In the United States, the shift towards weight loss drugs and non-alcoholic beverages has led consumers to reduce their soda purchases. Despite this trend, Coca-Cola announced impressive second-quarter earnings, bolstered by strong global demand for its products, leading the company to increase its full-year outlook.
Coca-Cola’s CEO, James Quincey, expressed optimism about their second-quarter performance, highlighting solid growth in revenue and operating income amid changing market conditions.
However, in North America, the company reported a 1% decline in volume sales for the quarter. Quincey attributed this decrease to weaker sales from “away-from-home channels,” which encompass water, sports drinks, coffee, tea, and sodas.
The drop in volume was somewhat counterbalanced by the success of Fairlife milk and the company’s flagship soda, Coke, which ranked first and second in retail sales growth during the quarter.
To combat the decline, Quincey mentioned that Coca-Cola is collaborating with restaurant chains to include their sodas in combo meals. The company is specifically working with McDonald’s to enhance the appeal of the fast food chain’s $5 meal deal that features a soft drink.
Overall, Coca-Cola exceeded expectations on Wall Street. For the second quarter, the beverage giant reported $12.4 billion in revenue, amounting to around $0.84 per share, surpassing analysts’ forecasts of $11.76 billion and $0.81 per share.
The company has raised its forecast for organic revenue growth to between 9% and 10%, an increase from its prior estimate of 8% to 9%.
Similarly, Pepsi has faced challenges in attracting U.S. consumers, who are increasingly opting for healthier products focused on weight loss. Additionally, Pepsi reported subdued second-quarter results, citing a series of product recalls as a contributing factor.