PepsiCo Loses KFC as Coca-Cola Gains Ground
On October 15, KFC announced it will switch from Pepsi products to Coca-Cola in its 4,000 U.S. locations, marking another setback for PepsiCo amid a challenging year marked by declining sales and margins. The shift is expected to cost PepsiCo around $50 million annually, though the symbolic impact may be greater than the financial hit given KFC's historical ties with PepsiCo dating back to 1986. This marks the third major loss for PepsiCo this year following similar moves by Marriott International and Costco. The decision reflects broader consumer trends affecting processed snacks and sugary beverages, particularly as GLP-1 drugs influence calorie consumption habits. Despite a better-than-expected Q3 earnings report with revenue up 5.6% to $25.3 billion, PepsiCo lowered its full-year guidance for both organic sales and profit growth. Coca-Cola appears to be benefiting from these trends due to its stronger lineup of low- or no-calorie products (68% of the portfolio), which may explain why Coca-Cola shares have risen 34% this year compared to an 8.7% decline for PepsiCo.
Topics: Beverage Industry Coca-Cola KFC PepsiCo
Read the full article at Motley Fool
Part of the story PepsiCo Loses KFC as Coca-Cola Gains Ground (3 articles)