(State or other jurisdiction of incorporation or organization) | (I.R.S. employer identification number) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||||||||
Page | ||||||||||||||
Term | Definition | |||||||
2021 364-Day Credit Agreement | The Company's $1,500 million credit agreement, which was entered into on March 26, 2021 and was terminated on February 23, 2022 | |||||||
2022 Revolving Credit Agreement | KDP’s $4 billion revolving credit agreement, which was executed in February 2022 and replaced the 2021 364-Day Credit Agreement and the KDP Revolver | |||||||
Annual Report | Annual Report on Form 10-K for the year ended December 31, 2022 | |||||||
AOCI | Accumulated other comprehensive income or loss | |||||||
Athletic Brewing | Athletic Brewing Holding Company, LLC, an equity method investment of KDP | |||||||
Bedford | Bedford Systems, LLC, an equity method investment of KDP and the maker of Drinkworks | |||||||
Board | The Board of Directors of KDP | |||||||
bps | Basis points | |||||||
CSD | Carbonated soft drink | |||||||
DIO | Days inventory outstanding | |||||||
DPO | Days of payables outstanding | |||||||
DPS | Dr Pepper Snapple Group, Inc. | |||||||
DPS Merger | The combination of the business operations of Keurig and DPS that was consummated on July 9, 2018 through a reverse merger transaction, whereby a wholly-owned special purpose merger subsidiary of DPS merged with and into the direct parent of Keurig | |||||||
DSD | Direct Store Delivery, KDP’s route-to-market whereby finished beverages are delivered directly to retailers | |||||||
DSO | Days sales outstanding | |||||||
EPS | Earnings per share | |||||||
Exchange Act | Securities Exchange Act of 1934, as amended | |||||||
FX | Foreign exchange | |||||||
IRi | Information Resources, Inc. | |||||||
KDP | Keurig Dr Pepper Inc. | |||||||
KDP Revolver | The Company's $2,400 million revolving credit facility, which was entered into on February 28, 2018 and terminated on February 23, 2022 | |||||||
Keurig | Keurig Green Mountain, Inc., a wholly-owned subsidiary of KDP, and the brand of our brewers | |||||||
La Colombe | La Colombe Holdings, Inc., an equity method investment of KDP | |||||||
LRB | Liquid refreshment beverages | |||||||
NCB | Non-carbonated beverage | |||||||
Notes | Collectively, the Company's senior unsecured notes | |||||||
Nutrabolt | Woodbolt Holdings LLC, d/b/a Nutrabolt, an equity method investment of KDP | |||||||
Revive | Revive Brands, a wholly-owned subsidiary of KDP | |||||||
RSU | Restricted share unit | |||||||
RTD | Ready to drink | |||||||
RVG | Residual value guarantee | |||||||
Tractor | Tractor Beverages, Inc., an equity method investment of KDP | |||||||
SEC | Securities and Exchange Commission | |||||||
SG&A | Selling, general and administrative | |||||||
SOFR | Secured Overnight Financing Rate | |||||||
U.S. GAAP | Accounting principles generally accepted in the U.S. | |||||||
Veyron SPEs | Special purpose entities with the same sponsor, Veyron Global | |||||||
VIE | Variable interest entity | |||||||
Vita Coco | The Vita Coco Company, Inc. | |||||||
WD | Warehouse Direct, KDP’s route-to-market whereby finished beverages are shipped to retailer warehouses, and then delivered by the retailer through its own delivery system to its stores |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions, except per share data) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
Cost of sales | |||||||||||||||||||||||
Gross profit | |||||||||||||||||||||||
Selling, general and administrative expenses | |||||||||||||||||||||||
Impairment of intangible assets | |||||||||||||||||||||||
Gain on litigation settlement | ( | ||||||||||||||||||||||
Other operating income, net | ( | ( | ( | ||||||||||||||||||||
Income from operations | |||||||||||||||||||||||
Interest expense | |||||||||||||||||||||||
Loss on early extinguishment of debt | |||||||||||||||||||||||
Gain on sale of equity method investment | ( | ||||||||||||||||||||||
Impairment of investments and note receivable | |||||||||||||||||||||||
Other (income) expense, net | ( | ( | |||||||||||||||||||||
Income before provision for income taxes | |||||||||||||||||||||||
Provision for income taxes | |||||||||||||||||||||||
Net income including non-controlling interest | |||||||||||||||||||||||
Less: Net loss attributable to non-controlling interest | ( | ( | |||||||||||||||||||||
Net income attributable to KDP | $ | $ | $ | $ | |||||||||||||||||||
Earnings per common share: | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | |||||||||||||||||||||||
Weighted average common shares outstanding: | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income including non-controlling interest | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive (loss) income | |||||||||||||||||||||||
Foreign currency translation adjustments | ( | ( | ( | ||||||||||||||||||||
Net change in pension and post-retirement liability, net of tax of $ | ( | ||||||||||||||||||||||
Net change in cash flow hedges, net of tax of $ | ( | ||||||||||||||||||||||
Total other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Comprehensive income (loss) including non-controlling interest | ( | ||||||||||||||||||||||
Less: Comprehensive income attributable to non-controlling interest | |||||||||||||||||||||||
Comprehensive income (loss) attributable to KDP | $ | $ | ( | $ | $ |
September 30, | December 31, | |||||||||||||
(in millions, except share and per share data) | 2023 | 2022 | ||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Trade accounts receivable, net | ||||||||||||||
Inventories | ||||||||||||||
Prepaid expenses and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Property, plant and equipment, net | ||||||||||||||
Investments in unconsolidated affiliates | ||||||||||||||
Goodwill | ||||||||||||||
Other intangible assets, net | ||||||||||||||
Other non-current assets | ||||||||||||||
Deferred tax assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||
Current liabilities: | ||||||||||||||
Accounts payable | $ | $ | ||||||||||||
Accrued expenses | ||||||||||||||
Structured payables | ||||||||||||||
Short-term borrowings and current portion of long-term obligations | ||||||||||||||
Other current liabilities | ||||||||||||||
Total current liabilities | ||||||||||||||
Long-term obligations | ||||||||||||||
Deferred tax liabilities | ||||||||||||||
Other non-current liabilities | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies | ||||||||||||||
Stockholders' equity: | ||||||||||||||
Preferred stock, $ | ||||||||||||||
Common stock, $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Retained earnings | ||||||||||||||
Accumulated other comprehensive income | ||||||||||||||
Total stockholders' equity | ||||||||||||||
Non-controlling interest | ( | |||||||||||||
Total equity | ||||||||||||||
Total liabilities and equity | $ | $ |
First Nine Months | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Operating activities: | |||||||||||
Net income attributable to KDP | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Depreciation expense | |||||||||||
Amortization of intangibles | |||||||||||
Other amortization expense | |||||||||||
Provision for sales returns | |||||||||||
Deferred income taxes | ( | ( | |||||||||
Employee stock-based compensation expense | |||||||||||
Loss on early extinguishment of debt | |||||||||||
Gain on sale of equity method investment | ( | ||||||||||
Gain on disposal of property, plant and equipment | ( | ( | |||||||||
Unrealized (gain) loss on foreign currency | ( | ||||||||||
Unrealized loss on derivatives | |||||||||||
Settlements of interest rate contracts | |||||||||||
Equity in (earnings) loss of unconsolidated affiliates | ( | ||||||||||
Impairment of intangible assets | |||||||||||
Impairment on investments and note receivable of unconsolidated affiliate | |||||||||||
Other, net | ( | ||||||||||
Changes in assets and liabilities: | |||||||||||
Trade accounts receivable | ( | ||||||||||
Inventories | ( | ( | |||||||||
Income taxes receivable and payables, net | ( | ( | |||||||||
Other current and non-current assets | ( | ( | |||||||||
Accounts payable and accrued expenses | ( | ||||||||||
Other current and non-current liabilities | |||||||||||
Net change in operating assets and liabilities | ( | ( | |||||||||
Net cash provided by operating activities | |||||||||||
Investing activities: | |||||||||||
Proceeds from sale of investment in unconsolidated affiliates | |||||||||||
Purchases of property, plant and equipment | ( | ( | |||||||||
Proceeds from sales of property, plant and equipment | |||||||||||
Purchases of intangibles | ( | ( | |||||||||
Issuance of related party note receivable | ( | ||||||||||
Investments in unconsolidated affiliates | ( | ( | |||||||||
Other, net | |||||||||||
Net cash (used in) provided by investing activities | $ | ( | $ | ( | |||||||
First Nine Months | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Financing activities: | |||||||||||
Proceeds from issuance of Notes | $ | $ | |||||||||
Repayments of Notes | ( | ||||||||||
Net issuance (repayment) of commercial paper | ( | ||||||||||
Proceeds from structured payables | |||||||||||
Repayments of structured payables | ( | ( | |||||||||
Cash dividends paid | ( | ( | |||||||||
Repurchases of common stock | ( | ( | |||||||||
Tax withholdings related to net share settlements | ( | ( | |||||||||
Payments on finance leases | ( | ( | |||||||||
Other, net | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Cash, cash equivalents, and restricted cash and cash equivalents: | |||||||||||
Net change from operating, investing and financing activities | ( | ||||||||||
Effect of exchange rate changes | ( | ||||||||||
Beginning balance | |||||||||||
Ending balance | $ | $ | |||||||||
Supplemental cash flow disclosures of non-cash investing activities: | |||||||||||
Capital expenditures included in accounts payable and accrued expenses | $ | $ | |||||||||
Transaction costs included in accounts payable and accrued expenses | |||||||||||
Non-cash conversion of note receivable to investment in unconsolidated affiliate | |||||||||||
Non-cash purchases of intangibles | |||||||||||
Supplemental cash flow disclosures of non-cash financing activities: | |||||||||||
Dividends declared but not yet paid | |||||||||||
Supplemental cash flow disclosures: | |||||||||||
Cash paid for interest | |||||||||||
Cash paid for income taxes |
Common Stock Issued | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income | Total Stockholders' Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
(in millions, except per share data) | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Repurchases of common stock, inclusive of excise tax obligation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2023 | ( | ||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Repurchases of common stock, inclusive of excise tax obligation | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2023 | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Repurchases of common stock, inclusive of excise tax obligation | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Non-controlling interest surrender of shares | — | — | — | ( | — | ( | — | ||||||||||||||||||||||||||||||||||||||||
Balance as of September 30, 2023 | $ | $ | $ | $ | $ | $ | $ |
Common Stock Issued | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Stockholders' Equity | Non-controlling Interest | Total Equity | |||||||||||||||||||||||||||||||||||||||||
(in millions, except per share data) | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||
Balance as of January 1, 2022 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance as of March 31, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Repurchases of common stock | ( | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | — | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Dividends declared, $ | — | — | — | ( | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Shares issued under employee stock-based compensation plans and other | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Tax withholdings related to net share settlements | — | — | ( | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation and stock options exercised | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Balance as of September 30, 2022 | $ | $ | $ | $ | ( | $ | $ | ( | $ |
(in millions) | Prior Presentation | First Nine Months of 2022 | ||||||||||||
Net issuance (repayment) of commercial paper | Proceeds from issuance of commercial paper | $ | ||||||||||||
Net issuance (repayment) of commercial paper | Repayments of commercial paper | ( |
(in millions) | September 30, 2023 | December 31, 2022 | |||||||||
Notes | $ | $ | |||||||||
Less: current portion of long-term obligations | ( | ( | |||||||||
Long-term obligations | $ | $ |
(in millions) | September 30, 2023 | December 31, 2022 | |||||||||
Commercial paper notes | $ | $ | |||||||||
Current portion of long-term obligations | |||||||||||
Short-term borrowings and current portion of long-term obligations | $ | $ |
(in millions, except %) | ||||||||||||||||||||||||||
Issuance | Maturity Date | Rate | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||
2023 Notes | December 15, 2023 | $ | $ | |||||||||||||||||||||||
2024 Notes | March 15, 2024 | |||||||||||||||||||||||||
2025 Merger Notes | May 25, 2025 | |||||||||||||||||||||||||
2025 Notes | November 15, 2025 | |||||||||||||||||||||||||
2026 Notes | September 15, 2026 | |||||||||||||||||||||||||
2027 Notes | June 15, 2027 | |||||||||||||||||||||||||
2028 Merger Notes | May 25, 2028 | |||||||||||||||||||||||||
2029 Notes | April 15, 2029 | |||||||||||||||||||||||||
2030 Notes | May 1, 2030 | |||||||||||||||||||||||||
2031 Notes | March 15, 2031 | |||||||||||||||||||||||||
2032 Notes | April 15, 2032 | |||||||||||||||||||||||||
2038 Merger Notes | May 25, 2038 | |||||||||||||||||||||||||
2045 Notes | November 15, 2045 | |||||||||||||||||||||||||
2046 Notes | December 15, 2046 | |||||||||||||||||||||||||
2048 Merger Notes | May 25, 2048 | |||||||||||||||||||||||||
2050 Notes | May 1, 2050 | |||||||||||||||||||||||||
2051 Notes | March 15, 2051 | |||||||||||||||||||||||||
2052 Notes | April 15, 2052 | |||||||||||||||||||||||||
Principal amount | ||||||||||||||||||||||||||
Adjustment from principal amount to carrying amount(1) | ( | ( | ||||||||||||||||||||||||
Carrying amount | $ | $ |
(in millions) | September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||
Issuance | Maturity Date | Capacity | Carrying Value | Carrying Value | ||||||||||||||||||||||
2022 Revolving Credit Agreement(1) | February 23, 2027 | $ | $ | $ | ||||||||||||||||||||||
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions, except %) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Weighted average commercial paper borrowings | $ | $ | $ | $ | |||||||||||||||||||
Weighted average borrowing rates | % | % | % | % |
(in millions) | U.S. Refreshment Beverages | U.S. Coffee | International | Total | |||||||||||||||||||
Balance as of January 1, 2023 | $ | $ | $ | $ | |||||||||||||||||||
Foreign currency translation | |||||||||||||||||||||||
Balance as of September 30, 2023 | $ | $ | $ | $ |
(in millions) | September 30, 2023 | December 31, 2022 | ||||||||||||
Brands(1) | $ | $ | ||||||||||||
Trade names | ||||||||||||||
Contractual arrangements | ||||||||||||||
Distribution rights(2) | ||||||||||||||
Total | $ | $ |
September 30, 2023 | December 31, 2022 | ||||||||||||||||||||||||||||||||||
(in millions) | Gross Amount | Accumulated Amortization | Net Amount | Gross Amount | Accumulated Amortization | Net Amount | |||||||||||||||||||||||||||||
Acquired technology | $ | $ | ( | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||
Customer relationships | ( | ( | |||||||||||||||||||||||||||||||||
Trade names | ( | ( | |||||||||||||||||||||||||||||||||
Brands | ( | ( | |||||||||||||||||||||||||||||||||
Contractual arrangements | ( | ( | |||||||||||||||||||||||||||||||||
Distribution rights | ( | ( | |||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | $ | ( | $ |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Amortization expense | $ | $ | $ | $ |
Remainder of 2023 | For the Years Ending December 31, | ||||||||||||||||||||||||||||||||||
(in millions) | 2024 | 2025 | 2026 | 2027 | 2028 | ||||||||||||||||||||||||||||||
Expected amortization expense | $ | $ | $ | $ | $ | $ |
Reportable Segments | Reporting Units | |||||||
U.S. Refreshment Beverages | U.S. Beverage Concentrates | |||||||
U.S. WD | ||||||||
DSD | ||||||||
U.S. Coffee | U.S. Coffee | |||||||
International | Canada Beverage Concentrates | |||||||
Canada WD | ||||||||
Canada Coffee | ||||||||
Latin America Beverages |
(in millions) | September 30, 2023 | December 31, 2022 | |||||||||
Interest rate contracts | |||||||||||
Forward starting swaps, not designated as hedging instruments | $ | $ | |||||||||
Forward starting swaps, designated as cash flow hedges | |||||||||||
Receive-fixed, pay-variable interest rate swaps, not designated as hedging instruments | |||||||||||
Swaptions, not designated as hedging instruments | |||||||||||
FX contracts | |||||||||||
Forward contracts, not designated as hedging instruments | |||||||||||
Forward contracts, designated as cash flow hedges | |||||||||||
Commodity contracts, not designated as hedging instruments(1) |
(in millions) | Balance Sheet Location | September 30, 2023 | December 31, 2022 | ||||||||||||||
Assets: | |||||||||||||||||
FX contracts | Prepaid expenses and other current assets | $ | $ | ||||||||||||||
Commodity contracts | Prepaid expenses and other current assets | ||||||||||||||||
Interest rate contracts | Other non-current assets | ||||||||||||||||
FX contracts | Other non-current assets | ||||||||||||||||
Commodity contracts | Other non-current assets | ||||||||||||||||
Liabilities: | |||||||||||||||||
Interest rate contracts | Other current liabilities | ||||||||||||||||
FX contracts | Other current liabilities | ||||||||||||||||
Commodity contracts | Other current liabilities | ||||||||||||||||
Interest rate contracts | Other non-current liabilities | ||||||||||||||||
Commodity contracts | Other non-current liabilities |
(in millions) | Balance Sheet Location | September 30, 2023 | December 31, 2022 | ||||||||||||||
Assets: | |||||||||||||||||
FX contracts | Prepaid expenses and other current assets | $ | $ | ||||||||||||||
FX contracts | Other non-current assets | ||||||||||||||||
Interest rate contracts | Other non-current assets | ||||||||||||||||
Liabilities: | |||||||||||||||||
FX contracts | Other current liabilities | ||||||||||||||||
Third Quarter | First Nine Months | ||||||||||||||||||||||||||||
(in millions) | Income Statement Location | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||
Interest rate contracts | Interest expense | $ | $ | $ | $ | ||||||||||||||||||||||||
Interest rate contracts | Loss on early extinguishment of debt | ||||||||||||||||||||||||||||
FX contracts | Cost of sales | ( | ( | ( | ( | ||||||||||||||||||||||||
FX contracts | Other (income) expense, net | ( | ( | ( | ( | ||||||||||||||||||||||||
Commodity contracts | Cost of sales | ( | |||||||||||||||||||||||||||
Commodity contracts | SG&A expenses | ( | ( | ( | |||||||||||||||||||||||||
Third Quarter | First Nine Months | ||||||||||||||||||||||||||||
(in millions) | Income Statement Location | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||
Interest rate contracts(1) | Interest expense | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||
FX contracts | Cost of sales | ( |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
Finance lease cost | |||||||||||||||||||||||
Amortization of right-of-use assets | |||||||||||||||||||||||
Interest on lease liabilities | |||||||||||||||||||||||
Variable lease cost(1) | |||||||||||||||||||||||
Short-term lease cost | |||||||||||||||||||||||
Sublease income | ( | ( | |||||||||||||||||||||
Total lease cost | $ | $ | $ | $ | |||||||||||||||||||
First Nine Months | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||
Operating cash flows from operating leases | $ | $ | |||||||||
Operating cash flows from finance leases | |||||||||||
Financing cash flows from finance leases | |||||||||||
Right-of-use assets obtained in exchange for lease obligations: | |||||||||||
Operating leases | |||||||||||
Finance leases |
September 30, 2023 | December 31, 2022 | ||||||||||
Weighted average discount rate | |||||||||||
Operating leases | % | % | |||||||||
Finance leases | % | % | |||||||||
Weighted average remaining lease term | |||||||||||
Operating leases | |||||||||||
Finance leases |
(in millions) | Operating Leases | Finance Leases | |||||||||
Remainder of 2023 | $ | $ | |||||||||
2024 | |||||||||||
2025 | |||||||||||
2026 | |||||||||||
2027 | |||||||||||
2028 | |||||||||||
Thereafter | |||||||||||
Total future minimum lease payments | |||||||||||
Less: imputed interest | ( | ( | |||||||||
Present value of minimum lease payments | $ | $ |
(in millions) | Sale Proceeds | Carrying Value | Gain on Sale | |||||||||||||||||
March 31, 2023(1) | $ | $ | $ |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Segment Results – Net sales | |||||||||||||||||||||||
U.S. Refreshment Beverages | $ | $ | $ | $ | |||||||||||||||||||
U.S. Coffee | |||||||||||||||||||||||
International | |||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
Segment Results – Income from operations | |||||||||||||||||||||||
U.S. Refreshment Beverages | $ | $ | $ | $ | |||||||||||||||||||
U.S. Coffee | |||||||||||||||||||||||
International | |||||||||||||||||||||||
Unallocated corporate costs | ( | ( | ( | ( | |||||||||||||||||||
Income from operations | $ | $ | $ | $ |
(in millions) | September 30, 2023 | December 31, 2022 | |||||||||
Identifiable operating assets | |||||||||||
U.S. Refreshment Beverages | $ | $ | |||||||||
U.S. Coffee | |||||||||||
International | |||||||||||
Segment total | |||||||||||
Unallocated corporate assets | |||||||||||
Total identifiable operating assets | |||||||||||
Investments in unconsolidated affiliates | |||||||||||
Total assets | $ | $ |
(in millions) | U.S. Refreshment Beverages | U.S. Coffee | International | Total | |||||||||||||||||||
For the third quarter of 2023: | |||||||||||||||||||||||
LRB | $ | $ | $ | $ | |||||||||||||||||||
K-Cup pods | |||||||||||||||||||||||
Appliances | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
For the third quarter of 2022: | |||||||||||||||||||||||
LRB | $ | $ | $ | $ | |||||||||||||||||||
K-Cup pods | |||||||||||||||||||||||
Appliances | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
For the first nine months of 2023: | |||||||||||||||||||||||
LRB | $ | $ | $ | $ | |||||||||||||||||||
K-Cup pods | |||||||||||||||||||||||
Appliances | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Net sales | $ | $ | $ | $ | |||||||||||||||||||
For the first nine months of 2022: | |||||||||||||||||||||||
LRB | $ | $ | $ | $ | |||||||||||||||||||
K-Cup pods | |||||||||||||||||||||||
Appliances | |||||||||||||||||||||||
Other | |||||||||||||||||||||||
Net sales | $ | $ | $ | $ |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions, except per share data) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Net income attributable to KDP | $ | $ | $ | $ | |||||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Dilutive effect of stock-based awards | |||||||||||||||||||||||
Weighted average common shares outstanding and common stock equivalents | |||||||||||||||||||||||
Basic EPS | $ | $ | $ | $ | |||||||||||||||||||
Diluted EPS | |||||||||||||||||||||||
Anti-dilutive shares excluded from the diluted weighted average shares outstanding calculation |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
Total stock-based compensation expense(1) | $ | $ | $ | $ | |||||||||||||||||||
Income tax benefit | ( | ( | ( | ( | |||||||||||||||||||
Stock-based compensation expense, net of tax | $ | $ | $ | $ |
RSUs | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Term (Years) | Aggregate Intrinsic Value (in millions) | ||||||||||||||||||||
Outstanding as of December 31, 2022 | $ | $ | |||||||||||||||||||||
Granted | |||||||||||||||||||||||
Vested and released | ( | ||||||||||||||||||||||
Forfeited | ( | ||||||||||||||||||||||
Outstanding as of September 30, 2023 | $ | $ |
(in millions) | Ownership Interest | September 30, 2023 | December 31, 2022 | |||||||||||||||||
Nutrabolt(1) | % | $ | $ | |||||||||||||||||
La Colombe | % | |||||||||||||||||||
Tractor | % | |||||||||||||||||||
Athletic Brewing | % | |||||||||||||||||||
Dyla LLC | % | |||||||||||||||||||
Force Holdings LLC(2) | % | |||||||||||||||||||
Beverage startup companies(3) | (various) | |||||||||||||||||||
Other | (various) | |||||||||||||||||||
Investments in unconsolidated affiliates | $ | $ |
Third Quarter | First Nine Months | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Effective tax rate | % | % | % | % |
Third Quarter | First Nine Months | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Statutory federal income tax rate | % | % | % | % | |||||||||||||||||||
State income taxes, net | % | % | % | % | |||||||||||||||||||
Impact of non-U.S. operations(1)(2) | ( | % | ( | % | ( | % | ( | % | |||||||||||||||
Tax credits(2) | ( | % | ( | % | ( | % | ( | % | |||||||||||||||
U.S. taxation of foreign earnings(2) | % | % | % | % | |||||||||||||||||||
Deferred rate change(3) | ( | % | ( | % | % | ( | % | ||||||||||||||||
Uncertain tax positions | % | % | % | % | |||||||||||||||||||
U.S. federal provision to return | % | % | % | % | |||||||||||||||||||
Excess tax deductions on stock-based compensation | ( | % | % | ( | % | ( | % | ||||||||||||||||
Other | % | % | % | % | |||||||||||||||||||
Total provision for income taxes | % | % | % | % |
(in millions) | Foreign Currency Translation Adjustments | Pension and Post-Retirement Benefit Liabilities | Cash Flow Hedges | Accumulated Other Comprehensive Income | |||||||||||||||||||
For the third quarter of 2023: | |||||||||||||||||||||||
Beginning balance | $ | $ | ( | $ | $ | ||||||||||||||||||
Other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Amounts reclassified from AOCI | |||||||||||||||||||||||
Total other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Balance as of September 30, 2023 | $ | $ | ( | $ | $ | ||||||||||||||||||
For the third quarter of 2022: | |||||||||||||||||||||||
Beginning balance | $ | $ | ( | $ | $ | ||||||||||||||||||
Other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Amounts reclassified from AOCI | ( | ( | |||||||||||||||||||||
Total other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Balance as of September 30, 2022 | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
For the first nine months of 2023: | |||||||||||||||||||||||
Beginning balance | $ | ( | $ | ( | $ | $ | |||||||||||||||||
Other comprehensive income (loss) | ( | ||||||||||||||||||||||
Amounts reclassified from AOCI | ( | ( | |||||||||||||||||||||
Total other comprehensive income (loss) | ( | ||||||||||||||||||||||
Balance as of September 30, 2023 | $ | $ | ( | $ | $ | ||||||||||||||||||
For the first nine months of 2022: | |||||||||||||||||||||||
Beginning balance | $ | $ | ( | $ | ( | $ | ( | ||||||||||||||||
Other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Amounts reclassified from AOCI | |||||||||||||||||||||||
Total other comprehensive (loss) income | ( | ( | |||||||||||||||||||||
Balance as of September 30, 2022 | $ | ( | $ | ( | $ | $ | ( |
Third Quarter | First Nine Months | ||||||||||||||||||||||||||||
(in millions) | Income Statement Caption | 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||
Cash Flow Hedges: | |||||||||||||||||||||||||||||
Interest rate contracts(1) | Interest expense | $ | ( | $ | ( | $ | ( | $ | ( | ||||||||||||||||||||
FX contracts | Cost of sales | ( | |||||||||||||||||||||||||||
Total | ( | ( | |||||||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||||||||
Total, net of tax | $ | $ | ( | $ | ( | $ |
September 30, | December 31, | ||||||||||
(in millions) | 2023 | 2022 | |||||||||
Inventories: | |||||||||||
Raw materials | $ | $ | |||||||||
Work-in-progress | |||||||||||
Finished goods | |||||||||||
Total | |||||||||||
Allowance for excess and obsolete inventories | ( | ( | |||||||||
Total Inventories | $ | $ | |||||||||
Prepaid expenses and other current assets: | |||||||||||
Other receivables | $ | $ | |||||||||
Prepaid income taxes | |||||||||||
Customer incentive programs | |||||||||||
Derivative instruments | |||||||||||
Prepaid marketing | |||||||||||
Spare parts | |||||||||||
Income tax receivable | |||||||||||
Other | |||||||||||
Total prepaid expenses and other current assets | $ | $ | |||||||||
Other non-current assets: | |||||||||||
Operating lease right-of-use assets | $ | $ | |||||||||
Customer incentive programs | |||||||||||
Derivative instruments | |||||||||||
Equity securities(1) | |||||||||||
Equity securities without readily determinable fair values | |||||||||||
Other | |||||||||||
Total other non-current assets | $ | $ |
September 30, | December 31, | ||||||||||
(in millions) | 2023 | 2022 | |||||||||
Accrued expenses: | |||||||||||
Accrued customer trade | $ | $ | |||||||||
Accrued compensation | |||||||||||
Insurance reserve | |||||||||||
Accrued interest | |||||||||||
Accrued professional fees | |||||||||||
Other accrued expenses | |||||||||||
Total accrued expenses | $ | $ | |||||||||
Other current liabilities: | |||||||||||
Dividends payable | $ | $ | |||||||||
Income taxes payable | |||||||||||
Derivative instruments | |||||||||||
Other | |||||||||||
Total other current liabilities | $ | $ | |||||||||
Other non-current liabilities: | |||||||||||
$ | $ | ||||||||||
Pension and post-retirement liability | |||||||||||
Insurance reserves | |||||||||||
Derivative instruments | |||||||||||
Deferred compensation liability | |||||||||||
Other | |||||||||||
Total other non-current liabilities | $ | $ |
(in millions) | September 30, 2023(1) | December 31, 2022(2) | ||||||||||||
Non-current assets | $ | $ | ||||||||||||
Current liabilities | ||||||||||||||
Non-current liabilities |
Remainder of 2023 | For the Years Ending December 31, | ||||||||||||||||||||||||||||||||||
(in millions) | 2024 | 2025 | 2026 | 2027 | 2028 | ||||||||||||||||||||||||||||||
Fixed service fees | $ | $ | $ | $ | $ | $ |
Third Quarter | First Nine Months | ||||||||||||||||||||||
(in millions) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
2023 CEO Succession and Associated Realignment | $ | $ | $ | $ | |||||||||||||||||||
DPS Integration Program |
(in millions) | Restructuring Liabilities | ||||
Balance as of January 1, 2023 | $ | ||||
Charges to expense | |||||
Cash payments | ( | ||||
Balance as of September 30, 2023 | $ |
Third Quarter | Dollar | Percentage | |||||||||||||||||||||
($ in millions, except per share amounts) | 2023 | 2022 | Change | Change | |||||||||||||||||||
Net sales | $ | 3,805 | $ | 3,622 | $ | 183 | 5.1 | % | |||||||||||||||
Cost of sales | 1,694 | 1,721 | (27) | (1.6) | |||||||||||||||||||
Gross profit | 2,111 | 1,901 | 210 | 11.0 | |||||||||||||||||||
Selling, general and administrative expenses | 1,217 | 1,196 | 21 | 1.8 | |||||||||||||||||||
Impairment of intangible assets | 2 | 311 | (309) | NM | |||||||||||||||||||
Other operating income, net | (4) | — | (4) | NM | |||||||||||||||||||
Income from operations | 896 | 394 | 502 | 127.4 | |||||||||||||||||||
Interest expense | 237 | 207 | 30 | 14.5 | |||||||||||||||||||
Other (income) expense, net | (5) | 4 | (9) | NM | |||||||||||||||||||
Income before provision for income taxes | 664 | 183 | 481 | 262.8 | |||||||||||||||||||
Provision for income taxes | 146 | 4 | 142 | NM | |||||||||||||||||||
Net income including non-controlling interest | 518 | 179 | 339 | 189.4 | |||||||||||||||||||
Less: Net loss attributable to non-controlling interest | — | (1) | 1 | NM | |||||||||||||||||||
Net income attributable to KDP | $ | 518 | $ | 180 | 338 | 187.8 | |||||||||||||||||
Earnings per common share: | |||||||||||||||||||||||
Basic | $ | 0.37 | $ | 0.13 | $ | 0.24 | 184.6 | % | |||||||||||||||
Diluted | 0.37 | 0.13 | 0.24 | 184.6 | |||||||||||||||||||
Gross margin | 55.5 | % | 52.5 | % | 300 bps | ||||||||||||||||||
Operating margin | 23.5 | % | 10.9 | % | NM | ||||||||||||||||||
Effective tax rate | 22.0 | % | 2.2 | % | NM |
Percentage Change | ||||||||
LRB | — | % | ||||||
K-Cup pods | (6.3) | |||||||
Brewers | 8.7 |
Third Quarter | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Segment Results — Net sales | |||||||||||
U.S. Refreshment Beverages | $ | 2,270 | $ | 2,144 | |||||||
U.S. Coffee | 1,012 | 1,045 | |||||||||
International | 523 | 433 | |||||||||
Net sales | $ | 3,805 | $ | 3,622 | |||||||
Third Quarter | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Segment Results — Income from operations | |||||||||||
U.S. Refreshment Beverages | $ | 676 | $ | 322 | |||||||
U.S. Coffee | 293 | 272 | |||||||||
International | 139 | 97 | |||||||||
Unallocated corporate costs | (212) | (297) | |||||||||
Income from operations | $ | 896 | $ | 394 |
Third Quarter | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 2,270 | $ | 2,144 | $ | 126 | 5.9 | % | |||||||||||||||
Income from operations | 676 | 322 | 354 | 109.9 | |||||||||||||||||||
Operating margin | 29.8 | % | 15.0 | % | NM | ||||||||||||||||||
Third Quarter | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 1,012 | $ | 1,045 | $ | (33) | (3.2) | % | |||||||||||||||
Income from operations | 293 | 272 | 21 | 7.7 | |||||||||||||||||||
Operating margin | 29.0 | % | 26.0 | % | 300 bps |
Third Quarter | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 523 | $ | 433 | $ | 90 | 20.8 | % | |||||||||||||||
Income from operations | 139 | 97 | 42 | 43.3 | |||||||||||||||||||
Operating margin | 26.6 | % | 22.4 | % | 420 bps |
Percentage Change | ||||||||
LRB | 8.7 | % | ||||||
K-Cup pods | 8.2 | |||||||
Brewers | 15.9 |
First Nine Months | Dollar Change | Percentage Change | |||||||||||||||||||||
($ in millions, except per share amounts) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 10,947 | $ | 10,254 | $ | 693 | 6.8 | % | |||||||||||||||
Cost of sales | 5,051 | 4,927 | 124 | 2.5 | |||||||||||||||||||
Gross profit | 5,896 | 5,327 | 569 | 10.7 | |||||||||||||||||||
Selling, general and administrative expenses | 3,654 | 3,418 | 236 | 6.9 | |||||||||||||||||||
Impairment of intangible assets | 2 | 311 | (309) | NM | |||||||||||||||||||
Gain on litigation settlement | — | (299) | 299 | NM | |||||||||||||||||||
Other operating income, net | (9) | (35) | 26 | NM | |||||||||||||||||||
Income from operations | 2,249 | 1,932 | 317 | 16.4 | |||||||||||||||||||
Interest expense | 432 | 570 | (138) | (24.2) | |||||||||||||||||||
Loss on early extinguishment of debt | — | 217 | (217) | NM | |||||||||||||||||||
Gain on sale of equity method investment | — | (50) | 50 | NM | |||||||||||||||||||
Impairment of investments and note receivable | — | 12 | (12) | NM | |||||||||||||||||||
Other (income) expense, net | (41) | 22 | (63) | NM | |||||||||||||||||||
Income before provision for income taxes | 1,858 | 1,161 | 697 | 60.0 | |||||||||||||||||||
Provision for income taxes | 370 | 179 | 191 | 106.7 | |||||||||||||||||||
Net income including non-controlling interest | 1,488 | 982 | 506 | 51.5 | |||||||||||||||||||
Less: Net loss attributable to non-controlling interest | — | (1) | 1 | NM | |||||||||||||||||||
Net income attributable to KDP | $ | 1,488 | $ | 983 | 505 | 51.4 | |||||||||||||||||
Earnings per common share: | |||||||||||||||||||||||
Basic | $ | 1.06 | $ | 0.69 | $ | 0.37 | 53.6 | % | |||||||||||||||
Diluted | 1.05 | 0.69 | 0.36 | 52.2 | |||||||||||||||||||
Gross margin | 53.9 | % | 52.0 | % | 190 bps | ||||||||||||||||||
Operating margin | 20.5 | % | 18.8 | % | NM | ||||||||||||||||||
Effective tax rate | 19.9 | % | 15.4 | % | 450 bps |
Percentage Change | ||||||||
LRB | 0.2 | % | ||||||
K-Cup pods | (4.7) | |||||||
Brewers | (7.4) |
(in millions) | First Nine Months | ||||||||||
Net sales | 2023 | 2022 | |||||||||
U.S. Refreshment Beverages | $ | 6,607 | $ | 6,009 | |||||||
U.S. Coffee | 2,913 | 3,017 | |||||||||
International | 1,427 | 1,228 | |||||||||
Total net sales | $ | 10,947 | $ | 10,254 | |||||||
Income from operations | |||||||||||
U.S. Refreshment Beverages | $ | 1,795 | $ | 1,554 | |||||||
U.S. Coffee | 775 | 822 | |||||||||
International | 331 | 259 | |||||||||
Unallocated corporate costs | (652) | (703) | |||||||||
Total income from operations | $ | 2,249 | $ | 1,932 |
First Nine Months | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 6,607 | $ | 6,009 | $ | 598 | 10.0 | % | |||||||||||||||
Income from operations | 1,795 | 1,554 | 241 | 15.5 | |||||||||||||||||||
Operating margin | 27.2 | % | 25.9 | % | 130 bps |
First Nine Months | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 2,913 | $ | 3,017 | $ | (104) | (3.4) | % | |||||||||||||||
Income from operations | 775 | 822 | (47) | (5.7) | |||||||||||||||||||
Operating margin | 26.6 | % | 27.2 | % | (60) bps |
First Nine Months | Dollar Change | Percentage Change | |||||||||||||||||||||
(in millions) | 2023 | 2022 | |||||||||||||||||||||
Net sales | $ | 1,427 | $ | 1,228 | $ | 199 | 16.2 | % | |||||||||||||||
Income from operations | 331 | 259 | 72 | 27.8 | |||||||||||||||||||
Operating margin | 23.2 | % | 21.1 | % | 210 bps |
Percentage Change | ||||||||
LRB | 5.1 | % | ||||||
K-Cup pods | 5.2 | |||||||
Brewers | 5.4 |
Cost of sales | Gross profit | Gross margin | Selling, general and administrative expenses | Impairment of intangible assets | Income from operations | Operating margin | |||||||||||||||||||||||||||||||||||
For the Third Quarter of 2023 | |||||||||||||||||||||||||||||||||||||||||
Reported | $ | 1,694 | $ | 2,111 | 55.5 | % | $ | 1,217 | $ | 2 | $ | 896 | 23.5 | % | |||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||
Mark to market | 13 | (13) | 21 | — | (34) | ||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | (34) | — | 34 | ||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | (4) | — | 4 | ||||||||||||||||||||||||||||||||||||
Restructuring - 2023 CEO Succession and Associated Realignment | — | — | (27) | — | 27 | ||||||||||||||||||||||||||||||||||||
Productivity | (25) | 25 | (27) | — | 52 | ||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | (2) | 2 | ||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | (2) | — | 2 | ||||||||||||||||||||||||||||||||||||
Transaction costs | — | — | (1) | — | 1 | ||||||||||||||||||||||||||||||||||||
Adjusted | $ | 1,682 | $ | 2,123 | 55.8 | % | $ | 1,143 | $ | — | $ | 984 | 25.9 | % | |||||||||||||||||||||||||||
Impact of foreign currency | — | % | — | % | |||||||||||||||||||||||||||||||||||||
Constant currency adjusted | 55.8 | % | 25.9 | % | |||||||||||||||||||||||||||||||||||||
For the Third Quarter of 2022 | |||||||||||||||||||||||||||||||||||||||||
Reported | $ | 1,721 | $ | 1,901 | 52.5 | % | $ | 1,196 | $ | 311 | $ | 394 | 10.9 | % | |||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||
Mark to market | (51) | 51 | (55) | — | 106 | ||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | (33) | — | 33 | ||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | (5) | — | 5 | ||||||||||||||||||||||||||||||||||||
Restructuring and integration costs - DPS Merger | — | — | (33) | — | 33 | ||||||||||||||||||||||||||||||||||||
Productivity | (30) | 30 | (27) | — | 57 | ||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | (311) | 311 | ||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | (2) | — | 2 | ||||||||||||||||||||||||||||||||||||
COVID-19 | (3) | 3 | (2) | — | 5 | ||||||||||||||||||||||||||||||||||||
Foundational projects | — | — | (1) | — | 1 | ||||||||||||||||||||||||||||||||||||
Adjusted | $ | 1,637 | $ | 1,985 | 54.8 | % | $ | 1,038 | $ | — | $ | 947 | 26.1 | % |
Interest expense | Other (income) expense, net | Income before provision for income taxes | Provision for income taxes | Effective tax rate | Net income attributable to KDP | Diluted earnings per share | |||||||||||||||||||||||||||||||||||
For the Third Quarter of 2023 | |||||||||||||||||||||||||||||||||||||||||
Reported | $ | 237 | $ | (5) | $ | 664 | $ | 146 | 22.0 | % | $ | 518 | $ | 0.37 | |||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||
Mark to market | (114) | (2) | 82 | 20 | 62 | 0.04 | |||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | 34 | 9 | 25 | 0.02 | |||||||||||||||||||||||||||||||||||
Amortization of fair value debt adjustment | (5) | — | 5 | 1 | 4 | — | |||||||||||||||||||||||||||||||||||
Stock compensation | — | — | 4 | 3 | 1 | — | |||||||||||||||||||||||||||||||||||
Restructuring - 2023 CEO Succession and Associated Realignment | — | — | 27 | 6 | 21 | 0.01 | |||||||||||||||||||||||||||||||||||
Productivity | — | — | 52 | 12 | 40 | 0.03 | |||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | 2 | — | 2 | — | |||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | 2 | — | 2 | — | |||||||||||||||||||||||||||||||||||
Transaction costs | — | — | 1 | — | 1 | — | |||||||||||||||||||||||||||||||||||
Change in deferred tax liabilities related to goodwill and other intangible assets | — | — | — | 3 | (3) | — | |||||||||||||||||||||||||||||||||||
Adjusted | $ | 118 | $ | (7) | $ | 873 | $ | 200 | 22.9 | % | $ | 673 | $ | 0.48 | |||||||||||||||||||||||||||
Impact of foreign currency | (0.2) | % | |||||||||||||||||||||||||||||||||||||||
Constant currency adjusted | 22.7 | % | |||||||||||||||||||||||||||||||||||||||
For the Third Quarter of 2022 | |||||||||||||||||||||||||||||||||||||||||
Reported | $ | 207 | $ | 4 | $ | 183 | $ | 4 | 2.2 | % | $ | 180 | $ | 0.13 | |||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||
Mark to market | (113) | 2 | 217 | 54 | 163 | 0.11 | |||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | 33 | 8 | 25 | 0.02 | |||||||||||||||||||||||||||||||||||
Amortization of fair value of debt adjustment | (5) | — | 5 | 1 | 4 | — | |||||||||||||||||||||||||||||||||||
Stock compensation | — | — | 5 | 2 | 3 | — | |||||||||||||||||||||||||||||||||||
Restructuring and integration costs - DPS Merger | — | — | 33 | 8 | 25 | 0.02 | |||||||||||||||||||||||||||||||||||
Productivity | — | — | 57 | 10 | 47 | 0.03 | |||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | 311 | 77 | 234 | 0.16 | |||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | 2 | — | 2 | — | |||||||||||||||||||||||||||||||||||
COVID-19 | — | — | 5 | 1 | 4 | — | |||||||||||||||||||||||||||||||||||
Foundational projects | — | — | 1 | 1 | — | — | |||||||||||||||||||||||||||||||||||
Change in deferred tax liabilities related to goodwill and other intangible assets | — | — | — | 31 | (31) | (0.02) | |||||||||||||||||||||||||||||||||||
Adjusted | $ | 89 | $ | 6 | $ | 852 | $ | 197 | 23.1 | % | $ | 656 | $ | 0.46 | |||||||||||||||||||||||||||
Change - adjusted | 32.6 | % | 2.6 | % | 4.3 | % | |||||||||||||||||||||||||||||||||||
Impact of foreign currency | — | % | (0.8) | % | — | % | |||||||||||||||||||||||||||||||||||
Change - constant currency adjusted | 32.6 | % | 1.8 | % | 4.3 | % |
(in millions) | Reported | Items Affecting Comparability | Adjusted | ||||||||||||||
For the third quarter of 2023: | |||||||||||||||||
Income from operations | |||||||||||||||||
U.S. Refreshment Beverages | $ | 676 | $ | 19 | $ | 695 | |||||||||||
U.S. Coffee | 293 | 40 | 333 | ||||||||||||||
International | 139 | 6 | 145 | ||||||||||||||
Unallocated corporate costs | (212) | 23 | (189) | ||||||||||||||
Total income from operations | $ | 896 | $ | 88 | $ | 984 | |||||||||||
For the third quarter of 2022: | |||||||||||||||||
Income from operations | |||||||||||||||||
U.S. Refreshment Beverages | $ | 322 | $ | 333 | $ | 655 | |||||||||||
U.S. Coffee | 272 | 43 | 315 | ||||||||||||||
International | 97 | 7 | 104 | ||||||||||||||
Unallocated corporate costs | (297) | 170 | (127) | ||||||||||||||
Total income from operations | $ | 394 | $ | 553 | $ | 947 |
Reported | Impact of Foreign Currency | Constant Currency | ||||||||||||||||||
For the third quarter of 2023: | ||||||||||||||||||||
Net sales | ||||||||||||||||||||
U.S. Refreshment Beverages | 5.9 | % | — | % | 5.9 | % | ||||||||||||||
U.S. Coffee | (3.2) | — | (3.2) | |||||||||||||||||
International | 20.8 | (7.9) | 12.9 | |||||||||||||||||
Total net sales | 5.1 | (1.0) | 4.1 |
Adjusted | Impact of Foreign Currency | Constant Currency Adjusted | ||||||||||||||||||
For the third quarter of 2023: | ||||||||||||||||||||
Income from operations | ||||||||||||||||||||
U.S. Refreshment Beverages | 6.1 | % | — | % | 6.1 | % | ||||||||||||||
U.S. Coffee | 5.7 | — | 5.7 | |||||||||||||||||
International | 39.4 | (7.7) | 31.7 | |||||||||||||||||
Total income from operations | 3.9 | (0.8) | 3.1 |
Reported | Items Affecting Comparability | Adjusted | Impact of Foreign Currency | Constant Currency Adjusted | ||||||||||||||||||||||||||||
For the third quarter of 2023: | ||||||||||||||||||||||||||||||||
Operating margin | ||||||||||||||||||||||||||||||||
U.S. Refreshment Beverages | 29.8 | % | 0.8 | % | 30.6 | % | — | % | 30.6 | % | ||||||||||||||||||||||
U.S. Coffee | 29.0 | 3.9 | 32.9 | — | 32.9 | |||||||||||||||||||||||||||
International | 26.6 | 1.1 | 27.7 | 0.3 | 28.0 | |||||||||||||||||||||||||||
Total operating margin | 23.5 | 2.4 | 25.9 | — | 25.9 |
Cost of sales | Gross profit | Gross margin | Selling, general and administrative expenses | Impairment of intangible assets | Gain on litigation settlement | Other operating income, net | Income from operations | Operating margin | |||||||||||||||||||||||||||||||||||||||||||||
For the First Nine Months of 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported | $ | 5,051 | $ | 5,896 | 53.9 | % | $ | 3,654 | $ | 2 | $ | — | $ | (9) | $ | 2,249 | 20.5 | % | |||||||||||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark to market | 18 | (18) | 14 | — | — | — | (32) | ||||||||||||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | (103) | — | — | — | 103 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | (13) | — | — | — | 13 | ||||||||||||||||||||||||||||||||||||||||||||||
Restructuring - 2023 CEO Succession and Associated Realignment | — | — | (27) | — | — | — | 27 | ||||||||||||||||||||||||||||||||||||||||||||||
Productivity | (89) | 89 | (99) | — | — | — | 188 | ||||||||||||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | (2) | — | — | 2 | ||||||||||||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | (5) | — | — | — | 5 | ||||||||||||||||||||||||||||||||||||||||||||||
Transaction costs | — | — | (1) | — | — | — | 1 | ||||||||||||||||||||||||||||||||||||||||||||||
Adjusted | $ | 4,980 | $ | 5,967 | 54.5 | % | $ | 3,420 | $ | — | $ | — | $ | (9) | $ | 2,556 | 23.3 | % | |||||||||||||||||||||||||||||||||||
Impact of foreign currency | — | % | 0.1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
Constant currency adjusted | 54.5 | % | 23.4 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
For the First Nine Months of 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported | $ | 4,927 | $ | 5,327 | 52.0 | % | $ | 3,418 | $ | 311 | $ | (299) | $ | (35) | $ | 1,932 | 18.8 | % | |||||||||||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark to market | (130) | 130 | (29) | — | — | — | 159 | ||||||||||||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | (100) | — | — | — | 100 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | (3) | — | — | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and integration costs - DPS Merger | — | — | (89) | — | — | (2) | 91 | ||||||||||||||||||||||||||||||||||||||||||||||
Productivity | (86) | 86 | (73) | — | — | — | 159 | ||||||||||||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | (311) | — | — | 311 | ||||||||||||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | (9) | — | — | — | 9 | ||||||||||||||||||||||||||||||||||||||||||||||
COVID-19 | (10) | 10 | (4) | — | — | — | 14 | ||||||||||||||||||||||||||||||||||||||||||||||
Gain on litigation | — | — | — | — | 271 | — | (271) | ||||||||||||||||||||||||||||||||||||||||||||||
Transaction costs | — | — | (1) | — | — | — | 1 | ||||||||||||||||||||||||||||||||||||||||||||||
Foundational projects | — | — | (3) | — | — | — | 3 | ||||||||||||||||||||||||||||||||||||||||||||||
Adjusted | $ | 4,701 | $ | 5,553 | 54.2 | % | $ | 3,107 | $ | — | $ | (28) | $ | (37) | $ | 2,511 | 24.5 | % |
Interest expense | Loss on early extinguishment of debt | Gain on sale of equity method investment | Impairment of investments and note receivable | Other (income) expense, net | Income before provision for income taxes | Provision for income taxes | Effective tax rate | Net income attributable to KDP | Diluted earnings per share | ||||||||||||||||||||||||||||||||||||||||||||||||||
For the First Nine Months of 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported | $ | 432 | $ | — | $ | — | $ | — | $ | (41) | $ | 1,858 | $ | 370 | 19.9 | % | $ | 1,488 | $ | 1.05 | |||||||||||||||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark to market | (74) | — | — | — | 16 | 26 | 6 | 20 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | — | — | — | 103 | 25 | 78 | 0.06 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs | (1) | — | — | — | — | 1 | — | 1 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of fair value debt adjustment | (14) | — | — | — | — | 14 | 3 | 11 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | — | — | — | 13 | 6 | 7 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring - 2023 CEO Succession and Associated Realignment | — | — | — | — | — | 27 | 6 | 21 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Productivity | — | — | — | — | — | 188 | 45 | 143 | 0.10 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | — | — | 2 | — | 2 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | — | — | — | 5 | 1 | 4 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Transaction costs | — | — | — | — | — | 1 | — | 1 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Change in deferred tax liabilities related to goodwill and other intangible assets | — | — | — | — | — | — | 28 | (28) | (0.02) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted | $ | 343 | $ | — | $ | — | $ | — | $ | (25) | $ | 2,238 | $ | 490 | 21.9 | % | $ | 1,748 | $ | 1.24 | |||||||||||||||||||||||||||||||||||||||
Impact of foreign currency | (0.1) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Constant currency adjusted | 21.8 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest expense | Loss on early extinguishment of debt | Gain on sale of equity method investment | Impairment of investments and note receivable | Other (income) expense, net | Income before provision for income taxes | Provision for income taxes | Effective tax rate | Net income attributable to KDP | Diluted earnings per share | ||||||||||||||||||||||||||||||||||||||||||||||||||
For the First Nine Months of 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reported | $ | 570 | $ | 217 | $ | (50) | $ | 12 | $ | 22 | $ | 1,161 | $ | 179 | 15.4 | % | $ | 983 | $ | 0.69 | |||||||||||||||||||||||||||||||||||||||
Items Affecting Comparability: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark to market | (247) | — | — | — | — | 406 | 101 | 305 | 0.21 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of intangibles | — | — | — | — | — | 100 | 25 | 75 | 0.05 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of deferred financing costs | (2) | — | — | — | — | 2 | — | 2 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Amortization of fair value of debt adjustment | (14) | — | — | — | — | 14 | 3 | 11 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock compensation | — | — | — | — | — | 3 | (1) | 4 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and integration costs - DPS Merger | — | — | — | — | — | 91 | 22 | 69 | 0.05 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Productivity | — | — | — | — | — | 159 | 32 | 127 | 0.09 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of intangible assets | — | — | — | — | — | 311 | 77 | 234 | 0.16 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of investment | — | — | — | (12) | — | 12 | — | 12 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on early extinguishment of debt | — | (217) | — | — | — | 217 | 54 | 163 | 0.11 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-routine legal matters | — | — | — | — | — | 9 | 2 | 7 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
COVID-19 | — | — | — | — | — | 14 | 3 | 11 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||
Gain on litigation | — | — | — | — | — | (271) | (68) | (203) | (0.14) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Gain on sale of equity-method investment | — | — | 50 | — | — | (50) | (12) | (38) | (0.03) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Transaction costs | — | — | — | — | — | 1 | — | 1 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Foundational projects | — | — | — | — | — | 3 | 1 | 2 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Change in deferred tax liabilities related to goodwill and other intangible assets | — | — | — | — | — | — | 81 | (81) | (0.06) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Adjusted | $ | 307 | $ | — | $ | — | $ | — | $ | 22 | $ | 2,182 | $ | 499 | 22.9 | % | $ | 1,684 | $ | 1.18 | |||||||||||||||||||||||||||||||||||||||
Change - adjusted | 11.7 | % | 3.8 | % | 5.1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Impact of foreign currency | — | % | (0.6) | % | (1) | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Change - constant currency adjusted | 11.7 | % | 3.2 | % | 4.2 | % |
(in millions) | Reported | Items Affecting Comparability | Adjusted | ||||||||||||||
For the first nine months of 2023: | |||||||||||||||||
Income from operations | |||||||||||||||||
U.S. Refreshment Beverages | $ | 1,795 | $ | 54 | $ | 1,849 | |||||||||||
U.S. Coffee | 775 | 135 | 910 | ||||||||||||||
International | 331 | 14 | 345 | ||||||||||||||
Unallocated corporate costs | (652) | 104 | (548) | ||||||||||||||
Total income from operations | $ | 2,249 | $ | 307 | $ | 2,556 | |||||||||||
For the first nine months of 2022: | |||||||||||||||||
Income from operations | |||||||||||||||||
U.S. Refreshment Beverages | $ | 1,554 | $ | 103 | $ | 1,657 | |||||||||||
U.S. Coffee | 822 | 136 | 958 | ||||||||||||||
International | 259 | 20 | 279 | ||||||||||||||
Unallocated corporate costs | (703) | 320 | (383) | ||||||||||||||
Total income from operations | $ | 1,932 | $ | 579 | $ | 2,511 |
Reported | Impact of Foreign Currency | Constant Currency | ||||||||||||||||||
For the first nine months of 2023: | ||||||||||||||||||||
Net sales | ||||||||||||||||||||
U.S. Refreshment Beverages | 10.0 | % | — | % | 10.0 | % | ||||||||||||||
U.S. Coffee | (3.4) | — | (3.4) | |||||||||||||||||
International | 16.2 | (4.3) | 11.9 | |||||||||||||||||
Total net sales | 6.8 | (0.6) | 6.2 |
Adjusted | Impact of Foreign Currency | Constant Currency Adjusted | ||||||||||||||||||
For the first nine months of 2023: | ||||||||||||||||||||
Income from operations | ||||||||||||||||||||
U.S. Refreshment Beverages | 11.6 | % | — | % | 11.6 | % | ||||||||||||||
U.S. Coffee | (5.0) | — | (5.0) | |||||||||||||||||
International | 23.7 | (4.3) | 19.4 | |||||||||||||||||
Total income from operations | 1.8 | (0.5) | 1.3 |
Reported | Items Affecting Comparability | Adjusted | Impact of Foreign Currency | Constant Currency Adjusted | ||||||||||||||||||||||||||||
For the first nine months of 2023: | ||||||||||||||||||||||||||||||||
Operating margin | ||||||||||||||||||||||||||||||||
U.S. Refreshment Beverages | 27.2 | % | 0.8 | % | 28.0 | % | — | % | 28.0 | % | ||||||||||||||||||||||
U.S. Coffee | 26.6 | 4.6 | 31.2 | — | 31.2 | |||||||||||||||||||||||||||
International | 23.2 | 1.0 | 24.2 | — | 24.2 | |||||||||||||||||||||||||||
Total operating margin | 20.5 | 2.8 | 23.3 | 0.1 | 23.4 |
Component | Calculation (on a trailing twelve month basis) | |||||||
DIO | (Average inventory divided by cost of sales) * Number of days in the period | |||||||
DSO | (Accounts receivable divided by net sales) * Number of days in the period | |||||||
DPO | (Accounts payable * Number of days in the period) divided by cost of sales and SG&A expenses |
September 30, | ||||||||||||||
2023 | 2022 | |||||||||||||
DIO | 72 | 64 | ||||||||||||
DSO | 32 | 39 | ||||||||||||
DPO | 127 | 174 | ||||||||||||
Cash conversion cycle | (23) | (71) |
Rating Agency | Long-Term Debt Rating | Commercial Paper Rating | Outlook | |||||||||||||||||
Moody's | Baa1 | P-2 | Stable | |||||||||||||||||
S&P | BBB | A-2 | Stable |
(in millions) | For the First Nine Months of 2023 | ||||
Net sales | $ | 6,849 | |||
Income from operations | 952 | ||||
Net income attributable to KDP | 1,488 |
(in millions) | September 30, 2023 | December 31, 2022 | |||||||||
Current assets | $ | 1,707 | $ | 1,712 | |||||||
Non-current assets | 46,442 | 45,721 | |||||||||
Total assets(1) | $ | 48,149 | $ | 47,433 | |||||||
Current liabilities | $ | 6,146 | $ | 4,797 | |||||||
Non-current liabilities | 16,640 | 17,463 | |||||||||
Total liabilities(2) | $ | 22,786 | $ | 22,260 |
Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed on May 12, 2008) and incorporated herein by reference). | |||||
Certificate of Amendment to Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of May 17, 2012 (filed as Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q (filed July 26, 2012) and incorporated herein by reference). | |||||
Certificate of Second Amendment to Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of May 19, 2016 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed May 20, 2016) and incorporated herein by reference). | |||||
Certificate of Third Amendment to the Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of July 9, 2018 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed July 9, 2018) and incorporated herein by reference). | |||||
Amended and Restated By-Laws of Keurig Dr Pepper Inc. effective as of July 9, 2018 (filed as Exhibit 3.2 to the Company's Current Report on Form 8-K (filed July 9, 2018) and incorporated herein by reference). | |||||
10.1* | Letter Agreement by and between the Company and Timothy Cofer dated September 18, 2023.++ | ||||
31.1* | Certification of Chief Executive Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act. | ||||
31.2* | Certification of Chief Financial Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act. | ||||
32.1** | Certification of Chief Executive Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(b) or 15d-14(b) promulgated under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code. | ||||
32.2** | Certification of Chief Financial Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(b) or 15d-14(b) promulgated under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code. | ||||
101* | The following financial information from Keurig Dr Pepper Inc.'s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Income, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Cash Flows, (v) Condensed Consolidated Statement of Changes in Stockholders' Equity, and (vi) the Notes to Condensed Consolidated Financial Statements. The Instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | ||||
104* | The cover page from this Quarterly Report on Form 10-Q, formatted as Inline XBRL. |
Keurig Dr Pepper Inc. | |||||||||||
By: | /s/ Sudhanshu Priyadarshi | ||||||||||
Name: | Sudhanshu Priyadarshi | ||||||||||
Title: | Chief Financial Officer | ||||||||||
(Principal Financial Officer) | |||||||||||
Date: October 26, 2023 |
/s/ Robert J. Gamgort | ||||||||
Date: October 26, 2023 | Robert J. Gamgort | |||||||
Chief Executive Officer and President of Keurig Dr Pepper Inc. |
/s/ Sudhanshu Priyadarshi | ||||||||
Date: October 26, 2023 | Sudhanshu Priyadarshi | |||||||
Chief Financial Officer of Keurig Dr Pepper Inc. |
/s/ Robert J. Gamgort | ||||||||
Date: October 26, 2023 | Robert J. Gamgort | |||||||
Chief Executive Officer and President of Keurig Dr Pepper Inc. |
/s/ Sudhanshu Priyadarshi | ||||||||
Date: October 26, 2023 | Sudhanshu Priyadarshi | |||||||
Chief Financial Officer of Keurig Dr Pepper Inc. | ||||||||
Condensed Consolidated Statements of Income - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Income Statement [Abstract] | ||||
Net sales | $ 3,805,000,000 | $ 3,622,000,000 | $ 10,947,000,000 | $ 10,254,000,000 |
Cost of sales | 1,694,000,000 | 1,721,000,000 | 5,051,000,000 | 4,927,000,000 |
Gross profit | 2,111,000,000 | 1,901,000,000 | 5,896,000,000 | 5,327,000,000 |
Selling, general and administrative expenses | 1,217,000,000 | 1,196,000,000 | 3,654,000,000 | 3,418,000,000 |
Impairment of intangible assets | 2,000,000 | 311,000,000 | 2,000,000 | 311,000,000 |
Gain (Loss) Related to Litigation Settlement | 0 | 0 | 0 | (299,000,000) |
Other operating income, net | (4,000,000) | 0 | (9,000,000) | (35,000,000) |
Income from operations | 896,000,000 | 394,000,000 | 2,249,000,000 | 1,932,000,000 |
Interest expense | 237,000,000 | 207,000,000 | 432,000,000 | 570,000,000 |
Loss on early extinguishment of debt | 0 | 0 | 0 | 217,000,000 |
Equity Method Investment, Realized Gain (Loss) on Disposal | 0 | 0 | 0 | (50,000,000) |
Impairment of investments and note receivable | 0 | 0 | 0 | 12,000,000 |
Other (income) expense, net | (5,000,000) | 4,000,000 | (41,000,000) | 22,000,000 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest, Total | 664,000,000 | 183,000,000 | 1,858,000,000 | 1,161,000,000 |
Provision for income taxes | 146,000,000 | 4,000,000 | 370,000,000 | 179,000,000 |
Net income including non-controlling interest | 518,000,000 | 179,000,000 | 1,488,000,000 | 982,000,000 |
Less: Net loss attributable to non-controlling interest | 0 | (1,000,000) | 0 | (1,000,000) |
Net income attributable to KDP | $ 518,000,000 | $ 180,000,000 | $ 1,488,000,000 | $ 983,000,000 |
Earnings per common share: | ||||
Basic (in dollars per share) | $ 0.37 | $ 0.13 | $ 1.06 | $ 0.69 |
Diluted (in dollars per share) | $ 0.37 | $ 0.13 | $ 1.05 | $ 0.69 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 1,397,400,000 | 1,416,100,000 | 1,401,300,000 | 1,417,300,000 |
Diluted (in shares) | 1,406,200,000 | 1,427,200,000 | 1,410,800,000 | 1,428,800,000 |
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Stockholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock authorized (in shares) | 15,000,000 | 15,000,000 |
Preferred stock issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock issued (in shares) | 1,398,322,033 | 1,408,394,293 |
Common stock outstanding (in shares) | 1,398,322,033 | 1,408,394,293 |
Condensed Consolidated Statements of Changes in Stockholders' Equity (Parentheticals) - $ / shares |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
|
Statement of Stockholders' Equity [Abstract] | ||||||
Common Stock, Dividends, Per Share, Declared | $ 0.215 | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.1875 | $ 0.1875 |
Condensed Consolidated Statements of Comprehensive Income (Parentheticals) - USD ($) |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, Tax | $ 0 | $ 0 | $ 0 | $ 0 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, Tax | 0 | (12,000,000) | 24,000,000 | (98,000,000) |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ 518,000,000 | $ 179,000,000 | $ 1,488,000,000 | $ 982,000,000 |
Background and Basis of Presentation |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Background and Basis of Presentation | General ORGANIZATION References in this Quarterly Report on Form 10-Q to "KDP" or "the Company" refer to Keurig Dr Pepper Inc. and all entities included in the unaudited condensed consolidated financial statements. Definitions of terms used in this Quarterly Report on Form 10-Q are included within the Master Glossary. This Quarterly Report on Form 10-Q refers to some of KDP's owned or licensed trademarks, trade names and service marks, which are referred to as the Company's brands. All of the product names included herein are either KDP registered trademarks or those of the Company's licensors. BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments, consisting principally of normal recurring adjustments, considered necessary for a fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with KDP's consolidated financial statements and accompanying notes included in the Company's Annual Report. References to the "third quarter" indicate the Company's quarterly periods ended September 30, 2023 and 2022. USE OF ESTIMATES The process of preparing KDP's unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and judgments that affect reported amounts. These estimates and judgments are based on historical experience, future expectations and other factors and assumptions the Company believes to be reasonable under the circumstances. These estimates and judgments are reviewed on an ongoing basis and are revised when necessary. Changes in estimates are recorded in the period of change. Actual amounts may differ from these estimates. REPORTABLE SEGMENTS As of January 1, 2023, the Company revised its segment structure to align with changes in how the Company’s Chief Operating Decision Maker manages the business, assesses performance and allocates resources. This change had no impact on the Company’s consolidated results of operations or financial position. Prior period segment results have been recast to reflect the Company’s new reportable segments. Refer to Note 6 for additional information on the Company’s reportable segments and Note 7 for the Company’s disaggregated revenue portfolio for each reportable segment. The change in segment structure also resulted in a change to the Company’s reporting units. Refer to Note 3 for additional information on the Company’s reporting units. RECENTLY ADOPTED ACCOUNTING STANDARDS As of January 1, 2023, the Company adopted ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations. The objective of ASU 2022-04 is to require entities to disclose information about the use of supplier finance programs in connection with the purchase of goods and services. While the adoption of ASU 2022-04 did not have a material impact on the Company’s unaudited condensed consolidated financial statements, it did impact the nature of the disclosures. The disclosure previously included in the Company’s Form 10-K was specific to the amount of KDP’s outstanding payment obligations that were voluntarily elected by the supplier and sold to financial institutions as informed by the third party administrators. ASU 2022-04 instead requires disclosure of the amount of KDP’s outstanding obligations loaded into the supplier finance programs by the Company at each reporting period regardless of whether the outstanding obligation has been elected by the supplier to be sold to financial institutions. Refer to Note 13 for additional information on the Company’s obligations to participating suppliers.
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Reclassifications | RECLASSIFICATIONS The Company reclassified amounts in the Financing Activities section of the unaudited condensed consolidated Statement of Cash Flows for the first nine months of 2022 in order to conform to current year presentation, as maturities for the Company’s commercial paper program in both periods are 90 days or less.
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Long-term Obligations and Borrowing Arrangements |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Long-term Obligations and Borrowing Arrangements | Long-term Obligations and Borrowing Arrangements The following table summarizes the Company's long-term obligations:
The following table summarizes the Company's short-term borrowings and current portion of long-term obligations:
SENIOR UNSECURED NOTES The Company's Notes consisted of the following:
(1)The carrying amount includes unamortized discounts, debt issuance costs and fair value adjustments related to the DPS Merger. VARIABLE-RATE BORROWING ARRANGEMENTS Revolving Credit Agreement The following table summarizes information about the 2022 Revolving Credit Agreement:
(1)The 2022 Revolving Credit Agreement has $200 million letters of credit available, none of which were utilized as of September 30, 2023. As of September 30, 2023, KDP was in compliance with its minimum interest coverage ratio relating to the 2022 Revolving Credit Agreement. Commercial Paper Program The following table provides information about the Company's weighted average borrowings under its commercial paper program:
Letter of Credit Facility In addition to the portion of the 2022 Revolving Credit Agreement reserved for issuance of letters of credit, KDP has an incremental letter of credit facility. Under this facility, $150 million is available for the issuance of letters of credit, $68 million of which was utilized as of September 30, 2023 and $82 million of which remains available for use. FAIR VALUE DISCLOSURES The fair value of KDP's commercial paper approximates the carrying value and are considered Level 2 within the fair value hierarchy. The fair values of KDP's Notes are based on current market rates available to KDP and are considered Level 2 within the fair value hierarchy. The difference between the fair value and the carrying value represents the theoretical net premium or discount that would be paid or received to retire all the Notes and related unamortized costs to be incurred at such date. The fair value of KDP's Notes was $10,242 million and $10,495 million as of September 30, 2023 and December 31, 2022, respectively.
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Goodwill and Other Intangible Assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets GOODWILL Changes in the carrying amount of goodwill by reportable segment are as follows:
INTANGIBLE ASSETS OTHER THAN GOODWILL The net carrying amounts of intangible assets other than goodwill with indefinite lives are as follows:
(1)The change in brands with indefinite lives was primarily driven by foreign currency translation of $89 million during the first nine months of 2023. (2)The Company acquired certain distribution rights during the first nine months of 2023 of approximately $55 million, primarily attributable to Nutrabolt. The net carrying amounts of intangible assets other than goodwill with definite lives are as follows:
Amortization expense for intangible assets with definite lives was as follows:
Amortization expense of these intangible assets over the remainder of 2023 and the next five years is expected to be as follows:
IMPAIRMENT TESTING KDP conducts impairment tests on goodwill and all indefinite lived intangible assets annually, or more frequently if circumstances indicate that the carrying amount of an asset may not be recoverable. Changes to the Company’s operating segments effective January 1, 2023, as described in Note 6, resulted in a change to the Company’s reporting units. The Company’s reporting units are as follows:
Management performed a step 0 analysis of the goodwill as of the effective date of the segment change for the impacted reporting units. The Company also performed an analysis as of September 30, 2023 to ensure that there were no additional triggering events which occurred during the quarter. As a result of these analyses, management did not identify any indications that a material carrying amount of any goodwill or any intangible asset may not be recoverable.
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Derivatives |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivatives | Derivatives KDP is exposed to market risks arising from adverse changes in interest rates, commodity prices, and FX rates. KDP manages these risks through a variety of strategies, including the use of interest rate contracts, FX forward contracts, commodity forward, future, swap and option contracts and supplier pricing agreements. KDP does not hold or issue derivative financial instruments for trading or speculative purposes. KDP formally designates and accounts for certain foreign exchange forward contracts and interest rate contracts that meet established accounting criteria under U.S. GAAP as cash flow hedges. For such contracts, the effective portion of the gain or loss on the derivative instruments is recorded, net of applicable taxes, in AOCI. When net income is affected by the variability of the underlying transaction, the applicable offsetting amount of the gain or loss from the derivative instrument deferred in AOCI is reclassified to net income. Cash flows from derivative instruments designated in a qualifying hedging relationship are classified in the same category as the cash flows from the hedged items. If a cash flow hedge were to cease to qualify for hedge accounting, or were terminated, the derivatives would continue to be carried on the balance sheet at fair value until settled, and hedge accounting would be discontinued prospectively. If the underlying hedged transaction ceases to exist, any associated amounts reported in AOCI would be reclassified to earnings at that time. For derivatives that are not designated or for which the designated hedging relationship is discontinued, the gain or loss on the instrument is recognized in earnings in the period of change. The Company has exposure to credit losses from derivative instruments in an asset position in the event of nonperformance by the counterparties to the agreements. Historically, the Company has not experienced material credit losses as a result of counterparty nonperformance. The Company selects and periodically reviews counterparties based on credit ratings, limits its exposure to a single counterparty under defined guidelines and monitors the market position of the programs upon execution of a hedging transaction and at least on a quarterly basis. INTEREST RATES Economic Hedges KDP is exposed to interest rate risk related to its borrowing arrangements and obligations. The Company enters into interest rate contracts to provide predictability in the Company's overall cost structure and to manage the balance of fixed-rate and variable-rate debt. KDP primarily enters into receive-fixed, pay-variable and receive-variable, pay-fixed swaps and swaption contracts. A natural hedging relationship exists in which changes in the fair value of the instruments act as an economic offset to changes in the fair value of the underlying items. Changes in the fair value of these instruments are recorded in earnings throughout the term of the derivative instrument and are generally reported in interest expense in the unaudited Condensed Consolidated Statements of Income. As of September 30, 2023, economic interest rate derivative instruments have maturities ranging from December 2023 to January 2038. Cash Flow Hedges In order to hedge the variability in cash flows from interest rate changes associated with the Company’s planned future issuances of long-term debt, during the first quarter of 2021, the Company entered into forward starting swaps and designated them as cash flow hedges. During the first quarter of 2023, KDP terminated the remaining forward starting swaps which were designated as cash flow hedges. As the forecasted debt transaction associated with the terminated forward starting swaps was no longer considered probable, the realized gains associated with the termination were recorded in interest expense during the first quarter of 2023. FOREIGN EXCHANGE KDP is exposed to foreign exchange risk in its international subsidiaries or with certain counterparties in foreign jurisdictions, which may transact in currencies that are different from the functional currencies of KDP’s legal entities. Additionally, the balance sheets of each of the Company’s Canadian and Mexican businesses are subject to exposure from movements in exchange rates. Economic Hedges KDP holds FX forward contracts to economically manage the balance sheet exposures resulting from changes in the FX rates described above. The intent of these FX contracts is to minimize the impact of FX risk associated with balance sheet positions not in local currency. In these cases, a hedging relationship exists in which changes in the fair value of the instruments act as an economic offset to changes in the fair value of the underlying items. Changes in the fair value of these instruments are recorded in earnings throughout the term of the derivative instrument and are reported in the same caption of the unaudited Condensed Consolidated Statements of Income as the associated risk. As of September 30, 2023, these FX contracts have maturities ranging from October 2023 to October 2024. Cash Flow Hedges KDP designates certain FX forward contracts as cash flow hedges in order to manage the exposures resulting from changes in the FX rates described above. These designated FX forward contracts relate to forecasted inventory purchases in U.S. dollars of the Canadian and Mexican businesses. The intent of these FX contracts is to provide predictability in the Company's overall cost structure. As of September 30, 2023, these FX contracts have maturities ranging from October 2023 to December 2024. COMMODITIES Economic Hedges KDP centrally manages the exposure to volatility in the prices of certain commodities used in its production process and transportation through various derivative contracts. The Company generally holds some combination of future, swap and option contracts that economically hedge certain of its risks. In these cases, a hedging relationship exists in which changes in the fair value of the instruments act as an economic offset to changes in the fair value of the underlying items or as an offset to certain costs of production. Changes in the fair value of these instruments are recorded in earnings throughout the term of the derivative instrument and are reported in the same line item of the unaudited Condensed Consolidated Statements of Income as the hedged transaction. Unrealized gains and losses are recognized as a component of unallocated corporate costs until the Company's reportable segments are affected by the completion of the underlying transaction, at which time the gain or loss is reflected as a component of the respective segment's income from operations. As of September 30, 2023, these commodity contracts have maturities ranging from October 2023 to June 2025. NOTIONAL AMOUNTS OF DERIVATIVE INSTRUMENTS The following table presents the notional amounts of KDP's outstanding derivative instruments by type:
(1)Notional value for commodity contracts is calculated as the expected volume times strike price per unit on a gross basis. FAIR VALUE OF DERIVATIVE INSTRUMENTS The fair values of commodity contracts, interest rate contracts and FX forward contracts are determined based on inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. The fair value of commodity contracts are valued using the market approach based on observable market transactions, primarily underlying commodities futures or physical index prices, at the reporting date. Interest rate contracts are valued using models based primarily on readily observable market parameters, such as SOFR forward rates, for all substantial terms of the Company's contracts and credit risk of the counterparties. The fair value of FX forward contracts are valued using quoted forward FX prices at the reporting date. Therefore, the Company has categorized these contracts as Level 2. Not Designated as Hedging Instruments The following table summarizes the location of the fair value of the Company's derivative instruments which are not designated as hedging instruments within the unaudited Condensed Consolidated Balance Sheets. All such instruments are considered level 2 within the fair value hierarchy.
Designated as Hedging Instruments The following table summarizes the location of the fair value of the Company's derivative instruments which are designated as hedging instruments within the unaudited Condensed Consolidated Balance Sheets. All such instruments are designated level 2 within the fair value hierarchy.
IMPACT OF DERIVATIVE INSTRUMENTS NOT DESIGNATED AS HEDGING INSTRUMENTS The following table presents the amount of (gains) losses, net, recognized in the unaudited Condensed Consolidated Statements of Income related to derivative instruments not designated as hedging instruments under U.S. GAAP during the periods presented. Amounts include both realized and unrealized gains and losses.
IMPACT OF CASH FLOW HEDGES The following table presents the amount of (gains) losses, net, reclassified from AOCI into the unaudited Condensed Consolidated Statements of Income related to derivative instruments designated as cash flow hedging instruments during the periods presented:
(1)Amounts recognized during the first nine months of 2023 include the realized gains associated with the termination of forward starting swaps designated as cash flow hedges of approximately $66 million. KDP expects to reclassify approximately $8 million and $1 million of pre-tax net gains from AOCI into net income during the next twelve months related to interest rate contracts and FX contracts, respectively.
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Leases |
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Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lessee, Finance Leases | Leases The following table presents the components of lease cost:
(1)Variable lease cost primarily consists of common area maintenance costs, property taxes, and adjustments for inflation. The following table presents supplemental cash flow and other information about the Company's leases:
The following table presents information about the Company's weighted average discount rate and remaining lease term:
Future minimum lease payments for non-cancellable leases that have commenced and are reflected on the unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 were as follows:
SIGNIFICANT LEASES THAT HAVE NOT YET COMMENCED As of September 30, 2023, the Company has entered into leases that have not yet commenced with estimated aggregated future lease payments of approximately $210 million. These leases are expected to commence between the fourth quarter of 2023 through 2026, with initial lease terms ranging from 4 years to 10 years. ASSET SALE-LEASEBACK TRANSACTION The Company entered into a sale-leaseback transaction with the Veyron SPEs during the first nine months of 2023. The following table presents details of the transaction. The gain on the sale-leaseback is recorded in Other operating income, net, and the leaseback is accounted for as an operating lease.
(1)The sale-leaseback transaction included one distribution property. The initial term of the leaseback is approximately 15 years, with two 10-year renewal options. The renewal options are not reasonably assured as (i) the Company's position that the dynamic environment in which it operates precludes the Company's ability to be reasonably certain of exercising the renewal options in the distant future and (ii) the options are contingent on the Company remaining investment grade and no change-in-control as of the end of the lease term. The leaseback has a RVG. Refer to Note 15 for additional information about the RVG associated with the asset sale-leaseback transaction.
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Lessee, Operating Leases | Leases The following table presents the components of lease cost:
(1)Variable lease cost primarily consists of common area maintenance costs, property taxes, and adjustments for inflation. The following table presents supplemental cash flow and other information about the Company's leases:
The following table presents information about the Company's weighted average discount rate and remaining lease term:
Future minimum lease payments for non-cancellable leases that have commenced and are reflected on the unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 were as follows:
SIGNIFICANT LEASES THAT HAVE NOT YET COMMENCED As of September 30, 2023, the Company has entered into leases that have not yet commenced with estimated aggregated future lease payments of approximately $210 million. These leases are expected to commence between the fourth quarter of 2023 through 2026, with initial lease terms ranging from 4 years to 10 years. ASSET SALE-LEASEBACK TRANSACTION The Company entered into a sale-leaseback transaction with the Veyron SPEs during the first nine months of 2023. The following table presents details of the transaction. The gain on the sale-leaseback is recorded in Other operating income, net, and the leaseback is accounted for as an operating lease.
(1)The sale-leaseback transaction included one distribution property. The initial term of the leaseback is approximately 15 years, with two 10-year renewal options. The renewal options are not reasonably assured as (i) the Company's position that the dynamic environment in which it operates precludes the Company's ability to be reasonably certain of exercising the renewal options in the distant future and (ii) the options are contingent on the Company remaining investment grade and no change-in-control as of the end of the lease term. The leaseback has a RVG. Refer to Note 15 for additional information about the RVG associated with the asset sale-leaseback transaction.
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Segments |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments | Segments Effective January 1, 2023, the Company revised its segment structure to align with changes in how the Company’s Chief Operating Decision Maker manages the business, assesses performance and allocates resources. The Company's reportable segments consist of the following: •The U.S. Refreshment Beverages segment reflects sales in the U.S. from the manufacture and distribution of branded concentrates, syrup and finished beverages, including the sales of the Company's own brands and third-party brands, to third-party bottlers, distributors and retailers. •The U.S. Coffee segment reflects sales in the U.S. from the manufacture and distribution of finished goods relating to the Company's K-Cup pods, single-serve brewers and accessories, and other coffee products to partners, retailers and directly to consumers through the Company’s Keurig.com website. •The International segment reflects sales in international markets, including the following: ◦Sales in Canada, Mexico, the Caribbean and other international markets from the manufacture and distribution of branded concentrates, syrup and finished beverages, including sales of the Company's own brands and third-party brands, to third-party bottlers, distributors and retailers. ◦Sales in Canada from the manufacture and distribution of finished goods relating to the Company’s single-serve brewers, K-Cup pods and other coffee products. Segment results are based on management reports. Net sales and income from operations are the significant financial measures used to assess the operating performance of the Company's reportable segments. Intersegment sales are recorded at cost and are eliminated in the unaudited Condensed Consolidated Statements of Income. “Unallocated corporate costs” are excluded from the Company's measurement of segment performance and include unrealized commodity derivative gains and losses, and certain general corporate expenses. Information about the Company's operations by reportable segment is as follows:
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Revenue Recognition |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue Recognition | Revenue Recognition KDP recognizes revenue when obligations under the terms of a contract with the customer are satisfied. Branded product sales, which include LRB, K-Cup pods and appliances, occur once control is transferred upon delivery to the customer. Revenue is measured as the amount of consideration that KDP expects to receive in exchange for transferring goods. The amount of consideration KDP receives and revenue KDP recognizes varies with changes in customer incentives that KDP offers to its customers and their customers. Sales taxes and other similar taxes are excluded from revenue. Costs associated with shipping and handling activities, such as merchandising, are included in SG&A expenses as revenue is recognized. The following table disaggregates KDP's revenue by product portfolio and by reportable segment:
LRB represents net sales of owned and partner brands within our portfolio and includes CSDs, NCBs, and contract manufacturing of KDP branded products for our bottlers and distributors. K-Cup pods represents net sales from owned brands, partner brands, and private label owners. Net sales for partner brands and private label owners are contractual and long-term in nature.
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Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share The following table presents the Company's basic and diluted EPS and shares outstanding.
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Stock Based Compensation |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation The components of stock-based compensation expense are presented below:
(1)The Company recorded a one-time $40 million reduction to stock-based compensation expense as a result of the change in forfeiture policy in the first nine months of 2022. RESTRICTED SHARE UNITS The table below summarizes RSU activity:
As of September 30, 2023, there was $189 million of unrecognized compensation cost related to unvested RSUs that is expected to be recognized over a weighted average period of 3.1 years.
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Investments in Unconsolidated Affiliates |
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Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in unconsolidated affiliates | Investments The following table summarizes investments in unconsolidated affiliates as of September 30, 2023 and December 31, 2022:
(1)The Company’s investment in Nutrabolt consists of preferred equity units, and the ownership interest is calculated on an as-converted basis. (2)Force Holdings LLC has a 14.1% ownership interest in Dyla LLC. (3)Beverage startup companies represent equity method investments in development stage entities and may include entities which are pre-revenue, in test markets, or in early operations. LA COLOMBE In August 2023, the Company invested $300 million in exchange for common shares in La Colombe that represent a 33.3% ownership interest. The Company additionally capitalized $7 million of incremental third-party costs into the investment balance. REVIVE On July 31, 2023, the remaining shareholders of Revive surrendered their ownership interests. As a result, the Company holds 100% ownership interest in Revive and has eliminated the Non-controlling interest component within the Company’s unaudited Condensed Consolidated Statements of Stockholder’s Equity.
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Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The Company’s effective tax rates were as follows:
The following is a reconciliation of the provision for income taxes computed at the U.S. federal statutory tax rate to the provision for income taxes reported in the unaudited Condensed Consolidated Statements of Income:
(1)For the first nine months of 2023, primarily driven by an immaterial non-cash true-up related to a prior period, which resulted in a $28 million reduction in foreign deferred tax liabilities. (2)For the third quarter and first nine months of 2022, primarily driven by the Company’s incremental income in low tax jurisdictions. (3)For the third quarter and first nine months of 2022, primarily driven by the revaluation of state deferred tax liabilities due to state legislative changes during 2022.
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Accumulated Other Comprehensive Income |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income The following table provides a summary of changes in AOCI, net of taxes:
The following table presents the amount of (gains) losses reclassified from AOCI into the unaudited Condensed Consolidated Statements of Income:
(1)Amounts reclassified from AOCI into interest expense during the first nine months of 2023 include the realized gains associated with the termination of forward starting swaps designated as cash flow hedges of approximately $66 million. Refer to Note 4 for additional information on the terminated forward starting swaps.
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Other Financial Information |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Financial Information | Other Financial Information SELECTED BALANCE SHEET INFORMATION The tables below provide selected financial information from the unaudited Condensed Consolidated Balance Sheets:
(1)Fair values of these equity securities are determined using quoted market prices from daily exchange traded markets, based on the closing price as of the balance sheet date, and are classified as Level 1. Unrealized mark-to-market gains and losses are recorded to Other (income) expense, net. For the first nine months of 2023, the Company recorded an unrealized mark-to-market gain of $16 million on its investment in Vita Coco. The Company recorded no mark-to-market gains or losses on its investment in Vita Coco for the first nine months of 2022.
ACCOUNTS PAYABLE KDP has agreements with third party administrators which allow participating suppliers to track payment obligations from KDP, and, if voluntarily elected by the supplier, to sell payment obligations from KDP to financial institutions. Suppliers can sell one or more of KDP's payment obligations, at their sole discretion, and the rights and obligations of KDP to its suppliers are not impacted. KDP has no economic interest in a supplier’s decision to enter into these agreements and no direct financial relationship with the financial institutions. KDP's obligations to its suppliers, including amounts due and scheduled payment terms, are not impacted. The amount of the outstanding obligations confirmed as valid included in as of September 30, 2023 and December 31, 2022 was $2,794 million and $4,113 million, respectively.
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Commitments and Contingencies |
9 Months Ended |
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Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies KDP is occasionally subject to litigation or other legal proceedings. Reserves are recorded for specific legal proceedings when the Company determines that the likelihood of an unfavorable outcome is probable and the amount of loss can be reasonably estimated. As of September 30, 2023 and December 31, 2022, the Company had litigation reserves of $10 million and $12 million, respectively. KDP has also identified certain other legal matters where we believe an unfavorable outcome is reasonably possible and/or for which no estimate of possible losses can be made. The Company does not believe that the outcome of these, or any other, pending legal matters, individually or collectively, will have a material adverse effect on the results of operations, financial condition or liquidity of KDP. ANTITRUST LITIGATION In February 2014, TreeHouse Foods, Inc. and certain affiliated entities filed suit against KDP’s wholly-owned subsidiary, Keurig, in the U.S. District Court for the Southern District of New York (“SDNY”) (TreeHouse Foods, Inc. et al. v. Green Mountain Coffee Roasters, Inc. et al.). The TreeHouse complaint asserted claims under the federal antitrust laws and various state laws, contending that Keurig had monopolized alleged markets for single serve coffee brewers and single serve coffee pods. The TreeHouse complaint sought treble monetary damages, declaratory relief, injunctive relief and attorneys’ fees. In March 2014, JBR, Inc. filed suit against Keurig in the U.S. District Court for the Eastern District of California (JBR, Inc. v. Keurig Green Mountain, Inc.). The claims asserted and relief sought in the JBR complaint were substantially similar to the claims asserted and relief sought in the TreeHouse complaint. Beginning in 2014, a number of putative class actions asserting similar claims and seeking similar relief to the matters described above were filed on behalf of purported direct purchasers of Keurig’s products in various federal district courts. In June 2014, these various actions, including the TreeHouse and JBR suits, were transferred to a single judicial district for coordinated pre-trial proceedings (the “Multidistrict Antitrust Litigation”). A consolidated putative class action complaint by direct purchaser plaintiffs was filed in July 2014. In January 2019, McLane Company, Inc. filed suit against Keurig (McLane Company, Inc. v. Keurig Green Mountain, Inc.) in the SDNY asserting similar claims and was also transferred into the Multidistrict Antitrust Litigation. These actions are now pending in the SDNY (In re: Keurig Green Mountain Single-Serve Coffee Antitrust Litigation). Discovery in the Multidistrict Antitrust Litigation concluded in 2021, with plaintiffs collectively claiming more than $5 billion of monetary damages. Keurig strongly disputes the merits of the claims and the calculation of damages. As a result, Keurig has fully briefed a summary judgment motion that, if successful, would end the cases entirely. Keurig has also fully briefed other significant motions, including challenges to the validity of plaintiffs’ damages calculations. Keurig is also pursuing its opposition to direct purchaser plaintiffs’ motion for class certification. Keurig’s motions and opposition remain pending in the SDNY. In July 2021, BJ’s Wholesale Club, Inc. filed suit against Keurig (BJ’s Wholesale Club, Inc. v. Keurig Green Mountain, Inc.) in the U.S. District Court for the Eastern District of New York (“EDNY”) asserting similar claims and also was transferred into the Multidistrict Antitrust Litigation. In August 2021, Winn-Dixie Stores, Inc. and Bi-Lo Holding LLC filed suit against Keurig (Winn-Dixie Stores, Inc. et al. v. Keurig Green Mountain, Inc. et al.) in the EDNY asserting similar claims and was also transferred into the Multidistrict Antitrust Litigation. Following the conclusion of discovery in 2023, Keurig similarly filed a motion for summary judgment seeking dismissal of these cases and also filed other significant motions. These motions remain pending in the SDNY. A number of putative class actions asserting similar claims and seeking similar relief were previously filed on behalf of purported indirect purchasers of Keurig’s products. In July 2020, Keurig reached an agreement with the putative indirect purchaser class plaintiffs in the Multidistrict Antitrust Litigation to settle the claims asserted for $31 million. The settlement class consists of individuals and entities in the United States that purchased, from persons other than Keurig and not for purposes of resale, Keurig manufactured or licensed single serve beverage portion packs during the applicable class period (beginning in September 2010 for most states). The SDNY granted preliminary approval of the settlement in December 2020, and the Company paid the settlement amount in January 2021. In June 2021, the SDNY granted final approval of the settlement, entered final judgment, and dismissed the indirect purchasers’ claims. Separate from the U.S. actions described above, a statement of claim was filed in September 2014 against Keurig and Keurig Canada Inc. in Ontario, Canada, by Club Coffee L.P., a Canadian manufacturer of single serve beverage pods, asserting a breach of competition law and false and misleading statements by Keurig. To date, this plaintiff has not taken substantive action to prosecute its claims. KDP intends to vigorously defend the remaining lawsuits described above. At this time, the Company is unable to predict the outcome of these lawsuits, the potential loss or range of loss, if any, associated with the resolution of these lawsuits or any potential effect they may have on the Company or its operations. Accordingly, the Company has not accrued for a loss contingency. Additionally, as the timelines in these cases may be beyond our control, we cannot assure you if or when there will be material developments in these matters.
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Transactions with Variable Interest Entities |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity Disclosure | 15. Transactions with Variable Interest Entities TRANSACTIONS WITH VEYRON SPEs The Company has a number of leasing arrangements and one licensing arrangement with special purpose entities associated with the same sponsor, which are referred to as the Veyron SPEs. The Veyron SPEs are VIEs for which KDP is not the primary beneficiary, as KDP has limited power based on the contractual agreements to direct the activities that most significantly impact the VIEs’ performance. Leasing Arrangements As of September 30, 2023, the Company has entered into sixteen lease transactions with the Veyron SPEs, fifteen of which were associated with asset sale-leaseback transactions. Refer to Note 5 for additional information about the asset sale-leaseback transaction during the first nine months of 2023. Each lease has a RVG based on a percentage of Veyron SPEs’s purchase price; however, the Company concluded it was not probable that the Company will owe an amount at the end of each individual lease term, as the fair values of the properties are not expected to fall below the RVGs at the end of each individual lease term. As such, the Company recorded each lease obligation excluding the associated RVG. The aggregate maximum undiscounted RVG associated with the leasing arrangements as of September 30, 2023 and December 31, 2022 were $653 million and $650 million, respectively. This aggregate maximum value assumes that the fair value of each property at the end of either the original lease term or renewal term is equal to zero, which the Company has concluded is not probable. The following table provides the carrying amounts of the right-to-use assets and lease obligations recorded on the Company’s unaudited Condensed Consolidated Balance Sheets associated with these leasing arrangements related to the VIEs as of September 30, 2023 and December 31, 2022.
(1)The leasing agreements included as of September 30, 2023 include nine manufacturing sites, five distribution centers and our Frisco, Texas headquarters. (2)The leasing agreements included as of December 31, 2022 include nine manufacturing sites, four distribution centers and our Frisco, Texas headquarters. Licensing Arrangement ABC, a wholly-owned subsidiary of KDP, has provided a guarantee in connection with its distribution agreement with the Veyron SPEs to be paid only in the event the Veyron SPEs sell specific distribution rights and the value of those distribution rights does not exceed $142 million, which is the maximum undiscounted amount that KDP could pay under the guarantee. All obligations with respect to the guarantee will cease upon termination of the distribution agreement, which would occur upon notice by ABC not to renew the distribution agreement, KDP no longer being investment grade at the end of the term, or the sale of the distribution rights by the Veyron SPEs. As of September 30, 2023, KDP has not recorded a liability as it is not probable that the Company will have to make any payments required under the residual value guarantee, as the fair value of the distribution rights is not expected to fall below $142 million over the term of the agreement. As of September 30, 2023, KDP had $94 million in fixed service fee commitments related to the 15-year distribution agreement which was effective on December 28, 2020, with Veyron SPEs. These commitments were used to assist the Veyron SPEs in obtaining financing. Such fixed service fee payments began on January 1, 2021. Fixed service fees over the next five years are expected to be as follows:
TRANSACTION WITH NUTRABOLT The Company has a preferred equity investment in Nutrabolt, which will earn the greater of (i) a 5% annual coupon on the preferred equity units plus any accretion for amounts not yet paid or (ii) KDP’s share of Nutrabolt’s earnings as if KDP’s preferred equity was converted into common units. As the other investors of Nutrabolt have to share in Nutrabolt's earnings with KDP if in excess of the 5% annual coupon, the other investors lack certain characteristics of a controlling financial interest, which qualifies Nutrabolt as a VIE. KDP is not the primary beneficiary of the VIE and therefore is not required to consolidate Nutrabolt, as the primary shareholder of the VIE has control over the board and decision-making for the activities that most significantly impact the VIE’s economic performance, including sales, marketing, and operations. KDP has no obligation to provide additional funding to Nutrabolt, and thus the Company’s maximum exposure and risk of loss related to Nutrabolt is limited to the carrying value of KDP’s investment. Refer to Note 10 for the carrying value of the Company’s investment in Nutrabolt. TRANSACTION WITH LA COLOMBE The Company has an investment in common shares of La Colombe. Under the terms of the investment agreement, KDP has certain contractual rights that will result in a return of investment at the greater of a specified floor or fair value. As other investors of La Colombe will have to absorb more risk when the specified floor is greater than fair value, the other investors lack certain characteristics of a controlling financial interest, which qualifies La Colombe as a VIE. KDP is not the primary beneficiary of the VIE and therefore is not required to consolidate La Colombe, as the primary shareholder of the VIE has control over the board and decision-making for the activities that most significantly impact the VIE’s economic performance, including sales, marketing, and operations. KDP has no obligation to provide additional funding to La Colombe, and thus the Company’s maximum exposure and risk of loss related to La Colombe is limited to the carrying value of KDP’s investment. Refer to Note 10 for the carrying value of the Company’s investment in La Colombe.
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Restructuring and Integration Costs |
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Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Integration Costs | Restructuring RESTRUCTURING PROGRAMS The Company records severance costs provided under an ongoing benefit arrangement once they are both probable and estimable. 2023 CEO Succession and Associated Realignment In the third quarter of 2023, the Company began to enact several organization movements to ensure succession plans, to reinforce enterprise capabilities to support growth, and to control costs. A key component of the program was the announcement of the appointment of a Chief Operating Officer, effective November 6, 2023, with the expectation that the new Chief Operating Officer will succeed Robert Gamgort as Chief Executive Officer of the Company during the second quarter of 2024. The Company is also planning to realign its executive and operating leadership structure to enable faster decision making and to better support various strategic initiatives of the Company. Additionally, certain workforce reductions could occur as we assess our organization and upskill our talent and capabilities as needed. The program is expected to incur charges of approximately $45 million, primarily driven by severance costs and the sign-on bonus for our new Chief Operating Officer. DPS Integration Program As part of the DPS Merger, the Company developed a program to deliver $600 million in synergies over a three-year period through supply chain optimization, reduction of indirect spend through new economies of scale, elimination of duplicative support functions and advertising and promotion optimization. Although the program was initially expected to be completed in 2021, as a result of delays due to COVID-19, KDP continued to recognize expenditures for certain initiatives which began during the integration period through December 31, 2022. The restructuring and integration program resulted in cumulative pre-tax charges of approximately $962 million, primarily consisting of professional fees related to the integration and transformation and costs associated with severance and employee terminations. RESTRUCTURING CHARGES Restructuring and integration expenses for the defined programs during the periods presented were as follows:
RESTRUCTURING LIABILITIES Restructuring liabilities that qualify as exit and disposal costs under U.S. GAAP are included in accounts payable and accrued expenses on the unaudited condensed consolidated financial statements. Restructuring liabilities, primarily consisting of workforce reduction costs, were as follows:
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Subsequent Events |
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Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events STRATEGIC PARTNERSHIP WITH GRUPO PISA Effective October 23, 2023, the Company executed an agreement for a strategic partnership with Grupo PiSA to sell and distribute Electrolit instant hydration beverages within the U.S. Under the long-term sales and distribution agreement, KDP will sell and distribute Electrolit in the majority of KDP's company-owned direct store distribution territories. The distribution is expected to begin in early 2024, and the Company estimates spending up to $57 million to transition the rights.
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Pay vs Performance Disclosure - USD ($) |
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Pay vs Performance Disclosure | ||||||||
Net income | $ 518,000,000 | $ 503,000,000 | $ 467,000,000 | $ 180,000,000 | $ 218,000,000 | $ 585,000,000 | $ 1,488,000,000 | $ 983,000,000 |
Insider Trading Arrangements - Officer or Director [Member] |
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Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Background and Basis of Presentation (Policies) |
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Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments, consisting principally of normal recurring adjustments, considered necessary for a fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with KDP's consolidated financial statements and accompanying notes included in the Company's Annual Report. References to the "third quarter" indicate the Company's quarterly periods ended September 30, 2023 and 2022. |
Use of Estimates | The process of preparing KDP's unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the use of estimates and judgments that affect reported amounts. These estimates and judgments are based on historical experience, future expectations and other factors and assumptions the Company believes to be reasonable under the circumstances. These estimates and judgments are reviewed on an ongoing basis and are revised when necessary. Changes in estimates are recorded in the period of change. Actual amounts may differ from these estimates |
New Accounting Pronouncements, Policy | RECENTLY ADOPTED ACCOUNTING STANDARDS As of January 1, 2023, the Company adopted ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations. The objective of ASU 2022-04 is to require entities to disclose information about the use of supplier finance programs in connection with the purchase of goods and services. While the adoption of ASU 2022-04 did not have a material impact on the Company’s unaudited condensed consolidated financial statements, it did impact the nature of the disclosures. The disclosure previously included in the Company’s Form 10-K was specific to the amount of KDP’s outstanding payment obligations that were voluntarily elected by the supplier and sold to financial institutions as informed by the third party administrators. ASU 2022-04 instead requires disclosure of the amount of KDP’s outstanding obligations loaded into the supplier finance programs by the Company at each reporting period regardless of whether the outstanding obligation has been elected by the supplier to be sold to financial institutions. Refer to Note 13 for additional information on the Company’s obligations to participating suppliers.
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Organization, Consolidation and Presentation of Financial Statements (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reclassifications |
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Long-term Obligations and Borrowing Arrangements (Tables) |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Short-term Debt [Table Text Block] | The following table provides information about the Company's weighted average borrowings under its commercial paper program:
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Schedule of debt | The following table summarizes the Company's long-term obligations:
The following table summarizes the Company's short-term borrowings and current portion of long-term obligations:
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Schedule of long-term debt instruments | The Company's Notes consisted of the following:
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Schedule of line of credit facilities | The following table summarizes information about the 2022 Revolving Credit Agreement:
(1)The 2022 Revolving Credit Agreement has $200 million letters of credit available, none of which were utilized as of September 30, 2023.
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Goodwill and Other Intangible Assets (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of changes in the carrying amount of goodwill by reportable segment | Changes in the carrying amount of goodwill by reportable segment are as follows:
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Schedule of net carrying amounts of intangible assets other than goodwill with indefinite lives | The net carrying amounts of intangible assets other than goodwill with indefinite lives are as follows:
(1)The change in brands with indefinite lives was primarily driven by foreign currency translation of $89 million during the first nine months of 2023. (2)The Company acquired certain distribution rights during the first nine months of 2023 of approximately $55 million, primarily attributable to Nutrabolt.
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Schedule of net carrying amounts of intangible assets other than goodwill with definite lives | The net carrying amounts of intangible assets other than goodwill with definite lives are as follows:
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Schedule of amortization expense for intangible assets with definite lives | Amortization expense for intangible assets with definite lives was as follows:
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Schedule of future amortization expense | Amortization expense of these intangible assets over the remainder of 2023 and the next five years is expected to be as follows:
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Derivatives (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notional Amounts of Derivative Instruments | NOTIONAL AMOUNTS OF DERIVATIVE INSTRUMENTS The following table presents the notional amounts of KDP's outstanding derivative instruments by type:
(1)Notional value for commodity contracts is calculated as the expected volume times strike price per unit on a gross basis.
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Schedule of derivative instruments in statement of financial position, fair value | Not Designated as Hedging Instruments The following table summarizes the location of the fair value of the Company's derivative instruments which are not designated as hedging instruments within the unaudited Condensed Consolidated Balance Sheets. All such instruments are considered level 2 within the fair value hierarchy.
Designated as Hedging Instruments The following table summarizes the location of the fair value of the Company's derivative instruments which are designated as hedging instruments within the unaudited Condensed Consolidated Balance Sheets. All such instruments are designated level 2 within the fair value hierarchy.
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Schedule of derivative instruments not designated as hedging instruments | The following table presents the amount of (gains) losses, net, recognized in the unaudited Condensed Consolidated Statements of Income related to derivative instruments not designated as hedging instruments under U.S. GAAP during the periods presented. Amounts include both realized and unrealized gains and losses.
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Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The following table presents the amount of (gains) losses, net, reclassified from AOCI into the unaudited Condensed Consolidated Statements of Income related to derivative instruments designated as cash flow hedging instruments during the periods presented:
(1)Amounts recognized during the first nine months of 2023 include the realized gains associated with the termination of forward starting swaps designated as cash flow hedges of approximately $66 million.
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Leases (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease, Cost [Table Text Block] | The following table presents the components of lease cost:
(1)Variable lease cost primarily consists of common area maintenance costs, property taxes, and adjustments for inflation.
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Supplemental Cash Flow Information for Leases [Table Text Block] | The following table presents supplemental cash flow and other information about the Company's leases:
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Schedule of Weighted Average Lease Disclosures [Table Text Block] | The following table presents information about the Company's weighted average discount rate and remaining lease term:
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Lessee, Operating Lease, Liability, Maturity [Table Text Block] | Future minimum lease payments for non-cancellable leases that have commenced and are reflected on the unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 were as follows:
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Finance Lease, Liability, Fiscal Year Maturity [Table Text Block] | Future minimum lease payments for non-cancellable leases that have commenced and are reflected on the unaudited Condensed Consolidated Balance Sheets as of September 30, 2023 were as follows:
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Schedule of Sale Leaseback Transactions |
(1)The sale-leaseback transaction included one distribution property.
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Segments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of segment reporting information, by segment | Information about the Company's operations by reportable segment is as follows:
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Reconciliation of operating profit (loss) from segments to consolidated | Information about the Company's operations by reportable segment is as follows:
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Reconciliation of Assets from Segment to Consolidated [Table Text Block] |
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Revenue Recognition (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of disaggregation of revenue | The following table disaggregates KDP's revenue by product portfolio and by reportable segment:
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Earnings Per Share (Tables) |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per share | The following table presents the Company's basic and diluted EPS and shares outstanding.
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Stock Based Compensation (Tables) |
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Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock based compensation expense | The components of stock-based compensation expense are presented below:
(1)The Company recorded a one-time $40 million reduction to stock-based compensation expense as a result of the change in forfeiture policy in the first nine months of 2022.
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Schedule of share-based compensation, restricted stock and restricted stock units activity | The table below summarizes RSU activity:
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Investments in Unconsolidated Affiliates (Tables) |
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Equity Method Investments and Joint Ventures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity method investments | The following table summarizes investments in unconsolidated affiliates as of September 30, 2023 and December 31, 2022:
(1)The Company’s investment in Nutrabolt consists of preferred equity units, and the ownership interest is calculated on an as-converted basis. (2)Force Holdings LLC has a 14.1% ownership interest in Dyla LLC. (3)Beverage startup companies represent equity method investments in development stage entities and may include entities which are pre-revenue, in test markets, or in early operations.
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Income Taxes (Tables) |
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Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | The Company’s effective tax rates were as follows:
The following is a reconciliation of the provision for income taxes computed at the U.S. federal statutory tax rate to the provision for income taxes reported in the unaudited Condensed Consolidated Statements of Income:
(1)For the first nine months of 2023, primarily driven by an immaterial non-cash true-up related to a prior period, which resulted in a $28 million reduction in foreign deferred tax liabilities. (2)For the third quarter and first nine months of 2022, primarily driven by the Company’s incremental income in low tax jurisdictions. (3)For the third quarter and first nine months of 2022, primarily driven by the revaluation of state deferred tax liabilities due to state legislative changes during 2022.
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Accumulated Other Comprehensive Income (Tables) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated other comprehensive income (loss), net of taxes | The following table provides a summary of changes in AOCI, net of taxes:
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Reclassification out of Accumulated Other Comprehensive Income | The following table presents the amount of (gains) losses reclassified from AOCI into the unaudited Condensed Consolidated Statements of Income:
(1)Amounts reclassified from AOCI into interest expense during the first nine months of 2023 include the realized gains associated with the termination of forward starting swaps designated as cash flow hedges of approximately $66 million. Refer to Note 4 for additional information on the terminated forward starting swaps.
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Other Financial Information (Tables) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of other assets and other liabilities | The tables below provide selected financial information from the unaudited Condensed Consolidated Balance Sheets:
(1)Fair values of these equity securities are determined using quoted market prices from daily exchange traded markets, based on the closing price as of the balance sheet date, and are classified as Level 1. Unrealized mark-to-market gains and losses are recorded to Other (income) expense, net. For the first nine months of 2023, the Company recorded an unrealized mark-to-market gain of $16 million on its investment in Vita Coco. The Company recorded no mark-to-market gains or losses on its investment in Vita Coco for the first nine months of 2022.
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Transactions with Variable Interest Entities (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity, Not Primary Beneficiary, Schedule of Assets and Liabilities Associated with VIE Relationship | The following table provides the carrying amounts of the right-to-use assets and lease obligations recorded on the Company’s unaudited Condensed Consolidated Balance Sheets associated with these leasing arrangements related to the VIEs as of September 30, 2023 and December 31, 2022.
(1)The leasing agreements included as of September 30, 2023 include nine manufacturing sites, five distribution centers and our Frisco, Texas headquarters. (2)The leasing agreements included as of December 31, 2022 include nine manufacturing sites, four distribution centers and our Frisco, Texas headquarters.
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Unrecorded Unconditional Purchase Obligations Text Block | Licensing Arrangement ABC, a wholly-owned subsidiary of KDP, has provided a guarantee in connection with its distribution agreement with the Veyron SPEs to be paid only in the event the Veyron SPEs sell specific distribution rights and the value of those distribution rights does not exceed $142 million, which is the maximum undiscounted amount that KDP could pay under the guarantee. All obligations with respect to the guarantee will cease upon termination of the distribution agreement, which would occur upon notice by ABC not to renew the distribution agreement, KDP no longer being investment grade at the end of the term, or the sale of the distribution rights by the Veyron SPEs. As of September 30, 2023, KDP has not recorded a liability as it is not probable that the Company will have to make any payments required under the residual value guarantee, as the fair value of the distribution rights is not expected to fall below $142 million over the term of the agreement. As of September 30, 2023, KDP had $94 million in fixed service fee commitments related to the 15-year distribution agreement which was effective on December 28, 2020, with Veyron SPEs. These commitments were used to assist the Veyron SPEs in obtaining financing. Such fixed service fee payments began on January 1, 2021. Fixed service fees over the next five years are expected to be as follows:
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Restructuring and Integration Costs (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and Related Activities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and related costs | Restructuring and integration expenses for the defined programs during the periods presented were as follows:
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Schedule of restructuring reserve by type of cost | Restructuring liabilities, primarily consisting of workforce reduction costs, were as follows:
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Background and Basis of Presentation Background and Basis of Presentation (Details) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Description of Effect on Previously Reported Segment Information for Change in Composition of Reportable Segments | REPORTABLE SEGMENTSAs of January 1, 2023, the Company revised its segment structure to align with changes in how the Company’s Chief Operating Decision Maker manages the business, assesses performance and allocates resources. This change had no impact on the Company’s consolidated results of operations or financial position. Prior period segment results have been recast to reflect the Company’s new reportable segments. Refer to Note 6 for additional information on the Company’s reportable segments and Note 7 for the Company’s disaggregated revenue portfolio for each reportable segment. The change in segment structure also resulted in a change to the Company’s reporting units. Refer to Note 3 for additional information on the Company’s reporting units. | |
Proceeds from Issuance of Commercial Paper | $ 500 | |
Repayments of commercial paper | $ (649) |
Long-term Obligations and Borrowing Arrangements - Long-Term Debt (Details) - USD ($) $ in Millions |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Long-term Debt, Current Maturities | $ (1,649) | $ (496) |
Long-term obligations | 9,940 | 11,072 |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt | 11,589 | 11,568 |
Long-term Debt, Current Maturities | $ (1,649) | $ (496) |
Long-term Obligations and Borrowing Arrangements - Current Debt (Details) - USD ($) $ in Millions |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Short-term Debt [Line Items] | ||
Current portion of long-term debt | $ 1,649 | $ 496 |
Short-term borrowings and current portion of long-term obligations | 2,798 | 895 |
Commercial Paper | ||
Short-term Debt [Line Items] | ||
Short-term debt | 1,149 | 399 |
Senior Notes | ||
Short-term Debt [Line Items] | ||
Current portion of long-term debt | $ 1,649 | $ 496 |
Long-term Obligations and Borrowing Arrangements - Borrowing Arrangements (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
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Debt Instrument [Line Items] | |||||||
Gain (Loss) on Extinguishment of Debt | $ 0 | $ 0 | $ 0 | $ (217) | |||
2022 Revolving Credit Agreement [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | [1] | 4,000 | 4,000 | ||||
Long-term Line of Credit | 0 | 0 | $ 0 | ||||
Letter of Credit Subfacility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | 200 | 200 | |||||
Letters of credit outstanding | $ 0 | $ 0 | |||||
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Long-term Obligations and Borrowing Arrangements - Commercial Paper Program (Details) - Commercial Paper - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Short-term Debt [Line Items] | ||||
Average outstanding amount | $ 1,495 | $ 0 | $ 1,061 | $ 29 |
Weighted average interest rate over time | 5.49% | 0.00% | 5.31% | 0.58% |
Long-term Obligations and Borrowing Arrangements - Letter of Credit Facilities (Details) - Letter of Credit $ in Millions |
Sep. 30, 2023
USD ($)
|
---|---|
Line of Credit Facility [Line Items] | |
Maximum borrowing capacity | $ 150 |
Letters of credit outstanding | 68 |
Remaining borrowing capacity | $ 82 |
Long-term Obligations and Borrowing Arrangements - Fair Values (Details) - USD ($) $ in Millions |
Sep. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Nonrecurring | Level 2 | Senior Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, fair value | $ 10,242 | $ 10,495 |
Goodwill and Other Intangible Assets - Goodwill (Details) $ in Millions |
9 Months Ended |
---|---|
Sep. 30, 2023
USD ($)
| |
Change in goodwill by operating segments [Abstract] | |
Balance as of January 1, 2023 | $ 20,072 |
Foreign currency impact | 50 |
Balance as of September 30, 2023 | 20,122 |
U.S. Refreshment Beverages | |
Change in goodwill by operating segments [Abstract] | |
Balance as of January 1, 2023 | 8,714 |
Foreign currency impact | 0 |
Balance as of September 30, 2023 | 8,714 |
International | |
Change in goodwill by operating segments [Abstract] | |
Balance as of January 1, 2023 | 2,736 |
Foreign currency impact | 50 |
Balance as of September 30, 2023 | 2,786 |
U.S. Coffee | |
Change in goodwill by operating segments [Abstract] | |
Balance as of January 1, 2023 | 8,622 |
Foreign currency impact | 0 |
Balance as of September 30, 2023 | $ 8,622 |
Goodwill and Other Intangible Assets - Intangible Assets (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Indefinite-lived intangible assets (excluding goodwill) | $ 22,135 | $ 22,135 | $ 21,993 | ||||||
Finite-lived intangible assets, gross | 2,012 | 2,012 | 2,015 | ||||||
Accumulated Amortization | (924) | (924) | (825) | ||||||
Finite-lived intangible assets, net | 1,088 | 1,088 | 1,190 | ||||||
Amortization expense | 34 | $ 33 | 103 | $ 100 | |||||
Amortization expense of intangible assets [Abstract] | |||||||||
Remainder of year | 33 | 33 | |||||||
Year one | 127 | 127 | |||||||
Year two | 115 | 115 | |||||||
Year three | 111 | 111 | |||||||
Year four | 95 | 95 | |||||||
Year five | 87 | 87 | |||||||
Acquired technology | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 1,146 | 1,146 | 1,146 | ||||||
Accumulated Amortization | (530) | (530) | (475) | ||||||
Finite-lived intangible assets, net | 616 | 616 | 671 | ||||||
Customer relationships | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 636 | 636 | 638 | ||||||
Accumulated Amortization | (227) | (227) | (204) | ||||||
Finite-lived intangible assets, net | 409 | 409 | 434 | ||||||
Trade Names | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 126 | 126 | 127 | ||||||
Accumulated Amortization | (111) | (111) | (101) | ||||||
Finite-lived intangible assets, net | 15 | 15 | 26 | ||||||
Brands | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 51 | 51 | 51 | ||||||
Accumulated Amortization | (24) | (24) | (19) | ||||||
Finite-lived intangible assets, net | 27 | 27 | 32 | ||||||
Contractual arrangements | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 24 | 24 | 24 | ||||||
Accumulated Amortization | (11) | (11) | (10) | ||||||
Finite-lived intangible assets, net | 13 | 13 | 14 | ||||||
Distribution rights | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Finite-lived intangible assets, gross | 29 | 29 | 29 | ||||||
Accumulated Amortization | (21) | (21) | (16) | ||||||
Finite-lived intangible assets, net | 8 | 8 | 13 | ||||||
Brands | |||||||||
Indefinite and Finite-Lived Intangible Assets by Major Class [Line Items] | |||||||||
Indefinite-lived Intangible Assets, Foreign Currency Translation Gain (Loss) | 89 | ||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Indefinite-lived intangible assets (excluding goodwill) | [1] | 19,380 | 19,380 | 19,291 | |||||
Trade Names | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Indefinite-lived intangible assets (excluding goodwill) | 2,478 | 2,478 | 2,480 | ||||||
Contractual arrangements | |||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Indefinite-lived intangible assets (excluding goodwill) | 122 | 122 | 122 | ||||||
Distribution rights | |||||||||
Indefinite and Finite-Lived Intangible Assets by Major Class [Line Items] | |||||||||
Indefinite-lived Intangible Assets Acquired | 55 | ||||||||
Change in intangible assets other than goodwill [Abstract] | |||||||||
Indefinite-lived intangible assets (excluding goodwill) | [2] | $ 155 | $ 155 | $ 100 | |||||
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Derivatives - Notional and Maturity Information (Details) - USD ($) $ in Millions |
Sep. 30, 2023 |
Dec. 31, 2022 |
||
---|---|---|---|---|
Interest Rate Contract | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | $ 1,700 | $ 1,000 | ||
Interest Rate Contract | Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | 0 | 500 | ||
Foreign Exchange Forward | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | 652 | 490 | ||
Foreign Exchange Forward | Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | 482 | 511 | ||
Commodity Contract | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | [1] | 439 | 754 | |
Receive-Fixed Pay-Variable Interest Rate Swaps | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | 0 | 1,900 | ||
Swaption | Not Designated as Hedging Instrument | ||||
Derivative [Line Items] | ||||
Notional amounts of derivative instruments | $ 1,700 | $ 0 | ||
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Derivatives - Fair Value (Details) - USD ($) |
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Dec. 31, 2022 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Dec. 31, 2021 |
---|---|---|---|---|---|---|---|---|
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Current | $ 37,000,000 | $ 35,000,000 | ||||||
Derivative Asset, Noncurrent | 8,000,000 | 140,000,000 | ||||||
Derivative Liability, Current | 77,000,000 | 112,000,000 | ||||||
Derivative Liability, Noncurrent | 300,000,000 | 195,000,000 | ||||||
Notional amounts of derivative instruments | 1,117,000,000 | 1,252,000,000 | ||||||
Stockholders' Equity Attributable to Parent | 25,364,000,000 | $ 25,268,000,000 | $ 25,103,000,000 | 25,126,000,000 | $ 25,102,000,000 | $ 25,391,000,000 | $ 25,511,000,000 | $ 24,972,000,000 |
Recurring | Level 2 | Interest Rate Contract | Not Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Noncurrent | 0 | 49,000,000 | ||||||
Derivative Liability, Current | 26,000,000 | 58,000,000 | ||||||
Derivative Liability, Noncurrent | 299,000,000 | 194,000,000 | ||||||
Recurring | Level 2 | Interest Rate Contract | Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Noncurrent | 0 | 88,000,000 | ||||||
Recurring | Level 2 | Foreign Exchange Forward | Not Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Current | 6,000,000 | 8,000,000 | ||||||
Derivative Asset, Noncurrent | 3,000,000 | 1,000,000 | ||||||
Derivative Liability, Current | 1,000,000 | 0 | ||||||
Recurring | Level 2 | Foreign Exchange Forward | Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Current | 9,000,000 | 21,000,000 | ||||||
Derivative Asset, Noncurrent | 0 | 1,000,000 | ||||||
Derivative Liability, Current | 11,000,000 | 3,000,000 | ||||||
Recurring | Level 2 | Commodity Contract | Not Designated as Hedging Instrument | ||||||||
Derivatives, Fair Value [Line Items] | ||||||||
Derivative Asset, Current | 22,000,000 | 6,000,000 | ||||||
Derivative Asset, Noncurrent | 5,000,000 | 1,000,000 | ||||||
Derivative Liability, Current | 39,000,000 | 51,000,000 | ||||||
Derivative Liability, Noncurrent | $ 1,000,000 | $ 1,000,000 |
Derivatives - Impact on Net Income (Details) - Not Designated as Hedging Instrument - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Commodity Contract | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | $ (7) | $ 29 | $ 2 | $ 33 |
Commodity Contract | SG&A expenses | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | (20) | 24 | (2) | (39) |
Interest Rate Contract | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | 104 | 96 | 49 | 219 |
Interest Rate Contract | Loss on early extinguishment of debt | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | 0 | 0 | 0 | 31 |
Foreign Exchange Forward | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | (4) | (7) | (4) | (9) |
Foreign Exchange Forward | Other expense, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of (Gain) Loss Recognized in Income | $ (6) | $ (10) | $ (1) | $ (9) |
Derivatives - Impact of Cash Flow Hedges (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
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Foreign Exchange Forward | |||||||
Derivative [Line Items] | |||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | $ 4 | $ 0 | $ (1) | $ 5 | |||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | (1) | ||||||
Interest Rate Contract | |||||||
Derivative [Line Items] | |||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | $ (2) | $ (2) | (72) | [1] | $ (4) | ||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | (8) | ||||||
Derivative, Cash Received on Hedge | $ 66 | ||||||
|
Leases (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|||
Lease, Cost [Abstract] | |||||||
Operating lease cost | $ 40 | $ 34 | $ 118 | $ 101 | |||
Amortization of right-of-use assets | 21 | 19 | 60 | 57 | |||
Interest on lease liabilities | 6 | 6 | 18 | 17 | |||
Variable lease cost(1) | [1] | 10 | 9 | 30 | 26 | ||
Sublease Income | 0 | (1) | 0 | (1) | |||
Short-term lease cost | 1 | 1 | 1 | 1 | |||
Total lease cost | $ 78 | $ 68 | 227 | 201 | |||
Cash Flow, Operating Activities, Lessee [Abstract] | |||||||
Operating cash flows from operating leases | 110 | 92 | |||||
Operating cash flows from finance leases | 18 | 17 | |||||
Cash Flow, Financing Activities, Lessee [Abstract] | |||||||
Financing cash flows from finance leases | 74 | 65 | |||||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 78 | 245 | |||||
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 75 | $ 84 | |||||
Lessee, Operating Lease, Description [Abstract] | |||||||
Operating Lease, Weighted Average Discount Rate, Percent | 5.20% | 5.20% | 5.00% | ||||
Operating Lease, Weighted Average Remaining Lease Term | 10 years | 10 years | 11 years | ||||
Lessee, Finance Lease, Description [Abstract] | |||||||
Finance Lease, Weighted Average Discount Rate, Percent | 3.80% | 3.80% | 3.70% | ||||
Finance Lease, Weighted Average Remaining Lease Term | 9 years | 9 years | 9 years | ||||
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||||||
Lessee, Operating Lease, Liability, to be Paid, Remainder of Fiscal Year | $ 25 | $ 25 | |||||
Lessee, Operating Lease, Liability, to be Paid, Year One | 148 | 148 | |||||
Lessee, Operating Lease, Liability, to be Paid, Year Two | 141 | 141 | |||||
Lessee, Operating Lease, Liability, to be Paid, Year Three | 129 | 129 | |||||
Lessee, Operating Lease, Liability, to be Paid, Year Four | 107 | 107 | |||||
Lessee, Operating Lease, Liability, to be Paid, Year Five | 85 | 85 | |||||
Lessee, Operating Lease, Liability, to be Paid, after Year Five | 527 | 527 | |||||
Lessee, Operating Lease, Liability, to be Paid | 1,162 | 1,162 | |||||
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | (261) | (261) | |||||
Operating Lease, Liability | 901 | 901 | |||||
Finance Lease, Liability, Payment, Due [Abstract] | |||||||
Finance Lease, Liability, to be Paid, Remainder of Fiscal Year | 31 | 31 | |||||
Finance Lease, Liability, to be Paid, Year One | 124 | 124 | |||||
Finance Lease, Liability, to be Paid, Year Two | 120 | 120 | |||||
Finance Lease, Liability, to be Paid, Year Three | 157 | 157 | |||||
Finance Lease, Liability, to be Paid, Year Four | 69 | 69 | |||||
Finance Lease, Liability, to be Paid, Year Five | 54 | 54 | |||||
Finance Lease, Liability, to be Paid, after Year Five | 290 | 290 | |||||
Finance Lease, Liability, Payment, Due | 845 | 845 | |||||
Finance Lease, Liability, Undiscounted Excess Amount | (131) | (131) | |||||
Finance Lease, Liability | 714 | 714 | |||||
Lessee, Lease, Description [Line Items] | |||||||
Leases not yet commenced, estimated obligation | $ 210 | $ 210 | |||||
Minimum | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lease not yet commenced, term | 4 years | 4 years | |||||
Maximum | |||||||
Lessee, Lease, Description [Line Items] | |||||||
Lease not yet commenced, term | 10 years | 10 years | |||||
|
Leases - Sale Leaseback Transactions (Details) - USD ($) $ in Millions |
9 Months Ended | ||||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Mar. 31, 2023 |
|||
Leases [Abstract] | |||||
Proceeds from sales of property, plant and equipment | $ 9 | $ 79 | |||
Sale Leaseback Transaction [Line Items] | |||||
Proceeds from sales of property, plant and equipment | 9 | $ 79 | |||
Veyron SPE March 31, 2023 SLB Transaction | |||||
Leases [Abstract] | |||||
Proceeds from sales of property, plant and equipment | [1] | 7 | |||
Sale Leaseback Transaction, Net Book Value | [1] | $ 1 | |||
Sale and Leaseback Transaction, Gain (Loss), Net | [1] | 6 | |||
Sale Leaseback Transaction [Line Items] | |||||
Proceeds from sales of property, plant and equipment | [1] | 7 | |||
Sale Leaseback Transaction, Net Book Value | [1] | $ 1 | |||
Sale and Leaseback Transaction, Gain (Loss), Net | [1] | $ 6 | |||
|
Segments (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
Segment Reporting Information [Line Items] | |||||
Net sales | $ 3,805 | $ 3,622 | $ 10,947 | $ 10,254 | |
Income from operations | 896 | 394 | 2,249 | 1,932 | |
Identifiable operating assets | 50,427 | 50,427 | $ 50,837 | ||
Equity Method Investments | 1,336 | 1,336 | 1,000 | ||
Assets | 51,763 | 51,763 | 51,837 | ||
U.S. Refreshment Beverages | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 2,270 | 2,144 | 6,607 | 6,009 | |
Identifiable operating assets | 28,688 | 28,688 | 28,987 | ||
U.S. Coffee | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 1,012 | 1,045 | 2,913 | 3,017 | |
Identifiable operating assets | 14,103 | 14,103 | 14,220 | ||
International | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 523 | 433 | 1,427 | 1,228 | |
Identifiable operating assets | 6,961 | 6,961 | 6,873 | ||
Corporate Segment | |||||
Segment Reporting Information [Line Items] | |||||
Identifiable operating assets | 675 | 675 | 757 | ||
Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Identifiable operating assets | 49,752 | 49,752 | $ 50,080 | ||
Operating Segments | U.S. Refreshment Beverages | |||||
Segment Reporting Information [Line Items] | |||||
Income from operations | 676 | 322 | 1,795 | 1,554 | |
Operating Segments | U.S. Coffee | |||||
Segment Reporting Information [Line Items] | |||||
Income from operations | 293 | 272 | 775 | 822 | |
Operating Segments | International | |||||
Segment Reporting Information [Line Items] | |||||
Income from operations | 139 | 97 | 331 | 259 | |
Corporate Unallocated | |||||
Segment Reporting Information [Line Items] | |||||
Income from operations | $ (212) | $ (297) | $ (652) | $ (703) |
Revenue Recognition (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 3,805 | $ 3,622 | $ 10,947 | $ 10,254 |
LRB | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,580 | 2,375 | 7,430 | 6,657 |
K-cup pods | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 889 | 913 | 2,646 | 2,675 |
Appliances | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 231 | 225 | 558 | 621 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 105 | 109 | 313 | 301 |
U.S. Refreshment Beverages | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,270 | 2,144 | 6,607 | 6,009 |
U.S. Refreshment Beverages | LRB | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2,232 | 2,107 | 6,498 | 5,912 |
U.S. Refreshment Beverages | K-cup pods | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
U.S. Refreshment Beverages | Appliances | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
U.S. Refreshment Beverages | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 38 | 37 | 109 | 97 |
U.S. Coffee | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1,012 | 1,045 | 2,913 | 3,017 |
U.S. Coffee | LRB | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
U.S. Coffee | K-cup pods | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 769 | 808 | 2,301 | 2,355 |
U.S. Coffee | Appliances | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 211 | 204 | 512 | 566 |
U.S. Coffee | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 32 | 33 | 100 | 96 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 523 | 433 | 1,427 | 1,228 |
International | LRB | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 348 | 268 | 932 | 745 |
International | K-cup pods | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 120 | 105 | 345 | 320 |
International | Appliances | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 20 | 21 | 46 | 55 |
International | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 35 | $ 39 | $ 104 | $ 108 |
Earnings Per Share (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
|
Basic EPS: | ||||||||
Net income | $ 518,000,000 | $ 503,000,000 | $ 467,000,000 | $ 180,000,000 | $ 218,000,000 | $ 585,000,000 | $ 1,488,000,000 | $ 983,000,000 |
Weighted average common shares outstanding (in shares) | 1,397,400,000 | 1,416,100,000 | 1,401,300,000 | 1,417,300,000 | ||||
Earnings per common share - basic (in dollars per share) | $ 0.37 | $ 0.13 | $ 1.06 | $ 0.69 | ||||
Diluted EPS: | ||||||||
Weighted average common shares outstanding (in shares) | 1,397,400,000 | 1,416,100,000 | 1,401,300,000 | 1,417,300,000 | ||||
Effect of dilutive securities (in shares) | 8,800,000 | 11,100,000 | 9,500,000 | 11,500,000 | ||||
Weighted average common shares outstanding and common stock equivalents (in shares) | 1,406,200,000 | 1,427,200,000 | 1,410,800,000 | 1,428,800,000 | ||||
Earnings per common share - diluted (in dollars per share) | $ 0.37 | $ 0.13 | $ 1.05 | $ 0.69 | ||||
Anti-dilutive shares excluded from the diluted weighted average shares outstanding calculation (in shares) | 1,000,000.0 | 0 | 1,000,000.0 | 0 |
Stock Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
||||
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |||||||||||
Total stock-based compensation expense(1) | $ 29 | $ 31 | $ 86 | $ 43 | [1] | ||||||
Income tax benefit | (5) | (5) | (14) | (6) | |||||||
Stock-based compensation expense, net of tax | 24 | 26 | 72 | 37 | |||||||
Aggregate Intrinsic Value (in millions) | |||||||||||
Payment, Tax Withholding, Share-based Payment Arrangement | 25 | $ 1 | $ 31 | 2 | $ 3 | $ 5 | 57 | 10 | |||
Total stock-based compensation expense(1) | $ 29 | $ 31 | $ 86 | 43 | [1] | ||||||
Cumulative Effect, Period of Adoption, Adjustment [Member] | |||||||||||
Share-based Payment Arrangement, Additional Disclosure [Abstract] | |||||||||||
Total stock-based compensation expense(1) | 40 | ||||||||||
Aggregate Intrinsic Value (in millions) | |||||||||||
Total stock-based compensation expense(1) | $ 40 | ||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||
RSUs | |||||||||||
Outstanding as of beginning of the period (in shares) | 18,038,745 | 18,038,745 | |||||||||
Granted (in shares) | 3,520,386 | ||||||||||
Vested and released (in shares) | (5,273,915) | ||||||||||
Forfeited (in shares) | (913,249) | ||||||||||
Outstanding as of end of the period (in shares) | 15,371,967 | 15,371,967 | |||||||||
Unrecognized compensation costs related to nonvested awards | $ 189 | $ 189 | |||||||||
Weighted average recognition period of unrecognized compensation costs | 3 years 1 month 6 days | ||||||||||
Weighted Average Grant Date Fair Value | |||||||||||
Outstanding as of the beginning of the period (in dollars per share) | $ 27.46 | $ 27.46 | |||||||||
Granted (in dollars per share) | 31.21 | ||||||||||
Vested and released (in dollars per share) | 23.68 | ||||||||||
Forfeited (in dollars per share) | 29.43 | ||||||||||
Outstanding as of the end of the period (in dollars per share) | $ 29.50 | $ 29.50 | |||||||||
Weighted Average Remaining Contractual Term (Years) | |||||||||||
Outstanding | 1 year 7 months 6 days | 1 year 8 months 12 days | |||||||||
Aggregate Intrinsic Value (in millions) | |||||||||||
Outstanding as of the beginning of the period | $ 643 | $ 643 | |||||||||
Vested and released | 178 | ||||||||||
Outstanding as of the end of the period | $ 485 | $ 485 | |||||||||
|
Investments In Unconsolidated Affiliates (Details) - USD ($) $ in Millions |
9 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Investments in unconsolidated affiliates | $ 1,336 | $ 1,000 | |||||||
Payments to Acquire Equity Method Investments | 308 | $ 48 | |||||||
Other Significant Noncash Transaction, Value of Consideration Given | $ 13 | $ 0 | |||||||
Nutrabolt | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | [1] | 33.20% | |||||||
Investments in unconsolidated affiliates | [1] | $ 907 | 874 | ||||||
Tractor | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | 19.20% | ||||||||
Investments in unconsolidated affiliates | $ 45 | 49 | |||||||
Athletic Brewing | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | 13.10% | ||||||||
Investments in unconsolidated affiliates | $ 50 | 51 | |||||||
Dyla LLC | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | 12.50% | ||||||||
Investments in unconsolidated affiliates | $ 13 | 12 | |||||||
Force Holding LLC | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | [2] | 33.30% | |||||||
Investments in unconsolidated affiliates | [2] | $ 4 | 4 | ||||||
Beverage startup companies | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Investments in unconsolidated affiliates | [3] | 5 | 5 | ||||||
Other | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Investments in unconsolidated affiliates | $ 5 | 5 | |||||||
La Colombe | |||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||
Ownership percentage | 33.30% | ||||||||
Investments in unconsolidated affiliates | $ 307 | $ 0 | |||||||
Payments to Acquire Equity Method Investments | 300 | ||||||||
Other Significant Noncash Transaction, Value of Consideration Given | $ 7 | ||||||||
|
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||
Effective income tax rate | 22.00% | 2.20% | 19.90% | 15.40% | |||||||||
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% | 21.00% | 21.00% | |||||||||
Effective Income Tax Rate Reconciliation, State and Local Income Taxes, Percent | 3.00% | 1.70% | 3.00% | 3.30% | |||||||||
Effective Income Tax Rate Reconciliation, Foreign Income Tax Rate Differential, Percent | (0.70%) | (5.90%) | [1] | (3.30%) | [2] | (1.70%) | [1] | ||||||
Effective Income Tax Rate Reconciliation, Tax Credit, Percent | (3.80%) | (11.70%) | [1] | (3.40%) | (3.20%) | [1] | |||||||
Effective Income Tax Rate Reconciliation, Repatriation of Foreign Earnings, Percent | 2.30% | 11.20% | [1] | 2.50% | 3.10% | [1] | |||||||
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent | (0.40%) | (18.50%) | [3] | 0.00% | (7.80%) | [3] | |||||||
Effective Income Tax Rate Reconciliation, Tax Contingency, Percent | 0.20% | 0.40% | 0.10% | 0.10% | |||||||||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Share-Based Payment Arrangement, Percent | (0.50%) | 0.00% | (0.50%) | (0.10%) | |||||||||
Effective Income Tax Rate Reconciliation, Other Adjustments, Percent | 0.50% | 4.00% | 0.50% | 0.70% | |||||||||
Non-cash true-up related to a prior period | $ 28 | ||||||||||||
Effective Income Tax Rate Reconciliation, Prior Year Income Taxes, Percent | 0.40% | 0.00% | 0.00% | 0.00% | |||||||||
|
Accumulated Other Comprehensive Income (Details) - USD ($) |
3 Months Ended | 9 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2023 |
Jun. 30, 2023 |
Mar. 31, 2023 |
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Total stockholders' equity at beginning of period | $ 25,268,000,000 | $ 25,103,000,000 | $ 25,126,000,000 | $ 25,391,000,000 | $ 25,511,000,000 | $ 24,972,000,000 | $ 25,126,000,000 | $ 24,972,000,000 | |||||
Total stockholders' equity at end of period | 25,364,000,000 | 25,268,000,000 | 25,103,000,000 | 25,102,000,000 | 25,391,000,000 | 25,511,000,000 | 25,364,000,000 | 25,102,000,000 | |||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (126,000,000) | 142,000,000 | 26,000,000 | (214,000,000) | (10,000,000) | 241,000,000 | |||||||
Reclassification from AOCI, Current Period, Tax | 0 | 1,000,000 | 17,000,000 | 0 | |||||||||
Foreign Exchange Forward | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 4,000,000 | 0 | (1,000,000) | 5,000,000 | |||||||||
Interest Rate Contract | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | (2,000,000) | (2,000,000) | (72,000,000) | [1] | (4,000,000) | ||||||||
Accumulated Other Comprehensive Income | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Total stockholders' equity at beginning of period | 297,000,000 | 155,000,000 | 129,000,000 | 205,000,000 | 215,000,000 | (26,000,000) | 129,000,000 | (26,000,000) | |||||
Other comprehensive income (loss) | (128,000,000) | (213,000,000) | 98,000,000 | 16,000,000 | |||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 2,000,000 | (1,000,000) | (56,000,000) | ||||||||||
Total stockholders' equity at end of period | 171,000,000 | 297,000,000 | 155,000,000 | (9,000,000) | 205,000,000 | 215,000,000 | 171,000,000 | (9,000,000) | |||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, before Tax | 1,000,000 | ||||||||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (126,000,000) | 142,000,000 | 26,000,000 | (214,000,000) | (10,000,000) | 241,000,000 | 42,000,000 | 17,000,000 | |||||
Accumulated Foreign Currency Adjustment Attributable to Parent [Member] | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Total stockholders' equity at beginning of period | 181,000,000 | (86,000,000) | 47,000,000 | 81,000,000 | (86,000,000) | 81,000,000 | |||||||
Other comprehensive income (loss) | (135,000,000) | (249,000,000) | 132,000,000 | (283,000,000) | |||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | 0 | ||||||||||
Total stockholders' equity at end of period | 46,000,000 | 181,000,000 | (202,000,000) | 47,000,000 | 46,000,000 | (202,000,000) | |||||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, before Tax | 0 | ||||||||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (135,000,000) | (249,000,000) | 132,000,000 | (283,000,000) | |||||||||
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Total stockholders' equity at beginning of period | (10,000,000) | (10,000,000) | (7,000,000) | (4,000,000) | (10,000,000) | (4,000,000) | |||||||
Other comprehensive income (loss) | 0 | 0 | 0 | (3,000,000) | |||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | 0 | ||||||||||
Total stockholders' equity at end of period | (10,000,000) | (10,000,000) | (7,000,000) | (7,000,000) | (10,000,000) | (7,000,000) | |||||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, before Tax | 0 | ||||||||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 0 | 0 | 0 | (3,000,000) | |||||||||
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Total stockholders' equity at beginning of period | 126,000,000 | $ 225,000,000 | 165,000,000 | $ (103,000,000) | 225,000,000 | (103,000,000) | |||||||
Other comprehensive income (loss) | 7,000,000 | 36,000,000 | (34,000,000) | 302,000,000 | |||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 2,000,000 | (1,000,000) | (56,000,000) | ||||||||||
Total stockholders' equity at end of period | 135,000,000 | $ 126,000,000 | 200,000,000 | $ 165,000,000 | 135,000,000 | 200,000,000 | |||||||
Other Comprehensive (Income) Loss, Defined Benefit Plan, Reclassification Adjustment from AOCI, before Tax | 1,000,000 | ||||||||||||
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 9,000,000 | 35,000,000 | (90,000,000) | 303,000,000 | |||||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 2,000,000 | (2,000,000) | (73,000,000) | 1,000,000 | |||||||||
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | Foreign Exchange Forward | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | 4,000,000 | 0 | (1,000,000) | 5,000,000 | |||||||||
Accumulated Gain (Loss), Net, Cash Flow Hedge, Parent | Interest Rate Contract | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Reclassification from AOCI, Current Period, before Tax, Attributable to Parent | (2,000,000) | (2,000,000) | (72,000,000) | [2] | (4,000,000) | ||||||||
Accumulated Gain (Loss), Cash Flow Hedge, Including Noncontrolling Interest [Member] | |||||||||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | $ 2,000,000 | $ (1,000,000) | $ (56,000,000) | $ 1,000,000 | |||||||||
|
Other Financial Information (Details) - USD ($) $ in Millions |
9 Months Ended | ||||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|||
Inventory Disclosure [Abstract] | |||||
Raw materials | $ 449 | $ 475 | |||
Work-in-progress | 9 | 8 | |||
Finished goods | 914 | 858 | |||
Inventory, Gross | 1,372 | 1,341 | |||
Inventory Valuation Reserves | 24 | 27 | |||
Total | 1,348 | 1,314 | |||
Prepaid expenses and other current assets: | |||||
Other receivables | 116 | 167 | |||
Prepaid income taxes | 53 | 49 | |||
Customer incentive programs | 55 | 25 | |||
Derivative Asset, Current | 37 | 35 | |||
Prepaid marketing | 46 | 19 | |||
Spare parts | 106 | 89 | |||
Income tax receivable | 14 | 17 | |||
Other | 92 | 70 | |||
Prepaid expenses and other current assets | 519 | 471 | |||
Other non-current assets: | |||||
Customer incentive programs | 34 | 46 | |||
Operating lease right-of-use assets | 873 | 881 | |||
Derivative Asset, Noncurrent | 8 | 140 | |||
Equity securities without readily determinable fair values | [1] | 67 | 48 | ||
Equity Securities without Readily Determinable Fair Value, Amount | 0 | 1 | |||
Other | 135 | 136 | |||
Total other non-current assets | 1,117 | 1,252 | |||
Accrued expenses: | |||||
Customer rebates & incentives | 403 | 429 | |||
Accrued compensation | 191 | 246 | |||
Insurance reserve | 51 | 53 | |||
Interest accrual | 151 | 76 | |||
Accrued professional fees | 6 | 7 | |||
Other accrued expenses | 321 | 342 | |||
Total accrued expenses | 1,123 | 1,153 | |||
Other current liabilities: | |||||
Dividends payable | 300 | 281 | |||
Income taxes payable | 49 | 87 | |||
Operating lease liability | 108 | 100 | |||
Finance lease liability | 100 | 95 | |||
Derivative instruments | 77 | 112 | |||
Other | 47 | 10 | |||
Total other current liabilities | 681 | 685 | |||
Other non-current liabilities: | |||||
Long-term pension and postretirement liability | 30 | 37 | |||
Insurance reserves | 87 | 69 | |||
Operating lease liability | 793 | 803 | |||
Finance lease liability | 614 | 618 | |||
Derivative instruments | 300 | 195 | |||
Deferred compensation liability | 30 | 30 | |||
Other | 77 | 73 | |||
Other non-current liabilities | $ 1,931 | $ 1,825 | |||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Total other current liabilities | Total other current liabilities | |||
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Total other current liabilities | Total other current liabilities | |||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other non-current liabilities | Other non-current liabilities | |||
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other non-current liabilities | Other non-current liabilities | |||
Unrealized Gain (Loss) on Investments | $ (16) | $ 0 | |||
Supplier Finance Program, Obligation, Current | $ 2,794 | $ 4,113 | |||
Supplier Finance Program, Obligation, Statement of Financial Position [Extensible Enumeration] | Accounts payable | ||||
|
Commitments and Contingencies (Details) - USD ($) |
1 Months Ended | 9 Months Ended | |
---|---|---|---|
Jul. 31, 2020 |
Sep. 30, 2023 |
Dec. 31, 2022 |
|
Loss Contingencies [Line Items] | |||
Loss Contingency Accrual | $ 10,000,000 | $ 12,000,000 | |
Antitrust Litigation [Member] | |||
Loss Contingencies [Line Items] | |||
Litigation Settlement, Amount Awarded to Other Party | $ 31,000,000 | ||
Loss Contingency, Damages Sought, Value | $ 5,000,000,000 |
Transactions with Variable Interest Entities - Leasing Arrangements (Details) - USD ($) $ in Millions |
Sep. 30, 2023 |
Dec. 31, 2022 |
||||||
---|---|---|---|---|---|---|---|---|
Variable Interest Entity [Line Items] | ||||||||
Assets, Current | $ 3,406 | $ 3,804 | ||||||
Liabilities, Current | 8,814 | 8,076 | ||||||
Variable Interest Entity, Not Primary Beneficiary | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Assets, Noncurrent | 418 | [1] | 430 | [2] | ||||
Liabilities, Current | 23 | [1] | 22 | [2] | ||||
Liabilities, Noncurrent | 408 | [1] | 419 | [2] | ||||
Variable Interest Entity, Not Primary Beneficiary | Leasing Arrangements [Member] | ||||||||
Variable Interest Entity [Line Items] | ||||||||
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 653 | $ 650 | ||||||
|
Transactions with Variable Interest Entities - Licensing Arrangement (Details) $ in Millions |
Sep. 30, 2023
USD ($)
|
---|---|
Variable Interest Entity [Line Items] | |
Remainder of 2022 | $ 1 |
2023 | 8 |
2024 | 8 |
2025 | 7 |
2026 | 8 |
2027 | 8 |
Variable Interest Entity, Not Primary Beneficiary | Licensing Arrangements [Member] | |
Variable Interest Entity [Line Items] | |
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | 142 |
Fixed fee service commitments | $ 94 |
Transactions with Variable Interest Entities - Nutrabolt (Details) |
Sep. 30, 2023 |
---|---|
Nutrabolt | |
Variable Interest Entity [Line Items] | |
Equity Method Investment Annual Coupon Rate | 0.05 |
Restructuring and Integration Costs - Restructuring Liabilities (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | 54 Months Ended | ||
---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2022 |
|
2023 CEO Succession | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Charges | $ 25 | $ 0 | $ 25 | $ 0 | |
Integration Program | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Charges | 0 | $ 33 | 0 | $ 91 | $ 962 |
Restructuring Liabilities | |||||
Restructuring Reserve [Roll Forward] | |||||
Balance at beginning of period | 55 | ||||
Charges to expense | 18 | ||||
Cash payments | (42) | ||||
Balance at end of period | $ 31 | $ 31 | $ 55 |
Restructuring and Integration Costs - Restructuring Programs (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | 42 Months Ended | 54 Months Ended | ||
---|---|---|---|---|---|---|
Sep. 30, 2023 |
Sep. 30, 2022 |
Sep. 30, 2023 |
Sep. 30, 2022 |
Dec. 31, 2021 |
Dec. 31, 2022 |
|
2023 CEO Succession | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Expected cost | $ 45 | $ 45 | ||||
Restructuring Charges | 25 | $ 0 | 25 | $ 0 | ||
Integration Program | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring And Related Cost, Expected Annual Synergies | $ 600 | |||||
Restructuring Charges | $ 0 | $ 33 | $ 0 | $ 91 | $ 962 |
Subsequent Events (Details) $ in Millions |
Oct. 23, 2023
USD ($)
|
---|---|
Subsequent Event | |
Subsequent Event [Line Items] | |
Anticipated Purchases of Intangibles, Maximum Amount | $ 57 |
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