Coca-Cola has reported strong second-quarter earnings, despite a decline in volume sales in North America, particularly in its away-from-home channels, which encompass water, sports drinks, coffee, tea, and sodas. The beverage company experienced a 1% drop in volume sales in its U.S. division during this quarter, but it still managed to exceed Wall Street expectations with reported revenues of $12.4 billion, equating to approximately $0.84 per share. This figure surpassed the forecasted revenue of $11.76 billion, or about $0.81 per share.
Coca-Cola’s CEO, James Quincey, expressed optimism about the company’s performance, highlighting solid topline and operating income growth amid changing market conditions. The company has revised its full-year guidance for organic revenue growth to between 9% and 10%, up from the previous estimate of 8% to 9%. This marked improvement was partly fueled by strong global demand for its soda products, as well as its Fairlife milk offering, which helped mitigate the sales decline.
To combat the volume drop, Coca-Cola is collaborating with fast-food chains to incorporate its soft drinks into meal deals, including a partnership with McDonald’s aimed at enhancing its $5 meal deal.
In contrast, Pepsi has been facing challenges in engaging U.S. consumers who are increasingly leaning towards weight loss and healthier products. A recent Gallup poll noted a decline in alcohol consumption among young adults in the U.S. As a result, Pepsi has experienced subdued performance in its second quarter, partially attributed to a series of product recalls.