Across the three companies, KO stands out for its superior margin profile despite being the smallest by revenue, while PEP operates at a larger scale with moderately high but recently pressured margins, and COST runs a high-volume, razor-thin-margin warehouse model that nonetheless generates strong absolute earnings growth.
KO grew revenues from $43.0B in FY2022 [KO:Q0] to $47.9B in FY2025 [KO:Q3], while delivering a net margin that expanded to roughly 27% in FY2025 (net income $13.1B [KO:Q7] on revenues of $47.9B [KO:Q3]). Gross margins have trended upward in recent years, reaching approximately 61.6% in FY2025 (gross profit $29.5B [KO:Q15]), though this 60%+ threshold was only achieved in FY2024 and FY2025 — earlier years ran closer to 58–60%. PEP operates at roughly double KO's revenue scale ($93.9B in FY2025 [PEP:Q3]) and generates the largest absolute gross profit of the three ($50.9B in FY2025 [PEP:Q15]), but profitability has deteriorated meaningfully: net income fell to $8.2B in FY2025 [PEP:Q7] from $9.6B in FY2024 [PEP:Q6] — and notably, FY2025 net income also sits below FY2022 levels of approximately $8.9B, indicating a more sustained earnings erosion than a single-year comparison would suggest. Operating income similarly slipped to $11.5B [PEP:Q11] from $12.9B [PEP:Q10], signaling ongoing cost pressures. COST dwarfs both in revenue ($275.2B in FY2025 [COST:Q3]), but its membership warehouse model produces structurally thin net margins of roughly 2.9%. Despite this, COST has delivered the strongest absolute earnings growth trajectory among the three, with net income rising from $5.8B in FY2022 [COST:Q4] to $8.1B in FY2025 [COST:Q7] and operating income climbing from $7.8B [COST:Q8] to $10.4B [COST:Q11], reflecting consistent operational leverage as membership and volume scale up.
KO: Coca-Cola demonstrates the strongest margin profile of the three, with gross profit reaching $29.5B on $47.9B in revenues in FY2025 [KO:Q15][KO:Q3], implying a gross margin of approximately 61.6% — a level achieved in FY2024 and FY2025 as margins have trended upward. Net income surged to $13.1B in FY2025 [KO:Q7], up from $10.6B in FY2024 [KO:Q6], and operating income recovered strongly to $13.8B [KO:Q11] after a dip to $10.0B in FY2024 [KO:Q10], reflecting KO's durable pricing power and high-margin concentrate business.
PEP: PepsiCo generates the largest absolute gross profit among the three ($50.9B in FY2025 [PEP:Q15]) on revenues of $93.9B [PEP:Q3], but profitability has deteriorated over a multi-year period: net income fell to $8.2B in FY2025 [PEP:Q7] from $9.6B in FY2024 [PEP:Q6] and is also below FY2022 levels of approximately $8.9B, while operating income declined to $11.5B [PEP:Q11] from $12.9B [PEP:Q10], suggesting sustained cost pressures or structural headwinds weighing on the bottom line.
COST: Costco's warehouse membership model produces structurally thin net margins (roughly 2.9% in FY2025 on $275.2B in revenues [COST:Q3][COST:Q7]), but the company has delivered the most consistent earnings growth of the three, with net income rising to $8.1B in FY2025 [COST:Q7] from $5.8B in FY2022 [COST:Q4] and operating income expanding to $10.4B [COST:Q11] from $7.8B [COST:Q8], demonstrating strong operational leverage as membership and transaction volume scale up.
Cross-axis takeaway: On profitability, the three companies represent distinct archetypes: KO leads on margin quality with a high-return, asset-light concentrate model; COST leads on earnings growth momentum despite razor-thin margins, powered by scale and membership economics; and PEP finds itself in the most challenged position, with margin compression that extends beyond a single year and reflects broader cost and volume headwinds across its diversified food and beverage portfolio.