KFC Switches to Coca-Cola, Putting $500 Million in PepsiCo Sales at Risk

KFC announced it is changing its U.S. beverage supplier from PepsiCo to The Coca-Cola Company. The move ends a long-standing partnership: Yum! Brands, KFC’s parent, spun off from PepsiCo in 1997. PepsiCo will continue supplying KFC locations internationally.

Analysts estimate the lost U.S. contract could cost PepsiCo about $500 million in annual sales. The change adds pressure on PepsiCo, which has faced sluggish sales growth in North America.

The switch follows Marriott International’s recent decision to replace Pepsi with Coca-Cola across its global hotel network. It highlights competition for major beverage contracts and marks a strategic win for Coca-Cola in the cola wars.