Federal SNAP could twist off steam off Coke

Republican effort to remove sodas from SNAP program could impact sales of sodas in the US

Federal Supplemental Nutrition Assistance Program (SNAP) helps poor Americans pay for food (but not alcohol)

• Total Budget: ~$112.8 billion (FY 2023), likely ~$113–115 billion (FY 2024 estimate).

• Breakdown: ~95–97% ($107–109 billion) on benefits, ~3–5% ($3.5–5 billion) on administration.

• #1 item paid for with SNAP are sodas

  

• COKE controls a large market share of sodas in the US

• A red state of Arkansas now wants to stop SNAP payments for sodas (blue states have been asking for years but got rebuffed)

  • It’s personal as Gov. Sarah Huckabee Sanders father had diabetes

POLITICAL LOGIC FOR DUMMIES

• Republicans: “We should not tell people what to drink! Let them drink sodas if they want to

• Republicans: “We should have lower taxes and less handouts

• American Beverage Association / Soda Business: “We support SNAP program and helping the poor. The Federal handouts are great for business. We pay corporate taxes and for lunches in DC

  • We love milking the Federal cow

• The Free People of America - the poor & hungry get addicted to sugar —> develop diabetes

  • Health & Medical industry: “OMG! The Growth Potential is Great! More business for us!

  • Poor monkeys get screwed again: “You’ve Got Mail - Statement of Benefits - sorry, the computer said your diabetes is not covered anymore!

• Also Republicans: “The States should pay for their own healthcare - cut federal spending on healthcare programs

Can you believe how profitable sugar can be ?

The Trade

• If Arkansas is successful in removing sodas from the list of SNAP covered items, it will be bad for sales of soda in the US

• Tickers to play

  • KO - The Coca-Cola Company

  • PEP

  • FIZZ

  • KDP

  • WMT

Background read:

https://www.wsj.com/health/rfk-jr-and-his-allies-target-trumps-beloved-soda-8f65b234?st=7EBrvA&reflink=desktopwebshare_permalink

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What percentage of Coke's revenues come from sales paid by SNAP program in the US?

• No official data exists on the exact percentage of Coca-Cola’s U.S. revenues from SNAP sales.

• A claim from X posts estimates 40.2% of Coca-Cola’s U.S. revenue comes from SNAP:

  • Based on SNAP’s $113 billion budget, Coca-Cola’s 46.3% sugary drink market share, and 10% of SNAP spending on sugary drinks.

  • Assumes $5.23 billion from SNAP out of $13 billion U.S. revenue.

  • Flawed due to oversimplification of revenue streams (e.g., ignores B2B sales) and competition (e.g., PepsiCo).

• Adjusted critiques from X suggest a lower percentage:

  • SNAP is ~4% of U.S. food/beverage spending.

  • Coca-Cola’s U.S. revenue likely $17–20 billion, reducing SNAP’s share to ~8–10%.

• Web data context:

  • 2016 Forbes: U.S. carbonated drinks were ~25% of Coca-Cola’s global revenue, declining over time.

  • 2016 USDA: SNAP households spend ~10% of food budget on sugary drinks, split across brands.

• Coca-Cola’s 2023 global revenue: $45.75 billion; North America (mostly U.S.): ~$17 billion (37%).

• Reasonable estimate: SNAP contributes 5–15% of U.S. revenue ($1–2.5 billion), likely single-digit (5–10%).

• Conclusion: SNAP’s contribution is significant but far below 40.2%, with 5–10% being a plausible range based on available data.