The Coca-Cola Company announced on Tuesday that it is revising its annual sales and profit forecasts for the second time this year, citing robust consumer demand for its assortment of beverages, including sodas, juices, and energy drinks, coupled with escalating selling prices. The news sent the company’s shares soaring by 3% in pre-market trading, following the release of third-quarter results that surpassed expectations.
Notably, rival PepsiCo also exceeded estimates and disclosed plans to implement price hikes next year in response to mounting food expenses and an increased cost of living. In the third quarter, Coca-Cola reported a noteworthy 9% surge in average selling prices, accompanied by a 2% uptick in overall unit case volumes.
During an earnings call, Coca-Cola’s CEO, James Quincey, addressed the potential impact of weight-loss medications on the company’s sales, remarking, “There is still a lot of views out there as to what impact, if any, it will have.” This observation reflects the keen interest of investors and industry observers in how the popularity of medications like Wegovy and Ozempic might influence packaged food makers’ performance in this earnings season.
Buoyed by its resilient performance amid challenges posed by weight-loss drugs and the prevailing economic conditions, Coca-Cola now anticipates organic revenue growth for the year to range between 10% and 11%, up from the earlier projection of 8% to 9%. Similarly, core earnings per share are poised to climb by 7% to 8%, a notable increase from the prior estimate of 5% to 6%.
In terms of financials, The Coca-Cola Company reported third-quarter net revenue of $11.91 billion, surpassing the estimated figure of $11.44 billion. Moreover, adjusted earnings stood at 74 cents per share, outperforming the anticipated 69 cents, according to data from the London Stock Exchange Group.
The robust sales and profit performance of Coca-Cola in the third quarter underscores its enduring strength and promise in the competitive beverage industry.
Source: Reuters
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