Coca-Cola is facing challenges as its sales stagnate. The beverage, a staple at Chinese New Year feasts, is encountering weak performance with sluggish sales overseas and declining demand domestically. Recent financial reports indicate that the company's global unit case volume remained flat last year, marking the first time in nearly a decade that Coca-Cola has seen zero growth.
In the Asia-Pacific region, which includes China, operating profit fell by 5% year-over-year. The fourth-quarter results were particularly disappointing, with operating profit plunging 36%.
At the same time, following recent price increases, many consumers on social media have been complaining that Coca-Cola "doesn't taste as good as before," with comments such as "the flavor has changed" and "it's not as sweet" becoming increasingly common. Experts suggest that relying solely on price hikes is no longer a sustainable strategy. Moving forward, the company must rely on volume to share costs; otherwise, it risks falling into a cycle where higher prices lead to lower demand.
This zero growth in global unit case volume is the first in ten years. However, Coca-Cola's Chairman and CEO described the 2025 performance as "encouraging," highlighting the company's resilience and growth momentum.
Nevertheless, it is an undeniable fact that Coca-Cola's previous strategy of increasing both volume and price has shifted. Recent growth has been driven more by price increases rather than sales volume.
According to the financial report, the stagnation in volume was mainly due to declines in the U.S., Mexico, and Thai markets offsetting growth in Central Asia, North Africa, and Brazil. However, on a global scale, the slowdown in growth in Central Asia, including China, has also been a key factor affecting the company's sales and performance. In the fourth quarter of 2025, revenue in the Asia-Pacific region, including China, dropped by 7% year-over-year to $11.39 billion, while operating profit fell by 36% to $250 million.
Looking at a longer timeline, data from Coca-Cola's authorized partners in China, China Foods and Swire Pacific, show a fluctuating but overall declining trend in revenue. As early as 2021, Coca-Cola's revenue in mainland China reached approximately HK$48.558 billion, but by 2024, it had fallen to around HK$46.725 billion.
This indicates that in the densely populated Asia-Pacific market, which holds significant theoretical growth potential, Coca-Cola's sales performance is far from optimistic.
In its financial report, Coca-Cola's Chief Operating Officer emphasized that China remains one of the company's most important markets, where it is implementing a long-term development strategy and strengthening its leadership in core business areas.
However, the reality is that Coca-Cola faces a more complex and challenging situation in the Chinese market than anticipated. Domestic beverage companies such as Dongpeng Beverage, Nongfu Spring, and Genki Forest have achieved more positive market responses. For instance, Dongpeng Beverage reported estimated revenue of RMB 20.76 billion to RMB 21.12 billion for 2025, with net profit increasing by 30% to 38% year-over-year. Nongfu Spring also saw strong performance, with revenue rising by 15.6% in the first half of 2025. Genki Forest, a key competitor for Coca-Cola, has grown from RMB 600 million in revenue in 2019 to tens of billions today, prompting Coca-Cola to launch multiple sugar-free sparkling water products in response, though with limited success.
Beyond external competition, the deeper reasons for Coca-Cola's slowing revenue and volume growth lie in its decision to adjust its formula, resulting in a "lighter" taste, and its frequent price increases, which have reduced consumers' willingness to purchase.
On social media platforms like Xiaohongshu, many users have expressed dissatisfaction, claiming that Coca-Cola "tastes worse," "has changed," or "is less sweet." These complaints are eroding the brand's reputation. Behind this, Coca-Cola has been replacing more expensive sweeteners like sucrose with cost-effective alternatives such as corn syrup and high-fructose corn syrup to reduce costs, leading to changes in taste.
Last July, former U.S. President Donald Trump mentioned on social media that he was discussing with Coca-Cola the possibility of switching from high-fructose corn syrup to sucrose, describing the latter as "better." This indirectly highlights the issue of declining taste quality.
Moreover, while the taste has been changing, Coca-Cola has frequently raised prices in recent years to improve profit margins, extracting more profits from distributors and consumers.
The 2025 financial report clearly shows that despite flat sales volume, the average product price increased by 4%, indicating higher prices without additional volume. In China, during the first half of 2024, Swire Coca-Cola issued multiple price adjustment notices in provinces like Hubei and Jiangxi, raising prices by 7% to 25% for various products. For example, the suggested retail price for a 500ml bottle of Coke increased from RMB 3 to RMB 3.5.
With limited innovation in new products and changes in the classic Coca-Cola taste, raising prices may prove counterproductive.
Experts analyzing the situation noted that in the past, Coca-Cola leveraged global inflation to increase profits through strategies such as raising prices for larger packages, reducing sizes of smaller packages, and passing on sugar taxes, even when sales volume remained flat. However, the underlying dynamics have shifted. Consumers in markets like Europe and the U.S. are now reluctant to pay $4 for a bottle of Coke, leaving little room for further price increases. Additionally, alternatives like Pepsi and regional brands priced at $1 have become affordable substitutes. Relying solely on price hikes is no longer viable. The company must now depend on volume to share costs; otherwise, it risks a cycle of declining demand due to rising prices.
According to Coca-Cola's management transition plan, the current Executive Vice President and Chief Operating Officer will succeed the current CEO on March 31, 2026. After nine years at the helm, the current CEO will transition to Executive Chairman, continuing to participate in strategic decisions.
The incoming CEO joined Coca-Cola in Atlanta in 1996 and has held significant roles across North America, Europe, Latin America, and Asia, with responsibilities spanning supply chain, new business development, marketing, innovation, and bottling operations. From 2013 to 2016, he served as President of Coca-Cola Greater China and South Korea, gaining deep experience in the Chinese market.
Whether the new leadership can steer Coca-Cola back to growth in Greater China and capture greater market opportunities remains to be seen.
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