Coke thinks Microsoft’s AI future is the real thing.
There’s no doubt about it.
Coca-Cola and Microsoft are two of the biggest companies in the world, with market caps of $7.79 billion and $2.98 trillion, respectively. Microsoft ranks 13th in the Fortune 500, while Coca-Cola is 100th.
Now the two corporate giants are teaming up on a new five-year AI-based strategic partnership deal. The alliance will see Coke align its core technology systems with Microsoft’s technology lineup to “enable the adoption of leading-edge technology; and foster innovation and productivity globally,” according to a April 23 Microsoft company statement.
“Through our long-term partnership, we have made significant progress to accelerate system-wide AI Transformation across The Coca-Cola Company and its network of independent bottlers worldwide,” said Judson Althoff, executive vice president and chief commercial officer at Microsoft. “We’re excited to support Coca-Cola as it continues to embrace the era of AI and looks to solutions like Azure OpenAI Service and Copilot for Microsoft 365 to drive innovation across every area of its business.”
Here Are Five Big Takeaways From the Eye-Opening Deal
A big cash injection. Coca-Cola has committed $1.1 billion to the Microsoft Cloud and its generative AI capabilities. “The collaboration underscores Coca-Cola’s ongoing technology transformation, underpinned by the Microsoft Cloud as Coca-Cola’s globally preferred and strategic cloud and AI platform,” Microsoft says.
Coke lands with Azure AI. Coca-Cola has migrated all its applications to Microsoft Azure, “with most major independent bottling partners following suit,” the company notes. Microsoft says both firms will undertake “joint experiments” with Azure OpenAI Service to create generative AI use cases across numerous Coca-Cola business operations. Those tests should include merging Microsoft’s Copilot AI assistant into Coke’s workforce across the globe.
A year in the making. Both companies report working together on developing new generative AI tools and applications since summer, 2023. Coke is reportedly “exploring the use of generative AI-powered digital assistants on Azure OpenAI Service to help employees improve customer experiences, streamline operations, foster innovation, gain a competitive advantage, boost efficiency and uncover new growth opportunities,” the report states.
From $250 million to $1.1 trillion. The new deal builds on a $250 million AI development alliance between the two companies in 2020. Coca-Cola executives must have liked the experience, with company officials citing a “significant step in advancing Coca-Cola’s digital transformation, focused on providing expanded access to Microsoft’s cloud and AI platforms — as well as solutions such as Microsoft 365, Power BI, Dynamics 365, Defender and Fabric — to enhance efficiency and scalability while fostering innovation across the system.”
“Our expanded partnership with Microsoft is an important next chapter in Coca-Cola’s journey toward a digital-first enterprise powered by emerging technologies,” says Neeraj Tolmare, senior vice president and global chief information officer for The Coca-Cola Company. “Microsoft’s capabilities help accelerate our adoption of AI to create incremental enterprise value.”
Coke leans into AI. The Microsoft deal signals a green light for more expansion into AI product development. In 2023, Coke rolled out Coca-Cola Y3000, the first-ever company beverage created by human and AI developers. Coke is also already using AI to develop and promote new advertising and market campaigns.
Brian O’Connell, a former Wall Street bond trader and best-selling author, is a prominent figure in the finance industry. With a substantial background as an ex-Wall Street trader, he has authored two best-selling books: ‘The 401k Millionaire’ and ‘CNBC’s Creating Wealth’, demonstrating his profound knowledge of finance and investing.
Brian is also a finance and business writer for esteemed national platforms and publications, including CNN, TheStreet.com, CBS News, The Wall Street Journal, U.S. News & World Report, Forbes, and Fox News.
