Caffeinated Beverages Get New Buzz

Caffeine is giving the U.S. economy a jolt. Since 2019, U.S. spending on caffeinated beverages has grown at 6% annually – nearly double the pace of the broader food and restaurant industry – with energy drinks (8%) and beverage shops (7%) leading the category. 

“Caffeinated beverages are one of the most attractive growth areas in the consumer-packaged goods and restaurants space,” says Dara Mohsenian, who leads coverage of U.S. beverages and household products at Morgan Stanley Research. “People living increasingly busy and active lives want that energy.”

Morgan Stanley Research expects that pace to continue through 2030, with a number of other factors boosting the sector, including the proliferation of healthier energy and carbonated soft drinks, the perception that coffee has health benefits and the expansion of the population on GLP-1 medications.

What Consumers Say

In a 2026 Morgan Stanley AlphaWise survey of about 3,000 people, the number of U.S. consumers expecting to increase their energy drink consumption increased, with a net 19% of respondents saying they expect to drink more over the next three months, up from an average of about 5% in Morgan Stanley's 2019 and 2021 AlphaWise surveys.

The strongest intent to increase energy drink consumption came from adults ages 25-34 and 35-44, suggesting people are maintaining the habit as they age. 

“This acceleration has been driven in part by a wave of innovation from new and existing brands, particularly in the sugar-free and better-for-you energy space bringing new consumers and keeping existing consumers in the category for longer as they get older,” says Eric Serotta, who covers U.S. Beverages, Tobacco, and Household Products at Morgan Stanley Research.

Importantly, energy drinks are not simply replacing coffee or soft drinks. Survey results indicate that consumers are turning to energy drinks because they want more energy, new flavors and greater convenience, creating new consumption occasions and expanding the overall market for caffeinated beverages. 

Six Drivers of Energy Drink Growth

Morgan Stanley sees six structural factors supporting demand for energy drinks over the long term.

• Favorable Demographics: The 25–44 age cohort — Millennials and older Gen Z — show the strongest intention to increase energy drink consumption.
• Expanding Household Penetration: Energy drinks are attracting a broader range of consumers, particularly women. Morgan Stanley Research believes the growth of zero-sugar and reduced-sugar options has helped expand the category's appeal beyond its traditional consumer base. 
• Improved Relative Affordability: Energy drinks have seen smaller price increases than soft drinks and packaged coffee in recent years, helping them remain a relatively affordable caffeine option. Rising coffee costs could further strengthen that advantage. 
• Pricing Power and Revenue Growth Management: Energy drink makers are increasingly using targeted pricing strategies, allowing them to raise prices gradually while maintaining demand. 
• Attractive Value vs. Coffee Shops: Energy drinks can provide a lower-cost alternative to specialty coffee beverages purchased from coffee shops. 
• Convenience of packaged energy drinks: Widely available and ready to consume, packaged energy drinks offer a grab-and-go option that fits into busy lifestyles. 

“These factors suggest that energy drink growth is being driven by more than just changing consumer tastes,” says Mohsenian. “Demographic trends, expanding adoption, pricing flexibility and convenience are creating a foundation for long-term demand.” 

The GLP-1 Bright Spot 

GLP-1 use continues to rise globally, with a potential impact on the consumption of caffeinated products. Morgan Stanley's AlphaWise survey suggests GLP-1 users are already gravitating toward energy drinks.  

Net purchase intent among GLP-1 users reached 55%, compared with 19% for the overall population. GLP-1 users also reported drinking energy drinks more frequently, consuming an average of 42 per month versus roughly 28 for all respondents. 

“This makes sense intuitively, with GLP-1 users saying they need additional energy to help compensate for weight loss and the overall reduction in calorie intake,” says Sarah Simon, who leads European staples coverage at Morgan Stanley Research. “We expect continued GLP-1 support for caffeinated beverages as the population on those therapies expands.”

The Evolving Caffeine Market

Beverage shops stand out as a bright spot in the restaurant industry. Away-from-home coffee and specialty beverages are attracting broad consumer demand, particularly among younger consumers.

“Our survey reinforces that away-from-home coffee and specialty beverages remain one of the more robust pockets of demand in restaurants, with broad reach, high-frequency usage, younger consumer affinity and room for brands to capture more of an existing habit with ongoing innovation,” says Brian Harbour, who leads coverage of U.S. restaurants and food distributors at Morgan Stanley Research.

According to the survey, 33% of consumers expect to visit a beverage shop more often for an away-from-home coffee or tea beverage over the next three months, compared to only 16% who expect to go less often — a net positive intent of 17%.

“That is somewhat surprising in a tough restaurant backdrop,” Harbour says. “That means there is an opportunity for beverage shops to continue to expand into custom mixed energy drinks and increase an already successful business.” 

While Morgan Stanley expects more muted growth for at-home coffee, consumers are likely to increasingly shift toward away-from-home coffee occasions and energy drinks, particularly younger consumers who prefer blended and cold beverages over traditional hot coffee.