KO 1Q26 First Take: As the first quarterly print under new CEO Henrique Braun, results were solid. Revenue and EPS beat estimates.
1) Organic revenue grew 10% in Q1. By driver, concentrate sales volume rose 8% YoY, while price/mix was up 2%. The quarter had six more selling days vs. last year, adding ~500bps to concentrate volume, but underlying sell-through remained very strong even ex-calendar.
North America, the home market, was the standout. With last year's drag from a boycott among Hispanic consumers behind it, unit case volume rose 4% YoY vs. -3% a year ago. High-frequency scanner data indicate share gains across nearly all categories.
By category, zero-sugar within CSDs continued to grow at double digits (+13%). Among other categories, tea led (+8% YoY), reflecting consumers' shift toward healthier, functional options beyond CSDs.
GPM expanded 40bps to a record 63%, driven by mix shift toward higher-margin, health-oriented SKUs such as zero-sugar, Fairlife ultrafiltered milk, and premium sparkling water. Leveraging AI to boost efficiency in ad spend, supply chain, channel pricing, and customer ops, the opex ratio fell 130bps to 27.8%. Core OPM improved 90bps to 33.8%.
Guidance: the company maintained organic revenue growth of 4–5%, but raised comparable EPS growth from +7–8% to +8–9%, mainly as FX flipped from a headwind to a ~300bps tailwind. For more details, stay tuned for Dolphin Research's detailed take and call. $Coca Cola(KO.US)
