Executive Summary

Solid quarter: Net sales grew 3.3% YoY to $1.86B, gross margin expanded 10 bps to 40.0%, and operating margin rose 30 bps to 14.7%, driving 8.4% YoY net income growth; volume fell 0.8% amid consumer value-seeking and softness in Coca‑Cola Original Taste offset by zero-sugar and flavor growth .
Mix/pricing drove results: Sparkling and Still net sales rose 3.0% and 4.8% YoY, led by zero-sugar and flavors in Sparkling and Monster, Core Power, Topo Chico, and smartwater in Still; supermarkets/club/value channels outperformed, while convenience and on‑premise slowed .
Cost discipline: SD&A grew 2.8% YoY but fell 10 bps as a percentage of sales to 25.4%; adjusted net income was $195.2M vs. $192.8M (+1.2%) as non‑cash fair value changes and commodity hedges were normalized .
Guidance/capital: FY25 capex outlook reaffirmed at approximately $300M; operating cash flow YTD $406.2M and YTD capex ~$157M; Board declared a Q3 dividend of $0.25 per share (post 10‑for‑1 split) on July 11, 2025 .

What Went Well and What Went Wrong

What Went Well
- Pricing and mix execution: Gross margin +10 bps to 40.0% and operating margin +30 bps to 14.7% on pricing realization and mix, despite volume declines .
- Category resilience beyond Coke Original: Zero-sugar and other flavors grew within Sparkling; Still category strength in enhanced water, energy, and protein; Monster, Core Power, Topo Chico, smartwater called out .
- Strong retail channels: Supermarkets, club, and value channels posted strong sales as consumers sought value in take‑home packages; management emphasized “strong marketplace execution” and “steady profit growth and substantial cash flow” .
  - “We’re pleased to report very solid second quarter results… strong marketplace execution…” — J. Frank Harrison, III (CEO) .
  - “Steady investments in supply chain… enabled us to be highly responsive to this evolving marketplace.” — Dave Katz (President & COO) .
What Went Wrong
- Volume softness: Total volume −0.8%; Sparkling −0.3% and Still −2.4% as Coke Original Taste remains pressured; Dasani weakness weighed on Still volume .
- Channel headwinds: Sales slowed in small store convenience and on‑premise locations, tempering otherwise strong performance in value/take‑home channels .
- H1 profitability down: First half income from operations decreased 2.7% YoY (two fewer selling days contributed ~$10M); reported H1 net income down 14.0% due to non‑cash fair value adjustments .

Financial Results

YoY Comparison – Q2 2025 vs Q2 2024

Metric	Q2 2024	Q2 2025
Net Sales ($B)	$1.80	$1.86
Gross Profit ($B)	$0.717	$0.742
Gross Margin (%)	39.9%	40.0%
SD&A ($B)	$0.458	$0.470
Operating Income ($B)	$0.259	$0.272
Operating Margin (%)	14.4%	14.7%
Net Income ($B)	$0.173	$0.187
Diluted EPS ($)	$1.85	$2.15
Adjusted Net Income ($B)	$0.193	$0.195

Notes: Adjusted figures exclude non‑cash fair value adjustments and commodity derivative impacts; reconciliations provided in release .

Sequential Trend – Q4 2024 to Q2 2025

Metric	Q4 2024	Q1 2025	Q2 2025
Net Sales ($B)	$1.75	$1.58	$1.86
Gross Margin (%)	40.0%	39.7%	40.0%
Operating Margin (%)	12.5%	12.0%	14.7%
Net Income ($B)	$0.179	$0.104	$0.187

Segment Breakdown (Net Sales)

Segment ($MM)	Q2 2024	Q2 2025	YoY Change
Sparkling bottle/can	$1,048.9	$1,080.0	+3.0%
Still bottle/can	$597.5	$626.1	+4.8%

KPIs

KPI	Q2 2024	Q2 2025	Notes
Volume (MM cases)	91.5	90.7	−0.8% YoY; Dasani weak; excluding Dasani, Still volume +2.0%
SD&A as % of Net Sales	25.5% (implied)	25.4%	−10 bps YoY; labor cost pressure offset by leverage
Effective Tax Rate	~26%	~26%	Stable YoY
Cash from Operations (H1)	$437.1M	$406.2M	Lower due to fair value and working capital
Capex (H1)	$159.4M	~$157M	Investing in supply chain; FY25 ~ $300M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Capital Expenditures	FY 2025	Approximately $300M (provided with FY24/Q4 results)	Approximately $300M (reaffirmed in Q1 and Q2 2025 releases)	Maintained
Dividend	Q2 2025	$2.50 per share declared Apr 11, 2025	—	—
Dividend	Q3 2025	—	$0.25 per share declared Jul 11, 2025	Maintained on split‑adjusted basis (10‑for‑1 split May 2025)
Effective Tax Rate	Q2 2025	—	~26% actual (indicative run‑rate)	—

Note: Company does not provide revenue/margin guidance; disclosure focuses on capex, dividends, and qualitative outlook .

Earnings Call Themes & Trends

Note: No Q2 2025 earnings call transcript was available in our sources; themes derived from company releases. [Search produced no transcript results.]

Topic	Previous Mentions (Q4’24, Q1’25)	Current Period (Q2’25)	Trend
Consumer value/mix	Q4: Value-oriented multi‑serve packages strong; stable commodities; Sparkling mix lift . Q1: Consumers increasingly selective; shift toward Still reduced gross margin 50 bps .	Value channels (supermarket/club/value) strong; convenience/on‑premise slowed; pricing realization aided margins .	Stable emphasis on value channels; margin management improving.
Sparkling performance	Q4: Zero‑calorie brands strength; Sparkling +7.7% . Q1: Coca‑Cola Original Taste softness; zero‑sugar/flavors grew .	Sparkling volume −0.3% but net sales +3.0%; zero‑sugar and flavors offset Original Taste softness .	Mix/pricing continue to offset core brand softness.
Still portfolio	Q4: Still +8.7% YoY; mix headwind earlier in 2024 . Q1: Ex‑Dasani Still +1.8%; Topo Chico introduced .	Still net sales +4.8% driven by Monster, Core Power, Topo Chico, smartwater; ex‑Dasani Still volume +2.0% .	Improving breadth; Dasani remains a headwind.
Distribution changes	Q4: Walmart Dasani shift to non‑DSD reduced reported volume (−1.3% Q4) . Q1: Continued impact (−1.3% volume) .	Dasani packages down; ex‑Dasani growth in Still .	Headwind persists but narrowing ex‑Dasani.
Supply chain/capex	Q4: 2024 capex $371M; 2025 capex plan ~$300M . Q1: Reaffirmed ~$300M .	Reaffirmed 2025 capex ~$300M; $157M YTD; continued supply chain investment; new Columbus OH facility (May) .	Ongoing reinvestment for capacity/efficiency.
Tax rate	FY24 effective tax rate 26.1% . Q1: tax expense impacted by fair value items .	Effective tax rate ~26% in Q2 .	Stable mid‑20s effective rate.

Management Commentary

“We’re pleased to report very solid second quarter results… strong marketplace execution… Our ongoing focus on top-line growth and margin management is producing steady profit growth and substantial cash flow.” — J. Frank Harrison, III, Chairman & CEO .
“Our commercial planning anticipated the need for a broad range of packages and prices that would appeal to value‑conscious consumers. Our steady investments in supply chain capabilities… enabled us to be highly responsive to this evolving marketplace.” — Dave Katz, President & COO .

Q&A Highlights

No Q2 2025 earnings call transcript was available in our search; therefore, specific Q&A themes and guidance clarifications cannot be provided. We will update if a transcript is furnished in the future. [No transcript found via document search.]

Estimates Context

S&P Global consensus estimates for Q2 2025 EPS and revenue were not available in our retrieval; as a result, we cannot provide a vs. consensus comparison this quarter. Values retrieved from S&P Global.

Additional Details and Non‑GAAP Adjustments

Adjusted Q2 2025 net income: $195.2M vs. reported $187.4M; adjustments primarily include non‑cash fair value changes and commodity derivative impacts; adjusted diluted EPS $2.24 vs. $2.15 reported .
H1 2025 adjusted net income: $331.4M vs. reported $291.0M; fair value adjustments were a key headwind to GAAP results in H1 .

Key Takeaways for Investors

Margin resilience: Modest gross margin expansion and stronger operating margin reflect solid pricing/mix and SD&A discipline despite flat to down volumes; margin structure remains a core strength into 2H25 .
Category breadth offsets core brand softness: Zero‑sugar, flavors, and Still adjacencies (Monster, Core Power, Topo Chico, smartwater) are offsetting Coca‑Cola Original Taste pressure; continued focus on value channels is prudent for macro conditions .
H1 drag largely calendar/non‑cash: Two fewer selling days and non‑cash fair value adjustments weighed on H1; underlying operations and cash generation remain healthy (H1 CFO $406M) .
Capex/infrastructure: Reaffirmed ~$300M FY25 capex; Columbus distribution investment underscores capacity and efficiency initiatives supporting execution and responsiveness to value‑seeking demand .
Dividend continuity post‑split: Q3 dividend declared at $0.25 per share following 10‑for‑1 split; income return intact alongside reinvestment .
What to watch near‑term: Mix sustainability (zero‑sugar/flavors), Dasani headwind moderation, convenience/on‑premise channel recovery, and continued SD&A leverage—key to sustaining mid‑teens operating margins .
Medium‑term thesis: Durable cash generation and disciplined reinvestment should support balanced shareholder returns and operational resilience across cycles, even amid selective consumer spending .

Sources: Q2 2025 8‑K and Exhibit 99.1 (press release and financials) ; Q1 2025 8‑K (press release and financials) ; Q4/FY 2024 8‑K (press release and financials) ; Dividend releases ; Stock split press release ; Columbus facility investment .

Coca-Cola Consolidated, Inc. (COKE)·Q2 2025 Earnings Summary