Analysis of Income Taxes
- Income Tax Expense (Benefit)
- Effective Income Tax Rate (EITR)
- Components of Deferred Tax Assets and Liabilities
- Deferred Tax Assets and Liabilities, Classification
- Adjustments to Financial Statements: Removal of Deferred Taxes
- Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
- Adjusted Net Profit Margin
- Adjusted Total Asset Turnover
- Adjusted Financial Leverage
- Adjusted Return on Equity (ROE)
- Adjusted Return on Assets (ROA)
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- Common-Size Income Statement
- Common-Size Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Long-term (Investment) Activity Ratios
- Analysis of Reportable Segments
- Enterprise Value to FCFF (EV/FCFF)
- Selected Financial Data since 2005
- Operating Profit Margin since 2005
- Total Asset Turnover since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
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Income Tax Expense (Benefit)
Coca-Cola Co., income tax expense (benefit), continuing operations
US$ in millions
| 12 months ended: | Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||||||
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| Income taxes |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The income tax expense exhibited fluctuating behavior over the five-year period. Current income taxes generally increased, while deferred income taxes demonstrated significant volatility. Overall income taxes initially decreased before stabilizing and then increasing.
- Current Income Taxes
- Current income taxes increased from US$1,727 million in 2021 to US$2,237 million in 2022, representing a growth of approximately 29.5%. This trend continued into 2023 with a slight increase to US$2,251 million. Further growth was observed in 2024, reaching US$2,448 million. In 2025, current income taxes experienced a modest decrease to US$2,344 million, though remaining above the 2021 and 2022 levels.
- Deferred Income Taxes
- Deferred income taxes showed substantial variation. Beginning at US$894 million in 2021, they decreased significantly to a negative US$122 million in 2022, indicating a benefit rather than an expense. This benefit expanded in 2023 to a negative US$2 million. A further, though smaller, benefit was recorded in 2024 at negative US$11 million. A dramatic shift occurred in 2025, with deferred income taxes becoming a positive US$517 million, representing a substantial expense.
- Total Income Taxes
- Total income taxes decreased from US$2,621 million in 2021 to US$2,115 million in 2022, driven by the significant decrease in deferred tax expense. A slight increase to US$2,249 million was observed in 2023, followed by a further increase to US$2,437 million in 2024. In 2025, total income taxes rose considerably to US$2,861 million, influenced by both the increase in current taxes and the shift from a deferred tax benefit to an expense.
The volatility in deferred income taxes suggests potential changes in temporary differences between book and tax bases of assets and liabilities, or changes in tax rates. The overall trend in total income taxes indicates a recovery and subsequent increase following the initial decrease in 2022, aligning with the growth observed in current income taxes.
Effective Income Tax Rate (EITR)
Coca-Cola Co., effective income tax rate (EITR) reconciliation
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Statutory U.S. federal tax rate | ||||||
| Effective tax rate |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The effective income tax rate exhibited fluctuations over the five-year period. While the statutory U.S. federal tax rate remained constant at 21.00%, the effective tax rate demonstrated variability, generally trending downward before stabilizing.
- Effective Tax Rate Trend
- In 2021, the effective tax rate was 21.10%, slightly above the statutory rate. A notable decrease was observed in 2022, falling to 18.10%. This downward trend continued into 2023, with the effective tax rate reaching 17.40%, the lowest value within the observed period. A modest increase occurred in 2024, bringing the rate to 18.60%, followed by a slight decline to 17.90% in 2025.
The consistent statutory rate suggests that changes in the effective tax rate are primarily driven by factors other than alterations to the corporate tax code. These factors could include geographic earnings mix, tax credits, deductions, and adjustments related to deferred tax assets and liabilities. The initial increase in 2021, above the statutory rate, could be due to items such as non-deductible expenses or the impact of foreign income repatriation. The subsequent declines in 2022 and 2023 suggest a potential benefit from these other factors, while the 2024 increase and 2025 stabilization indicate a lessening of those benefits or a shift in the composition of taxable income.
- Deviation from Statutory Rate
- The effective tax rate consistently deviated from the statutory rate, indicating the presence of permanent or temporary differences between book and taxable income. The largest deviation occurred in 2023, where the effective rate was 3.60 percentage points below the statutory rate. The deviations in 2022, 2024, and 2025 were smaller, at 2.90, 2.40, and 3.10 percentage points respectively. These differences warrant further investigation to understand the underlying drivers and their potential impact on future tax liabilities.
Overall, the effective tax rate demonstrates a pattern of fluctuation around the statutory rate, suggesting the influence of various tax-related factors beyond the standard corporate tax rate. Continued monitoring of these trends is recommended to assess potential impacts on financial performance.
Components of Deferred Tax Assets and Liabilities
Coca-Cola Co., components of deferred tax assets and liabilities
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The composition of deferred tax assets and liabilities exhibits notable shifts over the five-year period. Gross deferred tax assets initially decreased from 2021 to 2023, then increased significantly in 2024, followed by a slight decrease in 2025. Conversely, gross deferred tax liabilities consistently decreased from 2021 to 2023, then increased substantially in 2024, and decreased again in 2025. The net effect is a movement from a net deferred tax asset in 2021 to a net deferred tax liability throughout the remainder of the period, with the net liability increasing in magnitude each year.
- Property, Plant, and Equipment
- Deferred tax assets related to property, plant, and equipment decreased steadily from $36 million in 2021 to $28 million in 2025. Deferred tax liabilities associated with this asset category consistently increased, moving from -$721 million in 2021 to -$869 million in 2025. This suggests a growing difference between the book and tax basis of these assets.
- Goodwill and Intangible Assets
- Deferred tax assets linked to goodwill and intangible assets experienced a substantial decline from $1,910 million in 2021 to $1,133 million in 2024, before increasing to $2,204 million in 2025. Deferred tax liabilities related to these assets also decreased from -$1,783 million in 2021 to -$1,571 million in 2024, then remained relatively stable in 2025. The fluctuations indicate changes in the tax implications of these assets, potentially due to impairments or amortization.
- Equity Method Investments
- Deferred tax assets related to equity method investments decreased from $595 million in 2021 to $293 million in 2025. Deferred tax liabilities associated with these investments remained relatively stable, decreasing slightly from -$1,619 million in 2021 to -$1,649 million in 2025. This pattern suggests a diminishing tax benefit from these investments.
- Derivative Financial Instruments
- Deferred tax assets from derivative financial instruments decreased from $215 million in 2021 to $156 million in 2023, then increased to $403 million in 2025. Deferred tax liabilities associated with these instruments decreased from -$500 million in 2021 to -$282 million in 2023, then increased significantly to -$459 million in 2025. These changes likely reflect the fluctuating values and tax treatment of these instruments.
- Other Liabilities
- Deferred tax assets related to other liabilities increased from $1,255 million in 2021 to $1,709 million in 2023, then decreased to $1,020 million in 2025. Deferred tax liabilities associated with these items decreased from -$315 million in 2021 to -$228 million in 2025. The changes suggest evolving tax implications related to these liabilities.
- Net Operating Loss Carryforwards
- Net operating loss carryforwards increased substantially from $280 million in 2021 to $874 million in 2024, before decreasing to $534 million in 2025. This indicates a significant increase in the potential future tax benefits from these losses, followed by a reduction. The valuation allowance remained relatively stable, fluctuating between -$396 million and -$485 million.
- Net Deferred Tax Position
- The net deferred tax position transitioned from a net asset of -$692 million in 2021 to a net liability of -$1,200 million in 2025. This indicates a growing expectation of future taxable income to utilize existing deferred tax assets, or an increase in deferred tax liabilities exceeding deferred tax assets. The consistent increase in the net liability suggests a potential future increase in tax expense.
Deferred Tax Assets and Liabilities, Classification
Coca-Cola Co., deferred tax assets and liabilities, classification
US$ in millions
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Deferred tax assets | ||||||
| Deferred tax liabilities |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
Over the five-year period ending December 31, 2025, both deferred tax assets and deferred tax liabilities exhibited decreasing trends. However, the liabilities consistently exceeded the assets throughout the observed timeframe.
- Deferred Tax Assets
- Deferred tax assets decreased steadily from US$2,129 million in 2021 to US$1,206 million in 2025. This represents a cumulative reduction of approximately 43.3% over the five years. The largest year-over-year decrease occurred between 2021 and 2022, with a reduction of US$383 million. Subsequent annual decreases were more moderate, ranging from US$185 million to US$113 million.
- Deferred Tax Liabilities
- Deferred tax liabilities also demonstrated a declining trend, moving from US$2,821 million in 2021 to US$2,406 million in 2025. This signifies a total decrease of approximately 14.7% during the period. The most substantial decrease in deferred tax liabilities was observed between 2021 and 2022, amounting to US$87 million. The rate of decline slowed in subsequent years, with the smallest reduction occurring between 2024 and 2025, at US$63 million.
- Net Deferred Tax Position
- The difference between deferred tax liabilities and deferred tax assets, representing the net deferred tax liability, decreased from US$692 million in 2021 to US$1,200 million in 2025. While the net liability remained positive throughout the period, the narrowing gap suggests a potential reduction in future tax obligations relative to the deferred tax asset position.
The consistent decline in both deferred tax assets and liabilities could be attributable to various factors, including changes in temporary differences between the book and tax bases of assets and liabilities, alterations in tax rates, or adjustments to valuation allowances against deferred tax assets. Further investigation into the underlying causes of these trends would be necessary for a more comprehensive understanding.
Adjustments to Financial Statements: Removal of Deferred Taxes
Coca-Cola Co., adjustments to financial statements
US$ in millions
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The information presents a five-year trend of reported and adjusted financial statement items. The adjustments appear to relate to the removal of deferred tax assets and liabilities, impacting reported asset, liability, and equity figures, as well as net income. A consistent pattern emerges where adjusted figures generally differ from reported figures, suggesting a material impact from deferred tax adjustments.
- Total Assets
- Reported total assets demonstrate an overall increasing trend from $94,354 million in 2021 to $104,816 million in 2025. However, adjusted total assets show a slightly lower, but similar, upward trajectory, ranging from $92,225 million to $103,610 million over the same period. The difference between reported and adjusted assets remains relatively consistent, approximately $2.1 to $2.2 billion annually.
- Total Liabilities
- Reported total liabilities fluctuate over the period, initially decreasing from $69,494 million in 2021 to $66,937 million in 2022, then increasing to $74,177 million in 2024 before decreasing to $70,541 million in 2025. Adjusted total liabilities mirror this pattern, but at lower values, ranging from $64,023 million to $71,708 million. The difference between reported and adjusted liabilities is also relatively consistent, around $2.4 to $3.5 billion annually.
- Equity
- Reported equity attributable to shareowners shows an increase from $22,999 million in 2021 to $32,169 million in 2025, with some fluctuation in intervening years. Adjusted equity follows a similar trend, consistently exceeding the reported equity by approximately $700 to $1,200 million annually, ranging from $23,691 million to $33,369 million. The largest difference is observed in 2025.
- Net Income
- Reported net income attributable to shareowners demonstrates an increasing trend from $9,771 million in 2021 to $13,107 million in 2025. The adjusted net income generally aligns with the reported net income, with the exception of 2022 where the adjusted net income is lower. The adjustments increase net income in 2021, 2023, 2024 and 2025, by approximately $894 million, $2 million, $11 million and $517 million respectively. The adjustment decreased net income in 2022 by $122 million.
The consistent differences between reported and adjusted figures across all presented items indicate a systematic removal of deferred tax effects. The impact of these adjustments is material, affecting all balance sheet and income statement items. The adjustments to net income suggest that the deferred tax effects, when removed, generally increase reported profitability, except for the year 2022.
Coca-Cola Co., Financial Data: Reported vs. Adjusted
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Coca-Cola Co., adjusted financial ratios
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The financial performance metrics demonstrate a consistent pattern when adjusted for the removal of deferred tax impacts. Generally, the adjusted ratios exhibit slightly higher values than their reported counterparts, suggesting that deferred taxes have a moderating effect on reported profitability and returns. Over the five-year period, several trends are observable across the key ratios analyzed.
- Profitability
- The reported net profit margin fluctuates between 22.19% and 27.34%. The adjusted net profit margin shows a similar range, but consistently exceeds the reported margin, indicating a positive impact from removing deferred tax effects. Both reported and adjusted net profit margins show an increase in the final year of the period.
- Asset Turnover
- Reported total asset turnover remains relatively stable, ranging from 0.41 to 0.47. The adjusted total asset turnover mirrors this stability, with values slightly higher than the reported figures. There is a minor increase in both reported and adjusted asset turnover from 2021 to 2023, followed by a slight decline in the final two years.
- Financial Leverage
- Reported financial leverage exhibits a slight decreasing trend from 4.10 in 2021 to 3.26 in 2025. The adjusted financial leverage follows a similar pattern, consistently lower than the reported leverage, suggesting deferred taxes contribute to a higher reported leverage ratio. The decrease in leverage is most pronounced between 2021 and 2023.
- Return on Equity (ROE)
- Reported ROE fluctuates between 39.59% and 42.77%. The adjusted ROE consistently shows higher values, peaking at 45.02% in 2021, and then remaining relatively stable between 39.65% and 40.84% in the subsequent years. The adjusted ROE demonstrates a more pronounced initial decline from 2021 to 2022, followed by stabilization.
- Return on Assets (ROA)
- Reported ROA increases from 10.36% to 12.50% over the period. The adjusted ROA also demonstrates an increasing trend, consistently exceeding the reported ROA, and reaching 13.15% in the final year. The difference between reported and adjusted ROA widens in the later years, indicating a growing impact from deferred taxes on the reported asset returns.
In summary, the adjustments for deferred taxes generally result in improved profitability and return metrics. The trends observed in the adjusted ratios largely mirror those in the reported ratios, but with consistently higher values. The impact of deferred taxes appears to be relatively stable across the earlier years, but becomes more pronounced in the later years, particularly regarding ROA.
Coca-Cola Co., Financial Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Net profit margin = 100 × Net income attributable to shareowners of The Coca-Cola Company ÷ Net operating revenues
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net income attributable to shareowners of The Coca-Cola Company ÷ Net operating revenues
= 100 × ÷ =
The period under review demonstrates fluctuations in both reported and adjusted net income, consequently impacting associated profit margins. While both metrics generally move in tandem, discrepancies exist, suggesting the influence of specific adjustments made to reported earnings. A general observation is a recovery in profitability towards the end of the period, with 2025 showing the strongest performance.
- Reported Net Profit Margin
- The reported net profit margin experienced a decline from 25.28% in 2021 to 22.19% in 2022. A subsequent recovery was observed in 2023, reaching 23.42%, followed by a slight decrease to 22.59% in 2024. The most significant increase occurred in 2025, with the margin rising to 27.34%. This indicates a strengthening of profitability as measured by reported earnings in the latter years of the period.
- Adjusted Net Profit Margin
- The adjusted net profit margin mirrored the trend of the reported margin, initially decreasing from 27.59% in 2021 to 21.90% in 2022. It then stabilized around 23.41% and 22.57% in 2023 and 2024 respectively. Similar to the reported margin, 2025 saw a substantial increase, reaching 28.42%. The adjusted margin consistently exceeded the reported margin in 2021, 2023, 2024 and 2025, but was lower in 2022.
- Relationship Between Reported and Adjusted Margins
- The difference between the adjusted and reported net profit margins suggests the presence of non-recurring items or accounting adjustments that impact reported earnings. The largest divergence occurred in 2022, where the adjusted margin was notably lower than the reported margin. This could indicate the impact of significant one-time charges or gains affecting the reported figures. The convergence of the two margins in 2025 suggests a more consistent underlying profitability, with fewer significant adjustments needed to arrive at the adjusted net income.
Overall, the financial performance, as indicated by these margins, demonstrates a period of volatility followed by a strong recovery. The adjustments made to net income appear to have a material impact on the overall profitability picture, particularly in 2022, and warrant further investigation to understand the nature and frequency of these adjustments.
Adjusted Total Asset Turnover
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Total asset turnover = Net operating revenues ÷ Total assets
= ÷ =
2 Adjusted total asset turnover = Net operating revenues ÷ Adjusted total assets
= ÷ =
The information presents a five-year trend of reported and adjusted total assets, alongside their corresponding turnover ratios. Both reported and adjusted total assets generally increased over the period, while the asset turnover ratios exhibited relative stability.
- Total Assets
- Reported total assets decreased from US$94,354 million in 2021 to US$92,763 million in 2022, before increasing consistently through 2025, reaching US$104,816 million. Adjusted total assets followed a similar pattern, starting at US$92,225 million in 2021, dipping to US$91,017 million in 2022, and then rising to US$103,610 million by 2025. The difference between reported and adjusted total assets remained relatively consistent across all years.
- Reported Total Asset Turnover
- The reported total asset turnover ratio increased from 0.41 in 2021 to 0.46 in 2022, and then remained relatively stable at 0.47 for 2023 and 2024. A slight decrease to 0.46 was observed in 2025. This indicates a generally consistent level of revenue generated per dollar of reported assets.
- Adjusted Total Asset Turnover
- The adjusted total asset turnover ratio demonstrated an increasing trend from 0.42 in 2021 to 0.48 in 2023. Similar to the reported ratio, it stabilized at 0.47 in 2024 and decreased slightly to 0.46 in 2025. The adjusted ratio consistently exceeded the reported ratio across all years, suggesting that the adjustments to total assets result in a slightly more favorable turnover metric.
The convergence of the reported and adjusted asset turnover ratios towards the end of the period suggests that the impact of the asset adjustments may be diminishing or becoming more consistent in its effect on the turnover calculation. Overall, the asset turnover ratios indicate a stable ability to generate sales from the asset base.
Adjusted Financial Leverage
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 Financial leverage = Total assets ÷ Equity attributable to shareowners of The Coca-Cola Company
= ÷ =
2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted equity attributable to shareowners of The Coca-Cola Company
= ÷ =
The information presents a five-year trend of total assets, equity, and associated financial leverage ratios, both reported and adjusted. Over the period, both reported and adjusted total assets generally increased, while equity exhibited more fluctuation. The adjusted financial leverage ratios consistently remain below the reported figures, suggesting a moderating effect from the adjustments made.
- Total Assets
- Reported total assets decreased from 2021 to 2022, then demonstrated a consistent increase through 2025, reaching 104,816 US$ in millions. Adjusted total assets followed a similar pattern, though the magnitude of the decrease in 2022 was less pronounced. The difference between reported and adjusted total assets narrowed over the period, indicating a convergence in asset valuation.
- Equity
- Reported equity attributable to shareowners increased from 2021 to 2023, experienced a decrease in 2024, and then increased significantly in 2025, reaching 32,169 US$ in millions. Adjusted equity mirrored this trend, with a larger increase observed in 2025, resulting in 33,369 US$ in millions. The adjustments to equity consistently resulted in a higher equity value compared to the reported figures.
- Reported Financial Leverage
- Reported financial leverage decreased from 4.10 in 2021 to 3.77 in 2023, then increased to 4.05 in 2024 before decreasing to 3.26 in 2025. This suggests a period of deleveraging followed by a re-increase in leverage, and then a substantial decrease in the final year. The fluctuations likely correlate with changes in both asset and equity levels.
- Adjusted Financial Leverage
- Adjusted financial leverage exhibited a similar trend to the reported ratio, decreasing from 3.89 in 2021 to 3.56 in 2023, increasing to 3.82 in 2024, and then decreasing to 3.10 in 2025. The adjusted leverage consistently remained lower than the reported leverage, indicating that the adjustments to assets and equity resulted in a more conservative leverage position. The largest decrease in adjusted financial leverage occurred in 2025, mirroring the trend in the reported ratio and driven by the substantial increase in adjusted equity.
The convergence of reported and adjusted asset values, coupled with the consistent difference in equity values, suggests the adjustments primarily impact the equity portion of the leverage calculation. The decrease in both reported and adjusted financial leverage in 2025 indicates a strengthening of the company’s financial position based on these metrics.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 ROE = 100 × Net income attributable to shareowners of The Coca-Cola Company ÷ Equity attributable to shareowners of The Coca-Cola Company
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net income attributable to shareowners of The Coca-Cola Company ÷ Adjusted equity attributable to shareowners of The Coca-Cola Company
= 100 × ÷ =
The period between 2021 and 2025 demonstrates fluctuations in both reported and adjusted net income, equity, and resulting return on equity (ROE) metrics. While both reported and adjusted figures generally trend upward over the five-year span, variations exist, particularly in the earlier years. A comparison of reported and adjusted values reveals the impact of certain accounting adjustments on key performance indicators.
- Net Income
- Reported net income attributable to shareowners experienced a slight decrease from US$9,771 million in 2021 to US$9,542 million in 2022, before increasing to US$10,714 million in 2023 and remaining relatively stable at US$10,631 million in 2024. A significant increase is observed in 2025, reaching US$13,107 million. Adjusted net income mirrors this pattern, with a more pronounced dip in 2022 (US$9,420 million) and a stronger rise in 2025 (US$13,624 million) compared to the reported figures.
- Equity
- Reported equity attributable to shareowners consistently increased over the period, moving from US$22,999 million in 2021 to US$32,169 million in 2025. Adjusted equity follows a similar trajectory, starting at US$23,691 million in 2021 and reaching US$33,369 million in 2025. The difference between reported and adjusted equity remains relatively consistent throughout the period, suggesting systematic adjustments are being applied.
- Reported Return on Equity (ROE)
- Reported ROE exhibited a slight decline from 42.48% in 2021 to 39.59% in 2022, followed by increases to 41.30% in 2023 and 42.77% in 2024. The metric then decreased slightly to 40.74% in 2025. This suggests a moderate level of profitability relative to shareholder equity, with some year-to-year volatility.
- Adjusted Return on Equity (ROE)
- Adjusted ROE experienced a more substantial decrease from 45.02% in 2021 to 37.27% in 2022, mirroring the trend in adjusted net income. It then rose to 39.65% in 2023 and 40.84% in 2024, before stabilizing at 40.83% in 2025. The adjusted ROE consistently exceeds the reported ROE, indicating that the adjustments applied to net income and equity positively impact the return metric. The convergence of reported and adjusted ROE in 2025 suggests a lessening impact from the adjustments.
The divergence between reported and adjusted ROE highlights the significance of understanding the nature of the adjustments made to net income and equity. The fluctuations observed in both reported and adjusted ROE suggest sensitivity to changes in profitability and equity base. The overall trend indicates a generally stable, though fluctuating, return on equity over the five-year period.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
2025 Calculations
1 ROA = 100 × Net income attributable to shareowners of The Coca-Cola Company ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net income attributable to shareowners of The Coca-Cola Company ÷ Adjusted total assets
= 100 × ÷ =
The period between 2021 and 2025 demonstrates fluctuating, yet generally positive, performance in both reported and adjusted return on assets. Reported net income attributable to shareowners experienced a slight decrease from 2021 to 2022, followed by increases in subsequent years, culminating in a substantial rise in 2025. Adjusted net income mirrored this pattern, with a more pronounced increase in the final year. Total assets, both reported and adjusted, exhibited a consistent upward trend throughout the five-year period.
- Reported Return on Assets (ROA)
- Reported ROA remained relatively stable between 2021 and 2024, fluctuating between 10.29% and 10.97%. A significant increase to 12.50% was observed in 2025, coinciding with the largest increase in reported net income. This suggests a strengthening relationship between profitability and asset utilization in the final year of the period.
- Adjusted Return on Assets (ROA)
- Adjusted ROA showed a decrease from 11.56% in 2021 to 10.35% in 2022. It then experienced moderate growth through 2024, reaching 10.70%. Similar to the reported ROA, 2025 saw a substantial increase, with adjusted ROA reaching 13.15%. The adjusted ROA consistently exceeded the reported ROA throughout the period, indicating that adjustments to net income and total assets positively impacted the return generated from assets.
- Relationship between Reported and Adjusted ROA
- The difference between reported and adjusted ROA remained relatively consistent across the years, generally ranging between 1.0% and 2.0%. This suggests that the adjustments made to net income and total assets have a predictable and ongoing effect on the calculated return. The convergence of the two ROA figures in 2025, while both increased, could indicate that the underlying factors driving the adjustments were less significant in that year.
The consistent growth in total assets, coupled with the increases in both reported and adjusted net income, contributed to the overall positive trend in ROA. The substantial increases observed in 2025 warrant further investigation to determine the specific drivers behind these improvements.