Consumers in the United States are increasingly delaying soda purchases, influenced by weight loss medications and non-alcoholic alternatives. Despite this trend, Coca-Cola reported strong earnings for the second quarter, indicating high global demand for its beverage offerings and prompting the company to revise its full-year outlook positively.
Coca-Cola CEO James Quincey expressed optimism about the company’s performance, stating that the results reflected notable growth in both revenue and operating income amidst a changing market environment. However, the company experienced a 1% decline in volume sales in North America, largely attributed to a dip in “away-from-home channels” such as vending machines and restaurants, affecting its water, sports drinks, teas, and sodas.
To mitigate this downturn, Coca-Cola highlighted its strong sales in Fairlife milk and its flagship soda, Coke, which ranked first and second in retail sales growth during the quarter. Quincey mentioned that Coca-Cola is collaborating with food chains, particularly McDonald’s, to integrate soda into combo meals, an effort aimed at boosting sales.
Coca-Cola’s revenue for the second quarter reached $12.4 billion, surpassing Wall Street expectations, which had predicted revenues of around $11.76 billion. As a result, the company has increased its forecast for organic revenue growth to between 9% and 10%, up from an estimated range of 8% to 9%.
Meanwhile, Pepsi is facing challenges in capturing U.S. consumer interest, as many shift toward products that promote weight loss and healthier lifestyles. In July, Pepsi attributed its lackluster performance in the second quarter to a series of product recalls.