The Coca-Cola Company KO has reported first-quarter 2026 results, with the bottom and top lines surpassing the Zacks Consensus Estimate. The company’s revenues and earnings per share (EPS) improved year over year. The results have benefited from continued business momentum, aided by enhanced pricing across markets. This quarter’s results highlighted the strength of KO’s resilient, all-weather strategy.
Coca-Cola has reported a comparable EPS of 86 cents in the first quarter, up 18% from the year-ago period. Comparable EPS also beat the Zacks Consensus Estimate of 81 cents. Favorable currency translations aided the comparable EPS by three percentage points. Comparable currency-neutral EPS rose 15% year over year.
Revenues of $12.47 billion grew 12% year over year and came above the Zacks Consensus Estimate of $12.30 billion. Organic revenues on an adjusted basis rose 10% from the prior-year quarter, led by growth across all operating segments.
In the first quarter of 2026, KO gained a value share in the total non-alcoholic ready-to-drink beverages category.
Shares of Coca-Cola gained 2.7% in the pre-market trading session following the solid results in the first quarter. The Zacks Rank #4 (Sell) stock has risen 2.7% in the past three months compared with the industry’s 1.7% growth.
Detailed Picture of KO’s Q1 Volume & Pricing
In the reported quarter, concentrate sales grew 8% year over year, while the price/mix improved 2%. Concentrate sales were five points ahead of unit case volume, mainly owing to six additional days in the reported quarter, somewhat offset by the timing of concentrate shipments. Coca-Cola’s total unit case volume rose 3% year over year in the first quarter, led by growth in China, the United States and India.
Our model predicted year-over-year organic revenue growth of 7.1% for the first quarter, with a 3.6% increase in the price/mix and a 3.4% rise in the concentrate sales volume.
CocaCola Company (The) Price, Consensus and EPS Surprise
CocaCola Company (The) price-consensus-eps-surprise-chart | CocaCola Company (The) Quote
Regarding the cluster-category performance, the unit case volume grew 2% year over year for the sparkling soft drinks category. The trademark Coca-Cola’s unit volume rose 2%, buoyed by growth in Asia Pacific and North America. Coca-Cola Zero Sugar jumped 13%, backed by growth in all geographic operating segments. The unit case volume for Diet Coke/Coca-Cola Light also climbed 6%, on growth in North America. Sparkling flavors grew 3%, mainly owing to growth in all geographic operating segments.
Volume for juice, value-added dairy and plant-based beverages was down 1% in the first quarter, as increases in Asia Pacific were more than offset by decreases in Europe, the Middle East & Africa (EMEA).
Unit volume for the water, sports, coffee and tea category was up 5% year over year in the first quarter. Coca-Cola witnessed 5% volume growth in the water category, driven by growth in all the geographic operating segments. Sports drinks rose 3%, driven by gains in North America and EMEA. The coffee business was flat year over year. The tea volume was up 8%, backed by growth in Latin America, the Asia Pacific and EMEA.
Peek Into KO’s Segmental Details
Reported revenues rose 12% year over year for North America, 6% for the Asia Pacific, 14% for Latin America, 13% for EMEA and 12% for Bottling Investments.
Organic revenues jumped 12% year over year in North America, 5% in the Asia Pacific, 9% in Latin America, 11% in EMEA and 10% in Bottling Investments.
Analyzing Coca-Cola’s Q1 Margins
In dollar terms, the operating income rose 19% year over year to $1.84 billion, including a seven-point impact of currency headwinds. Comparable currency-neutral operating income advanced 12% on strong organic revenue growth across segments.
The operating margin of 35% in the first quarter expanded 210 basis points (bps) in the prior-year quarter, including items affecting comparability and currency tailwinds. The comparable operating margin expanded 70 bps to 34.5%, backed by organic revenue growth and reduced operating costs, partly offset by increased input costs and higher marketing investments.
Our model predicted the first-quarter operating margin to expand 150 bps year over year to 35.3%, driven by a 120-bps jump in the gross margin, offset by a 30-bps decline in the SG&A expense rate.
KO’s Guidance for 2026
For 2026, Coca-Cola still anticipates organic revenue growth on an adjusted basis of 4-5%. Comparable net revenues are expected to include a 1-2% currency tailwind based on current rates and hedge positions. The guidance also includes a 4% negative impact of acquisitions and divestitures. The company anticipates an underlying effective tax rate of 19.9% for 2026.
Comparable currency-neutral EPS for 2026 is expected to increase 6-7% year over year. The company anticipates comparable EPS growth of 8-9% for 2026 from the $3.00 reported in 2025. Comparable EPS growth is expected to include a currency tailwind of 3%. The EPS guidance also includes a 1% negative impact of acquisitions and divestitures.
Management still envisions an adjusted free cash flow of $12.2 billion for 2026, including $14.4 billion in cash flow from operations. Capital expenditure is still likely to be $2.2 billion.
For second-quarter 2026, comparable revenues and EPS are expected to include currency tailwinds of 1% and 3%, respectively. Both metrics are also estimated to include a 1% headwind from acquisitions and divestitures.
Three Stocks Looking Good
Freshpet, Inc. FRPT, which is a pet food company, currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Freshpet’s current financial-year sales indicates growth of 9.3% from the prior-year level. FRPT delivered a trailing four-quarter earnings surprise of 50%, on average.
United Natural Foods UNFI, which is the leading distributor of natural, organic and specialty food and non-food products, currently carries a Zacks Rank of 2.
The Zacks Consensus Estimate for United Natural Foods’ current financial-year earnings is expected to rise 254.9% from the year-ago reported figure. UNFI delivered a trailing four-quarter earnings surprise of 51.9%, on average.
B&G Foods BGS, which has a diversified portfolio of brands, including B&G, B&M, Cream of Wheat, Las Palmas and more, currently carries a Zacks Rank of 2. BGS delivered a negative average earnings surprise of 19.5% in the trailing four quarters.
The Zacks Consensus Estimate for BGS’ current financial-year earnings indicates growth of 5.9% from the year-ago number.
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CocaCola Company (The) (KO): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).