Keurig Green Mountain (GMCR) sold 1.7 million single-serve brewers last quarter, about 200,000 more machines than a year earlier. Part of the credit goes to discounting, as the company cleared inventory to make way for the soon-to-launch Keurig 2.0. The larger coffee maker is designed to accept only pods made by Keurig Green Mountain. The company’s net sales from brewers and accessories declined 4 percent year-on-year despite the increase in machines sold.
Anyone who recently got one of these deals on a Keurig 1.0 machine might find that during the holiday season it will feel like yesterday’s iPhone. The company is expanding the ranks of its coffee partners, so there will be more pod varieties for the old machines. But the old brewer will fall out of focus. “Over the holiday season, we’ll ship both Keurig 2.0 and Keurig 1.0 platforms, but our marketing and merchandising will be focused almost exclusively on Keurig 2.0,” Chief Executive Brian Kelley said on Wednesday’s earnings call.
The Keurig 2.0 will be able to brew more than one cup at a time, something normal coffee makers have been capable of for some time. The change ends the single-serving foundation on which Keurig has developed its brand. The new machines will also read the pods to get optimal brewing instructions for that variety.