After years of facing challenges, Pepsi has successfully climbed back up the soda rankings, as Coca-Cola unexpectedly hits a bump in the road.

According to the latest annual sales report from Beverage Digest, the iconic 127-year-old Pepsi brand has reclaimed the No. 3 spot for sales volume among the leading soda brands in the United States as of 2025.

This rebound marks a significant shift after Pepsi dropped to fourth place last year. It was initially pushed out of second place by Dr Pepper in 2023, followed by a ranking below Sprite in 2024.

Pepsi’s resurgence is a testament to its enduring competitive spirit, harking back to its days as a formidable contender against Coca-Cola during the ‘Cola Wars’ of the 1980s.

Coca-Cola, which made its debut in an Atlanta pharmacy in 1886, remains the leader in the $100 billion U.S. soda market, boasting a market share of 18.5 percent—more than double that of any competitor.

However, the beverage giant has seen a decline, with sales dropping by a notable 5.3 percent last year, indicating a loss of momentum.

Dr Pepper, a Texas-born soda first introduced in the 1880s, boosted sales and held firm in second place as it cemented its status as a serious challenger to the two cola giants.

Pepsi has clawed its way back up the soda rankings after years of decline, as rival Coca-Cola suffers a surprising stumble. Doja Cat in a Pepsi commercial

Pepsi’s sales were flat – meaning it gained on Coca Cola, but lost ground slightly on Dr Pepper. But a huge drop in demand for Sprite helped Pepsi back up the rankings. Sprite – created by Coca-Cola in 1961 – slid two spots down the rankings.

Diet Coke – launched in 1982 as America’s first major sugar-free cola – climbed into fourth place after posting one of the strongest performances among top brands.

According to Beverage Digest, Dr Pepper accounted for 8.8 percent of all carbonated soda sales in 2025, beating Pepsi’s 8.1 percent, Diet Coke’s 8 percent and Sprite’s 7.9 percent. Mountain Dew had 5.7 percent.

The soda wars play out not just via cans and bottles in stores and bars but via drinks fountains in restaurants and hotels.  

Yesterday, we reported how Coca-Cola had snatched the contract to supply Marriott from Pepsi – across its roughly 9,700 hotels in 143 countries, including 6,200 in the US. 

Coke also snatched big contract from Pepsi at Costco in 2025. Pepsi scored a win in 2024 when it won back the drinks contract at Subway across more than 20,000 US locations.

The shake-up highlights how quickly fortunes are shifting in the soda aisle. Just two decades ago, Pepsi was firmly entrenched as America’s No 2 soda, while Dr Pepper lagged far behind and Sprite had a fraction of its sales.

Coca-Cola’s slump was partly blamed on a backlash among Hispanic consumers following a viral hoax where TikTokers claimed the company fired thousands of Latino workers at a Texas bottling plant and reported them to ICE.

Just two decades ago, Pepsi was firmly entrenched as America’s No 2 soda, while Dr Pepper lagged far behind and Sprite had a fraction of its sales. Iconic supermodel Cindy Crawford in a 1992 Pepsi commercial

The 127-year-old cola brand has returned to the No 3 spot among America’s top soda brands by sales volume, while Coca-Cola’s soda Sprite fell two spots down from third

Americans are drinking less soda overall. Across the entire beverage market, total volumes fell by 0.9 percent last year as prices rose.

The long-term trend is even more stark. Americans now consume far fewer soft drinks than they did two decades ago, with per-person intake dropping sharply since the mid-2000s.

While traditional sodas are struggling, a new category is booming. Energy drinks were the only type to see volume growth last year – up 9 percent. 

Monster was a big winner, but older brands like Gatorade fell.

The jump in rank for Pepsi comes a year after it slid to fourth place when Dr Pepper overtook it for second in 2024, and Sprite moved into third in 2025.

Pepsi pointed out that the Pepsi brand remained the overall No 2 soda when taking into account the other versions, which also include Diet.