Consumer trends towards weight loss drugs and non-alcoholic beverages are impacting soda sales in the U.S. market. Despite these challenges, Coca-Cola reported strong earnings for the second quarter, driven by robust global demand for its products, which led the company to raise its full-year outlook.
Coca-Cola’s CEO, James Quincey, expressed optimism about the second-quarter results, highlighting significant growth in revenues and operating income amid a shifting market landscape. However, the beverage giant experienced a 1% decline in volume sales in North America, attributed to a downturn in what Quincey referred to as “away-from-home channels,” which encompass water, sports drinks, coffee, tea, and soda.
To mitigate these setbacks, Coca-Cola’s performance was partially bolstered by its Fairlife milk product and its flagship soda, Coke, both of which ranked high in retail sales growth. Quincey revealed that the company is collaborating with food chains, like McDonald’s, to integrate its soda offerings into combo meals—aiming to enhance sales in the fast-food sector.
In the second quarter, Coca-Cola’s reported revenue hit $12.4 billion, exceeding Wall Street’s anticipated $11.76 billion. The company noted an upward adjustment in its organic revenue growth forecast, now predicting between 9% and 10%, an increase from the earlier estimate of 8% to 9%.
Contrasting Coca-Cola’s performance, Pepsi has faced difficulties in attracting U.S. consumers, who are shifting towards healthier options and reducing alcohol consumption, as indicated by a Gallup poll. In July, Pepsi attributed its weaker second-quarter results to multiple product recalls.