Coca-Cola reported strong profits, while PepsiCo faced higher costs and slower growth. But beyond earnings, their updates on carbon emissions, water use, and plastic waste show how both companies are trying to balance business goals with environmental action.
Let’s study and find out which beverage giant is making faster progress on revenue and, more importantly, sustainability.
Coca-Cola Q1 2025: Strong Profits, Even as Sales Dip
Coca-Cola sold 2% more drinks in the first quarter of 2025, thanks to strong demand in India, China, and Brazil. While overall revenue dropped 2% to $11.1 billion, mainly due to currency changes and the shifting of some bottling operations.
Coke’s core business stayed strong. Organic revenue (which removes the impact of currency changes and one-time events) grew 6%, helped by higher prices and a small rise in concentrate sales.
Big Jump in Profit and Margins
Profit rose 71% this quarter, thanks to solid sales, better cost control, and smart timing on marketing. Coca-Cola’s profit margin jumped to 32.9%, up from 18.9% last year. Adjusted margins (non-GAAP) were even better at 33.8%. Earnings per share rose 5% to $0.77, even after being hit by currency losses. Adjusted earnings came in at $0.73, up 1%.
Coke Zero and Sparkling Drinks Lead the Way
Coke Zero Sugar saw big success, with a 14% jump in sales. Sparkling drinks like Coca-Cola and Fanta grew by 2%. Water, tea, and juice drinks also saw slight increases. Overall, Coca-Cola gained more market share in ready-to-drink beverages around the world.
Mixed Results Across Regions
- Europe, Middle East & Africa: Sales rose 3%, and profits held strong despite currency pressure.
- Latin America: Sales were flat, but smart pricing helped boost profits.
- North America: Sales dropped 3%, but profits grew thanks to higher prices.
- Asia Pacific: Sales rose 6%, with strong growth across all drink types.
- Bottling Operations: Volume fell 17% as Coca-Cola shifted bottling to partners. This lowered profits.
However, Coca-Cola’s free cash flow was down $5.5 billion. But this was mostly due to a large $6.1 billion payment related to its Fairlife deal. Without that, cash flow was still positive at $558 million.
Coca-Cola’s GHG Emissions in 2023: A Quick Look
- In 2023, Coca-Cola’s total manufacturing emissions were 5.62 million metric tons using the location-based method and 4.95 million metric tons using the market-based method.
Emissions directly from factories stayed the same at 1.61 million metric tons. Indirect emissions from electricity use increased slightly to 4.01 million metric tons (location-based) and 3.34 million metric tons (market-based).
However, carbon emissions per liter of product rose to 28.31 grams. Under CDP reporting, total emissions reached 5.62 million metric tons, with most coming from franchise operations.
Improved Water Efficiency
Water management is a key part of Coca-Cola’s sustainability efforts. Since 2015, the company has consistently replaced more water than it uses in its drinks. In 2023, it stayed committed to this goal by aiming to replenish over 100% of the water used in its finished products globally.
- Compared to 2022, Coca-Cola improved its water use efficiency in 2023. It used 1.78 liters of water per liter of product, slightly better than the 1.79 liters used the year before.
Meanwhile, total water withdrawal went up a bit, reaching 311,998 megaliters. Water consumption also increased to 194,853 megaliters.
Focus on Water-Stress Regions
Importantly, 28% of the water was used in high water-stress areas signifies the need for efficient water management. On the positive side, wastewater discharge dropped to 117,124 megaliters, showing better control and treatment of wastewater.
Additionally, Coca-Cola expanded its focus on water in high-risk locations. Previously, the goal was to replenish 100% of the water used in 175 high-risk sites by 2030.
Now, the target encompasses all high-risk locations, i.e., more than 200 sites by 2035. This broader commitment reflects the company’s growing emphasis on supporting local ecosystems and communities where water resources are under stress.
PepsiCo Q1 2025: Mixed Performance in a Tough Market
PepsiCo released its Q1 2025 results on April 24, showing mixed performance due to slow demand and higher global costs. Still, international sales provided a boost.
Net revenue fell by 1.8% to $17.92 billion, but still came in above analyst estimates. Organic revenue grew by 1.2%, with strong international performance helping balance weaker North American sales.
Profit Drops Amid Cost Pressures
Core earnings per share (EPS) dropped to $1.48, slightly below forecasts. Net income was $1.83 billion, down from $2.05 billion in Q1 2024. Rising supply chain costs and new tariffs impacted profitability.
North America Slows, International Gains
Pepsi Zero Sugar and Gatorade helped beverage sales in North America grow by 1%. However, food sales dropped, especially in Frito-Lay. International business saw strong demand in countries like India, Brazil, and Egypt.
PepsiCo now expects flat earnings growth for the rest of 2025 due to inflation and global uncertainty. Earlier, it had forecasted mid-single-digit growth.
This year, the company plans to focus on affordable products, expand globally, invest in new snacks and drinks, and cut costs to manage inflation.
PepsiCo’s 2023 ESG Progress: Big Wins in Farming, Emissions, Water, and Packaging
In 2023, PepsiCo made strong progress on its environmental goals. The company focused on farming, clean energy, water savings, and cutting plastic waste. While it faced some challenges, it stayed on track toward its long-term targets.
Boosting Regenerative Farming
PepsiCo doubled its regenerative farming land. It grew from 900,000 acres in 2022 to 1.8 million acres in 2023. The company also beat its water-use goal. It improved water efficiency by 22% — far above its 15% target.
In 2023, 58% of key ingredients came from sustainable sources. Since 2021, PepsiCo has supported over 57,000 farmers and workers. It offered training and programs to help women and build local economies.
PepsiCo also met its water protection goals in high-risk areas two years early. Now, it will focus on broader water efforts instead of tracking this specific goal.
Cutting Emissions and Using Clean Energy
PepsiCo plans to hit net-zero emissions by 2040. It also aims to cut Scope 1 and 2 emissions by 75% and Scope 3 emissions by 40% by 2030 (from 2015 levels).
- In 2023, total GHG emissions (Scopes 1, 2, and 3) were ~58 million metric tons. It dropped 4% from 2015 and 5% from 2022.
Direct emissions (from PepsiCo’s operations) fell by 33%. Scope 3 emissions (from suppliers and others) dropped only 1%.
To help lower emissions, PepsiCo added more electric vehicles. These EVs covered over 3 million zero-emission miles in 2023. The company also used more renewable biogas from food waste, like potato peels.
Saving and Replenishing Water
Water remains a top focus for PepsiCo. In 2023, it improved water-use efficiency by 25% at high-risk sites. This means it achieved its target 2 years early.
The company gave back about 69% of the water it used in water-stressed areas. This added up to over 12 billion liters. Also, the number of PepsiCo plants meeting top water standards rose from 8 to 27 in just one year.
- In Spain, PepsiCo restored 70 million liters of water near its Alvalle plant by replacing invasive plants with native trees.
Reducing Plastic and Promoting Reuse
PepsiCo continued to cut plastic waste. In 2023, 10% of its drinks were sold in reusable packages. It also became the first brand in North America to replace plastic rings on multipacks with paper-based ones.
The company used 10% recycled plastic in its packaging. Its 2030 goal is 50%. Over 30 countries now sell PepsiCo drinks in 100% recycled PET bottles (except caps and labels).
PepsiCo cut virgin plastic use per serving by 1% in 2020. Overall, virgin plastic use was 6% higher than in 2020 — a smaller increase than the 11% in 2022.
- By the end of 2023, 89% of PepsiCo’s packaging was designed to be recyclable, compostable, biodegradable, or reusable (RCBR).
- It now expects 98% to be RCBR by 2025, and 92% of it will likely be recycled in real life.
That falls short of the 100% goal, but the company is pushing forward with new ideas and partnerships.
Coca-Cola Vs PepsiCo: Who’s Winning The Sustainability Game?
In summary, PepsiCo’s reported emissions are much higher than Coca-Cola’s manufacturing-only figures due to broader reporting boundaries. Both companies have made progress versus their 2015 baselines, but PepsiCo achieved a year-over-year reduction in 2023, while Coca-Cola’s manufacturing emissions rose slightly.
- FURTHER READING: Starbucks Rakes in $1.9B International Revenue Amid Sales Dip: But how is its Sustainability Brewing Up?
The post Coca-Cola vs PepsiCo 2025: Who’s Leading on Profits—and Planet Goals? appeared first on Carbon Credits.
The accounting differences that decide whether your nature investment shows up in inventory, in BVCM, or nowhere at all.
The question reaches a procurement team about three weeks before the next sustainability committee meeting. Someone has read about insetting. Someone else has just signed off on an offset purchase. The CSO wants to know if the two are interchangeable. The answer is no, and the GHG Protocol Land Sector and Removals Standard is the reason why.
This article walks through what each term means at audit-grade specificity, what the standards actually say about how each gets counted, and how to decide which tool fits which target. The insetting vs offsetting question is one of the most-searched in corporate climate strategy, and one of the most poorly answered. By the end of this piece, you should be able to brief a committee on the difference without notes.
The two definitions, in plain English
Offsetting means buying carbon credits generated outside your value chain and retiring them against your residual emissions. The reduction happens somewhere else, financed by you, and the credit is the receipt.
Insetting means investing in emission reductions or removals inside your own value chain, typically with suppliers, where the reduction is directly linked to the products and services you buy. The reduction happens inside the boundary of your Scope 3 inventory, and the accounting treatment is fundamentally different.
The shorthand from the University of Oxford’s Nature-based Insetting Initiative is useful: insetting is what you do with the supply chain you have; offsetting is what you do with the supply chain you do not have.
What the GHG Protocol Land Sector Standard actually says
The GHG Protocol Land Sector and Removals Standard, finalised in 2024 after a multi-year pilot, sets the rules for how land-based emission reductions and removals enter corporate inventories. The Standard distinguishes between inventory accounting (Scope 1, 2, and 3) and project or intervention accounting (a separate methodology for crediting).
For insetting, the practical implication is that supplier-level interventions, when properly measured and attributed, can reduce your Scope 3 category 1 (purchased goods and services) emissions in your inventory. The reduction is not a credit retired against the inventory; it is a lower inventory number, period.
For offsetting, the credit is retired separately. It can be reported as a contribution toward a net-zero claim under the SBTi Beyond Value Chain Mitigation framework or as part of a VCMI Carbon Integrity claim, but it does not lower the inventory number.
A practical consequence: if your Science Based Target requires a 50% absolute reduction in Scope 3 emissions by 2030, insetting moves you toward the target. Offsetting does not. This single point of difference reshapes the procurement decision.
When insetting counts toward Scope 3 (and when it does not)
Insetting counts toward Scope 3 only when several conditions are met:
- The intervention must occur with an entity in your value chain.
- The emissions reduction or removal must be measured against a defensible baseline.
- The reduction must be attributed to your share of that supplier’s output, not double-counted with other buyers.
- It must follow the inventory accounting rules in the GHG Protocol Land Sector Standard, not the project accounting rules used to generate credits.
The most common failure mode is double counting. If your supplier sells the same reduction as a credit on the voluntary market and also reports it to you as a Scope 3 reduction, the math breaks. The Standard requires you to address this risk, typically by purchasing and retiring the supplier-issued credit as part of your inventory or by contractual provisions that prevent the supplier from selling the reduction twice.
When insetting does not count toward Scope 3: when the intervention sits with a supplier you do not buy from, when the baseline is not defensible, when the attribution is unclear, or when the documentation does not survive audit. Those cases default to Beyond Value Chain Mitigation, which is still useful but operates on a different ledger.
The procurement and supplier engagement question
Insetting is harder than offsetting. That is the unfashionable truth most buyers eventually confront. Offsetting is a transaction; insetting is a relationship.
To run an insetting program, you need supplier mapping precise enough to know which farms or facilities sit at which Scope 3 boundary. You need an engagement model that gets suppliers to participate, which usually requires multi-year commitments and shared economics. You need an MRV architecture that measures the right things and produces audit-ready documentation. And you need a contractual structure that prevents double counting and protects both sides.
The trade-off you receive in return is significant. Reductions count against your inventory rather than your residual. Supplier relationships deepen, which protects sourcing continuity. Yield and quality improvements often follow regenerative interventions, which reduces your input cost over time. And the regulatory file, under CSRD, CSDDD, EUDR, and the SBTi FLAG Guidance, is materially stronger.
Choosing the right tool for the right target
A practical decision rule. If your target is a science-based Scope 3 reduction and you operate in a FLAG sector or source FLAG commodities, insetting is the structurally correct tool. If your target is a net-zero claim that includes neutralising hard-to-abate residual emissions outside your value chain, BVCM via high-integrity offsets is the structurally correct tool. Most companies with material Scope 3 exposure need both, in different proportions, sequenced over time.
The sequencing matters. Insetting takes longer to stand up but produces a permanent reduction in the inventory. Offsetting can be transacted faster but does not change the inventory and now sits under tighter claim restrictions. Treat them as complementary tools with different jobs, not as substitutes. The Accountability Framework Initiative and the IUCN Global Standard for Nature-based Solutions both provide useful guardrails for the insetting side, with biodiversity, human rights, and benefit-sharing requirements that go beyond carbon math.
If you are mapping a Scope 3 reduction roadmap and need to scope which interventions count toward your inventory versus which sit in Beyond Value Chain Mitigation, the carbon and sustainability experts at Carbon Credit Capital can help you structure a nature-based supply chain investment program that fits your FLAG exposure, your target architecture, and your audit horizon. Schedule a consultation.
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