Coca-Cola takes nearly US$1B Bodyarmor impairment as Q4 operating income plunges 32%
Impairment on Bodyarmor weighs on Coca-Cola’s Q4 profits, even as full-year operating income and margins improve.
USA – Coca-Cola has recorded close to a US$1 billion impairment on its Bodyarmor sports drink brand, a charge that significantly weighed on profits in the fourth quarter of 2025.
During the period, the beverage giant reported a 32% decline in operating income, partly driven by a US$960 million impairment charge related to the Bodyarmor trademark, alongside unfavorable currency movements.
The charge also pressured profitability, with Coca-Cola’s operating margin for the three months ended December 31 falling to 15.6%, down from 23.5% in the same quarter a year earlier.
Despite the fourth-quarter setback, Coca-Cola posted strong results for the full year. Annual operating income rose 38% in 2025, while the company’s operating margin improved to 28.7%, compared with 21.2% in 2024, reflecting underlying performance across its broader portfolio.
North America, the core market for Bodyarmor, was particularly impacted by the impairment. Operating income in the region declined 65% in the fourth quarter, with the trademark write-down cited as a key factor behind the drop.
This is not the first time Coca-Cola has taken an impairment on the brand. Two years ago, the company booked a US$760 million charge related to the Bodyarmor trademark.
At the time, Coca-Cola said the impairment was “primarily driven by revised projections of future operating results and higher discount rates resulting from changes in macroeconomic conditions since the acquisition date.”
Coca-Cola initially acquired a 15% stake in Bodyarmor in 2018 before purchasing the remaining shares nearly five years ago in a deal valued at US$5.6 billion.
For the full year, group net revenue increased 2% on a reported basis and grew 5% organically to US$47.9 billion. Net sales rose 2% to US$11.82 billion, while total unit case volumes were flat.
In the fourth quarter, reported revenue increased 2%, while organic revenue grew 4% to US$11.8 billion, supported by 4% growth in concentrate sales and a 1% improvement in price and mix. Unit case volumes rose 2% during the period.
“I’m encouraged by our performance in 2025 which showed both the resilience and momentum that define our business,” said James Quincey, Coca-Cola’s chairman and outgoing chief executive officer. “Looking ahead, we will focus on executing our strategy even better and positioning our system for long-term success.”
For 2026, Coca-Cola expects organic revenue growth of between 4% and 5% and comparable earnings per share growth of 7% to 8%. Quincey added, “It’s right at the beginning of the year, and I think we’ve taken a realistic and prudent approach to a number of markets.”
In the first quarter of 2026, the company expects comparable net revenues to include a 2% currency tailwind and a 1% headwind from acquisitions and divestitures.
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