PepsiCo Secures 11-Year Beverage Deal with Taco Bell Amid KFC Switch to Coca-Cola

On October 22, 2026, PepsiCo announced an 11-year extension of its exclusive beverage partnership with Taco Bell, covering U.S. locations and international markets (Canada, United Kingdom, Ireland, Thailand) through 2036. The agreement keeps PepsiCo’s portfolio—including Pepsi, Pepsi Zero Sugar, Mountain Dew, Starry, and exclusive Baja Blast variants—on tap at participating Taco Bell, Taco Bell Cantina, and Live Más Café sites.

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PepsiCo and Yum! Brands’ restaurant concepts have been linked since PepsiCo owned Taco Bell and KFC before spinning them off into a separate public company in 1997. The partnership has produced co-branded products such as Mountain Dew Baja Blast and Doritos Locos Tacos. In early October 2026, KFC announced a shift of its U.S. fountain business to Coca-Cola, ending a four-decade relationship with PepsiCo.

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• Taco Bell operates over 8,200 U.S. restaurants, generating $17 billion in systemwide sales last year, versus roughly $5 billion for KFC.

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• Mountain Dew Baja Blast is described as a $1 billion brand.

Taco Bell, PepsiCo extend partnership through 2036, expand beverage innovation

• PepsiCo’s North America beverage unit posted a 2 % decline in its most recent quarter.

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• PepsiCo reported net revenue of nearly $94 billion in 2025 (Investing.com).

PepsiCo Locked In Taco Bell’s US Soda Deal Through 2036

• A memo from Catherine Tan-Gillespie, KFC U.S. President, emphasized that PepsiCo remains an important partner for Yum! Brands’ international operations despite the U.S. switch.

PepsiCo, Taco Bell Extend Beverage Deal to 2036

• The deal secures a high-margin “away-from-home” channel for PepsiCo, offsetting volume loss from KFC’s transition to Coca-Cola.

PepsiCo Locked In Taco Bell’s US Soda Deal Through 2036

• Analysts view the extension as a defensive move that stabilizes PepsiCo’s fountain presence in a competitive U.S. soda market.

PepsiCo locks in Taco Bell partnership through 2036 following KFC loss

• For Taco Bell, continued access to exclusive beverages supports its strategy to generate $5 billion in beverage revenue by 2030 and to attract Gen Z consumers through new “Refrescas” and functional-drink offerings.

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• “Strong partnerships have always been critical to how Taco Bell grows and evolves,” — Meg Farren, Taco Bell’s President, North America

Taco Bell extends PepsiCo partnership through 2036

No major discrepancies were identified among the sources regarding the terms of the Taco Bell agreement. However, precise timelines for KFC’s complete transition to Coca-Cola (scheduled to begin in January and finish by spring) are described only in general terms, leaving the exact rollout schedule unconfirmed.

PepsiCo, Taco Bell Extend Beverage Deal to 2036