Beverage company Keurig Dr Pepper (NASDAQ:KDP) reported Q2 CY2026 results beating Wall Street’s revenue expectations, with sales up 75.6% year on year to $7.31 billion. The company expects the full year’s revenue to be around $26.15 billion, close to analysts’ estimates. Its non-GAAP profit of $0.57 per share was 6.2% above analysts’ consensus estimates.
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Keurig Dr Pepper (KDP) Q2 CY2026 Highlights:
- Revenue: $7.31 billion vs analyst estimates of $7.24 billion (75.6% year-on-year growth, 0.9% beat)
- Adjusted EPS: $0.57 vs analyst estimates of $0.54 (6.2% beat)
- The company reconfirmed its revenue guidance for the full year of $26.15 billion at the midpoint
- Operating Margin: 8.6%, down from 21.6% in the same quarter last year
- Free Cash Flow Margin: 12.2%, up from 7.8% in the same quarter last year
- Market Capitalization: $41.84 billion
Company Overview
Born out of a 2018 merger between Keurig Green Mountain and Dr Pepper Snapple, Keurig Dr Pepper (NASDAQ:KDP) is a consumer staples powerhouse boasting a portfolio of beverages including sodas, coffees, and juices.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.
With $20.09 billion in revenue over the past 12 months, Keurig Dr Pepper is one of the most widely recognized consumer staples companies. Its influence over consumers gives it negotiating leverage with distributors, enabling it to pick and choose where it sells its products (a luxury many don’t have).
As you can see below, Keurig Dr Pepper’s sales grew at a decent 11.3% compounded annual growth rate over the last three years as consumers bought more of its products.
This quarter, Keurig Dr Pepper reported magnificent year-on-year revenue growth of 75.6%, and its $7.31 billion of revenue beat Wall Street’s estimates by 0.9%.
Looking ahead, sell-side analysts expect revenue to grow 46.5% over the next 12 months, an acceleration versus the last three years. This projection is eye-popping for a company of its scale and implies its newer products will catalyze better top-line performance.
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Cash Is King
Free cash flow isn’t a prominently featured metric in company financials and earnings releases, but we think it’s telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.
Keurig Dr Pepper has shown robust cash profitability, driven by its attractive business model that enables it to reinvest or return capital to investors. The company’s free cash flow margin averaged 10.6% over the last two years, quite impressive for a consumer staples business.
Keurig Dr Pepper’s free cash flow clocked in at $895 million in Q2, equivalent to a 12.2% margin. This result was good as its margin was 4.4 percentage points higher than in the same quarter last year. Its cash profitability was also above its two-year level, and we hope the company can build on this trend.
Key Takeaways from Keurig Dr Pepper’s Q2 Results
It was good to see Keurig Dr Pepper beat analysts’ EPS expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. On the other hand, its gross margin missed and its full-year revenue guidance was in line with Wall Street’s estimates. Overall, this was a softer quarter. The stock traded up 1.3% to $31.15 immediately following the results.
Big picture, is Keurig Dr Pepper a buy here and now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).