Keurig Dr Pepper Warns Cost Pressures Will Persist Into Early 2026

Keurig Dr Pepper Inc. (NASDAQ:KDP) shares moved higher Tuesday even as executives warned that cost pressures will likely weigh on performance in the near term.

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Investors balanced solid quarterly execution against management's cautious tone around expenses and margin challenges heading into the year.

The company reported fourth-quarter adjusted earnings per share of 60 cents, beating the analyst consensus estimate of 59 cents.

Keurig Dr Pepper's CEO said the company expects cost pressures to persist through the first half of 2026, speaking during a conference call.

Metrics

Quarterly sales of $4.499 billion (+10.5% year-over-year) outpaced the Street view of $4.361 billion.

On a constant currency basis, net sales increased 9.9%. The growth was driven by favorable net price realization of 6% and volume/mix gains of 3.9%.

U.S. Refreshment Beverages net sales for the fourth quarter increased 11.5% to $2.7 billion, while U.S. Coffee sales increased 3.9% to $1.2 billion.

International net sales for the fourth quarter increased 21.0% to $604 million.

The GHOST acquisition added 3.6 percentage points to volume and mix expansion.

Adjusted operating income increased 4.8% to $1,190 million and totaled 26.5% of net sales.

Adjusted operating income growth was driven by net sales growth and productivity savings, partially offset by the impact of inflationary pressures and higher SG&A costs.

Outlook

Keurig Dr Pepper sees 2026 net sales of $25.9 billion to $26.4 billion.

The firm projects 2026 adjusted EPS of $2.13 to $2.17, compared with the $2.17 analyst estimate.

In the quarterly conference call, Keurig Dr Pepper's CFO said the company expects first-quarter EPS in the range of 36 cents to 37 cents, compared with 42 cents a year ago.

KDP Price Action: Keurig Dr Pepper shares are trading higher by 4.01% to $30.97 at publication on Tuesday.

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