Subway Sips A New Partnership: PepsiCo To Quench Thirst Across US Locations In Major Beverage Shift
Portfolio Pulse from Shivani Kumaresan
PepsiCo Inc. (NASDAQ:PEP) has won a 10-year deal to become the exclusive beverage supplier for Subway restaurants across the U.S. starting January 1, 2025. This agreement includes a wide range of PepsiCo's beverages, such as Pepsi, MTN DEW, and Gatorade, and marks a significant shift as it replaces The Coca-Cola Company (NYSE:KO) as Subway's primary drink provider. The transition will see Coca-Cola products phased out from Subway locations beginning January 2025. This deal also strengthens PepsiCo's existing relationship with Subway, including snack provision through its Frito-Lay division until 2030.
March 19, 2024 | 3:35 pm
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Coca-Cola will be phased out as the primary beverage supplier for Subway in the U.S. starting January 2025, following a new deal between Subway and PepsiCo.
Losing the exclusive beverage supply contract with Subway, a major fast-food chain, to PepsiCo represents a significant setback for Coca-Cola. This change is likely to negatively impact Coca-Cola's market share and revenue from Subway franchises, contributing to a negative short-term outlook for Coca-Cola's stock.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
POSITIVE IMPACT
PepsiCo secures a major partnership with Subway to supply beverages across U.S. locations from January 1, 2025, for 10 years, replacing Coca-Cola as the primary beverage provider.
Securing a deal with Subway, a major fast-food chain, to supply beverages exclusively is a significant win for PepsiCo. This partnership not only expands PepsiCo's market presence but also strengthens its competitive position against Coca-Cola. The announcement of this deal has already positively impacted PepsiCo's stock, indicating a positive short-term outlook.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90