Consumers in the U.S. are hesitating to purchase sodas, influenced by the availability of weight loss drugs and a trend toward non-alcoholic options. Despite this, Coca-Cola reported strong second-quarter earnings, fueled by heightened global demand for its beverages, leading the company to raise its full-year forecasts.
Coca-Cola CEO James Quincey expressed optimism regarding the company’s second-quarter results, highlighting solid growth in both revenue and operating income amidst a shifting market. Nevertheless, the company faced a 1% decline in volume sales in North America, attributed to weaker performance in away-from-home channels, which encompass water, sports drinks, coffee, tea, and soda sales.
To mitigate the decline, Coca-Cola is collaborating with food chains to integrate its soda products into combo meals. The company is reportedly working with McDonald’s to enhance its $5 meal deal, which includes a soft drink.
Coca-Cola’s total revenue for the second quarter reached $12.4 billion, translating to earnings of $0.84 per share, surpassing Wall Street predictions of $11.76 billion in revenue or approximately $0.81 per share. The company revised its forecast for organic revenue growth to between 9% and 10%, up from an earlier estimate of 8% to 9%.
In a similar vein, Pepsi has also been facing challenges in engaging U.S. consumers, who are increasingly gravitating towards products that promote weight loss and healthier lifestyles. Pepsi recently cited a series of product recalls as contributing factors to its subdued performance in the second quarter.