COCA COLA FEMSA SAB DE CV (KOF)·Q4 2025 Earnings Summary

Coca-Cola FEMSA Posts Record December Volume as Brazil Soars and Mexico Recovers

February 24, 2026 · by Fintool AI Agent

Coca-Cola FEMSA delivered a mixed Q4 2025 with EBITDA beating consensus by 1.6% while revenue came in slightly below expectations. The headline story was volume momentum: December marked the strongest single month in company history, with Q4 representing record volumes for Brazil, Colombia, and Guatemala. Stock rose 2.4% on the news to $109.09.

Consolidated volumes grew 1.3% to 1.09 billion unit cases, driven by improving trends in Mexico and strong performance across South America. Total revenues increased 2.9% to MXN 77.7 billion (+6% currency-neutral), while Adjusted EBITDA expanded 12.8% to MXN 18.2 billion with margin up 210 basis points to 23.4%.

Did Coca-Cola FEMSA Beat Earnings?

Important context on margins: Q4 results were positively impacted by insurance recoveries in Brazil and Mexico totaling MXN 1.1 billion. Excluding these effects:

• Normalized operating income declined 2.1% with margin contracting 90 basis points to 16.1%
• Normalized Adjusted EBITDA grew 4.4% with margin expanding 30 basis points to 21.9%

What Changed From Last Quarter?

The turnaround story that began in Q3 accelerated in Q4:

Mexico improved sequentially — Volume decline narrowed from -3.7% in Q3 to -0.9% in Q4, a dramatic recovery from the -10% trough in Q2 driven by consumer sentiment issues and weather. Management noted December was the strongest month on record for Mexico.

Brazil posted record Q4 — Volumes grew 2.6% with outstanding execution and favorable weather driving the highest fourth quarter volume ever for the second-largest operation.

Coke Zero continues to dominate — The brand grew 14% in Mexico and 44% in Brazil for the full year. Sprite Zero followed the same playbook in Brazil, achieving 93% growth and now representing over 20% of total Sprite volume.

How Did Each Region Perform?

Mexico & Central America

Mexico volumes declined 0.9% but showed clear sequential improvement. Key highlights:

• Coke Zero grew 14% YoY
• Stills portfolio up 7.4% (Monster +41%, Fuze Tea +33%, Santa Clara +28%)
• 100,000+ new cooler doors installed by year-end
• Juntos+ Advisor rolled out, improving geo efficiency to 96.5% (from 91%)

Guatemala volumes grew 3.5% despite a decelerating macro environment.

South America

*Includes insurance recovery; normalized margin +90 bps

Brazil (record Q4 volume +2.6%):

• Full-year Coke Zero +44%, Sprite Zero +93%
• Juntos+ surpassed 303,000 monthly active users
• Added 5 new production lines, warehouse capacity +6%
• Fully recovered Rio Grande do Sul share after Porto Alegre plant reopening

Colombia (+4.5% volume): QuAtro is now #1 flavored sparkling beverage in the country.

Argentina (+3% volume): Single-serve mix reached 26.3% (+2.3pp YoY), digital orders +71%.

What Did Management Guide for 2026?

Management struck a cautiously optimistic tone while acknowledging headwinds from Mexico's IEPS excise tax increase:

CapEx guidance: 7-7.5% of revenues (down from 8.2% in 2025), with savings from completed capacity investments in Mexico and Brazil.

Key strategic priorities remain unchanged:

1. Grow core business through Coke Zero acceleration, flavor share gains, profitable non-carbonated beverages
2. Scale Juntos+ Advisor AI capabilities across four largest markets
3. Foster customer-centric culture

On the IEPS tax impact, CEO Ian Craig noted elasticity is behaving as expected but "the consumer is still sluggish in Mexico, so it wouldn't be prudent to venture into an additional price increase today."

How Did the Stock React?

KOF shares rose 2.4% to $109.09 on earnings day, recovering from a 6.3% selloff the prior session. The stock trades near its 52-week high of $116.36 and 19% above its 200-day moving average of $91.74.

The muted positive reaction reflects investors balancing strong volume momentum against Mexico tax headwinds and normalized margin pressure.

Key Management Quotes

On the sustainable growth model:

"It's a scale business. It's important that we continue growing relative scale... We need to come out of this IEPS impact stronger, with a stronger relative position." — CEO Ian Craig

On Mexico pricing strategy:

"We're not changing our guidance there... the elasticity is behaving as we have imagined. The consumer is still sluggish in Mexico." — CEO Ian Craig

On Brazil digital transformation:

"Juntos+ Advisor is a game changer for our sales force... increased its geo efficiency by more than 9.2 percentage points to reach 95.6%." — CEO Ian Craig

On dividend policy (cautious):

"Given that we're facing this challenge in Mexico with the IEPS, we're holding on a little bit to see how cash flow behaves during the year." — CFO Gerardo Cruz

Q&A Highlights

On Mexico's affordability strategy (Alvaro Garcia, BTG): Management confirmed this is a deliberate 12-month positioning strategy, not a permanent shift. "We don't want to lose household penetration... It's really a 12-month thing. We're planning to come out of this IEPS impact stronger."

On Brazil CapEx outlook (Renata Cabral, Citi): Current capacity supports growth through 2028. Next plant needed around 2030, with investments starting 2029. CapEx drops to ~6.5% of revenues until then.

On working capital (Rodrigo Alcântara, UBS): The large working capital outflow was driven by accounts payable normalization following SAP S/4HANA delays in Q4 2024. "We have normalized that for the year and don't expect to see any further disruptions."

On World Cup impact (Gabriela Martinez, Banorte): Management emphasized brand engagement opportunities over volume lift. "The most important upside that we see for the World Cup is regarding to brand engagement, the opportunities on frequency."

Forward Catalysts

Near-term positives:

• FIFA World Cup 2026 (Mexico as host country) — brand engagement and consumption occasions
• Brazil election-related spending and social programs
• Juntos+ Advisor rollout in Colombia and Guatemala

Near-term risks:

• Mexico IEPS tax impact on volumes (low-to-mid single digit decline expected)
• Potential Brazil excise tax in 2027
• Aluminum cost pressure on gross margins
• Consumer sentiment volatility in Mexico

---

Read the full Q4 2025 earnings call transcript or explore more about Coca-Cola FEMSA.