Why Should You Think About Coca-Cola Differently Now?

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Coca-Cola (KO) shares trade at 28.2 times the company’s earnings over the last twelve months, against 22.8 for the S&P 500. A holder paying that premium should know what they own, and management now describes the company differently. During the fiscal Q3 2025 call, management built its case around its re-franchising strategy, the sale of bottling businesses Coca-Cola owns. That is no longer its emphasis. So what does management talk up now?

Coca-Cola’s Management Now Talks Up Recruiting Consumers

On the fiscal Q3 2026 call, held on October 27, 2026, management said affordability, zero sugar offerings, innovation and stronger execution are helping Coca-Cola recruit consumers. It also said its investments in digital capabilities are creating momentum. These affordable offerings take concrete form in Vietnam, where Coca-Cola is expanding an affordable single-serve package that is now in over 400,000 outlets.

A year earlier, the emphasis was on how the company is built. During the fiscal Q3 2025 call in October 2025, management said re-franchising allowed Coca-Cola to further focus on brand building, and that it had a clear line of sight to complete the strategy. It called the global franchise model a strategic differentiator.

The bottling sales have not stopped. Management’s 2026 earnings guidance assumes the pending sale of Coca-Cola Beverages Africa closes during the fourth quarter, subject to regulatory approvals. Coca-Cola is also exploring a potential IPO of its bottling operations in India. On the latest call, though, those deals came up as assumptions and updates, not as the case management makes for the company.

Is Coca-Cola’s Bottling Business Shrinking While Sales Grow?

Yes. Coca-Cola’s Bottling Investments segment brought in $5.74 billion in fiscal 2025, accounting for 12.0% of company revenue. Segment revenue fell 7.8% that year, following a 20.8% drop in fiscal 2024.

North America, Coca-Cola’s largest segment, moved the other way in fiscal 2025 as revenue rose 3.8% to $19.6 billion. Not every region grew: Latin America slipped 2.1%.

Company revenue is growing faster now. Revenue rose 7.4% from a year earlier in fiscal Q3 2026, compared with 5.1% growth in fiscal Q3 2025. Management said unit cases, its count of drinks sold, grew 5% in the quarter.

Should Shareholders Welcome Coca-Cola’s New Focus?

On balance, Coca-Cola’s new focus reads as reassuring so far. Coca-Cola’s operating margin was 33.4% in fiscal Q3 2026, up from 32.2% a year earlier. Management said its own comparable margins benefited from last year’s sale of its finished product operations in Nigeria, alongside underlying expansion and currency tailwinds.

The weak spot is price mix. Price mix, the part of growth that comes from prices and the mix of drinks sold, grew 1% in the quarter, as four points of pricing actions were partly offset by three points of unfavorable mix. Management attributed that mix mainly to geographic mix, the timing of investments and category mix. Separately, it said cost pressures have risen with logistics and transportation costs.

When Coca-Cola reports its fourth quarter, expected in February 2027, price mix is the measure to watch.

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