Coca Cola Financial Statements 2025 : The Coca-Cola Company (NYSE: KO) released its first quarter 2025 earnings on April 29, 2025, showcasing a blend of resilience and challenges in a complex global environment. This article analyzes the company’s financial performance, strategic initiatives, and outlook to provide investors with a clear understanding of its fundamentals and investment potential and Ration Analysis of Coca Cola Financial Statement.
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Table of Contents
Financial Performance Overview
Revenue and Growth | Coca Cola Stock Earnings report 2025-Q1
- Net Revenues: Declined 2% to $11.1 billion, primarily due to currency headwinds and the refranchising of bottling operations. However, organic revenues (non-GAAP) grew 6%, driven by a 5% increase in price/mix and a 1% rise in concentrate sales. This indicates strong underlying demand despite external pressures. Or for More details click to official website.
- Unit Case Volume: Grew 2%, with notable strength in emerging markets like India, China, and Brazil. Sparkling soft drinks rose 2%, led by a 14% surge in Coca-Cola Zero Sugar, highlighting the brand’s appeal in health-conscious segments.
- Regional Performance:
- Europe, Middle East & Africa: 3% volume growth, 7% organic revenue growth, driven by pricing actions and Trademark Coca-Cola.
- Latin America: Flat volume, but 13% organic revenue growth due to robust pricing (16% price/mix).
- North America: 3% volume decline, offset by 3% organic revenue growth from pricing and favorable mix.
- Asia Pacific: 6% volume growth, 7% organic revenue growth, fueled by all beverage categories.
- Bottling Investments: 17% volume decline due to refranchising, though price/mix grew 3%. (At the end of this topic, we also provided area-wise Table)
Profitability
- Operating Income: Surged 71% to $3.66 billion, with comparable currency-neutral operating income (non-GAAP) up 10%. This was driven by organic revenue growth, effective cost management, and timing of marketing investments, though partially offset by higher input costs and currency headwinds.
- Operating Margin: Improved to 32.9% from 18.9% in Q1 2024. Comparable operating margin (non-GAAP) rose to 33.8% from 32.4%, reflecting operational efficiency.
- Earnings Per Share (EPS): Reported EPS grew 5% to $0.77, while comparable EPS (non-GAAP) increased 1% to $0.73, impacted by a 5-point currency headwind. This demonstrates resilience in earnings despite foreign exchange challenges.
Cash Flow and Balance Sheet
- Cash Flow: Cash flow used in operations was $5.2 billion, heavily impacted by a $6.1 billion contingent consideration payment related to the 2020 fairlife acquisition. Excluding this, free cash flow (non-GAAP) was $558 million, a decline from the prior year but manageable given the one-time payment.
- Balance Sheet:
- Total assets grew to $101.7 billion from $100.5 billion at year-end 2024.
- Cash and equivalents stood at $8.4 billion, down from $10.8 billion, reflecting the fairlife payment.
- Long-term debt increased to $43.5 billion from $42.4 billion, indicating moderate leverage.
- Equity attributable to shareholders rose to $26.2 billion, supported by reinvested earnings of $77.2 billion.
Market Share
Coca-Cola gained value share in total nonalcoholic ready-to-drink (NARTD) beverages, with notable gains in Romania, Egypt, Türkiye, and North America’s juice and dairy segments. This underscores the company’s competitive positioning in a fragmented market.
Below is a table summarizing The Coca-Cola Company’s Q1 2025 business performance by geographic operating segment, based on the provided earnings release for the first quarter ended March 28, 2025. The table includes key metrics such as unit case volume, net operating revenues, organic revenues, operating income, and comparable currency-neutral operating income, along with relevant percentage changes compared to Q1 2024.
| Operating Segment | Unit Case Volume (% Change) | Net Operating Revenues ($M) | Net Revenues (% Change) | Organic Revenues (% Change, Non-GAAP) | Operating Income ($M) | Operating Income (% Change) | Comparable Currency Neutral Operating Income (% Change, Non-GAAP) |
|---|---|---|---|---|---|---|---|
| Europe, Middle East & Africa | 3% | 2,657 | 1% | 7% | 1,065 | (1%) | 8% |
| Latin America | 0% | 1,477 | (3%) | 13% | 904 | (4%) | 18% |
| North America | (3%) | 4,361 | 3% | 3% | 1,341 | 170% | 4% |
| Asia Pacific | 6% | 1,421 | (4%) | 7% | 624 | (5%) | 7% |
| Bottling Investments | (17%) | 1,463 | (20%) | 2% | 119 | (24%) | (21%) |
| Corporate | – | 26 | (16%) | (16%) | (394) | 67% | – |
| Eliminations | – | (276) | 34% | – | – | – | – |
| Consolidated | 2% | 11,129 | (2%) | 6% | 3,659 | 71% | 10% |
Notes:
- Unit Case Volume: Represents the number of unit cases (192 U.S. fluid ounces of finished beverage) sold, computed based on average daily sales. The consolidated 2% growth was driven by strong performance in India, China, and Brazil.
- Net Operating Revenues: Reflects reported revenues, impacted by currency headwinds and refranchising. Consolidated revenues declined 2% to $11.1 billion.
- Organic Revenues (Non-GAAP): Excludes currency fluctuations and structural changes (e.g., refranchising). The 6% consolidated growth was driven by 5% price/mix and 1% concentrate sales growth.
- Operating Income: Reported figures include items impacting comparability and currency effects. The significant 170% growth in North America was largely due to items impacting comparability.
- Comparable Currency Neutral Operating Income (Non-GAAP): Adjusts for items impacting comparability and currency fluctuations, providing a clearer view of underlying performance.
- Bottling Investments: The 17% volume decline and 20% revenue drop were primarily due to refranchising of bottling operations in India, Bangladesh, and the Philippines.
- Corporate: Negative operating income reflects corporate expenses, with the 67% improvement driven by lower charges impacting comparability.
Strategic Initiatives
- Global Expansion: Coca-Cola capitalized on events like India’s Maha Kumbh Mela, serving over 180 million drinks through innovative activations. In China, Lunar New Year campaigns drove high single-digit volume growth. Türkiye’s “Made in, Made by” campaign boosted double-digit volume growth and market share.
- Portfolio Innovation: The company’s 30 billion-dollar brands, including Coca-Cola, Sprite, and fairlife, continue to resonate. The launch of Simply Pop, a prebiotic soda, reflects Coca-Cola’s focus on health-conscious consumers. Ready-to-drink tea brands like Fuze Tea and Gold Peak also gained share globally.
- Operational Efficiency: Refranchising bottling operations in India, Bangladesh, and the Philippines streamlined operations, though it temporarily reduced volumes in the Bottling Investments segment.
Outlook for Coca Cola Financial Statements 2025
- Organic Revenue Growth: Expected at 5–6%, signaling confidence in sustained demand.
- Comparable EPS Growth: Projected at 2–3% (non-GAAP), with currency-neutral EPS growth of 7–9%, despite a 5–6% currency headwind.
- Free Cash Flow: Forecasted at $9.5 billion (non-GAAP, excluding fairlife payment), supported by $11.7 billion in operating cash flow and $2.2 billion in capital expenditures.
- Tax Rate: Underlying effective tax rate (non-GAAP) estimated at 20.8%, up from 18.6% in 2024, reflecting global minimum tax regulations.
Investment Considerations
Strengths
- Global Brand Power: Coca-Cola’s portfolio, with iconic brands like Coca-Cola Zero Sugar and emerging ones like fairlife, drives consistent demand across 200+ countries.
- Pricing Power: A 5% price/mix increase demonstrates the ability to pass on costs without significant volume loss, critical in inflationary environments.
- Emerging Market Growth: Strong performance in India, China, and Brazil highlights exposure to high-growth regions, where 80% of the global population resides.
- Operational Efficiency: Margin expansion and cost management reflect disciplined execution, even amidst currency and cost pressures.
Risks
- Currency Headwinds: A 5% currency impact on revenues and EPS underscores vulnerability to foreign exchange fluctuations, particularly in Latin America and Asia Pacific.
- Input Cost Pressures: Higher commodity and packaging costs, exacerbated by potential U.S. tariffs on aluminum (25%), could squeeze margins if not offset by pricing or alternative materials.
- One-Time Charges: The $6.1 billion fairlife payment significantly impacted cash flow, and future acquisitions could introduce similar volatility.
- Regional Weakness: North America’s 3% volume decline signals challenges in developed markets, where health trends and competition are intensifying.
Valuation Metrics | Coca-cola stock prediction 2025
- Stock Price (as of May 31, 2025): $72.10, up from $63.65 in June 2024, reflecting a 13% gain.
- Market Cap: ~$308.92 billion, indicating a large, stable enterprise.
- Dividend Yield: Historically ~3% (based on recent data), appealing for income-focused investors.
- P/E Ratio: Not explicitly provided, but comparable EPS of $0.73 (Q1) and a full-year 2024 comparable EPS of $2.88 suggest a forward P/E of ~25, reasonable for a defensive stock.
- Coca-cola stock prediction 2025 : Result of not much change from previous years hence at the end of the years stock pries of coco-cola remain same around 72$ to 75$.
Key Financial Ratios for Q1 2025 of Coca Cola Financial Statements |Ratio Analysis of Coca-Cola company
| Ratio Category | Ratio | Q1 2025 | Q1 2024 | Interpretation |
|---|---|---|---|---|
| Profitability | Gross Margin | 62.6% | 62.5% | Stable gross profitability, reflecting consistent cost management. |
| Profitability | Operating Margin (GAAP) | 32.9% | 18.9% | Significant improvement due to lower operating charges and revenue growth. |
| Profitability | Comparable Operating Margin (Non-GAAP) | 33.8% | 32.4% | Modest expansion, driven by organic revenue growth and cost efficiency. |
| Profitability | Net Profit Margin | 29.9% | 28.1% | Improved profitability, supported by higher operating income. |
| Profitability | Return on Equity (ROE) | 50.8% (annualized) | 51.0% (annualized) | Strong returns, though slightly lower, indicating efficient use of equity. |
| Profitability | Return on Assets (ROA) | 13.1% (annualized) | 12.6% (annualized) | Improved asset utilization, reflecting higher net income. |
| Liquidity | Current Ratio | 1.10 | 1.03 | Improved liquidity, though still moderate, indicating ability to cover short-term obligations. |
| Liquidity | Quick Ratio | 0.88 | 0.84 | Slightly better liquidity excluding inventories, but below 1.0 suggests reliance on inventory sales. |
| Solvency | Debt-to-Equity Ratio | 1.74 | 1.77 | Stable leverage, with moderate debt levels relative to equity. |
| Solvency | Interest Coverage Ratio | 10.5 | 5.6 | Strong ability to cover interest expenses, improved by higher operating income. |
| Efficiency | Asset Turnover Ratio | 0.44 (annualized) | 0.45 (annualized) | Stable efficiency in generating revenue from assets. |
| Efficiency | Inventory Turnover Ratio | 2.0 (annualized) | 2.2 (annualized) | Slightly slower inventory turnover, possibly due to higher inventory levels. |
| Market | Earnings Per Share (EPS, Diluted) | $0.77 | $0.74 | 5% growth, reflecting improved profitability. |
| Market | Price-to-Earnings (P/E) Ratio | ~24.9 | N/A | Reasonable valuation for a defensive stock, based on annualized EPS. |
FAQ
1. Stock Market Symbol for Coca Cola
Ans : Symbol of The Coca-Cola Company is KO
2.coca cola stock buy or sell
Ans : If you want to hold for long term, then hold and if you want gain for short term the buy.
3.Would Coca-Cola be a good investment?
Ans : Coca-Cola is Good stock for Investment and It is value for money for long term.
4. Does Bill Gates invest in Coca-Cola?
Ans : Yes, Bill Gates has invested in Coco-Cola company and It has value around $346 million
5.Are Coca-Cola stocks a good/safe long-term investment?
Ans : Yes, Coca-Cola is good for long term investment.
Conclusion
Coca-Cola’s Q1 2025 results reflect a robust business model with strong fundamentals, driven by global brand strength, pricing power, and growth in emerging markets. While currency headwinds and input costs pose risks, the company’s strategic focus on innovation, market share gains, and operational efficiency supports its long-term value creation. Investors seeking stability, moderate growth, and dividends may find Coca-Cola attractive, though vigilance on cost pressures and developed market trends is warranted.
Recommendation: Coca-Cola is a Hold for conservative investors, with potential to Buy on dips below $68, where valuation becomes more compelling given its defensive nature and growth prospects.
Disclaimer: This analysis is for informational purposes only and not investment advice. Investors should conduct their own research and consult financial advisors before making decisions.