Coffee and soda don't mix, decides KDP's CEO-but for investors, adding Peet's and splitting the giant in two could pay off
Briefly

Coffee and soda don't mix, decides KDP's CEO-but for investors, adding Peet's and splitting the giant in two could pay off
"The combo thrived during the COVID lockdown as the new Keurig Dr Pepper deployed AI to parse data flowing from in-home brewers to detect early on that families were rushing to stockpile K-Pods in the stay-at-home economy. That detective work hinted that the trend would soon spread to soft drinks. So KDP stockpiled cans and ramped production of its best-selling Dr Pepper and Canada Dry brands while rivals were short of packaging and capacity."
"In Q2, soft drink revenues leaped 10.7% over the same period last year, while U.S. coffee fell 1.9% and the international "hot" side dipped 3.8%, a blend that held total sales gains in the quarter to 5.5%. The reason for coffee downer: A big jump in the price of beans is hiking K-Pod prices and depressing volumes as customers shift to cheaper bagged ground and instant options."
In 2018 Keurig Green Mountain merged with Dr Pepper Snapple for nearly $19 billion, combining hot and cold beverages under one company. During the COVID lockdown Keurig Dr Pepper deployed AI to parse data from in-home brewers and detected families stockpiling K-Pods, which signaled rising soft-drink demand and prompted KDP to stockpile cans and ramp production. Soft-drink sales surged while coffee sales declined as rising bean prices increased K-Pod costs and shifted consumers to bagged ground and instant coffee. Q2 results showed strong soft-drink growth but U.S. and international coffee declines. KDP announced plans to split the coffee and soft-drink franchises and to acquire JDE Peet's.
Read at Fortune
Unable to calculate read time
[
|
]