• by Sarah Mahoney , February 10, 2026

After pushing price hikes to protect profits, Coca-Cola and PepsiCo are running into the same reality: Consumers are pushing back.

The latest earnings reports from both companies show demand softening in North America, even as marketing and innovation take on a bigger role in holding volumes steady.

The divergence is in how each company is responding. Coke is still leaning on pricing discipline and brand power. Pepsi is openly acknowledging affordability limits—and adjusting course.

Coca-Cola reported fourth-quarter revenue growth of 2%, to $11.8 billion, slightly below Wall Street expectations. While the company pointed to improving performance in North America beverages, it also acknowledged softer demand following 4% price increases in the region. Management said it is not planning major price cuts, despite PepsiCo’s recent move to sharpen pricing on select products.

Instead, Coke is doubling down on marketing speed and relevance, particularly with younger consumers. Incoming CEO Henrique Braun said the company is focused on tightening the connection between brand campaigns and in-store execution as it looks to boost recruitment among young adults. The subtext: Brand storytelling still matters, but it has to translate more directly into sales.

That thinking is showing up in Coke’s emphasis on passion points and occasions. A global “Rings of Magic” platform, for example, activated across roughly 1,500 universities, aiming to strengthen ties with students through local “Study Break” moments. The company argues these efforts are helping support volume, even as pricing headwinds persist.

It also needs to do better with product launches. “Our innovation today is not where it needs to be,” Braun said on the call. “We are striving to better anticipate the next growth opportunity in beverages and shape what comes next, driven by our deep consumer insight.”

PepsiCo’s tone was more blunt. The company posted a 2.1% gain in organic revenue, reaching $29.34 billion, but volumes told a more mixed story. North American food sales fell 1%, while beverage volumes declined 3%, despite a 2% dollar increase.

Executives directly acknowledged consumer resistance to higher prices. “Following extensive consumer feedback around affordability limitations and subsequent market tests on sharper price points during the second half of 2025, we have begun offering greater affordability on certain packages of iconic brands,” the company said. The goal, executives added, is to improve purchase frequency—not just protect margins.

Pepsi is pairing that pricing reset with a heavier push on renovation and innovation across core brands, including Lay’s, Tostitos, Gatorade and Quaker, with an emphasis on hydration, whole grains, protein, fiber and fewer artificial ingredients. Analysts see early signs of stabilization, if not a full turnaround.

“We don't think the U.S. snack business is out of the woods yet, after a 2% volume decline, but this is an improvement over a 3% decline in prior quarters as recipe innovation and investments in affordability are starting to bear fruit,” writes Dan Su, an analyst who follows PepsiCo for Morningstar.

What’s emerging is a more sobering reality for big CPG brands: price elasticity is no longer theoretical. It’s showing up in depressed sales volumes, forcing companies to admit that brand equity alone isn’t enough to protect them from budget-conscious shoppers.

Marketing, in this environment, isn’t about louder storytelling or more novelty. It’s being asked to do more functional work. “Over the next few years, we anticipate high investments in marketing and innovation to reinforce PepsiCo's brand strength,” Su said.

Both companies offered cautious outlooks, signaling no quick rebound. Consumers are clearly back in control, and soda’s era of easy pricing wins looks to be over.