Yum Brands’ KFC U.S. Switches Soft-Drink Supply to Coca-Cola From January 2027

KFC U.S., the American arm of Yum! Brands (NYSE: YUM), said today that it will switch its soft-drink supply to Coca-Cola (NYSE: KO) from January 2027.

Yum shares closed today at $150.83, up 2.82% from $146.69 yesterday. They had opened 1.71% higher before the release, and the staples sector rallied as Treasury yields fell, so the deal does not explain the whole move.

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KFC U.S. said Coca-Cola products are expected in all its U.S. restaurants by spring 2027. The release also points to its “Kentucky Fried Comeback” and a new drinks lineup of iced coffees, boba and shakes at its Open House innovation restaurant in McKinney, Texas.

The switch is reportedly away from Pepsi, which has supplied KFC since Yum’s 1997 spin-off. Catherine Tan-Gillespie, President of KFC U.S., said:

This partnership is about more than what’s in the cup. It is another step in our work to evolve KFC, strengthen our restaurants, menu offerings and create a more relevant experience for today’s customers.

Catherine Tan-Gillespie, KFC U.S.

Coca-Cola closed up 0.24% at $92.00, its highest close in three months. PepsiCo fell 0.69% to $128.38 after opening 2.0% higher, a reversal that may not be down to KFC alone.

Since the close of the 14th of July, with each share price set to 100, Coca-Cola stands at 110.74, Yum at 95.35 and PepsiCo at 94.78.

Dagmar Boggs, President of Foodservice & On-Premise, North America at The Coca-Cola Company, said the partnership brings the two companies together across the U.S. for the first time.

No contract value, length or list of replaced products has been published, so the financial effect is unknown. Yum is due to report third-quarter results on the 3rd of November, with consensus at earnings of $1.51 a share on revenue of about $2.1bn.