Keurig Dr Pepper Q4 Earnings Beat Estimates, Expects Sales Growth From Ghost Deal

Keurig Dr Pepper Inc. KDP shares are trading higher in the premarket session on Tuesday.

The company reported fourth-quarter adjusted earnings per share of 58 cents, beating the street view of 57 cents. Quarterly sales of $4.07 billion (+5.2% year over year), outpaced the analyst consensus estimate of $4.02 billion.

Adjusted operating income increased by 3.4% to $1.129 billion. Adjusted operating margin in the quarter under review was 27.7%, lower than 28.5% in the year-ago period.

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Operating cash flow for the fourth quarter increased 185.9% to $849 million and free cash flow increased 380.4% to $687 million.

US Refreshment Beverages saw a 10.3% increase in net sales, reaching $2.4 billion in the fourth quarter. US Coffee experienced a 2.4% decline in net sales, totaling $1.1 billion. International net sales grew by 0.8%, reaching $0.5 billion in the same period.

The Plano, Texas-based company exited the quarter with cash and equivalents worth $510 million.

Outlook: The company expects mid-single-digit net sales growth and high-single-digit adjusted diluted EPS growth in 2025 on a constant currency basis, factoring in the 60% stake of Ghost.

“Though the operating backdrop is demanding, we are confident that our strategic progress and business momentum will translate into yet another set of compelling, on-algorithm results in 2025,” CEO Tim Cofer stated.

However, foreign currency translation is projected to create a one- to two-percentage point headwind to both top- and bottom-line growth for the full year.

Price Action: KDP shares are trading higher by 2.98% to $34.99 premarket at last check Tuesday.

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