Fast-food restaurant chain KFC will replace PepsiCo beverages with Coca-Cola products across its United States restaurants from January 2027, ending a partnership with Pepsi that dates back nearly four decades.
The transition is expected to be completed across all KFC locations in the US by spring 2027, according to an announcement by The Coca-Cola Company on Thursday.
Coca-Cola’s President of Foodservice and On-Premise for North America, Dagmar Boggs, described the agreement as a historic development for both brands.
“This exciting new partnership brings Coca-Cola and KFC together across the U.S. for the very first time,” Boggs said.
KFC US President Catherine Tan-Gillespie said the partnership would support the restaurant chain’s efforts to improve its operations, menu offerings and customer experience.
“This partnership is about more than what’s in the cup. It is another important step in our work to evolve KFC, strengthen our restaurants and create a more relevant experience for today’s customers,” Tan-Gillespie said.
According to Reuters, the agreement covers approximately 3,718 KFC restaurants in the United States. However, the companies have not disclosed the financial terms or duration of the deal.
PepsiCo acquired KFC in 1986 as part of its expansion into the restaurant business. In 1997, it spun off KFC, Pizza Hut and Taco Bell into a separate company that later became Yum! Brands, KFC’s current parent company.
Despite the separation, PepsiCo continued supplying beverages to KFC’s US restaurants.
The new agreement will end that longstanding arrangement in the American market, although PepsiCo will retain beverage partnerships with Taco Bell and KFC in international markets, Reuters reported.
The supplier change comes as KFC seeks to strengthen its performance in the United States, where sales have recently declined.
Yum! Brands reported in its second-quarter 2026 results, released on July 30, that KFC’s US system sales fell by 2 per cent in the quarter, excluding foreign-exchange effects. Sales were also down 2 per cent year to date.
By contrast, KFC’s worldwide system sales increased by 6 per cent, excluding currency effects, during the second quarter, reflecting stronger performance across several international markets.
Yum! Brands’ other major US chain, Taco Bell, recorded 9 per cent growth in US system sales during the same quarter, according to the figures provided in the company’s earnings report.
The Coca-Cola partnership is expected to support KFC’s efforts to refresh its brand and improve the experience offered to customers, although the companies have not disclosed the anticipated financial impact of the change.
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