Keurig Green Mountain merged with Dr Pepper Snapple Group in 2018, creating a new entity called Keurig Dr Pepper (KDP). The company deployed AI technology to analyze data from at-home brewers and detected early trends that suggested families were stockpiling K-Cups. However, the coffee side of the business has struggled since then.
Despite this, sales of refreshment beverages have thrived, with a 10.7% increase in soft drink revenues in the first half of 2025. The company’s CEO, Tim Cofer, attributes this success to expanding into premium territories like energy and sports hydration. However, KDP is now set to split its coffee franchise after an admission that the two businesses aren’t a great synergistic fit.
The coffee business will be sold to JDE Peet’s, Europe’s dominant coffee seller, for nearly $19 billion. This deal will create a global colossus featuring sales balanced between Europe and North America, hosting annual revenues of nearly $16 billion. The remaining business will focus exclusively on soft drinks, with over 150 brands under its portfolio.
Analysts believe that this strategic shift makes sense for KDP, as the coffee and soft drink businesses are different enough to warrant separate operations. By concentrating on refreshment beverages, KDP can achieve higher growth rates and gain share in fast food and other eateries.
The deal’s architect, CEO Tim Cofer, has a track record of successful marketing and dealmaking skills, which will be crucial in proving the market wrong about the promise of going all-in on one of America’s best panoplies of brands.
Source: https://fortune.com/2025/08/26/keurig-peets-dr-pepper-coffee-stock-outlook