Consumers in the U.S. are increasingly opting for weight loss drugs and non-alcoholic beverages, leading to a slowdown in soda purchases. Despite this trend, Coca-Cola reported strong earnings for the second quarter, spurred by solid global demand for its beverages. This performance has prompted the company to raise its full-year outlook.
Coca-Cola CEO James Quincey expressed optimism about the company’s results, highlighting both revenue and operating income growth amidst a dynamic market environment. However, the North American market saw a 1% decline in volume sales due to weakened performance in “away-from-home” channels, which encompass its water, sports drinks, coffee, tea, and soda offerings.
To mitigate this decline, Coca-Cola is collaborating with fast food chains, such as McDonald’s, to integrate its sodas into meal deals. Notably, the company’s Fairlife milk brand and its signature Coke saw significant retail sales growth during the quarter.
The company exceeded analysts’ expectations by generating $12.4 billion in revenue, translating to approximately $0.84 per share. Analysts had anticipated revenues of around $11.76 billion, or about $0.81 per share.
Coca-Cola has adjusted its forecast for organic revenue growth to between 9% and 10%, an increase from its previous estimate of 8% to 9%.
In a similar vein, Pepsi is facing challenges in attracting U.S. consumers who are increasingly prioritizing health-conscious products. The company recently attributed its subdued performance in the second quarter to a series of product recalls.