KFC Dumps Pepsi After 40 Years, Hands U.S. Fountain to Coca-Cola

By Amara Osei

KFC will pour Coca-Cola in every U.S. restaurant by spring 2027, ending a soda partnership with PepsiCo that has run roughly 40 years. The switch starts in January 2027, the chain announced, and represents one of the biggest fountain-rights shake-ups in recent fast-food history.

The move severs a corporate relationship that predates most of KFC's current customers. PepsiCo bought KFC in 1986, and it kept the pouring rights even after spinning the chicken chain off into Yum! Brands in 1997, according to Nation's Restaurant News. For four decades, the Pepsi logo sat alongside the Colonel's. Come 2027, it won't.

Why is KFC changing sodas now?

KFC framed the deal as part of a broader brand refresh rather than a simple supplier swap. The company is pushing to modernize what it sells and how it sells it, and the beverage menu sits at the center of that push.

"This partnership is about more than what's in the cup," said KFC U.S. President Catherine Tan-Gillespie. She called the Coca-Cola agreement another step in evolving the brand.

The proof is already on the menu — or at least in one test kitchen. KFC is expanding its drink lineup with iced coffees, boba and shakes at Open House, its new innovation restaurant in McKinney, Texas. That location functions as a live laboratory for what the chain may roll out nationally, and beverages are carrying the experiment.

The message: fountain drinks are no longer an afterthought bundled with a combo meal. They're a product category KFC wants to own, and Coca-Cola won the job of supplying it.

What happens to PepsiCo?

PepsiCo isn't exiting the Yum! orbit entirely. The company remains a partner for Yum! Brands and recently renewed agreements covering Taco Bell and KFC's international restaurants, including a 10-year deal with Taco Bell.

That split matters. PepsiCo keeps a large, long-dated piece of the business — Taco Bell's decade-long commitment alone is substantial — but it loses the U.S. KFC fountain, a flagship account it held since the Reagan administration. The loss is symbolic as much as financial. KFC was once literally part of PepsiCo.

For Coca-Cola, the win extends its dominance of the U.S. fountain business at a moment when rivals are fighting for every outlet. Landing a national chicken chain with thousands of U.S. locations, held by a competitor for some 40 years, is the kind of account shift that rarely happens in this industry.

What should customers expect?

The short version: same restaurants, different cups. Starting in January 2027, Coca-Cola products begin rolling into KFC's U.S. locations, and the chain expects the transition to cover every U.S. restaurant by spring 2027.

The longer version involves what sits next to the soda machine. If the McKinney, Texas, Open House location is any guide, KFC wants iced coffee, boba and shakes to do more work in its beverage mix. Tan-Gillespie's comment that the partnership goes beyond "what's in the cup" signals the chain sees drinks as a growth lever, not just a margin add-on.

Watch the rollout calendar. A January 2027 start and a spring 2027 completion give KFC a tight window to retool supply chains, equipment and packaging across its entire U.S. footprint — and give PepsiCo a deadline to defend everything it still holds.