What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-29 compared with 2026-04-30 · 237 added, 114 removed, 297 unchanged (54% of the section changed)

17 unchanged sentences

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

As of April 3, 2026, the fair value of this trademark approximates its carrying value.

As of July 3, 2026, the fair value of this trademark approximates its carrying value.

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

4 unchanged sentences

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

As previously disclosed in the Company’s Current Report on Form 8-K filed on July 16, 2026, the Company announced a ransomware event at its fairlife operations in the U.S., which are a part of the North America operating segment.

The event involved unauthorized access by a third party to a portion of fairlife’s systems and the taking of certain data, and led to a temporary suspension of production operations.

A majority of production operations have resumed, and based on the information currently available and the Company’s investigation to date, the Company believes that the incident has not had, and is not reasonably likely to have, a material impact on the Company’s financial condition or results of operations.

Structural Changes, Acquired Brands and Newly Licensed Brands

3 unchanged sentences

Unit case volume growth is a key metric used by management to evaluate the Company’s performance because it measures demand for our products at the consumer level.

The Company’s unit case volume represents the number of unit cases (or unit case equivalents) of Company beverage products directly or indirectly sold by the Company and its bottling partners (“Coca-Cola system”) to customers or consumers and, therefore, reflects unit case volume for both consolidated and unconsolidated bottlers.

The Company’s unit case volume represents the number of unit cases (or unit case equivalents) of Company beverage products directly or indirectly sold by the Company and its bottling partners

(collectively, “Coca-Cola system”) to customers or consumers and, therefore, reflects unit case volume for both consolidated and unconsolidated bottlers.

Refer to the heading “Beverage Volume” below.

29 unchanged sentences

In May 2025, the Company refranchised our bottling operations in certain territories in India.

The impact of this refranchising has been included as a structural change in our analysis of net operating revenues on a consolidated basis as well as for the Bottling Investments and Asia Pacific operating segments for the three months ended April 3, 2026.

Additionally, in October 2025, the Company sold our finished product operations in Nigeria.

The impact of this sale has been included as a divestiture in our analysis of net operating revenues on a consolidated basis as well as for the EMEA operating segment for the three months ended April 3, 2026.

The impact of this sale has been included as a divestiture in our analysis of net operating revenues on a consolidated basis as well as for the EMEA operating segment for the three and six months ended July 3, 2026.

Beverage Volume

6 unchanged sentences

Also included in unit case volume are certain brands licensed to, or distributed by, our Company, and brands owned by Coca-Cola system bottlers for which our Company provides marketing support and from the sale of which we derive an economic benefit.

In addition, unit case volume includes sales by certain joint ventures in which the Company has an ownership interest.

In addition, unit

case volume includes sales by certain joint ventures in which the Company has an ownership interest.

We believe unit case volume is one of the indicators of the underlying strength of the Coca-Cola system because it measures demand for our products at the consumer level.

The unit case volume numbers used in this report are derived based on estimates received by the

Company from its bottling partners and distributors.

The unit case volume numbers used in this report are derived based on estimates received by the Company from its bottling partners and distributors.

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

6 unchanged sentences

Three Months Ended

April 3, 2026

July 3, 2026 Six Months Ended

Unit Cases 1,2,3

Concentrate Sales 4

Unit Cases 1,2,3

Concentrate Sales 4

Worldwide 5 % 4 % 4 % 6 %

13 unchanged sentences

As a result, the first quarter of 2026 had six additional days when compared to the first quarter of 2025, and the fourth quarter of 2026 will have six fewer days when compared to the fourth quarter of 2025.

5 After considering the impact of structural changes, unit case volume for Bottling Investments for the three months ended April 3, 2026 increased 4%.

5 After considering the impact of structural changes, unit case volume for Bottling Investments for the three and six months ended July 3, 2026 increased 8% and 6%, respectively.

6 After considering the impact of structural changes, concentrate sales volume for Asia Pacific for both the three and six months ended July 3, 2026 increased 11%.

Unit Case Volume

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

Unit case volume in EMEA increased 2%, which included 4% growth in both sparkling flavors and water, sports, coffee and tea, as well as growth in energy drinks, partially offset by a 15% decline in juice, value-added dairy and plant-based beverages, which was primarily driven by the impact of the sale of our finished product operations in Nigeria.

Unit case volume in Trademark Coca-Cola was even.

The operating segment’s volume performance included an increase in unit case volume of 3% in the Africa operating unit, 2% in the Eurasia and Middle East operating unit and 1% in the Europe operating unit.

Unit case volume in Latin America increased 1%, which included 3% growth in water, sports, coffee and tea, 2% growth in sparkling flavors, as well as growth in energy drinks.

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

The operating segment’s volume performance included 2% growth in Brazil, partially offset by declines of 5% in Argentina and 1% in Mexico.

Unit case volume in North America increased 4%, which included 5% growth in both Trademark Coca-Cola and water, sports, coffee and tea, 2% growth in sparkling flavors, as well as growth in energy drinks.

Three Months Ended July 3, 2026 versus Three Months Ended June 27, 2025

Unit case volume in EMEA increased 4%, which included 4% growth in Trademark Coca-Cola, 7% growth in water, sports, coffee and tea, as well as growth in energy drinks, partially offset by a 9% decline in juice, value-added dairy and plant-based beverages, which was driven by the impact of the sale of our finished product operations in Nigeria.

Unit case volume in sparkling flavors was even.

The operating segment’s volume performance included an increase in unit case volume of 6% in the Eurasia and Middle East operating unit, 3% in the Europe operating unit and 4% in the Africa operating unit.

Unit case volume in Latin America increased 3%, which included 3% growth in Trademark Coca-Cola, 4% growth in water, sports, coffee and tea, 2% growth in sparkling flavors, as well as growth in energy drinks.

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

Unit case volume in Asia Pacific increased 5%, which included 8% growth in water, sports, coffee and tea, 5% growth in Trademark Coca-Cola, 4% growth in sparkling flavors, 2% growth in juice, value-added dairy and plant-based beverages, as well as growth in energy drinks.

The operating segment’s volume performance included 8% growth in the Greater China and Mongolia operating unit, 5% growth in both the India and Southwest Asia operating unit and the Japan and South Korea operating unit and 3% growth in the ASEAN and South Pacific operating unit.

Unit case volume for Bottling Investments increased 1%, primarily driven by growth in Africa, partially offset by the impact of refranchising certain territories of our bottling operations in India.

The operating segment’s volume performance included 6% growth in Brazil, 20% growth in Colombia and 16% growth in Peru.

Unit case volume in Mexico was even.

Unit case volume in North America increased 3%, which included 5% growth in Trademark Coca-Cola, 4% growth in juice, value-added dairy and plant-based beverages, 1% growth in sparkling flavors, as well as growth in energy drinks.

Unit case volume in water, sports, coffee and tea was even.

Unit case volume in Asia Pacific increased 8%, which included 8% growth in both sparkling flavors and Trademark Coca-Cola, 9% growth in water, sports, coffee and tea, 8% growth in juice, value-added dairy and plant-based beverages, as well as growth in energy drinks.

The operating segment’s volume performance included 13% growth in the India and Southwest Asia operating unit, 8% growth in both the Greater China and Mongolia and the ASEAN and South Pacific operating units, and 2% growth in the Japan and South Korea operating unit.

Unit case volume for Bottling Investments increased 5%, primarily driven by growth in India, partially offset by the impact of refranchising certain territories of our bottling operations in India.

Six Months Ended July 3, 2026 versus Six Months Ended June 27, 2025

Unit case volume in EMEA increased 3%, which included 2% growth in Trademark Coca-Cola, 5% growth in water, sports, coffee and tea, 2% growth in sparkling flavors, as well as growth in energy drinks, partially offset by a 12% decline in juice, value-added dairy and plant-based beverages, which was driven by the impact of the sale of our finished product operations in Nigeria.

The operating segment’s volume performance included an increase in unit case volume of 4% in both the Africa and the Eurasia and Middle East operating units and 2% growth in the Europe operating unit.

Unit case volume in Latin America increased 2%, which included 2% growth in Trademark Coca-Cola, 3% growth in water, sports, coffee and tea, 2% growth in sparkling flavors, as well as growth in energy drinks.

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

The operating segment’s volume performance included 4% growth in Brazil, 14% growth in Colombia and 11% growth in Peru, partially offset by declines of 1% in Mexico and 5% in Argentina.

Unit case volume in North America increased 3%, which included 5% growth in Trademark Coca-Cola, 2% growth in both water, sports, coffee and tea and juice, value-added dairy and plant-based beverages, 1% growth in sparkling flavors, as well as growth in energy drinks.

Unit case volume in Asia Pacific increased 7%, which included 7% growth in Trademark Coca-Cola, 6% growth in sparkling flavors, 8% growth in water, sports, coffee and tea, 5% growth in juice, value-added dairy and plant-based beverages, as well as growth in energy drinks.

The operating segment’s volume performance included 8% growth in the Greater China and Mongolia operating unit, 9% growth in the India and Southwest Asia operating unit, 5% growth in the ASEAN and South Pacific operating unit and 3% growth in the Japan and South Korea operating unit.

Unit case volume for Bottling Investments increased 3%, primarily driven by growth in India, partially offset by the impact of refranchising certain territories of our bottling operations in India.

Concentrate Sales Volume

During the three months ended April 3, 2026, worldwide concentrate sales volume increased 8% and unit case volume increased 3% compared to the three months ended March 28, 2025.

During the three months ended July 3, 2026, worldwide concentrate sales volume increased 4% and unit case volume increased 5% compared to the three months ended June 27, 2025.

During the six months ended July 3, 2026, worldwide concentrate sales volume increased 6% and unit case volume increased 4% compared to the six months ended June 27, 2025.

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

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

The first quarter of 2026 had six additional days when compared to the first quarter of 2025, which contributed to the differences between concentrate sales volume and unit case volume growth rates on a consolidated basis and for the individual operating segments.

The first quarter of 2026 had six additional days when compared to the first quarter of 2025, which

contributed to the differences between concentrate sales volume and unit case volume growth rates on a consolidated basis and for the individual operating segments during the six months ended July 3, 2026.

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

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

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

however, for the full year 2026 we currently expect worldwide concentrate sales volume growth to be slightly behind unit case volume growth.

Net Operating Revenues

During the three months ended April 3, 2026, net operating revenues were $12,472 million, compared to $11,129 million during the three months ended March 28, 2025, an increase of $1,343 million, or 12%.

Three Months Ended July 3, 2026 versus Three Months Ended June 27, 2025

During the three months ended July 3, 2026, net operating revenues were $13,380 million, compared to $12,535 million during the three months ended June 27, 2025, an increase of $845 million, or 7%.

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

23 unchanged sentences

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

• EMEA — favorable pricing initiatives, including inflationary pricing, and favorable mix;

• EMEA — favorable pricing initiatives, including inflationary pricing, partially offset by unfavorable mix;

• Latin America — favorable pricing initiatives, including inflationary pricing, partially offset by unfavorable mix;

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

• North America — favorable pricing initiatives;

• Asia Pacific — unfavorable mix and affordability initiatives;

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

• Bottling Investments — favorable mix and favorable pricing initiatives.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, favorably impacted our consolidated net operating revenues by 2%.

Net operating revenues were favorably impacted by a weaker U.S.

dollar compared to certain foreign currencies, including the euro, Mexican peso, South African rand and British pound, which had a favorable impact on our EMEA, Latin America and Bottling Investments operating segments.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real, euro and South African rand, which had a favorable impact on our Latin America, EMEA and Bottling Investments operating segments.

The favorable impact of a weaker U.S.

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

dollar compared to certain other foreign currencies, including the Argentine peso, Turkish lira and Indian rupee, which had an unfavorable impact on our Latin America, EMEA, Asia Pacific and Bottling Investments operating segments.

dollar compared to certain other foreign currencies, including the Indian rupee, Japanese yen, Turkish lira and Argentine peso, which had an unfavorable impact on our Asia Pacific, EMEA, Latin America and Bottling Investments operating segments.

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

4 unchanged sentences

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

Six Months Ended July 3, 2026 versus Six Months Ended June 27, 2025

During the six months ended July 3, 2026, net operating revenues were $25,852 million, compared to $23,664 million during the six months ended June 27, 2025, an increase of $2,188 million, or 9%.

Percent Change 2026 versus 2025

Price/Mix Foreign Currency Fluctuations Acquisitions & Divestitures 2

Consolidated 6 % 2 % 2 % (1) % 9 %

EMEA 3 3 4 (3) 7

Latin America 4 2 8 — 15

North America 7 3 — — 10

Asia Pacific 11 (8) — — 3

Bottling Investments 10 — 2 (2) 10

Certain rows may not add due to rounding.

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

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

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

Refer to the heading “Beverage Volume” above.

2 Includes structural changes, if any.

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

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

Price/mix had a 2% favorable impact on our consolidated net operating revenues.

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

• EMEA — favorable pricing initiatives, including inflationary pricing;

• Latin America — favorable pricing initiatives, including inflationary pricing, partially offset by unfavorable mix;

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

• Asia Pacific — unfavorable mix and affordability initiatives;

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

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, favorably impacted our consolidated net operating revenues by 2%.

Net operating revenues were favorably impacted by a weaker U.S.

The favorable impact of a weaker U.S.

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

dollar compared to certain other foreign currencies, including the Indian rupee, Japanese yen, Argentine peso and Turkish lira, which had an unfavorable impact on our Asia Pacific, Latin America, EMEA and Bottling Investments operating segments.

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

Net operating revenue growth rates are impacted by sales volume;

7 unchanged sentences

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

Our gross profit margin increased to 63.0% for the three months ended April 3, 2026, compared to 62.6% for the three months ended March 28, 2025.

The increase was primarily due to the favorable impact of pricing initiatives and foreign currency exchange rate fluctuations, as well as the impact of the sale of our finished product operations in Nigeria, partially offset by higher commodity costs.

Our gross profit margin increased to 62.9% for the three months ended July 3, 2026, compared to 62.4% for the three months ended June 27, 2025.

Our gross profit margin increased to 62.9% for the six months ended July 3, 2026, compared to 62.5% for the six months ended June 27, 2025.

The increases were primarily due to the favorable impact of pricing initiatives and foreign currency exchange rate fluctuations, as well as the impact of the sale of our finished product operations in Nigeria, partially offset by higher commodity costs.

Selling, General and Administrative Expenses

During the three months ended April 3, 2026, selling, general and administrative expenses were $3,472 million, compared to $3,234 million during the three months ended March 28, 2025, an increase of $238 million, or 7%.

The increase was primarily due to increased marketing spending, partially offset by lower annual incentive expense and the impact of the sale of our finished product operations in Nigeria.

During the three months ended April 3, 2026, foreign currency exchange rate fluctuations increased selling, general and administrative expenses by 4%.

Advertising expenses for the three months ended April 3, 2026 and March 28, 2025 were $1,377 million and $1,089 million, respectively.

During the three months ended July 3, 2026, selling, general and administrative expenses were $3,720 million, compared to $3,470 million during the three months ended June 27, 2025, an increase of $250 million, or 7%.

During the six months ended July 3, 2026, selling, general and administrative expenses were $7,192 million, compared to $6,704 million during the six months ended June 27, 2025, an increase of $488 million, or 7%.

These increases were primarily due to increased marketing spending partly due to timing.

Additionally, during the three and six months ended July 3, 2026, foreign currency exchange rate fluctuations increased selling, general and administrative expenses by 1% and 2%, respectively.

These increases were partially offset by lower annual incentive expense and the impact of the sale of our finished product operations in Nigeria.

Advertising expenses for the three months ended July 3, 2026 and June 27, 2025 were $1,565 million and $1,328 million, respectively.

Advertising expenses for the six months ended July 3, 2026 and June 27, 2025 were $2,942 million and $2,417 million, respectively.

Other Operating Charges

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

Three Months Ended

2026 March 28,

Three Months Ended Six Months Ended

2026 June 27,

EMEA $ — $ — $ — $ —

Latin America — 31 — 31

4 unchanged sentences

Total $ 23 $ 71 $ 44 $ 144

During the three months ended April 3, 2026, the Company recorded other operating charges of $21 million.

These charges consisted of $10 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $4 million related to North America modernization initiatives, $4 million for the amortization of noncompete agreements related to the BodyArmor acquisition and $3 million related to tax litigation expense.

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

During the three months ended July 3, 2026, the Company recorded other operating charges of $23 million.

These charges consisted of $9 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $6 million related to North America modernization initiatives, $5 million related to tax litigation expense and $3 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

During the six months ended July 3, 2026, the Company recorded other operating charges of $44 million.

These charges consisted of $19 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $10 million related to North America modernization initiatives, $8 million related to tax litigation expense and $7 million for the amortization of noncompete agreements related to the BodyArmor acquisition.

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

These charges primarily included $31 million related to the impairment of a trademark in Latin America, $28 million related to the Company’s productivity and reinvestment program, $7 million of transaction costs related to the refranchising of our bottling operations in certain territories in India, $4 million for the amortization of noncompete agreements related to the BodyArmor acquisition and $2 million related to tax litigation expense.

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

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

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

Additionally, other operating charges included $39 million related to the Company’s productivity and reinvestment program, $31 million related to the impairment of a trademark in Latin America, $8 million related to an indemnification agreement entered into as a part of the refranchising of certain of our bottling operations, $7 million for the amortization of noncompete agreements related to the BodyArmor acquisition, $7 million of transaction costs related to the refranchising of our bottling operations in certain territories in India and $5 million related to tax litigation expense.

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

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

Refer to Note 15 of Notes to Consolidated Financial Statements for additional information on the impairment charge.

Operating Income and Operating Margin

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

Three Months Ended

2026 March 28,

Three Months Ended Six Months Ended

2026 June 27,

EMEA 28.0 % 31.0 % 28.4 % 30.1 %

9 unchanged sentences

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

Three Months Ended

2026 March 28,

Three Months Ended Six Months Ended

2026 June 27,

Consolidated 34.9 % 34.1 % 34.9 % 33.6 %

6 unchanged sentences

* Calculation is not meaningful.

During the three months ended April 3, 2026, operating income was $4,359 million, compared to $3,659 million during the three months ended March 28, 2025, an increase of $700 million, or 19%.

The increase was driven by an increase in concentrate sales volume of 8%, favorable price/mix, lower operating expenses, lower other operating charges and a favorable foreign currency exchange rate impact of 4%, partially offset by increased marketing spending and higher commodity costs.

Three Months Ended July 3, 2026 versus Three Months Ended June 27, 2025

During the three months ended July 3, 2026, operating income was $4,672 million, compared to $4,280 million during the three months ended June 27, 2025, an increase of $392 million, or 9%.

The increase was primarily driven by an increase in concentrate sales volume of 4%, favorable price/mix, lower operating expenses, lower other operating charges and a favorable foreign currency exchange rate impact of 5%, partially offset by higher commodity costs and increased marketing spending partly due to timing.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, favorably impacted consolidated operating income by 5% due to a weaker U.S.

dollar compared to certain foreign currencies, including the Mexican peso and euro, which had a favorable impact on our Latin America and EMEA operating segments.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real and euro, which had a favorable impact on our Latin America and EMEA operating segments.

The favorable impact of a weaker U.S.

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

dollar compared to certain other foreign currencies, including the Argentine peso and Turkish lira, which had an unfavorable impact on our Latin America and EMEA operating segments.

dollar compared to certain other foreign currencies, including the Japanese yen, which had an unfavorable impact on our Asia Pacific operating segment.

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

The EMEA operating segment reported operating income of $1,259 million and $1,065 million for the three months ended April 3, 2026 and March 28, 2025, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 5%, favorable price/mix and a favorable foreign currency exchange rate impact of 6%, partially offset by increased marketing spending and higher operating expenses.

Latin America reported operating income of $1,038 million and $904 million for the three months ended April 3, 2026 and March 28, 2025, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 7%, favorable price/mix, lower commodity costs and a favorable foreign currency exchange rate impact of 5%, partially offset by increased marketing spending.

Operating income for North America for the three months ended April 3, 2026 and March 28, 2025 was $1,606 million and $1,341 million, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 11%, favorable price/mix and lower operating expenses, partially offset by increased marketing spending and higher commodity costs.

Asia Pacific’s operating income for the three months ended April 3, 2026 and March 28, 2025 was $536 million and $624 million, respectively.

The decrease in operating income was primarily driven by unfavorable price/mix, higher commodity costs and increased marketing spending, partially offset by an increase in concentrate sales volume of 10% and a favorable foreign currency exchange rate impact of 3%.

Bottling Investments’ operating income for the three months ended April 3, 2026 and March 28, 2025 was $191 million and $119 million, respectively.

The increase in operating income was primarily driven by an increase in unit case volume of 11%, lower commodity costs, lower operating expenses and a favorable foreign currency exchange rate impact of 12%, partially offset by unfavorable price/mix and the impact of refranchising certain territories of our bottling operations in India.

Corporate’s operating loss for the three months ended April 3, 2026 and March 28, 2025 was $271 million and $394 million, respectively.

The EMEA operating segment reported operating income of $1,309 million and $1,325 million for the three months ended July 3, 2026 and June 27, 2025, respectively.

The decrease in operating income was primarily driven by increased marketing spending and higher operating expenses, partially offset by an increase in concentrate sales volume of 1%, favorable price/mix, lower commodity costs and a favorable foreign currency exchange rate impact of 4%.

Latin America reported operating income of $1,177 million and $957 million for the three months ended July 3, 2026 and June 27, 2025, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 1%, favorable price/mix, lower operating expenses, lower other operating charges, and a favorable foreign currency exchange rate impact of 15%, partially offset by increased marketing spending.

Operating income for North America for the three months ended July 3, 2026 and June 27, 2025 was $1,695 million and $1,621 million, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 3%, favorable price/mix, lower operating expenses and a favorable foreign currency exchange rate impact of 1%, partially offset by higher commodity costs, higher other operating charges and increased marketing spending.

Asia Pacific’s operating income for the three months ended July 3, 2026 and June 27, 2025 was $656 million and $647 million, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 11%, lower commodity costs, lower operating expenses and a favorable foreign currency exchange rate impact of 1%, partially offset by unfavorable price/mix and increased marketing spending.

Bottling Investments’ operating income for the three months ended July 3, 2026 and June 27, 2025 was $91 million and $59 million, respectively.

The increase in operating income was primarily driven by an increase in unit case volume of 8%, favorable price/mix and lower commodity costs, partially offset by higher operating expenses, the impact of refranchising certain territories of our bottling operations in India and an unfavorable foreign currency exchange rate impact of 24%.

Corporate’s operating loss for the three months ended July 3, 2026 and June 27, 2025 was $256 million and $329 million, respectively.

This decrease is primarily a result of lower annual incentive expense and lower other operating charges.

Six Months Ended July 3, 2026 versus Six Months Ended June 27, 2025

During the six months ended July 3, 2026, operating income was $9,031 million, compared to $7,939 million during the six months ended June 27, 2025, an increase of $1,092 million, or 14%.

The increase was primarily driven by an increase in concentrate sales volume of 6%, favorable price/mix, lower operating expenses, lower other operating charges and a favorable foreign currency exchange rate impact of 4%, partially offset by higher commodity costs and increased marketing spending partly due to timing.

Fluctuations in foreign currency exchange rates, including the effects of our hedging activities, favorably impacted consolidated operating income by 4% due to a weaker U.S.

dollar compared to certain foreign currencies, including the Mexican peso, Brazilian real and euro, which had a favorable impact on our Latin America and EMEA operating segments.

The favorable impact of a weaker U.S.

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

dollar compared to certain other foreign currencies, including the Argentine peso, Turkish lira, Indian rupee and Japanese yen, which had an unfavorable impact on our Latin America, EMEA, Asia Pacific and Bottling Investments operating segments.

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

The EMEA operating segment reported operating income of $2,568 million and $2,390 million for the six months ended July 3, 2026 and June 27, 2025, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 3%, favorable price/mix, lower commodity costs and a favorable foreign currency exchange rate impact of 5%, partially offset by increased marketing spending and higher operating expenses.

Latin America reported operating income of $2,215 million and $1,861 million for the six months ended July 3, 2026 and June 27, 2025, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 4%, favorable price/mix, lower commodity costs, lower operating expenses, lower other operating charges and a favorable foreign currency exchange rate impact of 10%, partially offset by increased marketing spending partly due to timing.

Operating income for North America for the six months ended July 3, 2026 and June 27, 2025 was $3,301 million and $2,962 million, respectively.

The increase in operating income was primarily driven by an increase in concentrate sales volume of 7%, favorable price/mix, lower operating expenses and a favorable foreign currency exchange rate impact of 1%, partially offset by higher commodity costs, higher other operating charges and increased marketing spending partly due to timing.

Asia Pacific’s operating income for the six months ended July 3, 2026 and June 27, 2025 was $1,192 million and $1,271 million, respectively.

The decrease in operating income was primarily driven by unfavorable price/mix, higher commodity costs and increased marketing spending partly due to timing, partially offset by an increase in concentrate sales volume of 11%, lower operating expenses, and a favorable foreign currency exchange rate impact of 2%.

Bottling Investments’ operating income for the six months ended July 3, 2026 and June 27, 2025 was $282 million and $178 million, respectively.

The increase in operating income was primarily driven by an increase in unit case volume of 10% and lower commodity costs, partially offset by higher operating expenses and the impact of refranchising certain territories of our bottling operations in India.

Corporate’s operating loss for the six months ended July 3, 2026 and June 27, 2025 was $527 million and $723 million, respectively.

This decrease is primarily a result of lower annual incentive expense and lower other operating charges.

Based on current spot rates and our hedging coverage in place, we expect foreign currency exchange rate fluctuations will have a favorable impact on our full year 2026 operating income.

Interest Income

During the three months ended April 3, 2026, interest income was $222 million, compared to $180 million during the three months ended March 28, 2025, an increase of $42 million, or 23%.

The increase was primarily driven by higher average investment balances.

During the three months ended July 3, 2026, interest income was $198 million, compared to $188 million during the three months ended June 27, 2025, an increase of $10 million, or 6%.

During the six months ended July 3, 2026, interest income was $420 million, compared to $368 million during the six months ended June 27, 2025, an increase of $52 million, or 14%.

The increases were primarily driven by higher average investment balances.

Interest Expense

During the three months ended April 3, 2026, interest expense was $375 million, compared to $387 million during the three months ended March 28, 2025, a decrease of $12 million, or 3%.

The decrease was primarily due to lower average short-term debt balances.

During the three months ended July 3, 2026, interest expense was $369 million, compared to $445 million during the three months ended June 27, 2025, a decrease of $76 million, or 17%.

During the six months ended July 3, 2026, interest expense was $744 million, compared to $832 million during the six months ended June 27, 2025, a decrease of $88 million, or 11%.

The decreases were primarily due to lower average short-term debt balances.

Equity Income (Loss) — Net

During the three months ended April 3, 2026, equity income was $384 million, compared to equity income of $351 million during the three months ended March 28, 2025, an increase of $33 million, or 9%.

This increase reflects, among other items, the impact of more favorable operating results reported by certain of our equity method investees in the current year and a favorable foreign currency exchange rate impact.

These favorable impacts were partially offset by the impact of the sale of our ownership interests in certain equity method investees in 2025, and a $25 million increase in net charges resulting from the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

During the three months ended July 3, 2026, equity income was $604 million, compared to equity income of $561 million during the three months ended June 27, 2025, an increase of $43 million, or 8%.

During the six months ended July 3, 2026, equity income was $988 million, compared to equity income of $912 million during the six months ended June 27, 2025, an increase of $76 million, or 8%.

These increases reflect, among other items, the impact of more favorable operating results reported by certain of our equity method investees in the current year, a favorable foreign currency exchange rate impact and a reduction of net charges resulting from the Company’s proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.

These favorable impacts were partially offset by the impact of the sale of our ownership interests in certain equity method investees in 2025.

Other Income (Loss) — Net

During the three months ended April 3, 2026, other income (loss) — net was income of $21 million.

The Company recognized a net loss of $19 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, dividend income of $33 million and net foreign currency exchange gains of $30 million.

Other income (loss) — net also included $13 million of costs related to our trade accounts receivable factoring program and an impairment charge of $10 million related to our bottling operations in Africa, which are held for sale.

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

The Company recognized a gain of $331 million related to the sale of a portion of our ownership interest in CCEP, an impairment charge of $25 million related to an equity method investee in Latin America and a net loss of $19 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities.

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

Other income (loss) — net also included expense of $33 million related to the non-service cost components of net periodic benefit cost, which included charges of $25 million and $11 million for special termination benefits and a curtailment loss, respectively, related to non-U.S.

Three Months Ended July 3, 2026 versus Three Months Ended June 27, 2025

During the three months ended July 3, 2026, other income (loss) — net was income of $370 million.

The Company recognized a net gain of $320 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, dividend income of $38 million and net foreign currency exchange losses of $37 million.

The Company also recorded a $66 million reduction in the previously recorded impairment charge related to our bottling operations in Africa, which are held for sale.

This reduction is based on management’s revised estimates.

Other income (loss) — net also included $14 million of costs related to our trade accounts receivable factoring program.

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

The Company recognized a net gain of $163 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, a gain of $102 million related to the refranchising of our bottling operations in certain territories in India and dividend income of $36 million.

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

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

Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on our bottling operations in Africa and our divestiture activities.

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

Refer to Note 13 of Notes to Consolidated Financial Statements for additional information on net periodic benefit cost or income.

Refer to Note 15 of Notes to Consolidated Financial Statements for additional information on the impairment charges.

Six Months Ended July 3, 2026 versus Six Months Ended June 27, 2025

During the six months ended July 3, 2026, other income (loss) — net was income of $391 million.

The Company recognized a net gain of $301 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, dividend income of $71 million and net foreign currency exchange losses of $7 million.

The Company also recorded a $56 million reduction in the previously recorded impairment charge related to our bottling operations in Africa, which are held for sale.

This reduction is based on management’s revised estimates.

Other income (loss) — net also included $27 million of costs related to our trade accounts receivable factoring program.

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

The Company recognized a gain of $331 million related to the sale of a portion of our ownership interest in CCEP, a net gain of $144 million related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities, a gain of $102 million related to the refranchising of our bottling operations in certain territories in India and dividend income of $91 million.

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

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

pension activity.

Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on the sale of our ownership interest in CCEP.

Refer to Note 2 of Notes to Consolidated Financial Statements for additional information on our bottling operations in Africa and our divestiture activities.

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

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Refer to Note 15 of Notes to Consolidated Financial Statements for additional information on the impairment charges.

The Company recorded income taxes of $645 million (14.0% effective tax rate) and $722 million (17.8% effective tax rate) during the three months ended April 3, 2026 and March 28, 2025, respectively.

The Company’s effective tax rates for the three months ended April 3, 2026 and March 28, 2025 vary from the statutory U.S.

The Company recorded income taxes of $1,037 million (18.9% effective tax rate) and $993 million (20.7% effective tax rate) during the three months ended July 3, 2026 and June 27, 2025, respectively.

The Company recorded income taxes of $1,682 million (16.7% effective tax rate) and $1,715 million (19.4% effective tax rate) during the six months ended July 3, 2026 and June 27, 2025, respectively.

The Company’s effective tax rates for the three and six months ended July 3, 2026 and June 27, 2025 vary from the statutory U.S.

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

federal tax rate.

The Company’s effective tax rate for the three months ended April 3, 2026 included $279 million of net tax benefits related to various discrete tax items, including net interest income of $55 million related to the IRS Tax Litigation Deposit recorded in the line item income taxes in our consolidated statement of income, in accordance with our accounting policy, and a tax benefit of $194 million, primarily related to return to provision adjustments.

The Company’s effective tax rate for the three months ended March 28, 2025 included $143 million of net tax benefits related to various discrete tax items, including net interest income of $53 million related to the IRS Tax Litigation Deposit recorded in

the line item income taxes in our consolidated statement of income, in accordance with our accounting policy, and a tax benefit of $85 million related to a change in the Company’s indefinite reinvestment assertion for certain foreign entities.

The Company’s effective tax rates for the three and six months ended July 3, 2026 included $40 million and $319 million, respectively, of net tax benefits related to various discrete tax items, including net interest income of $43 million and $98 million, respectively, related to the IRS Tax Litigation Deposit recorded in the line item income taxes in our consolidated statements of income, in accordance with our accounting policy.

The Company’s effective tax rates for the three and six months ended July 3, 2026 also included net tax expense of $13 million and a net tax benefit of $181 million, respectively, primarily related to return to provision adjustments.

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

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

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

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

The Company’s cash, cash equivalents, short-term investments and marketable securities totaled $13.8 billion as of April 3, 2026.

In addition to these funds, our commercial paper program, and our ability to issue long-term debt, we had $6.6 billion in unused backup lines of credit for general corporate purposes as of April 3, 2026.

The Company’s cash, cash equivalents, short-term investments and marketable securities totaled $16.4 billion as of July 3, 2026.

These backup lines of credit expire at various times through 2031.

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

The Company sold $3,271 million and $5,034 million of trade accounts receivables under this program during the three months ended April 3, 2026 and March 28, 2025, respectively.

The costs of factoring such receivables were $13 million and $24 million for the three months ended April 3, 2026 and March 28, 2025, respectively.

The Company sold $7,011 million and $8,400 million of trade accounts receivables under this program during the six months ended July 3, 2026 and June 27, 2025, respectively.

The costs of factoring such receivables were $27 million and $36 million for the six months ended July 3, 2026 and June 27, 2025, respectively.

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

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

For the three months ended April 3, 2026 and March 28, 2025, the Company recorded net interest income of $55 million and $53 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 April 3, 2026 and December 31, 2025.

For the three and six months ended July 3, 2026, the Company recorded net interest income of $43 million and $98 million, respectively, and for the three and six months ended June 27, 2025, the Company recorded net interest income of $54 million and $107 million, respectively, related to this tax payment in the line item income taxes in our consolidated statements of income, in accordance with our accounting policy.

The payment of the IRS invoices and the related accrued interest were recorded in the line item other noncurrent assets in our consolidated balance sheets as of July 3, 2026 and December 31, 2025.

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

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

Court of Appeals for the Eleventh Circuit heard the case on June 25, 2026.

The Company strongly disagrees with the IRS’ positions and the portions of the Opinions affirming such positions and intends to vigorously defend our positions utilizing every available avenue of appeal.

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

In that event, the Company would not receive a refund of the applicable portion or all of the $6.0 billion it paid in response to the IRS invoices issued in September 2024 and the related accrued interest receivable of $457 million as of April 3, 2026.

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.

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Additional income tax and interest on any unpaid potential liabilities for the 2010 through 2025 tax years would continue to accrue until the time any such potential liability, or portion thereof, were to be paid.

The Company estimates the impact of the continued application of the methodology asserted by the IRS and affirmed in the Opinions for the three months ended April 3, 2026 would increase the potential aggregate incremental tax and interest liability by approximately $450 million.

The Company estimates the impact of the continued application of the methodology asserted by the IRS and affirmed in the Opinions for the three and six months ended July 3, 2026 would increase the potential aggregate incremental tax and interest liability by approximately $450 million and $900 million, respectively.

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

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Cash Flows from Operating Activities

Net cash provided by operating activities during the three months ended April 3, 2026 was $2,021 million, and net cash used in operating activities during the three months ended March 28, 2025 was $5,202 million.

The increase was primarily driven by strong cash operating results, a benefit of the trade accounts receivable factoring program in the current year, a favorable impact due to foreign currency exchange rate fluctuations, lower net interest payments and lower annual incentive payments.

These items were partially offset by higher tax payments and unfavorable hedging activity.

Additionally, the activity in 2025 included $6,069 million of the $6,173 million final milestone payment for fairlife that was made during the three months ended March 28, 2025.

Net cash provided by operating activities during the six months ended July 3, 2026 was $7,543 million, and net cash used in operating activities during the six months ended June 27, 2025 was $1,391 million.

The increase was primarily driven by strong cash operating results, a benefit of the trade accounts receivable factoring program in the current year, lower income tax payments, a favorable impact due to foreign currency exchange rate fluctuations, lower net interest payments and lower annual incentive payments.

These items were partially offset by the prior year transfer of surplus non-U.S.

plan assets from pension trusts to general assets of the Company and unfavorable hedging activity.

Additionally, the activity in 2025 included $6,069 million of the $6,173 million final milestone payment for fairlife that was made during the six months ended June 27, 2025.

Refer to Note 12 of Notes to Consolidated Financial Statements for additional information on our milestone payment for fairlife.

Cash Flows from Investing Activities

Net cash provided by investing activities during the three months ended April 3, 2026 was $1,746 million, and net cash used in investing activities during the three months ended March 28, 2025 was $1,067 million.

Net cash provided by investing activities during the six months ended July 3, 2026 was $1,104 million, and net cash used in investing activities during the six months ended June 27, 2025 was $278 million.

Purchases of Investments and Proceeds from Disposals of Investments

During the three months ended April 3, 2026, purchases of investments were $1,459 million and proceeds from disposals of investments were $3,503 million, resulting in a net cash inflow of $2,044 million.

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

During the six months ended July 3, 2026, purchases of investments were $2,799 million and proceeds from disposals of investments were $4,574 million, resulting in a net cash inflow of $1,775 million.

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

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

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Acquisitions of Businesses, Equity Method Investments and Nonmarketable Securities

During the three months ended April 3, 2026 and March 28, 2025, the Company’s acquisitions of businesses, equity method investments and nonmarketable securities totaled $37 million and $42 million, respectively.

The activity during the three months ended April 3, 2026 and March 28, 2025 included $32 million and $30 million, respectively, of investments in alternative energy limited partnerships.

During the six months ended July 3, 2026 and June 27, 2025, the Company’s acquisitions of businesses, equity method investments and nonmarketable securities totaled $199 million and $179 million, respectively.

The activity during the six months ended July 3, 2026 included additional investments of $112 million in an equity method investee in Japan.

The activity during the six months ended July 3, 2026 and June 27, 2025 also included $75 million and $148 million, respectively, of investments in alternative energy limited partnerships.

Refer to Note 14 of Notes to Consolidated Financial Statements for additional information on these investments.

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

During the three months ended March 28, 2025, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $748 million, which primarily related to the sale of a portion of our ownership interest in CCEP.

During the six months ended July 3, 2026 and June 27, 2025, proceeds from disposals of businesses, equity method investments and nonmarketable securities were $1 million and $973 million, respectively.

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

Refer to Note 2 of Notes to Consolidated Financial Statements.

Purchases of Property, Plant and Equipment

Purchases of property, plant and equipment during the three months ended April 3, 2026 and March 28, 2025 were $266 million and $309 million, respectively.

Purchases of property, plant and equipment during the six months ended July 3, 2026 and June 27, 2025 were $684 million and $751 million, respectively.

Other Investing Activities

During the six months ended July 3, 2026 and June 27, 2025, the total cash inflow was $241 million and $124 million, respectively.

The activity during the six months ended July 3, 2026 included the return of an advance payment of $184 million to acquire additional shares in an equity method investee in Japan.

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

Cash Flows from Financing Activities

Net cash used in financing activities during the three months ended April 3, 2026 was $3,868 million, and net cash provided by financing activities during the three months ended March 28, 2025 was $3,432 million.

Net cash used in financing activities during the six months ended July 3, 2026 was $6,535 million, and net cash provided by financing activities during the six months ended June 27, 2025 was $52 million.

Loans, Notes Payable and Long-Term Debt

The Company made payments of debt of $1,262 million during the three months ended April 3, 2026, which consisted of $746 million of payments related to commercial paper and short-term debt with maturities of 90 days or less, $500 million of payments related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $16 million.

During the three months ended March 28, 2025, the Company had issuances of debt of $5,436 million, which consisted of $3,917 million of net issuances of commercial paper and short-term debt with maturities of 90 days or less, $1,033 million of issuances of commercial paper and short-term debt with maturities greater than 90 days and long-term debt issuances of $486 million, net of related discounts and issuance costs.

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

The Company made payments of debt of $1,559 million during the six months ended July 3, 2026, which consisted of $1,027 million of payments related to commercial paper and short-term debt with maturities of 90 days or less, $500 million of

payments related to commercial paper and short-term debt with maturities greater than 90 days and payments of long-term debt of $32 million.

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

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

Issuances of Stock

The issuances of stock during the three months ended April 3, 2026 and March 28, 2025 were related to the exercise of stock options by employees.

The issuances of stock during the six months ended July 3, 2026 and June 27, 2025 were related to the exercise of stock options by employees.

Purchases of Stock for Treasury

During the three months ended April 3, 2026, the total cash outflow for treasury stock purchases was $477 million.

During the six months ended July 3, 2026, the total cash outflow for treasury stock purchases was $663 million.

The Company repurchased 7.3 million shares of common stock under the share repurchase plan authorized by our Board of Directors.

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

The net impact of the Company’s issuances of stock and share repurchases during the three months ended April 3, 2026 resulted in a net cash outflow of $322 million.

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

The net impact of the Company’s issuances of stock and share repurchases during the six months ended July 3, 2026 resulted in a net cash outflow of $412 million.

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

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

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

During the three months ended April 3, 2026 and March 28, 2025, the Company paid dividends of $2,281 million and $89 million, respectively.

As a result of the timing of our quarterly reporting periods as well as our dividend payment dates, the Company paid substantially all of the 2025 first quarterly dividend in the second quarter and paid all of the 2026 first quarterly dividend in the first quarter.

Our Board of Directors approved the Company’s regular quarterly dividend of $0.53 per share at its April 2026 meeting.

This dividend is payable on July 1, 2026 to shareowners of record as of the close of business on June 15, 2026.

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

During the six months ended July 3, 2026 and June 27, 2025, the Company paid dividends of $4,562 million and $2,283 million, respectively.

As a result of the timing of our quarterly reporting periods as well as our dividend payment dates, the Company paid all of the 2026 second quarterly dividend in the second quarter and paid substantially all of the 2025 second quarterly dividend in the third quarter.

Our Board of Directors approved the Company’s regular quarterly dividend of $0.53 per share at its July 2026 meeting.

This dividend is payable on October 1, 2026 to shareowners of record as of the close of business on September 15, 2026.

Other Financing Activities

During the three months ended April 3, 2026 and March 28, 2025, the total cash outflow for other financing activities was $3 million and $105 million, respectively.

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

During the six months ended July 3, 2026 and June 27, 2025, the total cash outflow for other financing activities was $11 million and $106 million, respectively.

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

Foreign Exchange

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

Taking into account the effects of our hedging activities, the impact of fluctuations in foreign currency exchange rates increased our operating income for the three months ended April 3, 2026 by 4%.

Taking into account the effects of our hedging activities, the impact of fluctuations in foreign currency exchange rates increased our operating income for the three and six months ended July 3, 2026 by 5% and 4%, respectively.

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

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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-Q

Item 2. Management’s Discussion and Analysis