Coca-Cola has reported strong second-quarter earnings, buoyed by global demand for its beverage offerings, even as U.S. sales volume experienced a slight decline. This performance has led the company to raise its full-year guidance. CEO James Quincey expressed optimism about the results, noting significant growth in both revenue and operating income amid changing market conditions.
Despite the overall success, Coca-Cola saw a 1% decrease in volume sales in North America, primarily attributed to reduced activity in away-from-home channels, which encompass water, sports drinks, coffee, tea, and soda products. However, the decline was mitigated by the success of Fairlife milk and the strong retail sales growth of Coke itself, which ranked first and second in sales during the quarter.
To counteract the volume drop, Coca-Cola is collaborating with food chains to incorporate its sodas into combo meal offerings. The company is working closely with McDonald’s to enhance the appeal of its $5 meal deal, which comes with a soft drink.
Despite challenges in the North American market, Coca-Cola exceeded Wall Street projections by reporting $12.4 billion in revenue for the quarter, translating to approximately $0.84 per share. Analysts had anticipated revenue of $11.76 billion, or around $0.81 per share.
Looking ahead, Coca-Cola has revised its forecast for organic revenue growth, now expecting an increase between 9% and 10%, up from the previous estimate of 8% to 9%.
Similarly, Pepsi has faced difficulties in the U.S. market, where consumers increasingly favor products aligned with weight loss and healthier lifestyles. A recent Gallup poll indicates that young adults in the U.S. are consuming significantly less alcohol than in the past. Earlier in July, Pepsi cited multiple recalls as a factor contributing to its weaker second-quarter performance.