Note 2.

In 2024, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) was reduced by $ 3,109 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 17.

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

Refer to Note 18.

• Operating income (loss) was reduced by $ 133 million for Corporate due to the Company’s productivity and reinvestment program.

Refer to Note 19.

• Operating income (loss) was reduced by $ 126 million for Latin America due to the impairment of a trademark.

Refer to Note 17.

• Operating income (loss) was reduced by $ 19 million for North America due to the restructuring of our manufacturing operations in the United States.

• Operating income (loss) was reduced by $ 15 million for Corporate due to charges related to our acquisition of BodyArmor.

Refer to Note 18.

• Operating income (loss) was reduced by $ 13 million for Corporate due to a payment under an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations.

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

Refer to Note 2.

In 2023, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) was reduced by $ 1,702 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

Refer to Note 17.

• Operating income (loss) was reduced by $ 165 million for Corporate due to the Company’s productivity and reinvestment program.

Operating income (loss) was 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 19.

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

• Operating income (loss) was reduced by $ 27 million for North America due to the restructuring of our North America operating unit.

Refer to Note 19.

• Operating income (loss) was reduced by $ 18 million for North America due to the restructuring of our manufacturing operations in the United States.

• Operating income (loss) was reduced by $ 15 million for Corporate due to charges related to our acquisition of BodyArmor.

Refer to Note 18.

• Operating income (loss) was reduced by $ 8 million for Corporate related to tax litigation expense.

Refer to Note 12.

In 2022, the results of our operating segments and Corporate were impacted by the following items:

• Operating income (loss) was increased by $ 7 million for Europe, Middle East and Africa and was reduced by $ 1 million for Corporate due to revisions of management’s estimates related to the Company’s strategic realignment initiatives.

• Operating income (loss) was reduced by $ 1,000 million for Corporate due to the remeasurement of our contingent consideration liability to fair value in conjunction with the fairlife acquisition.

• Operating income (loss) was reduced by $ 85 million for Corporate due to the Company’s productivity and reinvestment program.

Refer to Note 19.

• Operating income (loss) was reduced by $ 59 million for Corporate and was increased by $ 21 million for North America related to our acquisition of BodyArmor.

Refer to Note 18.

• Operating income (loss) was reduced by $ 57 million for Asia Pacific due to the impairment of a trademark.

• Operating income (loss) was reduced by $ 38 million for North America due to the restructuring of our North America operating unit.

Additionally, during 2025, 2024 and 2023, our operating segments and Corporate were impacted by certain significant operating and nonoperating items.

Refer to Note 18.

• Operating income (loss) was reduced by $ 33 million for North America due to the restructuring of our manufacturing operations in the United States.

NET CHANGE IN OPERATING ASSETS AND LIABILITIES

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(Increase) decrease in inventories ( 154 ) ( 520 ) ( 597 )

( 520 ) ( 597 ) ( 960 )

(Increase) decrease in prepaid expenses and other current assets and other noncurrent assets 1

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Increase (decrease) in accounts payable and accrued expenses 2

( 6,612 ) 1,134 841

Increase (decrease) in accrued income taxes ( 558 ) ( 823 ) ( 578 )

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Net change in operating assets and liabilities $ ( 7,208 ) $ ( 6,234 ) $ ( 846 )

1 The increase in inventories in 2022 was primarily due to improved business performance, higher costs and the buildup of inventory to manage potential supply chain disruptions.

1 The increase in prepaid expenses and other current assets and other noncurrent assets in 2024 was primarily due to the IRS Tax Litigation Deposit.

Refer to Note 12.

2 The decrease in accounts payable and accrued expenses in 2025 was primarily due to the payment of the contingent consideration liability in conjunction with our acquisition of fairlife in 2020.

Refer to Note 18.

REPORT OF MANAGEMENT

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Management’s Report on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934 (“Exchange Act”).

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Rule 13a-15(f) under the Exchange Act.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025.

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As of December 31, 2025, the gross amount of unrecognized tax benefits was $857 million.

As described in Note 12, on September 17, 2015 the Company received a Statutory Notice of Deficiency from the Internal Revenue Service (“IRS”) for the tax years 2007 through 2009 in the amount of $3.3 billion for the period.

On November 18, 2020, the U.S.

Tax Court issued an opinion predominantly siding with the IRS related to the Company’s transfer pricing between its U.S.

parent company and certain of its foreign affiliates for tax years 2007 through 2009.

On November 8, 2023, the U.S.

Tax Court issued a supplemental opinion, siding with the IRS.

On August 2, 2024, the Tax Court entered a decision reflecting additional federal income tax of $2.7 billion for the 2007 through 2009 tax years.

With applicable interest, the total liability for the 2007 through 2009 tax years resulting from the Tax Court’s decision is $6.0 billion.

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

Court of Appeals for the Eleventh Circuit.

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 December 31, 2024.

However, based on the required probability analysis and the accrual of interest through the current reporting period, the Company updated its tax reserve as of December 31, 2024 to $474 million.

Auditing management’s evaluation of uncertain tax positions, including the uncertain tax position associated with the IRS notice and opinion, was especially challenging due to the level of subjectivity and significant judgment associated with the recognition and measurement of the tax positions that are more likely than not to be sustained.

Auditing the amount of unrecognized tax benefits associated with some of management’s uncertain tax positions was especially challenging due to the level of subjectivity and significant judgment associated with the recognition and measurement of the tax position.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the effectiveness of controls over the Company’s accounting process for uncertain tax positions.

Our procedures included testing controls addressing the completeness of uncertain tax positions, controls relating to the identification and recognition of the uncertain tax positions, controls over the measurement of the unrecognized tax benefit, and controls over the identification of developments related to existing uncertain tax positions.

Our audit procedures included, among others, evaluating the assumptions the Company used to assess its uncertain tax positions and related unrecognized tax benefit amounts by jurisdiction.

Our audit procedures included, among others, evaluating the assumptions the Company used to assess some of its uncertain tax positions and related unrecognized tax benefit amounts by jurisdiction.

We also tested the completeness and accuracy of the underlying data used in the identification and measurement of uncertain tax positions.

We evaluated evidence of management’s assessment of uncertain tax positions, including inquiries of tax counsel, inspection of technical memos, and written representations of management.

We involved professionals with specialized skill and knowledge to assist in our evaluation of the tax technical merits of the Company’s assessments, including the assessments of whether the tax positions are more likely than not to be sustained, the amount of the potential benefits to be realized, and the application of relevant tax law.

We evaluated evidence of management’s assessment of specific uncertain tax positions, including inquiries of tax counsel, inspection of technical memos, and written representations of management.

For certain assessments, we involved professionals with specialized skill and knowledge to assist in our evaluation of the tax technical merits of the Company’s assessments, including the assessments of whether the tax positions are more likely than not to be sustained, the amount of the potential benefits to be realized, and the application of relevant tax law.

We also assessed the Company’s disclosures of uncertain tax positions included in Note 12 and Note 15.

Valuation of trademarks with indefinite lives and goodwill

Description of the Matter Included in the Company’s consolidated financial statements are trademarks with indefinite lives and goodwill of $13.3 billion and $18.1 billion, respectively, as of December 31, 2024.

As described in Note 1, management performs an annual impairment test of its indefinite-lived intangible assets, including trademarks with indefinite lives and goodwill.

Valuation of trademarks with indefinite lives

Description of the Matter Included in the Company’s consolidated financial statements are trademarks with indefinite lives of $12.5 billion as of December 31, 2025.

As described in Note 1, management performs an annual impairment test of its indefinite-lived intangible assets, including trademarks with indefinite lives.

Each impairment test may be qualitative or quantitative.

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The Company recorded an asset impairment charge of $960 million during the year ended December 31, 2025, related to their BodyArmor trademark in North America.

Auditing the valuation of trademarks with indefinite lives and reporting units with goodwill involved complex judgment due to the significant estimation required in determining the fair value of the trademarks with indefinite lives and related reporting units with goodwill, respectively.

Specifically, the fair value estimates were sensitive to significant assumptions about future market and economic conditions.

Significant assumptions used in the Company’s fair value estimates included sales volume, pricing, royalty rates, long-term growth rates, and discount rates, as applicable.

Auditing the valuation of certain indefinite-lived trademarks with indefinite lives involved complex judgment due to the significant estimation required by management in determining the fair value of the trademarks with indefinite lives.

Significant assumptions used in certain of the Company’s trademark fair value estimates included revenues, royalty rates, long-term growth rates, and discount rates, as applicable.

How We Addressed the Matter in Our Audit

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s interim review of impairment indicators, interim impairment test, and annual impairment tests for trademarks with indefinite lives and reporting units with goodwill.

For example, we tested management’s risk assessment process to determine whether to perform a quantitative or qualitative test, management’s control over the evaluation of interim impairment indicators, and management’s review controls over the valuation models and underlying assumptions used to develop such estimates.

For impairment tests of reporting units with goodwill, we also tested controls over the determination of the carrying value of the reporting units.

We tested the trademarks with indefinite lives and reporting units with goodwill based on our risk assessments.

Our audit procedures included, among others, comparing significant judgmental inputs to observable third party and industry sources, considering other observable market transactions, and evaluating the reasonableness of management’s projected financial information by comparing to third party industry projections, third party economic growth projections, and other internal and external data.

We performed sensitivity analyses of certain significant assumptions to evaluate the change in the fair value of the trademarks with indefinite lives and reporting units with goodwill and assessed the historical accuracy of management’s estimates.

In addition, we involved specialists to assist in our evaluation of certain significant assumptions used in the Company’s valuation model.

We also assessed the Company’s related disclosures of its valuation of trademarks with indefinite lives and goodwill.

We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s interim review of impairment indicators, interim impairment tests, and annual impairment tests for certain trademarks with indefinite lives.

For example, we tested management’s risk assessment process to determine whether to perform a quantitative or qualitative test, management’s control over the evaluation of interim impairment indicators, and management’s review controls over certain of the valuation models and underlying assumptions used to develop such estimates.

We tested certain of the Company’s trademarks with indefinite lives based on our risk assessments.

Our audit procedures included, among others, comparing significant judgmental inputs to observable third party and industry sources, and evaluating the reasonableness of management’s projected financial information by comparing to third party industry projections, third party economic growth projections, and other internal and external data.

We performed sensitivity analyses of certain significant assumptions to evaluate the change in the fair value of certain of the Company’s trademarks with indefinite lives and also assessed the historical accuracy of management’s estimates.

In addition, we involved specialists to assist in our evaluation of certain significant assumptions used in the Company’s valuation models.

We also assessed the Company’s related disclosures of its valuation of trademarks with indefinite lives.

/s/ Ernst & Young LLP

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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-K

Item 8. Financial Statements and Supplementary Data