KFC has ended its nearly 40-year partnership with Pepsi, signing rival Coca-Cola as its new beverage supplier across its U.S. restaurants.
“Coca-Cola shares our ambition for the future of this brand, and I'm excited about what we can create together,” said KFC U.S. President Catherine Tan-Gillespie.
The switch will begin in January 2027, with the change applying only to U.S. restaurants for now.
So why did the partnership end?
Context
KFC’s U.S. restaurants have served Pepsi since 1986, when PepsiCo acquired the fast food chain.
In 1997, PepsiCo split its restaurants – including KFC, Pizza Hut and Taco Bell – into a separate company, now known as Yum! Brands, allowing PepsiCo to focus on its drinks and snacks business.
In recent years, KFC has faced growing competition from rival chicken chains in the U.S.
In 2025, it launched its “Kentucky Fried Comeback” strategy, aimed at winning back customers and regaining market share.
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Coca-Cola deal
Last week, KFC announced it would replace Pepsi with Coca-Cola across its 3,600 U.S. restaurants from January 2027.
The move ends a nearly 40-year partnership.
Tan-Gillespie said the partnership was part of the chain’s broader efforts to update its restaurants and menu and better meet customer expectations.
PepsiCo
PepsiCo has been losing ground in the soft drink market, with its flagship Pepsi brand facing competition from Coca-Cola and rivals such as Dr Pepper, according to The Wall Street Journal.
PepsiCo told Reuters it had renewed its partnership with KFC International, but did not specify further details of the deal.
Pepsi also confirmed to TDA that Australian KFC stores will continue to serve the brand.
