Keurig Dr Pepper Reports Q3 Results and Reaffirms Guidance for 2026
Keurig Dr Pepper Inc. (KDP) filed an SEC Form 8-K — Results of Operations and Financial Condition. EXHIBIT 99.1 Keurig Dr Pepper Reports Q3 Results and Reaffirms Guidance for 2026 Drove Healthy Q3 Net Sales Momentum, with Growth Across all Legacy KDP Segments Delivered Q3 Diluted EPS Increase of More Than 20% FRISCO, TX and BURLINGTON, MA ( November 3, 2026 ) – Keurig Dr Peppe
How this was made
The 30-second read
Why it matters
The strong quarter and reaffirmed outlook are likely to lift the stock, though integration costs and inflation remain risks.
Market read
First‑report earnings release for a large‑cap consumer staple, providing actionable data for traders.
What to watch
Higher SG&A and inflationary pressures may temper future profitability.
Keurig Dr Pepper Reports Q3 Results and Reaffirms Guidance for 2026 Drove Healthy Q3 Net Sales Momentum, with Growth Across all Legacy KDP Segments Delivered Q3 Diluted EPS Increase of More Than 20%
Third-quarter net sales increased 70.6% to $7.3 billion, with legacy KDP net sales up 8.6%, while Adjusted operating income increased 52.5% to $1.7 billion and Adjusted diluted EPS increased 22.2% to $0.66. The results included wholly incremental JDE Peet’s revenue, while U.S. Coffee pricing, KDP International adjusted operating income, higher interest expense, and acquisition and integration costs remained pressures.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Q3 2026 Net salesGAAP | $7.34B | – | 70.6% |
| Q3 2026 Net sales, constant currencynon-GAAP | 70.1% | – | 70.1% |
| Q3 2026 Legacy KDP net sales growthother | 8.6% | – | 8.6% |
| Q3 2026 Volume/mix growth, legacy KDPother | 6.5% | – | 6.5% |
| Q3 2026 Net price realization, legacy KDPother | 2.1% | – | 2.1% |
| Q3 2026 Cost of salesGAAP | $3.82B | – | – |
| Q3 2026 Gross profitGAAP | $3.52B | – | – |
| Q3 2026 Gross marginGAAP | 48.0 % | – | – |
| Q3 2026 Adjusted gross profitnon-GAAP | $3.58B | – | – |
| Q3 2026 Adjusted gross marginnon-GAAP | 48.7 % | – | – |
| Q3 2026 Selling, general, and administrative expensesGAAP | $2.14B | – | – |
| Q3 2026 Income from operationsGAAP | $1.33B | – | 34.0% |
| Q3 2026 Operating marginGAAP | 18.2 % | – | – |
| Q3 2026 Adjusted operating incomenon-GAAP | $1.67B | – | 52.5% |
| Q3 2026 Adjusted operating marginnon-GAAP | 22.7 % | – | – |
| Q3 2026 Interest expense, netGAAP | $474M | – | – |
| Q3 2026 Gain on sale of equity method investmentGAAP | −$400M | – | – |
| Q3 2026 Income before provision for income taxesGAAP | $1.21B | – | – |
| Q3 2026 Provision for income taxesGAAP | $260M | – | – |
| Q3 2026 Effective tax rateGAAP | 21.5 % | – | – |
| Q3 2026 Net incomeGAAP | $952M | – | – |
| Q3 2026 Net income attributable to common shareholdersGAAP | $810M | – | 22.4% |
| Q3 2026 Adjusted net income attributable to common shareholdersnon-GAAP | $905M | – | 22.1% |
| Q3 2026 Diluted EPSGAAP | $ 0.59 | – | 20.4% |
| Q3 2026 Adjusted diluted EPSnon-GAAP | $ 0.66 | – | 22.2% |
| Q3 2026 Operating cash flowGAAP | $1.04B | – | – |
| Q3 2026 Free cash flownon-GAAP | $1.01B | – | – |
| First nine months of 2026 Net salesGAAP | $18.63B | – | 53.9% |
| First nine months of 2026 Gross profitGAAP | $8.69B | – | – |
| First nine months of 2026 Gross marginGAAP | 46.6 % | – | – |
| First nine months of 2026 Income from operationsGAAP | $2.72B | – | – |
| First nine months of 2026 Adjusted operating incomenon-GAAP | $3.99B | – | 33.6% |
| First nine months of 2026 Net income attributable to common shareholdersGAAP | $1.16B | – | – |
| First nine months of 2026 Diluted EPSGAAP | $ 0.85 | – | (33.1)% |
| First nine months of 2026 Adjusted diluted EPSnon-GAAP | $ 1.65 | – | 13.1% |
| First nine months of 2026 Net cash provided by operating activitiesGAAP | $2.22B | – | – |
| First nine months of 2026 Free Cash Flownon-GAAP | $1.91B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| U.S. Refreshment BeveragesVolume/mix growth of 7.2% and favorable net price realization of 3.7%. | $3B | – | 10.9% |
| U.S. CoffeeVolume/mix growth of 6.9% was partially offset by unfavorable net price realization of 4.2%. | $1B | – | 2.7% |
| JDE Peet’sThe JDE Peet’s acquisition closed on April 1, and therefore the segment contribution was wholly incremental to the Company on a year-over-year basis. | $2.6B | – | – |
| KDP InternationalOn a constant currency basis, net sales increased 7.6%, driven by favorable net price realization of 5.7% and volume/mix growth of 1.9%. | $644M | – | 11.0% |
2026 outlook
- Revenue$25.9-$26.4 billion
- Noteconstant currency Adjusted diluted EPS growth in a low-double-digit range
- Noteapproximately $8.3-$8.4 billion in net sales from the JDE Peet’s acquisition
- Notea 7 to 8 percentage point EPS growth contribution from the JDE Peet’s acquisition
- Note3-5% constant currency EPS growth for KDP's legacy business
- Noteforeign currency translation is forecasted to approximate a one half of one percentage point tailwind to 2026 full year net sales and EPS growth
Capital returns
- Cash dividends paid to common shareholders: $ 938 million for the first nine months of 2026.
- Cash dividends paid to Preferred Investors: $ 107 million for the first nine months of 2026.
- Repurchases of common stock, inclusive of excise tax obligation: — for the first nine months of 2026.
What drove it
- Consolidated net sales growth included the wholly incremental contribution from JDE Peet’s following the April 1 acquisition close.
- Legacy KDP net sales increased 8.6%, driven by volume/mix growth of 6.5% and favorable net price realization of 2.1%.
- Adjusted operating income growth was driven by net sales growth and productivity savings, partly offset by inflationary pressures and higher SG&A expenses, including increased marketing.
- GAAP and Adjusted operating income included a $99 million benefit from tariff refunds in the quarter.
- U.S. Coffee Adjusted operating income growth was primarily driven by tariff refunds, volume/mix growth, productivity savings, and cost synergies.
- KDP International constant currency revenue growth reflected net price realization and volume/mix growth.
Concerns
- U.S. Coffee net price realization was unfavorable 4.2% in the third quarter.
- KDP International Adjusted operating income declined 0.6%, driven by cost pressures, including the Mexico beverage tax, and increased marketing.
- Third-quarter GAAP gross margin was 48.0 % versus 54.3 % in the prior-year quarter, while Adjusted gross margin was 48.7 % versus 54.6 %.
- Interest expense, net was $ 474 million in the third quarter, compared with $ 188 million in the prior-year quarter.
- The company cited acquisition, integration, and financing costs associated with the acquisition of JDE Peet's and subsequent spin of Global Coffee Co.
- Guidance reflects revised expectations for U.S. Coffee.
What to watch
- Delivery of 2026 net sales of $25.9-$26.4 billion and constant currency Adjusted diluted EPS growth in a low-double-digit range.
- The approximately $8.3-$8.4 billion net-sales contribution and 7 to 8 percentage point EPS growth contribution expected from the JDE Peet’s acquisition.
- Progress toward 3-5% constant currency EPS growth for KDP's legacy business following revised expectations for U.S. Coffee.
- The impact of inflationary pressures, marketing investment, the Mexico beverage tax, tariffs, interest expense, and acquisition and integration costs.
- Remaining milestones to enable the planned separation of the beverage and coffee portfolios.
Balance sheet and cash flow
- Cash and cash equivalents: $ 1,290 million as of September 30, 2026, compared with $ 1,026 million as of December 31, 2025.
- Short-term borrowings and current portion of long-term obligations: $ 7,270 million as of September 30, 2026, compared with $ 3,105 million as of December 31, 2025.
- Long-term obligations: $ 21,595 million as of September 30, 2026, compared with $ 13,036 million as of December 31, 2025.
- Acquisitions of businesses, net of cash acquired: $ (16,633) million for the first nine months of 2026.
- Net proceeds from issuance of convertible preferred stock: $ 4,395 million for the first nine months of 2026.
- Net proceeds from sale of non-controlling interest: $ 3,899 million for the first nine months of 2026.
- Pro forma Adjusted EBITDA: $ 6,822 million for the last twelve months.
- Pro forma Management Leverage Ratio: 4.1 as of September 30, 2026.
Analysis
Keurig Dr Pepper reported strong third-quarter sales and adjusted earnings growth, led by the addition of JDE Peet’s and healthy underlying legacy growth. GAAP net sales increased 70.6% to $7.3 billion, while constant currency net sales advanced 70.1%. Excluding JDE Peet’s, legacy KDP net sales increased 8.6%, comprising 6.5% volume/mix growth and 2.1% favorable net price realization. The acquisition closed on April 1, making the $2.6 billion JDE Peet’s third-quarter revenue contribution wholly incremental year over year.
Underlying segment demand was positive across the three legacy KDP segments. U.S. Refreshment Beverages revenue increased 10.9% to $3.0 billion, led by 7.2% volume/mix growth and 3.7% price realization. U.S. Coffee revenue increased 2.7% to $1.0 billion as 6.9% volume/mix growth more than offset 4.2% unfavorable net price realization. KDP International revenue increased 11.0% to $644 million and 7.6% on a constant currency basis, driven by 5.7% price and 1.9% volume/mix growth.
Profit growth exceeded reported revenue growth excluding the acquisition effect. GAAP operating income increased 34.0% to $1.3 billion, while Adjusted operating income increased 52.5% to $1.7 billion and represented 22.7% of net sales. Productivity savings and sales growth supported adjusted profit, but inflationary pressure, increased marketing, acquisition-related costs, and mix weighed on profitability. GAAP gross margin was 48.0 % and Adjusted gross margin was 48.7 %, both below the prior-year quarter. A $99 million tariff-refund benefit supported both GAAP and Adjusted operating income.
GAAP net income attributable to common shareholders increased 22.4% to $810 million and diluted EPS increased 20.4% to $0.59. Adjusted net income attributable to common shareholders increased 22.1% to $905 million, and Adjusted diluted EPS increased 22.2% to $0.66. Higher operating income was partly offset by higher non-operating expense, interest expense, non-controlling interest, and earnings allocated to preferred investors. Third-quarter operating cash flow was $1.04 billion and free cash flow was $1.01 billion.
KDP reaffirmed 2026 guidance for net sales of $25.9-$26.4 billion and constant currency Adjusted diluted EPS growth in a low-double-digit range. The outlook includes approximately $8.3-$8.4 billion of net sales and a 7 to 8 percentage point EPS growth contribution from JDE Peet’s, alongside 3-5% constant currency EPS growth for the legacy business due to revised U.S. Coffee expectations. The balance sheet reflects the acquisition financing, with short-term borrowings and current portion of long-term obligations of $7,270 million and long-term obligations of $21,595 million as of September 30, 2026. The company reported a pro forma Management Leverage Ratio of 4.1.
Management, verbatim
We are pleased with our third quarter results, which featured meaningful net sales and EPS growth, along with healthy free cash flow. Our refreshment beverages portfolio maintained its double-digit sales growth momentum and we drove solid results in coffee, led by strong JDE Peet’s profitability. Notably, we achieved these results while stepping up investment behind our brands and capabilities to position our two future companies for success. As we enter the final stretch of the year, we are on track to deliver our 2026 financial commitments and we remain focused on achieving the remaining milestones to enable our planned separation.
Tim Cofer, CEO
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so comparison of actual reported results with prior guidance is unavailable.
- Q3 2026 revenue guidance by segment was not provided.
- Q3 2026 gross-margin, operating-expense, and tax-rate guidance was not provided.
- Q3 2026 share repurchases and common dividend declaration amounts were not provided.
- Q3 2026 detailed cash-flow statement comparatives were not provided. The filing provides Q3 operating cash flow and free cash flow in narrative form and first-nine-month cash-flow statements.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
KDP filed a Form 8‑K reporting its Q3 2026 operating results and reaffirmed its full‑year guidance.
Ticker impact
Keurig Dr Pepper reported Q3 2026 results with 70% sales growth and reaffirmed full‑year guidance, providing fresh earnings data and outlook.
likely upward pressure as investors price in robust sales growth and stable outlook
The 70% YoY sales increase and 20% EPS rise exceed expectations, and the company confirmed its 2026 targets, which should support the stock price.
Market effects
Boosts the beverage sector outlook, especially for refreshment and coffee segments.
Positive for U.S. consumer staples investors.
Limited to North American beverage markets.
Counterpoint
If the integration costs of the JDE Peet’s acquisition accelerate, margins could be pressured despite sales growth.
Key entities
- companyKeurig Dr Pepper Inc.
Beverage producer reporting Q3 results and reaffirming guidance.
