Keurig Dr Pepper (KDP) 10-K risk factor changes: FY2023 vs FY2022

[removed: The] [added: In our coffee business, the] quality of the coffee we seek tends to trade on a negotiated basis at a premium above the “C” price of coffee.

[removed: We] [added: Volatility in coffee prices can impact our ability to enter into fixed-price purchase commitments, and we] frequently enter into [added: “price-to-be-fixed”] supply contracts [removed: whereby] [added: in which] the quality, quantity, delivery [removed: period] [added: period,] and other negotiated terms are agreed upon, but the date, and therefore price, at which the base [removed: “C”] coffee commodity price component will be fixed has not yet been established.

In [removed: addition, in] order to ensure a continuous supply of high-quality raw materials, some of our inventory purchase obligations include long-term purchase commitments for certain strategic raw [removed: materials.][added: materials; the timing of these may not always coincide with the period in which we need the supplies to fulfill customer demand.]

This could lead to higher and more variable inventory levels [removed: and/or] [added: or] higher raw material costs for us.

[removed: The failure of our suppliers to meet our needs] [added: Disruptions] could occur for many reasons, including [removed: fires,] [added: fire,] natural disasters, weather, [added: water scarcity,] manufacturing problems, disease, widespread [removed: illness (such as the COVID-19 pandemic), crop failure,] [added: illness,] strikes, [added: labor shortages,] transportation [removed: disruption,] [added: or supply interruption, contractual dispute,] government regulation, [removed: political instability,] cybersecurity attacks [removed: and] [added: or] terrorism.

[removed: [Table](#i34cbdfb200994b3282a1df38c3186a8f_7) [of Contents](#i34cbdfb200994b3282a1df38c3186a8f_7)][added: [Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)]

The [added: beverage] industry [removed: in which we operate] is highly competitive and continues to evolve in response to changing consumer preferences.

[removed: These competitors] [added: We compete with multinational corporations that] can [removed: use their resources and scale to] rapidly respond to competitive pressures and changes in consumer preferences by introducing new products, changing their route to market, reducing [removed: prices] [added: prices,] or increasing promotional activities.

[removed: Smaller] [added: We also compete with various smaller or regional] companies [added: and private label manufacturers, which] may be more innovative, better able to bring new products to [removed: market] [added: market,] and better able to quickly [removed: exploit and] serve niche markets.

[removed: We also] [added: Additionally, we] compete for contract manufacturing with other bottlers and manufacturers.

Our sales [added: of beverages, Keurig brewers, K-Cup pods, and other products] may be negatively affected by numerous factors including our inability to maintain or increase prices, our inability to effectively promote our products, [removed: ineffective advertising and marketing campaigns,] new entrants into the market, the decision of wholesalers, [removed: retailers] [added: retailers,] or consumers to purchase competitors' products instead of ours, increased marketing [removed: costs] [added: costs,] and higher in-store placement and slotting fees driven by our competitors' willingness to spend aggressively.

A significant [removed: percentage] [added: portion] of [removed: the Coffee Systems segment's financial performance] [added: our business] is attributable to sales of K-Cup pods for use with Keurig brewing systems.

Any substantial or sustained decline in the sale of Keurig [removed: brewers, failure to continue to reduce the cost of Keurig brewers, or substantial or sustained decline in the sales of K-Cup pods] [added: brewers] could materially and adversely affect our business.

Keurig brewers compete against all sellers and types of [removed: coffeemakers.][added: coffeemakers, as well as cafes and coffee shops.]

The success of our business depends in part on our ability to maintain consumer confidence in the safety and quality of all of our products, including beverage products, their [removed: ingredients and] [added: ingredients, their] packaging, and our brewers.

A failure or perceived failure to meet our [removed: quality] [added: quality, health,] or safety standards, [added: particularly as we expand our product offerings through innovation, partnerships or acquisitions into new beverage categories,] including product contamination or tampering, [added: undeclared allergens] or allegations of mislabeling, whether actual or perceived, could occur in our operations or those of our bottlers, manufacturers, distributors or suppliers.

This could result in [removed: time consuming] [added: time-consuming] and expensive production interruptions, recalls, market withdrawals, product liability claims, and negative publicity.

Moreover, negative publicity may result from false, [removed: unfounded] [added: unfounded,] or nominal liability claims or limited recalls.

In addition, adverse public opinion, third-party [removed: studies] [added: studies,] or other allegations, whether or not valid, regarding the perceived or potential negative health effects of ingredients in our beverage products, [added: such as concerns about the caloric intake associated with soft drinks] or [added: the use of artificial sweeteners in our beverages, or chemicals of concern or other] substances in our [removed: packaging materials] [added: ingredients or materials,] may [removed: lead] [added: contribute] to [removed: additional government regulation, new or increased taxes on our products,] actual or threatened legal action against us, [removed: and a] negative consumer perception of our products, [added: additional government regulation, or new or increased taxes on our products,] any of which could result in decreased demand for our products or reformulations of existing products to remove such ingredients or substances, which may be costly and reduce their appeal.

Any or all of these events may lead to a loss of consumer confidence and trust, could damage the [removed: goodwill associated with] [added: reputation of] our brands and may cause consumers to choose other products and could negatively affect our business and financial performance.

Consumers’ preferences continually evolve due to a variety of factors, including changing demographics of the population, social trends, changes in consumer lifestyles and consumption patterns, concerns or perceptions regarding the health effects [added: or environmental impact] of [removed: products,] [added: our products or packaging,] concerns regarding the location of origin or source of ingredients and products, changes in consumers' spending habits, negative publicity, economic [removed: downturn] [added: downturn,] or other factors.

If we do not effectively anticipate and respond to [removed: these] changing trends and consumer beverage preferences, [added: including through innovation and renovation,] our sales and growth could suffer.

Consumers are [removed: also] increasingly focused on sustainability, with particular attention to the recyclability [added: or reuse] of product packaging, reducing consumption of single-use plastics and non-recyclable [removed: materials,] [added: materials] and the environmental impact of manufacturing operations.

If we do not meet consumer demands by continuing to provide [removed: recyclable] [added: sustainable] packaging options and focusing on sustainability throughout our manufacturing operations, our sales could suffer.

If we are unable to meet the consumer where and when they desire their products or if we are unable to respond to changes in distribution [removed: channels (including e-commerce),] [added: channels,] our financial results could be adversely impacted.

[removed: Achieving growth depends on our] [added: Addressing changes in consumer preferences may require] successful development, [removed: introduction] [added: introduction,] and marketing of [removed: innovative] new products and line extensions.

There are inherent risks associated with new product or packaging [removed: introductions,] [added: innovation,] including uncertainties about trade and consumer acceptance or potential impacts on our existing product offerings.

Successful innovation [removed: depends] [added: may depend] on our ability to [removed: correctly anticipate customer and consumer acceptance, to] obtain, protect, and maintain necessary intellectual property [removed: rights,] [added: rights] and to avoid infringing upon the intellectual property rights of others.

[removed: We must also be able] [added: Failure] to [removed: respond] [added: innovate] successfully [removed: to technological advances by and intellectual property rights of our competitors, and failure to do so] could compromise our competitive position and impact our product sales, financial condition, and operating results.

If we do not successfully manage our [added: acquisitions of and] investments in new [removed: business strategies or integrate and manage our acquired] businesses or brands, our operating results may adversely be affected.

From time to time, we acquire [removed: businesses] or [removed: brands,] invest in [removed: emerging companies and/or] [added: businesses or brands,] form joint ventures, and enter into [removed: various] licensing and distribution [removed: agreements to expand our product portfolio.][added: agreements.]

Furthermore, we may incur unforeseen liabilities and obligations in connection with any such [removed: transaction,] [added: transactions,] including in connection with the integration or management of the [removed: acquired] businesses or [removed: brands] [added: brands,] and may encounter unexpected difficulties and costs in integrating them into our [removed: operating] [added: operating, governance] and internal control structures.

We may also experience delays in extending our respective internal control over financial reporting to [removed: newly acquired businesses,] [added: new acquisitions or investments,] which may increase the risk of [removed: failure to prevent] misstatements in our financial records and in our consolidated financial statements.

These strategic initiatives [removed: may include] [added: have included] investments in new technologies and optimization [added: of certain processes] and [removed: relocation] of our manufacturing [removed: and distribution] footprint.

Our [removed: financial performance will depend in large part on how well we can] [added: ability to] manage and improve the performance of acquired businesses or brands and [removed: the success of] our other investments and [removed: ventures.][added: ventures will impact our financial performance.]

Our facilities and operations [removed: will] [added: may] require substantial investment and upgrading, [added: including investments in new technologies] and [removed: those] [added: digital transformation, and such] investments may not achieve the intended financial [removed: benefits of such investment.][added: benefits.]

We continue to incur significant costs to [removed: upgrade] [added: maintain] or [removed: keep up-to-date] [added: upgrade] various [removed: facilities] [added: technologies, facilities,] and equipment or restructure our operations, including closing existing facilities or opening new ones.

[removed: Additionally, we] [added: These investments require us to] rely on third parties for the construction and renovation of our facilities and manufacturing of our production equipment.

We have ongoing programs to invest and upgrade our manufacturing, distribution and other facilities, including expansive investments in manufacturing facilities in Spartanburg, South [removed: Carolina; Newbridge, Ireland;] [added: Carolina] and Allentown, Pennsylvania.

If [added: the cost of] our [removed: investment and restructuring costs are] [added: investments is] higher than anticipated, the investments and upgrades are not sufficient to meet our near-term future business needs, our business does not develop as anticipated to appropriately utilize new or upgraded facilities, or third parties fail to complete the construction or renovation of facilities or production equipment in a timely manner or in accordance with our specifications, [added: we may be delayed in realizing the intended benefits or] our costs and financial performance could be negatively affected.

Disruption of our manufacturing and distribution operations or supply chain, including increased commodity, raw material, packaging, energy, transportation, and other input costs may adversely affect our financial condition or results of operations.

We have experienced, and could continue to experience, disruptions in our supply chain and our manufacturing and distribution operations, which could have a material adverse effect on our business.

Some raw materials and supplies used in the production of our products, including packaging materials, are available from a limited number of suppliers or from a sole supplier or are in short supply when seasonal demand is at its peak.

Certain raw materials and supplies used directly or indirectly in the production of our products are sourced from countries experiencing civil unrest, political instability, or unfavorable economic conditions.

Adverse weather conditions may affect the supply of agricultural commodities from which key ingredients for our products are derived.

We may not be able to maintain favorable arrangements and relationships with suppliers, and our contingency plans may not be effective to mitigate disruptions that may arise from shortages or discontinuation of any raw materials and other supplies that we use in the manufacture and distribution of our products.

Any sustained or significant disruption to the manufacturing or sourcing of raw materials could increase our costs and interrupt product supply, which could adversely impact our business.

The raw materials and other supplies, including agricultural commodities (such as coffee, apples, and corn), fuel and packaging materials, transportation, and other supply chain inputs that we use for the manufacturing, production, and distribution of our products are subject to price volatility and fluctuations in availability caused by many factors, which include changes in supply and demand; supplier capacity constraints; inflation; weather conditions (including the effects of climate change); wildfires and other natural disasters; disease or pests; agricultural uncertainty; cost increases in farm inputs; health epidemics, pandemics, or other contagious outbreaks; labor shortages, strikes, or work stoppages; changes in or the enactment of new laws and regulations; governmental actions or controls (including import/export restrictions, such as new or increased tariffs, sanctions, quotas, or trade barriers); port congestion or delays; transport capacity constraints; cybersecurity incidents or other disruptions; political uncertainties; acts of terrorism; governmental instability; speculation in global trading of commodities, such as coffee; or fluctuations in foreign currency exchange rates.

We have been affected by a number of these factors, led by inflationary pressures on input and other costs, which may continue.

Many of our raw materials and supplies are purchased in the open market, and the prices we pay for such items are subject to fluctuation.

When input prices increase unexpectedly or significantly, we may be unwilling or unable to increase our product prices or unable to effectively hedge against price increases to offset these increased costs without suffering reduced volume, revenue, margins, and operating results.

To the extent that price increases are not sufficient to offset higher costs adequately or in a timely manner, or if they result in significant decreases in sales volume, our financial condition or results of operations may be adversely affected.

We operate in intensely competitive categories, and our potential inability to compete effectively could adversely impact our business.

Continued acceptance of Keurig brewers to further increase household penetration is a significant factor in our growth plans.

Our competitive position may be weakened if we do not succeed in differentiating Keurig brewers from our competitors’ products.

If we are unable to effectively compete, our business and our financial results would be negatively affected.

Consumer shopping behavior is also rapidly evolving.

Changes in mobility, travel, and leisure activity patterns, the acceleration of e-commerce and other methods of purchasing products, inflation and economic uncertainty, and pandemics, epidemics or other disease outbreaks, among others, have impacted and could continue to impact consumer shopping behavior and demand for our products.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

Damage to our reputation or brand image can adversely affect our business.

Our ability to maintain our reputation and the brand image of our products is important to our success.

Our corporate image and reputation has in the past been, and could in the future be, adversely impacted by a variety of factors, including: any failure by us or our business partners to achieve goals or maintain high standards relating to ethical, business and environmental, social and governance practices, including with respect to human rights, child labor laws, diversity, equity and inclusion, workplace conditions, employee health and safety, the nutrition profile of our products, packaging, water use and impact on the environment; any failure to address health or other concerns about our products, products we distribute or particular ingredients in our products, including concerns regarding whether certain of our products contribute to obesity or an increase in public health costs; our research and development efforts; any product quality or safety issues, including the recall of any of our products; any failure to comply with laws and regulations; consumer perception of our advertising campaigns, sponsorship arrangements, marketing programs, use of social media and our response to political and social issues or catastrophic events; or any failure to effectively respond to negative or inaccurate comments about us on social media or otherwise regarding any of the foregoing.

Damage to our reputation or brand image could decrease demand for our products, thereby adversely affecting our business.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

In the past we have been, and in the future we may be, unable to realize the expected benefits of acquisitions, investments or licensing or distribution agreements; it may also take longer than expected to realize the expected benefits.

In addition, our quality management protocols, which are designed to ensure product quality and safety, may not be sufficiently robust to fully manage the expanded range of product offerings introduced through new investments, licensing or distribution agreements, which may increase our costs or subject us to negative publicity.

Failure to realize benefits or successfully manage the potential negative consequences of our productivity initiatives can adversely affect our financial performance.

We pursue strategic initiatives that are transformative in nature and are expected to generate significant cost savings, or productivity, over time.

Some of our productivity initiatives may result in unintended consequences, such as business disruptions, distraction of management and employees, reduced morale and productivity, inability to obtain expected savings to reinvest into the business, an inability to attract or retain employees, negative publicity and disruption of the internal control structures of the affected business operations.

If we are unable to successfully implement our productivity initiatives as planned or do not achieve expected savings as a result of these initiatives, we may not realize all or any of the anticipated benefits, resulting in adverse effects on our financial performance.

We invest in new and emerging technologies, including the use of automation, connected data, robotics, and artificial intelligence throughout our operations, including in our manufacturing and distribution facilities and our sales organization.

We have experienced delays related to the production equipment contained within our manufacturing facilities, including delays in receiving the equipment or in operating the equipment according to specifications outlined by the manufacturer, which have led to increased costs, and we may continue to experience such delays and cost increases.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

We depend on key information systems, and our use of information technology exposes us to business disruptions that could adversely affect us.

Our users’ data and customer information may be improperly accessed, used or disclosed if we fail to adopt or adhere to adequate information security practices, or fail to comply with their respective online policies, or in the event of a breach of our networks, which could subject us to legal action, reputational harm, or otherwise negatively impact our business and financial performance.

If we fail to adequately protect our intellectual property rights, or if changes in laws diminish or remove the current legal protections available to them, the competitiveness of our products may be eroded and our business could suffer.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

The labor market has experienced and may continue to experience labor shortages, inflation in labor costs and increased employee turnover, which has impacted and may continue to impact our ability to attract and retain a highly skilled and diverse workforce.

Competition in the labor market for qualified employees has increased alongside current and prospective employees’ changing expectations for compensation, benefits, and flexible work models.

Unplanned turnover or failure to develop and implement succession plans for senior management and other key personnel, including our CEO, could deplete our institutional knowledge base and erode our competitiveness.

Costs and supply for inputs to our products, including raw materials and transportation, may change substantially and shortages have occurred and may continue to occur.

We have been, and may continue to be, affected by supply chain constraints and labor shortages driven by overall macroeconomic and geopolitical uncertainty, largely caused by the COVID-19 pandemic and the Russian invasion of Ukraine.

The resulting impacts on the global economy have led to supply chain disruptions and significant inflation in input costs, logistics, manufacturing and labor costs, which have impacted our results of operations in the current year and may continue to do so in the future.

Our raw materials are sourced from industries characterized by a limited supply base, and their cost can fluctuate substantially.

Price increases for our raw materials have placed pressure on our costs and could continue to do so, and we may not be able to effectively hedge or pass along any such increases to our customers or consumers.

Furthermore, any price increases passed along to our customers or consumers could significantly reduce demand for our products and could negatively affect our business and financial performance.

Our principal raw materials in our coffee business include coffee beans and K-Cup pod raw materials (including cups, filter paper and other ingredients) used in the manufacturing of our K-Cup pods.

We purchase, roast and sell high-quality whole bean coffee and related coffee products.

Increases in the “C” coffee commodity price increase the price of high-quality coffee and also impact our ability to enter into fixed-price purchase commitments.

These are known as price-to-be-fixed contracts.

The supply and price of crops we purchase, such as coffee, apples, and corn, can also be affected by multiple factors in the producing countries, including weather, natural disasters, crop disease (such as coffee rust), general cost increases in farm inputs and costs of production, inventory levels and political and economic conditions, as well as the actions of certain organizations and associations that have historically attempted to influence prices of various commodities through agreements establishing export quotas or by restricting supplies.

Ongoing speculation in global trading of commodities, such as coffee, has and may continue to influence prices.

If we are unable to purchase sufficient quantities of our commodities due to any of the factors described herein or a worldwide or regional shortage, we may not be able to fulfill the demand for our products, which could have an adverse impact on our business and financial results.

We also have a limited number of suppliers for certain strategic raw materials critical to our operations.

We may have limited leverage to negotiate with these suppliers, which could negatively affect our operations and the financial performance of our business.

The timing of these may not always coincide with the period in which we need the supplies to fulfill customer demand.

If our suppliers are unable or unwilling to meet our requirements, we could suffer shortages or substantial cost increases.

Changing suppliers can require long lead times.

A failure of supply could also occur due to suppliers’ financial difficulties, including bankruptcy.

Some of these risks may be more acute where the supplier or its plant is located in riskier or less-developed countries or regions.

Any significant interruption to supply or cost increase could substantially harm our business and financial performance.

Some of our raw materials and finished products are sourced or manufactured overseas and shipped to the U.S. and Canada.

Changes in the global ocean transport market, including shortages of shipping containers and availability of U.S. and Canadian ports, have resulted in and may continue to result in increased costs of transportation for our raw materials and finished products, which may impact our results of operations.

In addition, we use a significant amount of energy in our business, and therefore may be significantly impacted by changes in fuel costs due to the large truck fleet we operate in our distribution business and our use of third-party carriers.

An increase in the price, disruption of supply, or shortage in fuel and other energy sources could also increase our suppliers’ operating costs and indirectly impact our results of operations.

We operate in intensely competitive categories.

Some of our competitors, such as Coca-Cola, PepsiCo, The Kraft Heinz Company and Nestlé S.A., are multinational corporations with significant financial resources.

We also compete with a number of smaller brands and a variety of smaller, regional and private label manufacturers.

In Canada, Mexico and the Caribbean, we compete with many of these same international companies as well as a number of regional competitors.

Competitive pressures may also cause us to reduce prices we charge customers or may restrict our ability to increase such prices.

We compete for sales of K-Cup pods against local and regional brands, as well as against private label brands developed by retailers.

Our ability to gain or maintain share of sales in the countries in which we operate or in various local marketplaces or maintain or enhance our relationships with our partners and customers may be limited as a result of actions by competitors, including as a result of increased consolidation in the food and beverage industry and a significant increase in the number of competitive pod contract manufacturers.

Continued acceptance of Keurig brewers and sales of K-Cup pods to an increasing installed customer base are significant factors in our Coffee Systems' growth plans.

If we do not succeed in continuing to reduce the costs of manufacturing Keurig brewers or differentiating Keurig brewers from our competitors in the coffeemaker category, based on technology, quality of products, desired brands or otherwise, or our competitors adopt their respective strategies, our competitive position may be weakened.

We have various quality, environmental, health and safety supply chain standards.

For example, consumers are increasingly concerned about health and wellness, focusing on the caloric intake associated with regular CSDs, the use of artificial sweeteners in diet CSDs, and the use of natural, organic or simple ingredients in beverages.

The demand for CSDs has therefore decreased as consumers have shifted towards NCBs, such as water, RTD coffee and teas, and sports drinks.

In addition, consumer shopping behavior is rapidly evolving due to both changes in travel, vacation and leisure activity patterns and the acceleration of e-commerce and other methods of purchasing products.

We have been, and may continue to be, adversely impacted by significant reductions in demand or significant volatility in demand for one or more of our products, as a result of, among other things: the temporary inability of consumers to purchase our products due to illness, quarantine or other restrictions, store closures, or financial hardship, shifts in demand away from one or more of our higher priced products to lower priced products, or stockpiling or similar activity, reduced options for marketing and promotion of products or other restrictions in connection with widespread illness such as the COVID-19 pandemic; such impacts could further increase the difficulty of operating our business during the pandemic, including accurately planning and forecasting customer demand.

If we do not innovate rapidly and successfully to respond to shifting consumer demands, our business may suffer.

*This section of this Annual Report on Form 10-K generally discusses the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] and year-over-year comparisons between the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021.][added: 2022.]

[removed: With] [added: KDP has] a [removed: wide range] [added: broad portfolio] of [removed: hot and cold beverages that meet virtually any consumer need, KDP key brands include Keurig,] [added: iconic beverage brands, including] Dr Pepper, Canada Dry, [removed: Snapple, Mott's, Clamato, Core,] Green Mountain Coffee [removed: Roasters and] [added: Roasters, Snapple, Mott's,] The Original Donut [removed: Shop.][added: Shop, Clamato, and Core Hydration, as well as the Keurig brewing system.]

KDP operates as an integrated brand owner, [removed: manufacturer] [added: manufacturer,] and distributor.

[removed: KDP markets] [added: We market] and [removed: sells its] [added: sell our] products to retailers, including supermarkets, mass merchandisers, club stores, pure-play e-commerce retailers, and office superstores; to restaurants, hotel chains, office product and coffee distributors, and partner brand owners; and directly to consumers through [removed: its] [added: our] website.

[removed: As of] [added: For the year ended] December 31, [removed: 2022,] [added: 2023,] our reportable segments were as follows:

[removed: - The Coffee Systems segment reflects sales] [added: ◦Sales] in [removed: the U.S. and] Canada [removed: of] [added: from] the manufacture and distribution of finished goods relating to our [removed: single-serve] [added: single serve] brewers, K-Cup [removed: pods] [added: pods,] and other coffee products.

- The [removed: Packaged] [added: U.S. Refreshment] Beverages segment reflects sales in the U.S. [removed: and Canada] from the manufacture and distribution of [removed: finished beverages] [added: branded concentrates, syrup,] and [removed: other products,] [added: finished beverages,] including [added: the] sales of our own brands and third-party brands, [removed: through both the DSD] [added: to third-party bottlers, distributors,] and [removed: WD systems.][added: retailers.]

[removed: In] [added: For] our [removed: Coffee Systems segments,] [added: K-Cup pods and appliances,] we measure our sales volume as the number of appliances and the number of individual K-Cup pods sold to our customers.

[removed: In our Packaged Beverages and Latin America Beverages segments,] [added: - For packaged beverages,] we measure volume as case sales to customers.

[removed: In our Beverage Concentrates segment,] [added: - For beverage concentrates,] we measure our sales volume as concentrate case sales for concentrates sold by us to our bottlers and distributors.

[removed: ][added: ]

[removed:  ][added: ]

Some of these [removed: items, such as the ongoing COVID-19 pandemic and the invasion of Ukraine by Russia, and the resulting impacts on the global economy, including supply chain constraints and labor shortages,] [added: items] have led to inflation in input costs, logistics, [removed: manufacturing] [added: manufacturing,] and labor costs, which has further led to fluctuation in interest rates.

These impacts have created headwinds for our [removed: industry] [added: business] that [removed: we expect to] [added: may] continue into [removed: 2023.][added: 2024.]

| [removed: For the year ended December 31, 2022] | | | [removed: | | | | | | | | | | | | | | | | | |] [added: For the Year Ended December 31,] | | | | | | | | |

| [removed: For the year ended December 31, 2021] | | | [removed: | | | | | | | | | | | | | | | | | |] [added: For the Year Ended December 31,] | | | | | | | | |

| Net sales | | | [removed: $] [added: $] | [removed: 14,057] [added: 14,057] | | | | | $ | 12,683 | | | | | $ | 1,374 | | | | | 10.8 | | % |

| Cost of sales | | | [removed: 6,734] [added: 6,734] | | | | | | 5,706 | | | | | | 1,028 | | | | | | 18.0 | | |

| Gross profit | | | [removed: 7,323] [added: 7,323] | | | | | | 6,977 | | | | | | 346 | | | | | | 5.0 | | |

| Selling, general and administrative expenses | | | [removed: 4,645] [added: 4,645] | | | | | | 4,153 | | | | | | 492 | | | | | | 11.8 | | |

| Impairment of intangible assets | | | [removed: 477] [added: 477] | | | | | | — | | | | | | 477 | | | | | | NM | | |

| Gain on litigation settlement | | | [removed: (299)] [added: —] | | | | | | [removed: —] [added: (299)] | | | | | | [removed: (299)] [added: 299] | | | | | | NM | | |

| Other operating income, net | | | [removed: (105)] [added: (26)] | | | | | | [removed: (70)] [added: (105)] | | | | | | [removed: (35)] [added: 79] | | | | | | NM | | |

| Income from operations | | | [removed: 2,605] [added: 2,605] | | | | | | 2,894 | | | | | | (289) | | | | | | (10.0) | | |

| Interest [removed: expense] [added: expense, net] | | | [removed: 693] [added: 693] | | | | | | 500 | | | | | | 193 | | | | | | 38.6 | | |

| Loss on early extinguishment of debt | | | [removed: 217] [added: 217] | | | | | | 105 | | | | | | 112 | | | | | | NM | | |

| Gain on sale of equity method investment | | | [removed: (50)] [added: (50)] | | | | | | (524) | | | | | | 474 | | | | | | NM | | |

| Impairment of investments and note receivable | | | [removed: 12] [added: —] | | | | | | [removed: 17] [added: 12] | | | | | | [removed: (5)] [added: (12)] | | | | | | NM | | |

| Other [removed: expense (income),] [added: (income) expense,] net | | | [removed: 14] [added: (61)] | | | | | | [removed: (2)] [added: 14] | | | | | | [removed: 16] [added: (75)] | | | | | | NM | | |

| Income before provision for income taxes | | | [removed: 1,719] [added: 1,719] | | | | | | 2,798 | | | | | | (1,079) | | | | | | (38.6) | | |

| Provision for income taxes | | | [removed: 284] [added: 284] | | | | | | 653 | | | | | | (369) | | | | | | (56.5) | | |

| Net income including non-controlling interest | | | [removed: 1,435] [added: 1,435] | | | | | | 2,145 | | | | | | (710) | | | | | | (33.1) | | |

| Less: Net loss attributable to non-controlling interest | | | [removed: (1)] [added: —] | | | | | | (1) | | | | | | [removed: —] [added: 1] | | | | | | NM | | |

| Net income attributable to KDP | | | [removed: $] [added: $] | [removed: 1,436] [added: 1,436] | | | | | $ | 2,146 | | | | | $ | (710) | | | | | (33.1) | | % |

| Basic | | | [removed: $] [added: $] | [removed: 1.01] [added: 1.01] | | | | | $ | 1.52 | | | | | $ | (0.51) | | | | | (33.6) | | % |

| Diluted | | | [removed: 1.01] [added: 1.01] | | | | | | 1.50 | | | | | | (0.49) | | | | | | (32.7) | | % |

| Gross margin | | | [removed: 52.1] [added: 52.1] | | [removed: %] [added: %] | | | | 55.0 | | % | | | | | | | | | | (290) bps | | |

| Operating margin | | | [removed: 18.5] [added: 18.5] | | [removed: %] [added: %] | | | | 22.8 | | % | | | | | | | | | | (430) bps | | |

| Effective tax rate | | | [removed: 16.5] [added: 16.5] | | [removed: %] [added: %] | | | | 23.3 | | % | | | | | | | | | | (680) bps | | |

| K-Cup [removed: pod volume] [added: pods] | | | | | | 1.4 | | % |

As a result of the change in our operating and reportable segments effective January 1, 2023, this section also presents year-over-year comparisons between the years ended December 31, 2022 and 2021 on a revised segment basis.*

KDP is a leading beverage company in North America that manufactures, markets, distributes and sells hot and cold beverages and single serve brewing systems.

We offer more than 125 owned, licensed, and partner brands, available nearly everywhere people shop and consume beverages through our sales and distribution network.

Effective January 1, 2023, we revised our segment structure to align with how our CODM manages the business, assesses performance and allocates resources.

Our operating and reportable segments consist of the following:

- The U.S. Coffee segment reflects sales in the U.S. from the manufacture and distribution of finished goods relating to our K-Cup pods, single serve brewers, and other coffee products to partners, retailers, and directly to consumers through our Keurig.com website.

- The International segment reflects sales in international markets, including the following:

◦Sales in Canada, Mexico, the Caribbean, and other international markets from the manufacture and distribution of branded concentrates, syrup, and finished beverages, including sales of our own brands and third-party brands, to third-party bottlers, distributors, and retailers.

In evaluating our performance, we use different volume measures for LRB and for K-Cup pods and appliances.

For LRB, we measure our sales volume in 288 fluid ounce equivalent cases.

Key Events During and Subsequent to the Fourth Quarter of 2023

Strategic Partnership with Grupo PiSA

Effective October 23, 2023, we executed an agreement for a strategic partnership with Grupo PiSA to sell and distribute Electrolit instant hydration beverages within the U.S., which is expected to begin in early 2024.

Appointment of Chief Operating Officer

On November 6, 2023, we appointed Tim Cofer as Chief Operating Officer, reporting to Chairman and CEO, Bob Gamgort.

Mr. Cofer will work side by side with Mr. Gamgort in the Chief Operating Officer capacity, with an expected transition to CEO in the second quarter of 2024.

Mr. Gamgort will continue to serve as our Executive Chairman after the transition occurs.

The following table sets forth our consolidated results of operations for the years ended December 31, 2023 and 2022:

| (in millions, except per share amounts) | | | 2023 | | | | | | 2022 | | | | | | Change | | | | | | Change | | |

| Net sales | | | $ | 14,814 | | | | | $ | 14,057 | | | | | $ | 757 | | | | | 5.4 | | % |

| Cost of sales | | | 6,734 | | | | | | 6,734 | | | | | | — | | | | | | — | | |

| Gross profit | | | 8,080 | | | | | | 7,323 | | | | | | 757 | | | | | | 10.3 | | |

| Selling, general, and administrative expenses | | | 4,912 | | | | | | 4,645 | | | | | | 267 | | | | | | 5.7 | | |

| Interest expense, net | | | 496 | | | | | | 693 | | | | | | (197) | | | | | | (28.4) | | |

| Income before provision for income taxes | | | 2,757 | | | | | | 1,719 | | | | | | 1,038 | | | | | | 60.4 | | |

| Provision for income taxes | | | 576 | | | | | | 284 | | | | | | 292 | | | | | | 102.8 | | |

| Net income including non-controlling interest | | | 2,181 | | | | | | 1,435 | | | | | | 746 | | | | | | 52.0 | | |

| Net income attributable to KDP | | | $ | 2,181 | | | | | $ | 1,436 | | | | | $ | 745 | | | | | 51.9 | | % |

| Basic | | | $ | 1.56 | | | | | $ | 1.01 | | | | | $ | 0.55 | | | | | 54.5 | | % |

| Diluted | | | 1.55 | | | | | | 1.01 | | | | | | 0.54 | | | | | | 53.5 | | % |

| Gross margin | | | 54.5 | | % | | | | 52.1 | | % | | | | | | | | | | 240 bps | | |

| Operating margin | | | 21.5 | | % | | | | 18.5 | | % | | | | | | | | | | 300 bps | | |

| Effective tax rate | | | 20.9 | | % | | | | 16.5 | | % | | | | | | | | | | 440 bps | | |

Sales Volume. The following table sets forth changes in sales volume for the year ended December 31, 2023 compared to the prior year:

| LRB | | | | | | (0.1) | | % |

| K-Cup pods | | | | | | (3.9) | | % |

| Appliances | | | | | | (9.4) | | % |

Net Sales. Net sales increased $757 million, or 5.4%, to $14,814 million for the year ended December 31, 2023 compared to $14,057 million in the prior year.

This performance reflected favorable net price realization of 7.0% and favorable FX translation of 0.5%, partially offset by unfavorable volume/mix of 2.1%.

Gross Profit. Gross profit increased $757 million, or 10.3%, to $8,080 million for the year ended December 31, 2023 compared to $7,323 million in the prior year.

Discussions of the periods prior to the year ended December 31, 2021 that are not included in this Annual Report on Form 10-K are found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021 and the discussion therein for the year ended December 31, 2021 compared to the year ended December 31, 2020 is incorporated by reference into this Annual Report.*

KDP is a leading beverage company in North America, with a diverse portfolio of flavored CSDs, NCBs, including water (enhanced and flavored), RTD tea and coffee, juice, juice drinks, mixers and specialty coffee, and is a leading producer of innovative single serve brewers.

KDP offers more than 125 owned, licensed and partner brands, including the top ten best-selling coffee brands and Dr Pepper as a leading flavored CSD in the U.S. according to IRi, available nearly everywhere people shop and consume beverages.

- The Beverage Concentrates segment reflects sales primarily in the U.S. and Canada of our branded concentrates to third-party bottlers and our syrup to fountain foodservice customers.

Most of the brands in this segment are carbonated soft drink brands.

- The Latin America Beverages segment reflects sales primarily in Mexico and the Caribbean from the manufacture and distribution of concentrates, syrup and finished beverages.

In evaluating our performance, we consider different volume measures depending on whether we sell beverage concentrates, finished beverages, pods or brewers.

Coffee Systems K-Cup Pod and Appliance Sales Volume

Packaged Beverages and Latin America Beverages Sales Volume

Beverage Concentrates Sales Volume

USE OF NON-GAAP FINANCIAL MEASURES

Non-GAAP financial measures are provided in addition to U.S. GAAP measures, including adjusted income from operations, adjusted net income and adjusted diluted earnings per share.

See *Non-GAAP Financial Measures* for more information, including reconciliations to the corresponding U.S. GAAP measures.

As Adjusted, in millions (except Diluted EPS)

On October 6, 2022, we announced a strategic partnership with Red Bull, the iconic global energy brand, to sell and distribute Red Bull Energy Drink products in Mexico, which began in the fourth quarter of 2022.

On November 9, 2022, we invested $51 million, inclusive of incremental third-party costs, in exchange for equity interests in Athletic Brewing, a leading non-alcoholic craft beer maker in the U.S.

On December 8, 2022, we announced a strategic partnership with Nutrabolt, a global active health and wellness company, to sell and distribute C4 Energy RTD beverages in the vast majority of our company-owned DSD territories.

We invested $871 million, inclusive of incremental third-party costs, in exchange for an approximately 30% ownership interest in the company and expect to begin distributing C4 Energy RTD beverages in early 2023.

As a result of our quarterly triggering events assessment and our annual impairment assessment, we recorded non-cash impairment charges of $472 million on indefinite-lived brands during the year ended December 31, 2022, led by Bai and Schweppes.

During the year ended December 31, 2022, we have experienced supply chain disruptions and a significant inflationary impact compared to the prior year.

Impact of COVID-19 on our Financial Statements

The following table sets forth our reconciliation of significant COVID-19-related expenses.

Employee compensation expense and employee protection costs, which impact our SG&A expenses and cost of sales, are included as the COVID-19 item affecting comparability and are excluded in our Adjusted financial measures.

In addition, reported amounts under U.S. GAAP also include additional costs, not included as the COVID-19 item affecting comparability, as presented in tables below.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Items Affecting Comparability(1) | | | | | | | | | | | | | | | | | | | | | | | | | | |

| (in millions) | | | Employee Compensation Expense(2) | | | | | | Employee Protection Costs(3) | | | | | | Allowances for Expected Credit Losses(4) | | | | | | | | | | | | Total | | |

| Coffee Systems | | | $ | 1 | | | | | $ | 5 | | | | | $ | — | | | | | | | | | | | $ | 6 | |

| Packaged Beverages | | | 4 | | | | | | 3 | | | | | | — | | | | | | | | | | | | 7 | | |

| Beverage Concentrates | | | — | | | | | | — | | | | | | — | | | | | | | | | | | | — | | |

| Latin America Beverages | | | — | | | | | | 1 | | | | | | — | | | | | | | | | | | | 1 | | |

| Total | | | $ | 5 | | | | | $ | 9 | | | | | $ | — | | | | | | | | | | | $ | 14 | |

| Coffee Systems | | | $ | 4 | | | | | $ | 16 | | | | | $ | (2) | | | | | | | | | | | $ | 18 | |

| Packaged Beverages | | | 8 | | | | | | 7 | | | | | | (8) | | | | | | | | | | | | 7 | | |

| Beverage Concentrates | | | — | | | | | | — | | | | | | (3) | | | | | | | | | | | | (3) | | |

| Latin America Beverages | | | — | | | | | | 2 | | | | | | — | | | | | | | | | | | | 2 | | |

| Total | | | $ | 12 | | | | | $ | 25 | | | | | $ | (13) | | | | | | | | | | | $ | 24 | |

(1)Employee compensation expense and employee protection costs are both included as the COVID-19 items affecting comparability in the reconciliation of our Adjusted Non-GAAP financial measures.

(2)Amounts primarily included incremental benefits provided to frontline workers such as extended sick leave, in order to maintain essential operations during the COVID-19 pandemic.

We are exposed to market risks arising from changes in market rates and prices, including movements in foreign currency exchange rates, interest [removed: rates] [added: rates,] and commodity prices.

We do not enter into derivative instruments for [removed: speculation, investing or trading.][added: speculative purposes.]

The majority of our net sales, [removed: expenses] [added: expenses,] and capital purchases are transacted in U.S. dollars.

Our primary exposure to foreign exchange rates is the Canadian dollar, the Mexican [removed: peso] [added: peso,] and the Euro against the U.S. dollar.

As of December 31, [removed: 2022,] [added: 2023,] we had derivative contracts outstanding with notional values of [removed: $1,001] [added: $1,135] million maturing at various dates through [removed: October] [added: December] 2024.

The fair value of foreign currency derivatives that qualify for hedge accounting resulted in a net unrealized [removed: gain] [added: loss] of [removed: $19] [added: $13] million as of December 31, [removed: 2022,] [added: 2023,] and the impact of a 10% [removed: change (up or down)] [added: weakening] in [removed: exchange rates] [added: the U.S. dollar] is estimated to [removed: increase or] decrease the fair value by approximately [removed: $50] [added: $49] million.

The fair value of foreign currency derivatives that do not qualify for hedge accounting resulted in a net unrealized [removed: gain] [added: loss] of [removed: $16] [added: $3] million as of December 31, [removed: 2022,] [added: 2023,] and the impact of a 10% [removed: change (up or down)] [added: weakening] in [removed: exchange rates] [added: the U.S. dollar] is estimated to [removed: increase or] decrease the fair value by approximately [removed: $50] [added: $40] million.

As of December 31, [removed: 2022,] [added: 2023,] the carrying value of our fixed-rate debt, excluding lease obligations, was [removed: $11,568 million] [added: $11,095 million,] and our variable-rate debt was [removed: $399] [added: $2,096] million, comprised entirely of commercial paper.

[removed: Our variable-rate] [added: These] derivative instruments are generally based on SOFR and a credit spread.

We estimate that the potential impact to our interest rate expense associated with variable rate [removed: debt and derivative instruments] [added: interest payments] resulting from a hypothetical interest rate change of 1%, based on [removed: variable-rate debt and derivative instrument levels] [added: amounts outstanding] as of December 31, [removed: 2022,] [added: 2023,] would be an increase or decrease of approximately [removed: $23] [added: $33] million.

Our principal commodities risks relate to our purchases of coffee beans, PET, aluminum, diesel fuel, corn (for high fructose corn syrup), apple juice concentrate, [removed: sucrose] [added: sucrose,] and natural gas (for use in processing and packaging).

As of December 31, [removed: 2022,] [added: 2023,] we had derivative contracts outstanding with a notional value of [removed: $754] [added: $500] million maturing at various dates through [removed: April 2024.][added: December 2025.]

The fair market value of these contracts as of December 31, [removed: 2022] [added: 2023] was a net liability of [removed: $45] [added: $52] million.

From time to time, we also enter into interest rate contracts that effectively result in variable-rate interest payments or receipts.

As of December 31, 2023, certain of our outstanding forward starting swaps, with a total notional value of $1,200 million, are expected to begin such payments or receipts in the first quarter of 2024.

As of December 31, 2023, a 10% change (up or down) in commodity prices is estimated to increase or decrease the fair value of these derivative instruments by approximately $45 million.

Any increase or decrease in the value of the commodities derivatives instruments would have an approximately offsetting change in the underlying hedged risk.

Additionally, as of December 31, 2022, the total notional value of receive-fixed, pay-variable interest rate swaps was $1,900 million.

As of December 31, 2022, the impact of a 10% change (up or down) in market prices for these commodities where the risk of movements has not been hedged is estimated to have a $42 million impact to our income from operations for the year ended December 31, 2023.

[removed: With] [added: KDP has] a [removed: wide range] [added: broad portfolio] of [removed: hot and cold beverages that meet virtually any consumer need, KDP key brands include Keurig,] [added: iconic beverage brands, including] Dr Pepper, Canada Dry, [removed: Snapple, Mott's, Clamato, Core,] Green Mountain Coffee [removed: Roasters and] [added: Roasters, Snapple, Mott's,] The Original Donut [removed: Shop.][added: Shop, Clamato, and Core Hydration, as well as the Keurig brewing system.]

[removed: KDP has] [added: We have] some of the most recognized beverage brands in North America, with significant consumer awareness levels and long histories that evoke strong emotional connections with consumers.

KDP was created [added: on July 9, 2018,] through the combination of the business operations of Keurig, a leading producer of innovative single serve brewing systems and specialty coffee in the U.S. and Canada, and DPS, a company built over time through a series of strategic acquisitions that brought together iconic beverage brands in North [removed: America such as Dr Pepper, Snapple, 7UP, Canada Dry, Mott's, A&W and the Peñafiel business in Mexico.][added: America.]

*Strong, balanced portfolio of leading, consumer-preferred brands with proven ability to expand via innovation, renovation and partnerships.* We own a diverse portfolio of well-known [removed: CSD, coffee and NCB] [added: beverage] brands.

Many of our brands enjoy high levels of consumer awareness, [removed: preference] [added: preference,] and loyalty rooted in their rich heritage.

This portfolio provides our [removed: retailers, bottlers and distributors, and other] customers with a wide variety of products to meet consumers' needs and provides us with a platform for growth and profitability.

We drive growth in our business [removed: by a combination of innovating] [added: through investments in innovation, renovation,] and [removed: renovating] [added: marketing to support] our portfolio of owned brands and partnerships with other leading beverage brands.

We have a robust innovation program, which is designed to meet consumers' changing flavor and beverage preferences and to grow [removed: the number of households using] our [removed: single serve brewers.][added: share of beverage occasions.]

*Flexible and scalable route-to-market network, with unique e-commerce expertise.* We have strategically-located distribution capabilities, which [removed: enables] [added: enable] us to better align our operations with our customers and our [added: sales] channels, [added: to] ensure our products are available to meet consumer demand, [added: to] reduce transportation [removed: costs] [added: costs,] and [added: to] have greater control over the timing and coordination of new product launches.

We actively manage transportation of our products using our fleet (owned and leased) of approximately [removed: 6,700] [added: 6,900] vehicles in the U.S. and [removed: 1,600] [added: 2,000] in Mexico, as well as third party logistics providers.

With our Keurig.com website, we have a leading [added: direct-to-consumer] e-commerce platform which provides us insights and expertise in the e-commerce channel.

We have been able to translate those insights and [removed: experience into] [added: experiences to] our cold business as the number of fulfillment options that are better suited economically for beverages has evolved, leading to growth in the e-commerce channel.

*High-performing team driving better, faster decisions, enabled by technology.* We believe that our team and the culture we have [removed: created, through the integration of two companies into one,] [added: created] are [removed: truly our] [added: a] competitive advantage.

*Highly efficient business model, driving significant cash flow and investments.* Our highly efficient business model, both from a cost and a cash perspective, gives us optionality to invest internally and [removed: look outside for acquisitions] [added: pursue investments, partnerships, acquisitions,] or other [removed: options] [added: opportunities] to continue to drive growth and create value.

We are a leading integrated brand owner, manufacturer, and distributor of [removed: non-alcoholic] beverages in the U.S., Canada, Mexico and the Caribbean.

We have a portfolio of brands with the ability to satisfy every consumer need, anytime and anywhere – hot or cold, at home or on-the-go, at [removed: work] [added: work,] or at play.

[removed: [Table](#i34cbdfb200994b3282a1df38c3186a8f_7) [of Contents](#i34cbdfb200994b3282a1df38c3186a8f_7)][added: [Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)]

[removed: In the CSD market, we] [added: We manufacture and] distribute finished beverages [removed: and manufacture] [added: of our own] beverage [removed: concentrates and fountain syrups.][added: brands.]

Our [added: U.S. Coffee segment is primarily a brand owner, manufacturer, and distributor of innovative single serve brewers, specialty coffee (including hot and iced varieties), and RTD coffee in the U.S. Our] Keurig single serve brewers are aimed at changing the way consumers prepare and enjoy coffee and other beverages both at home and away from home in places such as offices, [added: hotels,] restaurants, cafeterias, [removed: convenience stores] and [removed: hotels.][added: convenience stores.]

[removed: Expansion of] [added: We create value by developing and selling our] Keurig [removed: system] [added: single serve brewers and by expanding Keurig brewer] household [removed: adoption] [added: adoption, which] enables sales of specialty coffee and a variety of other specialty beverages in K-Cup pods (including hot and iced teas, hot [removed: cocoa] [added: cocoa,] and other beverages) for use with Keurig brewers.

We also [removed: offer] [added: compete in the broader coffee category through] traditional whole bean and ground coffee in other package types, including bags, fractional [removed: packages] [added: packages,] and [removed: cans.][added: cans, as well as RTD coffee beverages.]

[removed: PRODUCT AND PACKAGE INNOVATION][added: Product Innovation and New Partnerships]

We also continuously innovate and renovate our portfolio of [removed: K-cup pods, CSDs] [added: K-Cup pods] and [removed: NCBs] [added: beverages] to provide an expansive array of flavors.

As of December 31, [removed: 2022,] [added: 2023,] our operating structure consists of [removed: four] [added: three operating and] reportable segments: [removed: Coffee Systems, Packaged] [added: U.S. Refreshment] Beverages, [removed: Beverage Concentrates,] [added: U.S. Coffee,] and [removed: Latin America Beverages.][added: International.]

[removed: Our Coffee Systems segment manufactures over] [added: We manufacture approximately] 80% of the pods in the [removed: single-serve K-Cup pod] [added: single serve] format in the [removed: U.S.,] [added: U.S.] on a dollar share basis.

We manufacture and sell 100% of the K-Cup pods of [removed: the following brands to retailers, away from home channel participants and end-use consumers:] [added: certain brands, including] Green Mountain Coffee Roasters, The Original Donut Shop, [added: and] McCafé, [removed: Van Houtte,] [added: to retailers, away from home channel participants,] and [removed: REVV.][added: end-use consumers.]

Generally, we are able to sell these brands to our away from home channel participants and [removed: end-use consumers.][added: directly to consumers through our website at www.keurig.com.]

We also have agreements for manufacturing, distributing, and selling K-Cup pods for tea under brands such as Celestial [removed: Seasonings, Lipton] [added: Seasonings] and [removed: Tazo.][added: Bigelow.]

Our [added: U.S.] Coffee [removed: Systems] segment manufactures [removed: its] K-Cup pods [removed: in facilities in North America that include specialty designed proprietary high-speed packaging lines] using freshly roasted and ground coffee as well as tea, [removed: cocoa] [added: cocoa,] and other products.

We offer high-quality, responsibly sourced coffee, including certified single-origin, organic, flavored, limited [removed: edition] [added: edition,] and proprietary blends.

We carefully select our coffee beans and [removed: appropriately] roast [removed: the coffees] [added: them] to optimize their taste and flavor differences.

We distribute our brewers using third-party distributors, retail partners and [added: directly to consumers] through our website at www.keurig.com.

Key brands [added: in this segment] include Dr Pepper, Canada Dry, [removed: Schweppes, Crush,] [added: Mott’s, Snapple,] A&W, [removed: Sunkist,] 7UP, [removed: SunDrop,] [added: Sunkist soda,] Squirt, [added: Hawaiian Punch, Core Hydration, Bai, C4 Energy, Clamato, Evian, Yoo-Hoo,] Big Red, [removed: Hawaiian Punch] and [removed: RC Cola.][added: Vita Coco.]

Beverage [removed: concentrates] [added: concentrates, which] are [removed: shipped to third party bottlers, as well as to our own manufacturing systems, who combine them] [added: highly concentrated proprietary flavors, are combined] with carbonation, water, [removed: sweeteners] [added: sweeteners,] and other ingredients, [removed: package the combined product] [added: packaged] in aluminum cans, PET bottles, and glass bottles, and [removed: sell them] [added: sold] as a packaged beverage to retailers and, ultimately, the end consumer.

[added: Our U.S. Refreshment Beverages segment is a brand owner, manufacturer, and distributor of liquid refreshment beverages, or LRBs, in the U.S.] In this segment, we [removed: primarily] manufacture and distribute [removed: packaged] [added: beverage concentrates, syrups, and finished] beverages of our brands to [removed: retailers] [added: third-party bottlers, distributors, retailers,] and, ultimately, the end consumer.

Additionally, in order to maximize the size and scale of our manufacturing and distribution operations, we also distribute [removed: packaged] [added: finished] beverages for our partner brands and manufacture [removed: packaged] [added: finished] beverages for other third [removed: parties in the U.S.] [added: parties, including partners] and [removed: Canada.][added: private labels.]

These brands [added: can also] give us exposure in certain markets to fast growing segments of the beverage industry [removed: with minimal capital investment.][added: in a capital-efficient manner.]

We sell [removed: our Packaged Beverages products] [added: finished beverages] through our DSD and our WD systems, both of which include sales to all major retail channels.

[removed: The largest] [added: Key beverage] brands include Peñafiel, Clamato, Squirt, [removed: Mott's,] [added: Canada Dry,] Dr Pepper, [removed: Crush] [added: Mott’s,] and [removed: Aguafiel.][added: Crush.]

[removed: OUR CUSTOMERS][added: CUSTOMERS]

Keurig Dr Pepper Inc. is a leading beverage company in North America that manufactures, markets, distributes and sells hot and cold beverages and single serve brewing systems.

We offer more than 125 owned, licensed, and partner brands, available nearly everywhere people shop and consume beverages through our sales and distribution network.

When we approach our customers, we do so as a modern beverage company, strengthened through our use of data and technology.

*Bold ESG commitments and collaborations making positive impacts.* We have worked diligently to embed conscious and responsible business practices into the foundation of our company.

Our holistic ESG strategy is positioned to drive tangible and scalable solutions in service of doing more and better for our people, our environment and our communities.

OUR PRODUCTS AND OPERATING STRUCTURE

Operating and Reportable Segments

U.S. Refreshment Beverages

We manufacture beverage concentrates and syrups, which we then sell throughout the U.S. to third party bottlers or use them in our own manufacturing systems.

We partner with other brands seeking effective route-to-market capabilities, including national selling and distribution scale.

U.S. Coffee

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

We also manufacture K-Cup pods for our partner brands, who in turn sell them to retailers and consumers.

Our partner brands include Starbucks, Dunkin', Folgers, Peet's, Newman’s Own Organics, Caribou Coffee, and Community Coffee, among others.

We also participate in private label manufacturing arrangements.

International

Our International segment includes:

- Sales in Canada, Mexico, and other international markets from the manufacture and distribution of branded concentrates, syrup, and finished beverages, including sales of the Company's own brands and third-party brands, to third-party bottlers, distributors, and retailers.

- Sales in Canada from the manufacture and distribution of finished goods relating to the Company's single serve brewers, K-Cup pods, and other coffee products to partners and retailers.

Key K-Cup pod brands include Van Houtte, Tim Hortons, and McCafé, as well as other partner and private label brands.

During 2023, we launched our Keurig K-Iced family of brewers, featuring an innovative brew over ice process that allows consumers to brew both hot and iced beverages with a single coffeemaker.

In addition, we expanded our ICED K-Cup pod offerings to include a variety of options that can be brewed over ice and are compatible with all Keurig models.

We launched a limited edition “Start Me Up” iced coffee kit in collaboration with The Rolling Stones, which featured a custom-designed K-Iced brewer and a customized coffee blend.

We launched Dr Pepper Strawberries & Cream and Dr Pepper Strawberries & Cream Zero Sugar.

We also expanded our Core Hydration enhanced water portfolio with Core Hydration+, a nutrient enhanced water with real fruit extracts and essences, in Vibrance (grapefruit), Immunity (lemon), and Calm (cucumber).

In Mexico, we elevated our mineral water portfolio with Peñafiel Soft, which has no calories or sugar.

Finally, we joined forces with Blue Bell Creameries to create Dr Pepper Float ice cream, which provides us a royalty from these sales.

We entered into a new partnership with Philz Coffee to provide two unique coffee blends in K-Cup pod format.

We invested in, and simultaneously entered into a long-term strategic partnership with, La Colombe, which enables us to sell and distribute La Colombe shelf-stable varieties of RTD coffee and to license, manufacture, and distribute La Colombe branded K-Cup pods, both of which began in the fourth quarter of 2023.

We also entered into a long-term agreement with Grupo PiSA to sell, distribute and merchandise Electrolit, a premium hydration beverage, across the U.S, beginning in early 2024.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

Net sales to Walmart are included in all reportable segments.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

Green Coffee

Energy and Transportation Costs

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

SEASONALITY

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

Innovative ideas come from a diverse workforce, and KDP is committed to both.

Just as each of our brands brings its own personality to our product portfolio, each KDP employee brings their own unique set of experiences, perspectives, and background to our business.

Keurig Dr Pepper Inc. is a leading beverage company in North America, with a diverse portfolio of flavored CSDs, NCBs, including water (enhanced and flavored), RTD tea and coffee, juice, juice drinks, mixers and specialty coffee, and is a leading producer of innovative single serve brewing systems.

KDP offers more than 125 owned, licensed and partner brands, including the top ten best-selling coffee brands and Dr Pepper as a leading flavored CSD in the U.S. according to IRi, available nearly everywhere people shop and consume beverages.

The DPS Merger was consummated on July 9, 2018, at which time DPS changed its name to Keurig Dr Pepper Inc. and began trading on the NYSE under the symbol "KDP".

When we approach our customers, we do so as one fully combined modern beverage company.

This go-to market system is strengthened through sophisticated data and technology, which includes our line of connected brewers, predictive ordering powered by artificial intelligence for our frontline sales team within our DSD system, and best in class revenue growth management tools.

*Bold ESG commitments and collaborations making positive impacts.* ESG is embedded in the way that we do business at KDP, ensuring that we make a positive impact in our environment and communities.

PRODUCTS AND DISTRIBUTION

The following presents highlights of our major owned and licensed brands as of December 31, 2022:

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Category | | | Major Brands | | | North America Market Position | | |

| CSDs | | | Dr Pepper | | | #1 in its flavor category and #2 overall flavored CSD in the U.S. | | |

| | | | Canada Dry | | | #1 ginger ale in the U.S. and Canada | | |

| | | | A&W | | | #1 root beer in the U.S. | | |

| | | | Squirt | | | #1 grapefruit CSD in the U.S. and a leading grapefruit CSD in Mexico | | |

| | | | Peñafiel | | | #1 carbonated mineral water in Mexico | | |

| | | | Sunkist soda | | | #1 orange flavored CSD in the U.S. | | |

| | | | Schweppes | | | #2 ginger ale in the U.S. and Canada | | |

| | | | 7UP | | | #2 lemon-lime CSD in the U.S. | | |

| | | | Crush | | | #3 orange flavored CSD in the U.S. | | |

| NCBs | | | Snapple | | | #2 premium shelf stable RTD tea in the U.S. | | |

| | | | Hawaiian Punch | | | A leading branded shelf-stable fruit punch in the U.S. | | |

| | | | Mott's | | | #1 branded multi-serve apple juice and apple sauce in the U.S. | | |

| | | | Clamato | | | A leading spicy tomato juice in the U.S., Canada and Mexico | | |

| | | | Bai | | | #3 enhanced water in the U.S. | | |

| | | | Core | | | A rapidly growing water brand in the U.S. | | |

| Single Serve Coffee | | | Green Mountain Coffee Roasters | | | #2 K-cup pod brand in the U.S. | | |

| | | | The Original Donut Shop | | | #5 K-cup pod brand in the U.S. | | |

| | | | McCafé | | | #6 K-cup pod brand in the U.S. | | |

| | | | Van Houtte | | | #2 K-cup pod brand in Canada | | |

| Single Serve Brewers | | | Keurig | | | #1 single serve brewer in the U.S. and Canada | | |

All information regarding our brand market positions in the U.S. is based on retail market dollars in 2022.

U.S. beverage information is from IRi; U.S. brewing system information is from NPD.

In the CSD market in the U.S. and Canada, we participate primarily in the flavored segment of the CSD category.

In addition to our major brands above, we also own regional and smaller niche brands, such as Big Red, Sun Drop and Vernors.

Our beverage concentrates, which are highly concentrated proprietary flavors used to make syrup or finished beverages, are used by our own Packaged Beverages segment, as well as sold to third party bottling companies through our Beverage Concentrates segment.

According to IRi, we had a 24.2% share of the U.S. CSD market in 2022 (measured by retail sales).

We also manufacture fountain syrup that we sell to the foodservice industry directly and indirectly through bottlers or through other third parties.

In the NCB market segment in the U.S., we participate primarily in the premium water category, including enhanced and flavored water, RTD tea, juice, juice drinks, and mixer categories.

In addition to our major brands above, we also sell regional and smaller niche brands, such as Nantucket Nectars.

Refer to Note [removed: 18] [added: 17] of the Notes to our Consolidated Financial Statements related to commitments and contingencies, which is incorporated herein by reference.

The Staff of the SEC (the “Staff”) is investigating certain statements by the Company regarding the recyclability of our K-Cup pods, including statements in prior Exchange Act reports.

We have been cooperating with this investigation and responding to the Staff’s various requests for information.

In the course of cooperating with this investigation, we have reviewed our prior statements about the recyclability of K-Cup pods, and we continue to believe they were appropriate, accurate and in compliance with the securities laws.

We cannot predict the timing or eventual outcome of this investigation, but do not expect it to have a material impact on the Company.

BODYARMOR LITIGATION

In 2019, ABC, a subsidiary of KDP, filed suit against BodyArmor and Mike Repole in the Superior Court for the State of Delaware.

The complaint asserted breach of contract and other related claims in connection with BodyArmor’s attempted early termination of the distribution contract between BodyArmor and ABC.

In January 2022, KDP agreed to a $350 million payment from BodyArmor as full settlement of all claims under the litigation against BodyArmor and satisfaction of the holdback amount owed to ABC in association with the sale of ABC’s equity interest in BodyArmor in 2021.

FOR THE FISCAL YEAR ENDED December 31, [removed: 2022][added: 2023]

[removed: ][added: ]

As of June 30, [removed: 2022,] [added: 2023,] the aggregate market value of the registrant's common equity held by non-affiliates of the registrant was approximately [removed: $30.1] [added: $31.3] billion (based on the closing sales price of the registrant's common stock on that date).

As of February [removed: 21, 2023,] [added: 20, 2024,] there were [removed: 1,406,447,151] [added: 1,387,591,010] shares of the registrant's common stock, par value $0.01 per share, outstanding.

FOR THE YEAR ENDED DECEMBER 31, [removed: 2022][added: 2023]

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| 2022 Strategic Refinancing | | | | | | A series of transactions in April 2022, whereby KDP issued the 2029 Notes, the 2032 Notes, and the 2052 Notes, and voluntarily prepaid and retired the remaining 2023 Merger Notes and tendered portions of the 2025 Merger Notes, the 2028 Merger Notes, the 2038 Merger [removed: Notes] [added: Notes,] and the 2048 Merger Notes | | |

| [removed: A Shoc] [added: Accelerator] | | | | | | [removed: Adrenaline Shoc,] [added: Accelerator Active Energy LLC,] an equity method investment of KDP and a brand of energy drinks [added: (formerly known as A Shoc)] | | |

| DSD | | | | | | Direct Store Delivery, [removed: the reporting unit] [added: KDP’s route-to-market] whereby finished beverages are delivered directly to retailers | | |

| ESG | | | | | | Environmental, [removed: social] [added: social,] and governance | | |

| Proxy Statement | | | | | | The definitive proxy statement for the Annual Meeting of Stockholders to be filed with the SEC within 120 days of December 31, [removed: 2022,] [added: 2023,] pursuant to Regulation 14A under the Exchange Act | | |

| Veyron SPEs | | | | | | Special purpose entities with [removed: the same] [added: a single] sponsor, Veyron Global | | |

| WD | | | | | | Warehouse Direct, [removed: the reporting unit] [added: KDP’s route-to-market] whereby finished beverages are shipped to retailer warehouses, and then delivered by the retailer through its own delivery system to its stores | | |

This discussion contains forward-looking statements that are based on management's current expectations, [removed: estimates] [added: estimates,] and projections about our business and operations.

[removed: [Table](#i34cbdfb200994b3282a1df38c3186a8f_7) [of Contents](#i34cbdfb200994b3282a1df38c3186a8f_7)][added: [Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)]

| | | | [PART I](#ia0f33831c52344488846e28e940f75af_13) | | | | | |

| [Item 1C](#ia0f33831c52344488846e28e940f75af_2199023257972) | | | [Cybersecurity](#ia0f33831c52344488846e28e940f75af_2199023257972) | | | [24](#ia0f33831c52344488846e28e940f75af_2199023257972) | | |

| | | | [PART II](#ia0f33831c52344488846e28e940f75af_37) | | | | | |

| [Item 9B](#ia0f33831c52344488846e28e940f75af_244) | | | [Other Information](#ia0f33831c52344488846e28e940f75af_244) | | | [108](#ia0f33831c52344488846e28e940f75af_244) | | |

| | | | [PART III](#ia0f33831c52344488846e28e940f75af_250) | | | | | |

| [Item 11](#ia0f33831c52344488846e28e940f75af_250) | | | [Executive Compensation](#ia0f33831c52344488846e28e940f75af_250) | | | [109](#ia0f33831c52344488846e28e940f75af_250) | | |

| | | | [PART IV](#ia0f33831c52344488846e28e940f75af_253) | | | | | |

| [Item 16](#ia0f33831c52344488846e28e940f75af_259) | | | [Form 10-K Summary](#ia0f33831c52344488846e28e940f75af_259) | | | [113](#ia0f33831c52344488846e28e940f75af_259) | | |

| | | | [Signatures](#ia0f33831c52344488846e28e940f75af_262) | | | [114](#ia0f33831c52344488846e28e940f75af_262) | | |

FOR THE YEAR ENDED DECEMBER 31, 2023

| | | | | | | | | |

| CEO | | | | | | Chief Executive Officer | | |

| Chobani | | | | | | FHU US Holdings LLC, an equity method investment of KDP | | |

| CISO | | | | | | Chief Information Security Officer | | |

| CODM | | | | | | Chief Operating Decision Maker | | |

| | | | | | | | | |

| DPS Merger | | | | | | The combination of the business operations of Keurig and DPS as of July 9, 2018 | | |

| IRA | | | | | | Inflation Reduction Act of 2022 | | |

FOR THE YEAR ENDED DECEMBER 31, 2023

| | | | | | | | | |

| La Colombe | | | | | | La Colombe Holdings, Inc. | | |

| LRB | | | | | | Liquid refreshment beverages | | |

| | | | | | | | | |

| PFAS | | | | | | Per- and polyfluoroalkyl substances | | |

| Revive | | | | | | Revive Brands, a wholly-owned subsidiary of KDP | | |

| | | | [PART I](#i34cbdfb200994b3282a1df38c3186a8f_13) | | | | | |

| | | | [PART II](#i34cbdfb200994b3282a1df38c3186a8f_37) | | | | | |

| [Item 9B](#i34cbdfb200994b3282a1df38c3186a8f_235) | | | [Other Information](#i34cbdfb200994b3282a1df38c3186a8f_235) | | | [102](#i34cbdfb200994b3282a1df38c3186a8f_235) | | |

| | | | [PART III](#i34cbdfb200994b3282a1df38c3186a8f_241) | | | | | |

| [Item 11](#i34cbdfb200994b3282a1df38c3186a8f_241) | | | [Executive Compensation](#i34cbdfb200994b3282a1df38c3186a8f_241) | | | [103](#i34cbdfb200994b3282a1df38c3186a8f_241) | | |

| | | | [PART IV](#i34cbdfb200994b3282a1df38c3186a8f_244) | | | | | |

| [Item 16](#i34cbdfb200994b3282a1df38c3186a8f_250) | | | [Form 10-K Summary](#i34cbdfb200994b3282a1df38c3186a8f_250) | | | [106](#i34cbdfb200994b3282a1df38c3186a8f_250) | | |

| | | | [Signatures](#i34cbdfb200994b3282a1df38c3186a8f_253) | | | [107](#i34cbdfb200994b3282a1df38c3186a8f_253) | | |

| 2019 KDP Term Loan | | | | | | KDP’s $2 billion term loan, executed in February 2019 and terminated in March 2021 | | |

| 2020 364-Day Credit Agreement | | | | | | The Company's $1,500 million credit agreement, which was entered into on April 12, 2020 and replaced the 2019 364-Day Credit Agreement | | |

| CARES Act | | | | | | U.S. Coronavirus Aid, Relief and Economic Security Act | | |

| CERT | | | | | | Council for Education and Research on Toxins | | |

| Costco | | | | | | Costco Wholesale Corporation | | |

| DPS Merger | | | | | | The combination of the business operations of Keurig and DPS that was consummated on July 9, 2018 through a reverse merger transaction, whereby a wholly-owned special purpose merger subsidiary of DPS merged with and into the direct parent of Keurig | | |

| FFS | | | | | | Fountain Foodservice, an operating segment of KDP which serves the fountain channel, such as restaurants | | |

| IRi | | | | | | Information Resources, Inc. | | |

| KDP Credit Agreement | | | | | | Collectively, the KDP Revolver, the 364-day credit agreements, and the 2019 KDP Term Loan | | |

| LIBOR | | | | | | London Interbank Offered Rate | | |

| LifeFuels | | | | | | LifeFuels, Inc., an equity method investment | | |

| NCB | | | | | | Non-carbonated beverage | | |

| NPD | | | | | | The NPD Group's Total Market Dataset | | |

| NYSE | | | | | | New York Stock Exchange | | |

| Proposition 65 | | | | | | The State of California's Safe Drinking Water and Toxic Enforcement Act of 1986 | | |

[Table](#i34cbdfb200994b3282a1df38c3186a8f_7) [of Contents](#i34cbdfb200994b3282a1df38c3186a8f_7)

We use information technology and third-party service providers to support our global business processes and activities, which exposes us to cybersecurity risks.

KDP’s risk management strategy includes ongoing cybersecurity risk assessment and reporting, incident management, and a diligence and risk management process for third-party service providers.

Employees with network access participate in ongoing phishing, social engineering, and cybersecurity awareness training efforts, and we also conduct periodic tabletop exercises led by external consultants.

Our cybersecurity risk assessment and reporting process leverages the National Institute of Standards and Technology’s Cybersecurity Framework and is managed by our CISO, whose team comprises both internal personnel and third-party cybersecurity consultants.

The CISO provides periodic reports to management, including our CEO, as well as other executive leadership members, and to the Audit and Finance Committee of our Board, which has oversight for cybersecurity risk management.

These reports include updates on critical cybersecurity risks and the threat landscape; updates on the status of ongoing cybersecurity improvement initiatives, the internal control environment, and ongoing internal audit activities; and, if relevant, the status of actions taken with respect to certain cybersecurity incidents identified during the period.

We have an overall incident management plan, which is intended to provide guidance and protocols to facilitate timely notification and communication to key internal and external stakeholders during an incident.

A subset of this incident management plan is our Security Incident Response Plan, or SIRP, which is based on leading cybersecurity incident response practices.

Incidents may be escalated to the CISO, our Chief Information Officer, our Chief Legal Officer, or other members of management or the Board, depending on the severity of the incident, and are handled according to the SIRP protocols, which includes incident detection and analysis; containment, eradication and recovery; and post-incident monitoring.

We have developed a framework for assessing the materiality of any such incidents, including a committee responsible for determining whether the incident is material for disclosure.

The committee includes our CISO, our Chief Information Officer, our Chief Legal Officer, our Senior Vice President and Controller (Principal Accounting Officer), our head of Internal Audit, and other members of management with relevant subject matter expertise.

Our CISO has more than 25 years of experience in cybersecurity and information technology, including, prior to joining KDP in 2019, more than 11 years as a principal in Ernst & Young’s cybersecurity practice.

Our CISO reports directly to our Chief Information Officer, who also has over 36 years of experience in information technology and cybersecurity.

To date, we have not identified any risks from cybersecurity threats, including as a result of any previous cybersecurity incidents, which have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition.

For additional description of cybersecurity risks and potential related impacts on us, refer to the risk factors captioned “*Our use of information technology and third-party service providers exposes us to cybersecurity breaches and other business disruptions that could adversely affect us*” and “*The use of information technology by our third party commercial partners and service providers exposes us to business disruptions or other negative impacts that could adversely affect us*” in Item 1A, Risk Factors, in this Annual Report on Form 10-K.

[Table of](#ia0f33831c52344488846e28e940f75af_7) [Contents](#ia0f33831c52344488846e28e940f75af_7)

The following table summarizes our principal manufacturing plants and principal warehouse and distribution facilities by geography and reportable segment as of December 31, [removed: 2022:][added: 2023:]

| | | | Owned | | | | | | Leased | | | | | | Owned | | | | | | Leased | | | | | | Owned | | | | | | Leased | | | | | | Owned | | | | | | Leased | | | [removed: | | | Owned | | | | | | Leased | | |]

| United States | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: | | | | | | | | | | | |]

| Production facilities | | | [removed: 1] [added: 6] | | | | | | [removed: —] [added: 12] | | | | | | [removed: 5] [added: 1] | | | | | | [removed: 12] [added: 5] | | | | | | — | | | | | | — | | | | | | [removed: 1 | | | | | | 5 | | | | | |] 7 | | | | | | 17 | | |

| Warehouse and distribution facilities | | | [removed: — | | | | | | — | | | | | | 28] [added: 27] | | | | | | [removed: 60] [added: 61] | | | | | | — | | | | | | [removed: —] [added: 8] | | | | | | — | | | | | | [removed: 8] [added: —] | | | | | | [removed: 28] [added: 27] | | | | | | [removed: 68] [added: 69] | | |

| International | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [removed: | | | | | | | | | | | |]

| Production facilities | | | 1 | | | | | | — | | | | | | — | | | | | | — | | | | | | 3 | | | | | | [removed: — | | | | | | — | | | | | |] 2 | | | | | | 4 | | | | | | 2 | | |

| Warehouse and distribution facilities | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 5 | | | | | | [removed: 31 | | | | | | — | | | | | | 33] [added: 63] | | | | | | 5 | | | | | | [removed: 64] [added: 63] | | |

| Total | | | [removed: 2] [added: 34] | | | | | | [removed: —] [added: 73] | | | | | | [removed: 33] [added: 1] | | | | | | [removed: 72] [added: 13] | | | | | | 8 | | | | | | [removed: 31 | | | | | | 1 | | | | | | 48] [added: 65] | | | | | | [removed: 44] [added: 43] | | | | | | 151 | | |

We believe our facilities are well-maintained and adequate, that they are being appropriately [removed: utilized] [added: utilized, except for our next-generation coffee production facility in Spartanburg, South Carolina,] and that they have sufficient production capacity for their present intended purposes.

The extent of utilization of such facilities varies based on seasonal demand for our [removed: products.][added: products and the status of our investments to maintain or upgrade various technologies or equipment within such facilities.]

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | U.S. Refreshment Beverages | | | | | | | | | | | | U.S. Coffee | | | | | | | | | | | | International | | | | | | | | | | | | Total | | | | | | | | |

As of December 31, 2023, the facility that we are establishing in Spartanburg, South Carolina was significantly underutilized due to delays in the manufacture and installation of certain manufacturing lines, as well as delays exacerbated by the COVID-19 pandemic.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Beverage Concentrates | | | | | | | | | | | | Packaged Beverages | | | | | | | | | | | | Latin America Beverages | | | | | | | | | | | | Coffee Systems | | | | | | | | | | | | Total | | | | | | | | |

It is not possible to measure with any degree of certainty or uniformity the productive capacity and extent of utilization of these facilities.

[removed: Effective September 21, 2020, our] [added: Our] common stock [removed: was] [added: is] listed [removed: and began trading] on Nasdaq's Global Select Market under the ticker symbol "KDP".

As of December 31, [removed: 2022,] [added: 2023,] there were [removed: 9,059] [added: 8,315] stockholders of record of our common stock.

On October 1, 2021, our Board [removed: of Directors] authorized a share repurchase program of up to $4 billion of our outstanding common stock, potentially enabling us to return value to shareholders.

The following table summarizes shares repurchased by us under this program during the fourth quarter of [removed: 2022:][added: 2023:]

| Period | | | | | | Total Number of Shares Purchased | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased as Part of Publicly Announced Program | | | | | | Maximum Amount of Dollars that May Yet be Used to Purchase Shares Under the [removed: Program (in millions)] [added: Program] | | |

The following performance graph compares the cumulative total returns of [removed: DPS through July 9, 2018 and] KDP [removed: from July 10, 2018 through December 31, 2022] [added: for a five-year period] with the cumulative total returns of the S&P 500 Index and the S&P Food and Beverage Select Industry Index.

The graph assumes that $100 was invested on December 31, [removed: 2017,] [added: 2018,] with dividends reinvested quarterly.

[removed: ][added: ]

Information on securities authorized for issuance under our equity compensation plans has been omitted and will be incorporated by reference, when filed, from our Proxy Statement.

| October 1 to October 31 | | | | | | 2,000,000 | | | | | | $ | 29.95 | | | | | 2,000,000 | | | | | | $ | 3,103,859,210 | |

| November 1 to November 30 | | | | | | 6,120,798 | | | | | | 30.77 | | | | | | 6,120,798 | | | | | | 2,915,505,309 | | |

| December 1 to December 31 | | | | | | 10,900 | | | | | | 31.22 | | | | | | 10,900 | | | | | | 2,915,165,022 | | |

| Total | | | | | | 8,131,698 | | | | | | $ | 30.57 | | | | | 8,131,698 | | | | | | $ | 2,915,165,022 | |

From July 9, 2018, through September 18, 2020, our common stock was listed and traded on the NYSE under the ticker symbol "KDP".

Prior to the closing of the DPS Merger, our common stock was listed and traded on the NYSE under the ticker symbol "DPS".

There were no share repurchase programs in effect during the years ended December 31, 2021 and 2020.

| October 1 to October 31 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 3,912 | |

| November 1 to November 30 | | | | | | — | | | | | | — | | | | | | — | | | | | | 3,912 | | |

| December 1 to December 31 | | | | | | 8,018,696 | | | | | | 36.31 | | | | | | 8,018,696 | | | | | | 3,621 | | |

| Total | | | | | | 8,018,696 | | | | | | $ | 36.31 | | | | | 8,018,696 | | | | | | $ | 3,621 | |

The graph additionally assumes that a special cash dividend of $103.75 which was declared and paid as a result of the DPS Merger was reinvested in KDP once shares resumed trading on July 10, 2018.

| [Reports of Independent Registered Accounting [removed: Firm](#i34cbdfb200994b3282a1df38c3186a8f_142)] [added: Firm](#ia0f33831c52344488846e28e940f75af_148)] (PCAOB ID No. 34) | | | | | | [removed: [50](#i34cbdfb200994b3282a1df38c3186a8f_142)] [added: [52](#ia0f33831c52344488846e28e940f75af_148)] | | |

| [Consolidated Statements of [removed: Income](#i34cbdfb200994b3282a1df38c3186a8f_145)] [added: Income](#ia0f33831c52344488846e28e940f75af_151)] | | | | | | [removed: [53](#i34cbdfb200994b3282a1df38c3186a8f_145)] [added: [55](#ia0f33831c52344488846e28e940f75af_151)] | | |

| [Consolidated Statements of Comprehensive [removed: Income](#i34cbdfb200994b3282a1df38c3186a8f_148)] [added: Income](#ia0f33831c52344488846e28e940f75af_154)] | | | | | | [removed: [54](#i34cbdfb200994b3282a1df38c3186a8f_148)] [added: [56](#ia0f33831c52344488846e28e940f75af_154)] | | |

| [Consolidated Balance [removed: Sheets](#i34cbdfb200994b3282a1df38c3186a8f_151)] [added: Sheets](#ia0f33831c52344488846e28e940f75af_157)] | | | | | | [removed: [55](#i34cbdfb200994b3282a1df38c3186a8f_151)] [added: [57](#ia0f33831c52344488846e28e940f75af_157)] | | |

| [Consolidated Statements of Cash [removed: Flows](#i34cbdfb200994b3282a1df38c3186a8f_154)] [added: Flows](#ia0f33831c52344488846e28e940f75af_160)] | | | | | | [removed: [56](#i34cbdfb200994b3282a1df38c3186a8f_154)] [added: [58](#ia0f33831c52344488846e28e940f75af_160)] | | |

[removed: | [Consolidated Statements of Changes in Stockholders' Equity](#i34cbdfb200994b3282a1df38c3186a8f_157) | | | | | | [58](#i34cbdfb200994b3282a1df38c3186a8f_157) | | |][added: CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY]

[removed: | [Notes to Consolidated Financial Statements](#i34cbdfb200994b3282a1df38c3186a8f_160) | | | | | | [59](#i34cbdfb200994b3282a1df38c3186a8f_160) | | |][added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS]

| [1. Business and Basis of [removed: Presentation](#i34cbdfb200994b3282a1df38c3186a8f_163)] [added: Presentation](#ia0f33831c52344488846e28e940f75af_169)] | | | | | | [removed: [59](#i34cbdfb200994b3282a1df38c3186a8f_163)] [added: [61](#ia0f33831c52344488846e28e940f75af_169)] | | |

| [2. Significant Accounting [removed: Policies](#i34cbdfb200994b3282a1df38c3186a8f_166)] [added: Policies](#ia0f33831c52344488846e28e940f75af_172)] | | | | | | [removed: [60](#i34cbdfb200994b3282a1df38c3186a8f_166)] [added: [62](#ia0f33831c52344488846e28e940f75af_172)] | | |

| [3. Goodwill and Other Intangible [removed: Assets](#i34cbdfb200994b3282a1df38c3186a8f_172)] [added: Assets](#ia0f33831c52344488846e28e940f75af_175)] | | | | | | [removed: [69](#i34cbdfb200994b3282a1df38c3186a8f_172)] [added: [73](#ia0f33831c52344488846e28e940f75af_175)] | | |

| [4. Long-Term Obligations and Borrowing [removed: Arrangements](#i34cbdfb200994b3282a1df38c3186a8f_169)] [added: Arrangements](#ia0f33831c52344488846e28e940f75af_181)] | | | | | | [removed: [71](#i34cbdfb200994b3282a1df38c3186a8f_169)] [added: [75](#ia0f33831c52344488846e28e940f75af_181)] | | |

| [9. Earnings per [removed: Share](#i34cbdfb200994b3282a1df38c3186a8f_190)] [added: Share](#ia0f33831c52344488846e28e940f75af_196)] | | | | | | [removed: [82](#i34cbdfb200994b3282a1df38c3186a8f_190)] [added: [86](#ia0f33831c52344488846e28e940f75af_196)] | | |

| [10. Employee Benefit [removed: Plans](#i34cbdfb200994b3282a1df38c3186a8f_184)] [added: Plans](#ia0f33831c52344488846e28e940f75af_199)] | | | | | | [removed: [83](#i34cbdfb200994b3282a1df38c3186a8f_184)] [added: [87](#ia0f33831c52344488846e28e940f75af_199)] | | |

| [11. Stock-Based [removed: Compensation](#i34cbdfb200994b3282a1df38c3186a8f_193)] [added: Compensation](#ia0f33831c52344488846e28e940f75af_202)] | | | | | | [removed: [88](#i34cbdfb200994b3282a1df38c3186a8f_193)] [added: [92](#ia0f33831c52344488846e28e940f75af_202)] | | |

| [13. Income [removed: Taxes](#i34cbdfb200994b3282a1df38c3186a8f_199)] [added: Taxes](#ia0f33831c52344488846e28e940f75af_208)] | | | | | | [removed: [91](#i34cbdfb200994b3282a1df38c3186a8f_199)] [added: [95](#ia0f33831c52344488846e28e940f75af_208)] | | |

[removed: | [14. Restructuring] [added: Restructuring] and Integration [removed: Costs](#i34cbdfb200994b3282a1df38c3186a8f_175) | | | | | | [94](#i34cbdfb200994b3282a1df38c3186a8f_175) | | |][added: Costs]

| [removed: [15.] [added: [14.] Accumulated Other Comprehensive Income [removed: (Loss)](#i34cbdfb200994b3282a1df38c3186a8f_205)] [added: (Loss)](#ia0f33831c52344488846e28e940f75af_214)] | | | | | | [removed: [95](#i34cbdfb200994b3282a1df38c3186a8f_205)] [added: [98](#ia0f33831c52344488846e28e940f75af_214)] | | |

[removed: | [16.] Property, [removed: Plant] [added: Plant,] and [removed: Equipment](#i34cbdfb200994b3282a1df38c3186a8f_208) | | | | | | [95](#i34cbdfb200994b3282a1df38c3186a8f_208) | | |][added: Equipment]

We have audited the accompanying consolidated balance sheets of Keurig Dr Pepper Inc. and subsidiaries (the "Company") as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows, for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 23, 2023,] [added: 22, 2024,] expressed an unqualified opinion on the Company's internal control over financial reporting.

As discussed in Notes 2 and 3, the Company has indefinite-lived brand intangible assets (“brand [removed: assets”) with a balance of $19,291 million as of December 31, 2022.][added: assets”).]

Each of these assumptions [removed: is] [added: may be] sensitive to future market or industry conditions, as well as company-specific conditions.

Changes in these assumptions could have a significant impact on the fair value of certain indefinite-lived brand intangible assets (“certain brand assets”) [removed: that have a lower] [added: affecting the] headroom percentage, the amount of any impairment, or both.

Given the significant judgments made by management to estimate the fair value of certain brand assets, a high degree of auditor judgment and an increased extent of effort were required to perform audit procedures that evaluated the [removed: timing and] reasonableness of management’s estimates and assumptions.

Our audit procedures consisted of risk assessment and testing [removed: the timing of] management’s impairment [removed: assessment and] [added: analyses including] the underlying business and valuation assumptions for certain brand assets.

- We tested the effectiveness of controls over the Company’s indefinite-lived brand intangible asset impairment review [removed: process, including annual and interim controls when circumstances indicated that the carrying amount may not be recoverable.][added: process.]

- We evaluated the reasonableness of management’s ability to forecast revenue growth and [removed: operating] margins by [removed: comparing the forecasts to:][added: considering:]

–Historical revenue and [removed: operating] margins.

–Historical [removed: and forecasted] peer data.

- With the assistance of our fair value specialists, we evaluated the reasonableness of the valuation methodology and discount [removed: rates, including testing the mathematical accuracy of the calculation, and developed a range of independent estimates and compared those to the discount rates selected by management.][added: rates.]

We have audited the internal control over financial reporting of Keurig Dr Pepper Inc. and subsidiaries (the "Company") as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, [removed: 2022,] [added: 2023,] of the Company and our report dated February [removed: 23, 2023,] [added: 22, 2024,] expressed an unqualified opinion on those financial statements.

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying [removed: management’s] Report on Internal Control over Financial Reporting, appearing under [removed: item] [added: Item] 9A.

| (in millions, except per share data) | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | |

| Net sales | | | $ | [removed: 14,057] [added: 14,814] | | | | | $ | [removed: 12,683] [added: 14,057] | | | | | $ | [removed: 11,618] [added: 12,683] | |

| Cost of sales | | | 6,734 | | | | | | [removed: 5,706] [added: 6,734] | | | | | | [removed: 5,132] [added: 5,706] | | |

| Gross profit | | | [removed: 7,323] [added: 8,080] | | | | | | [removed: 6,977] [added: 7,323] | | | | | | [removed: 6,486] [added: 6,977] | | |

| Selling, [removed: general] [added: general,] and administrative expenses | | | [removed: 4,645] [added: 4,912] | | | | | | [removed: 4,153] [added: 4,645] | | | | | | [removed: 3,978] [added: 4,153] | | |

| [Notes to Consolidated Financial Statements](#ia0f33831c52344488846e28e940f75af_166) | | | | | | [61](#ia0f33831c52344488846e28e940f75af_166) | | |

| [5. Derivatives](#ia0f33831c52344488846e28e940f75af_184) | | | | | | [78](#ia0f33831c52344488846e28e940f75af_184) | | |

| [6. Leases](#ia0f33831c52344488846e28e940f75af_187) | | | | | | [82](#ia0f33831c52344488846e28e940f75af_187) | | |

| [7. Segments](#ia0f33831c52344488846e28e940f75af_190) | | | | | | [84](#ia0f33831c52344488846e28e940f75af_190) | | |

| [8. Revenue Recognition](#ia0f33831c52344488846e28e940f75af_193) | | | | | | [86](#ia0f33831c52344488846e28e940f75af_193) | | |

| [12. Investments](#ia0f33831c52344488846e28e940f75af_205) | | | | | | [94](#ia0f33831c52344488846e28e940f75af_205) | | |

| [16. Other Financial Information](#ia0f33831c52344488846e28e940f75af_220) | | | | | | [100](#ia0f33831c52344488846e28e940f75af_220) | | |

| [17. Commitments and Contingencies](#ia0f33831c52344488846e28e940f75af_223) | | | | | | [102](#ia0f33831c52344488846e28e940f75af_223) | | |

| [18. Transactions with Variable Interest Entities](#ia0f33831c52344488846e28e940f75af_229) | | | | | | [104](#ia0f33831c52344488846e28e940f75af_229) | | |

| [20. Related Parties](#ia0f33831c52344488846e28e940f75af_232) | | | | | | [107](#ia0f33831c52344488846e28e940f75af_232) | | |

February 22, 2024

February 22, 2024

| Loss on early extinguishment of debt | | | — | | | | | | 217 | | | | | | 105 | | |

| Gain on sale of equity method investment | | | — | | | | | | (50) | | | | | | (524) | | |

| Earned equity | | | (44) | | | | | | — | | | | | | — | | |

| Impairment of intangible assets | | | 2 | | | | | | 477 | | | | | | — | | |

| Earned equity | | | 44 | | | | | | — | | | | | | — | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Repurchases of common stock, inclusive of excise tax obligation | | | (21.7) | | | | | | — | | | | | | (711) | | | | | | — | | | | | | — | | | | | | (711) | | | | | | — | | | | | | (711) | | |

| Tax withholdings related to net share settlements | | | — | | | | | | — | | | | | | (62) | | | | | | — | | | | | | — | | | | | | (62) | | | | | | — | | | | | | (62) | | |

| Balance as of December 31, 2023 | | | 1,390.4 | | | | | | $ | 14 | | | | | $ | 20,788 | | | | | $ | 4,559 | | | | | $ | 315 | | | | | $ | 25,676 | | | | | $ | — | | | | | $ | 25,676 | |

Keurig Dr Pepper Inc. is a leading coffee and beverage company in North America that manufactures, markets, distributes, and sells hot and cold beverages and single serve brewing systems.

(CONTINUED)

REPORTABLE SEGMENTS

As of January 1, 2023, the Company revised its segment structure to align with changes in how the Company’s CODM manages the business, assesses performance and allocates resources.

This change had no impact on the Company’s consolidated results of operations or financial position.

Prior period segment results have been recast to reflect the Company’s new reportable segments.

Refer to Note 7 for additional information on the Company’s reportable segments and Note 8 for the Company’s disaggregated revenue portfolio for each reportable segment.

The change in segment structure also resulted in a change to the Company’s reporting units.

(CONTINUED)

(CONTINUED)

(CONTINUED)

On July 31, 2023, the remaining shareholders of Revive surrendered their ownership interests.

As a result, the Company holds 100% ownership interest in Revive and has eliminated the Non-controlling interest component within the Company’s Consolidated Statements of Changes in Stockholders’ Equity.

(CONTINUED)

To the extent the Company earns additional equity in these investments from achieving certain contractual milestones in our distribution activities, the earned equity is recorded as a reduction in Cost of sales and included in the Earned equity line on the Consolidated Statements of Cash Flows.

(CONTINUED)

| U.S. Refreshment Beverages | | | | | | U.S. Beverage Concentrates | | |

| [5. Derivatives](#i34cbdfb200994b3282a1df38c3186a8f_178) | | | | | | [74](#i34cbdfb200994b3282a1df38c3186a8f_178) | | |

| [6. Leases](#i34cbdfb200994b3282a1df38c3186a8f_181) | | | | | | [78](#i34cbdfb200994b3282a1df38c3186a8f_181) | | |

| [7. Segments](#i34cbdfb200994b3282a1df38c3186a8f_187) | | | | | | [80](#i34cbdfb200994b3282a1df38c3186a8f_187) | | |

| [8. Revenue Recognition](#i34cbdfb200994b3282a1df38c3186a8f_196) | | | | | | [82](#i34cbdfb200994b3282a1df38c3186a8f_196) | | |

| [12. Investments and Acquisitions](#i34cbdfb200994b3282a1df38c3186a8f_202) | | | | | | [90](#i34cbdfb200994b3282a1df38c3186a8f_202) | | |

| [17. Other Financial Information](#i34cbdfb200994b3282a1df38c3186a8f_211) | | | | | | [96](#i34cbdfb200994b3282a1df38c3186a8f_211) | | |

| [18. Commitments and Contingencies](#i34cbdfb200994b3282a1df38c3186a8f_214) | | | | | | [98](#i34cbdfb200994b3282a1df38c3186a8f_214) | | |

| [19. Transactions with Variable Interest Entities](#i34cbdfb200994b3282a1df38c3186a8f_220) | | | | | | [100](#i34cbdfb200994b3282a1df38c3186a8f_220) | | |

| [20. Related Parties](#i34cbdfb200994b3282a1df38c3186a8f_223) | | | | | | [101](#i34cbdfb200994b3282a1df38c3186a8f_223) | | |

Management recognized non-cash impairment losses of $472 million for the year ended December 31, 2022.

–Internal communication to senior management.

- We considered the impact of changes in management's forecast from the October 1, 2022 annual assessment date to December 31, 2022.

February 23, 2023

| Proceeds from KDP Revolver | | | — | | | | | | — | | | | | | 1,850 | | |

| Repayment of KDP Revolver | | | — | | | | | | — | | | | | | (1,850) | | |

| Proceeds from controlling shareholder stock transactions | | | — | | | | | | — | | | | | | 29 | | |

| Balance as of December 31, 2019 | | | 1,406.8 | | | | | | $ | 14 | | | | | $ | 21,557 | | | | | $ | 1,582 | | | | | $ | 104 | | | | | $ | 23,257 | | | | | $ | — | | | | | $ | 23,257 | |

| Proceeds from sale of stock by JAB | | | — | | | | | | — | | | | | | 29 | | | | | | — | | | | | | — | | | | | | 29 | | | | | | — | | | | | | 29 | | |

| Non-cash acquisition of controlling interest | | | — | | | | | | — | | | | | | 3 | | | | | | — | | | | | | — | | | | | | 3 | | | | | | 1 | | | | | | 4 | | |

Keurig Dr Pepper Inc. is a leading coffee and beverage company in North America with a diverse portfolio of flavored CSDs, specialty coffee, and NCBs, and is a leader in single serve coffee brewers in the U.S. and Canada.

UNALLOCATED CORPORATE COST ALIGNMENT

Effective January 1, 2022, the Company updated its presentation of certain of KDP's unallocated corporate costs, primarily related to IT, to be aligned among the Company's segments and to more consistently reflect controllable costs at the segment level.

Refer to Note 7 for current year presentation.

The following table summarizes the revised and prior presentations of income from operations at the segment level:

| | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Segment Results – Income from operations | | | | | | Current Presentation | | | | | | Prior Presentation | | | | | | Current Presentation | | | | | | Prior Presentation | | |

| Coffee Systems | | | | | | $ | 1,446 | | | | | $ | 1,318 | | | | | $ | 1,398 | | | | | $ | 1,268 | |

| Packaged Beverages | | | | | | 1,023 | | | | | | 1,010 | | | | | | 835 | | | | | | 822 | | |

| Beverage Concentrates | | | | | | 1,047 | | | | | | 1,044 | | | | | | 935 | | | | | | 932 | | |

Acquisitions

The majority of the Company's customers are located in the U.S. and Canada.

The Company's proportionate share of the net income (loss) resulting from these investments is recorded in Other expense (income), net in the Consolidated Statements of Income.

| Packaged Beverages | | | | | | DSD | | |

| | | | | | | WD | | |

| Coffee Systems | | | | | | Coffee Systems | | |

| | | | | | | Fountain Foodservice | | |

| Latin America Beverages | | | | | | Latin America Beverages | | |

voluntarily elected by the supplier, to sell payment obligations from KDP to financial institutions.

In March 2020, the FASB issued ASU 2020-04, *Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting*, later amended by ASU 2021-01, *Reference Rate Reform (Topic 848) Scope* and ASU 2022-06, *Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848*.

As required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act, management, with the participation of our [removed: chief executive officer] [added: CEO] and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, [removed: 2022,] [added: 2023,] and has concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is (i) recorded, processed, [removed: summarized] [added: summarized,] and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including our [removed: chief executive officer] [added: CEO] and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Our management, with the participation of the [removed: chief executive officer] [added: CEO] and chief financial officer, assessed the effectiveness of the Company’s internal control over financial reporting.

Based on the criteria for effective internal control over financial reporting established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission, management concluded that the internal control over financial reporting was effective as of December 31, [removed: 2022.][added: 2023.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2022] [added: 2023] has been audited by Deloitte & Touche LLP, our independent registered public accounting firm, as stated in their attestation report, which is included in Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

As of December 31, [removed: 2022,] [added: 2023,] management has concluded that there have been no changes in our internal control over financial reporting that occurred during our fourth quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

During the fourth quarter of 2023, no directors or executive officers of the Company adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement,” as defined in Item 408 of Regulation S-K.

None.

- Consolidated Statements of Income for the years ended December 31, [added: 2023,] 2022, [removed: 2021] and [removed: 2020.][added: 2021.]

- Consolidated Statements of Comprehensive Income for the years ended December 31, [added: 2023,] 2022, [removed: 2021] and [removed: 2020.][added: 2021.]

- Consolidated Balance Sheets as of December 31, [removed: 2022] [added: 2023] and [removed: 2021.][added: 2022.]

- Consolidated Statements of Cash Flows for the years ended December 31, [added: 2023,] 2022, [removed: 2021] and [removed: 2020.][added: 2021.]

- Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, [added: 2023,] 2022, [removed: 2021] and [removed: 2020.][added: 2021.]

- Notes to Consolidated Financial Statements for the years ended December 31, [added: 2023,] 2022, [removed: 2021] and [removed: 2020] [added: 2021] and as of December 31, [removed: 2022] [added: 2023] and [removed: 2021.][added: 2022.]

| [removed: [10.12](http://www.sec.gov/Archives/edgar/data/0001418135/000141813521000024/exhibit101fernandocortesse.htm)] [added: [10.15](http://www.sec.gov/Archives/edgar/data/0001418135/000119312522196625/d379262dex101.htm)] | | | [removed: Separation and Release Agreement, dated September 24, 2021,] [added: Letter Agreement] by and between the Company and [removed: Fernando Cortes] [added: Mauricio Leyva dated July 15, 2022] (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K (filed on [removed: September 24, 2021)] [added: July 19, 2022)] and incorporated herein by reference). [added: ++] | | |

| [removed: [10.13](http://www.sec.gov/Archives/edgar/data/1418135/000141813521000028/q32021ex1013suspensionofri.htm)] [added: [10.12](http://www.sec.gov/Archives/edgar/data/1418135/000141813521000028/q32021ex1013suspensionofri.htm)] | | | Suspension of Rights Agreement, dated September 10, 2021, among Keurig Dr Pepper Inc. (f/k/a Dr Pepper Snapple Group, Inc.), JPMorgan Chase Bank, N.A., as administrative agent, and the lenders and issuing banks party thereto (filed as Exhibit 10.13 to the Company’s Quarterly Report on Form 10-Q (filed on October 28, 2021) and incorporated herein by reference). | | |

| [removed: [10.14](http://www.sec.gov/Archives/edgar/data/1418135/000141813522000005/kdp-ex1015_20211231.htm)] [added: [10.13](http://www.sec.gov/Archives/edgar/data/1418135/000141813522000005/kdp-ex1015_20211231.htm)] | | | Credit Agreement, dated as of February 23, 2022, among Keurig Dr Pepper Inc., JPMorgan Chase Bank, N.A. as administrative agent, and the lenders and issuing banks party thereto (filed as Exhibit 10.15 to the Company’s Annual Report on Form 10-K (filed on February 24, 2022) and incorporated herein by reference). | | |

| [removed: [10.15](http://www.sec.gov/Archives/edgar/data/1418135/000119312522095668/d335432dex101.htm)] [added: [10.14](http://www.sec.gov/Archives/edgar/data/1418135/000119312522095668/d335432dex101.htm)] | | | Letter Agreement by and between the Company and Robert J. Gamgort dated April 5, 2022 (filed as Exhibit 10.1 to the Company's Current Report on Form 8-K (filed on April 5, 2022) and incorporated herein by reference). | | |

| [removed: [10.16](http://www.sec.gov/Archives/edgar/data/0001418135/000119312522196625/d379262dex101.htm)] [added: [10.17](http://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex1018letteragreements.htm)] | | | Letter Agreement by and between the Company and [removed: Mauricio Leyva] [added: Sudhanshu Priyadarshi] dated [removed: July 15,] [added: October 21,] 2022 (filed as Exhibit [removed: 10.1] [added: 10.18] to the Company’s [removed: Current] [added: Annual] Report on Form [removed: 8-K] [added: 10-K] (filed on [removed: July 19, 2022)] [added: February 23, 2023)] and incorporated herein by [removed: reference). ++] [added: reference).++] | | |

| [removed: [10.17](http://www.sec.gov/Archives/edgar/data/1418135/000141813522000017/kdp-ex104_2022630.htm)] [added: [10.16](http://www.sec.gov/Archives/edgar/data/1418135/000141813522000017/kdp-ex104_2022630.htm)] | | | Keurig Dr Pepper Inc. Executive Severance Plan, effective as of July 29, 2022 (filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q (filed on July 28, 2022) and incorporated herein by reference).++ | | |

| [removed: [10.18](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex1018letteragreements.htm)*] [added: [10.20](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex1020_20231231.htm)*] | | | Letter Agreement by and between the Company and [removed: Sudhanshu Priyadarshi] [added: Andrew Archambault] dated October [removed: 21, 2022.++] [added: 31, 2023.++] | | |

| [removed: [10.20](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex1020kdpshorttermince.htm)*] [added: [10.18](http://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex1020kdpshorttermince.htm)] | | | Keurig Dr Pepper Short-Term Incentive [removed: Plan.++] [added: Plan (filed as Exhibit 10.20 to the Company’s Annual Report on Form 10-K (filed on February 23, 2023) and incorporated herein by reference).++] | | |

| [removed: [21.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex211_20221231.htm)*] [added: [21.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex211_20231231.htm)*] | | | List of Subsidiaries of Keurig Dr Pepper Inc. | | |

| [removed: [23.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex231_20221231.htm)*] [added: [23.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex231_20231231.htm)*] | | | Consent of Deloitte & Touche LLP | | |

| [removed: [31.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex311_20221231.htm)*] [added: [31.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex311_20231231.htm)*] | | | Certification of Chief Executive Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act. | | |

| [removed: [31.2](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex312_20221231.htm)*] [added: [31.2](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex312_20231231.htm)*] | | | Certification of Chief Financial Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(a) or 15d-14(a) promulgated under the Exchange Act. | | |

| [removed: [32.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex321_20221231.htm)] [added: [32.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex321_20231231.htm)] | | | Certification of Chief Executive Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(b) or 15d-14(b) promulgated under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code. | | |

| [removed: [32.2](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex322_20221231.htm)] [added: [32.2](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex322_20231231.htm)] | | | Certification of Chief Financial Officer of Keurig Dr Pepper Inc. pursuant to Rule 13a-14(b) or 15d-14(b) promulgated under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code. | | |

| 101* | | | The following financial information from Keurig Dr Pepper Inc.'s Annual Report on Form 10-K for the year ended December 31, [removed: 2022,] [added: 2023,] formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statement of Changes in Stockholders' Equity, and (vi) the Notes to the Audited Consolidated Financial Statements. | | |

| | | | | | |

| --- | --- | --- | --- | --- | --- |

| [10.19](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000018/kdp-ex101letteragreementti.htm) | | | Letter Agreement by and between the Company and Timothy Cofer dated September 18, 2023 (filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q (filed on October 26, 2023) and incorporated herein by reference).++ | | |

| [10.21](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp-ex1021_20231231.htm)* | | | Restricted Stock Unit Award Terms and Conditions under the Keurig Dr Pepper Omnibus Stock Incentive Plan of 2019 (award for certain of the Company’s Named Executive Officers).++ | | |

| [97.1](https://www.sec.gov/Archives/edgar/data/1418135/000141813524000007/kdp_ex971x20231231.htm)* | | | Keurig Dr Pepper Inc. Clawback Policy, As Adopted on September 18, 2023++ | | |

| [10.19](https://www.sec.gov/Archives/edgar/data/1418135/000141813523000003/kdp-ex1019separationandrel.htm)* | | | Separation Agreement and Release by and between the Company and Tony Milikin dated October 28, 2022.++ | | |

| | | | Date: | | | | | | February [removed: 23, 2023] [added: 22, 2024] | | |

| | | | Date: | | | | | | February [removed: 23, 2023] [added: 22, 2024] | | | | | | Date: | | | | | | February [removed: 23, 2023] [added: 22, 2024] | | |

| | | | Name: | | | | | | [removed: Michael Call] [added: Olivier Goudet] | | | | | | Name: | | | | | | [removed: Olivier Goudet] [added: Peter Harf] | | |

| | | | Title: | | | | | | Director | | | | | | [removed: Title:] | | | | | | [removed: Director] | | |

| | | | Name: | | | | | | [removed: Peter Harf] [added: Juliette Hickman] | | | | | | Name: | | | | | | [removed: Juliette Hickman] [added: Paul S. Michaels] | | |

| | | | Name: | | | | | | [removed: Paul S. Michaels] [added: Pamela Patsley] | | | | | | Name: | | | | | | [removed: Pamela Patsley] [added: Lubomira Rochet] | | |

| | | | Name: | | | | | | [removed: Lubomira Rochet] [added: Debra Sandler] | | | | | | Name: | | | | | | [removed: Debra Sandler] [added: Robert Singer] | | |

| By: | | | /s/ [removed: Robert Singer] [added: Larry Young] | | | | | | | | | [removed: By:] | | | [removed: /s/ Larry Young] | | | | | | | | |

| | | | Name: | | | | | | [removed: Robert Singer] [added: Larry Young] | | | | | | [removed: Name:] | | | | | | [removed: Larry Young] | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | Date: | | | | | | February 22, 2024 | | |

| By: | | | /s/ Olivier Goudet | | | | | | | | | By: | | | /s/ Peter Harf | | | | | | | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | Date: | | | | | | February 22, 2024 | | |

| By: | | | /s/ Juliette Hickman | | | | | | | | | By: | | | /s/ Paul S. Michaels | | | | | | | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | Date: | | | | | | February 22, 2024 | | |

| By: | | | /s/ Pamela Patsley | | | | | | | | | By: | | | /s/ Lubomira Rochet | | | | | | | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | Date: | | | | | | February 22, 2024 | | |

| By: | | | /s/ Debra Sandler | | | | | | | | | By: | | | /s/ Robert Singer | | | | | | | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | Date: | | | | | | February 22, 2024 | | |

| | | | Date: | | | | | | February 22, 2024 | | | | | | | | | | | | | | |

| By: | | | /s/ Michael Call | | | | | | | | | By: | | | /s/ Olivier Goudet | | | | | | | | |

| By: | | | /s/ Peter Harf | | | | | | | | | By: | | | /s/ Juliette Hickman | | | | | | | | |

| By: | | | /s/ Paul S. Michaels | | | | | | | | | By: | | | /s/ Pamela Patsley | | | | | | | | |

| By: | | | /s/ Lubomira Rochet | | | | | | | | | By: | | | /s/ Debra Sandler | | | | | | | | |