The Coca-Cola Company Coca-Cola announced a beat on earnings and revenue on Tuesday, shocking analysts as the company struggled in multiple markets. The drink manufacturer posted profits of 87 cents per share, after cutting out asset impairment and restructuring costs. Robust demand in Europe played a large part in this stellar performance. That was enough to help offset the relatively weak volume seen across other regions.
The company’s net sales increased by 1% to $12.54 billion, with revenue excluding some items at $12.62 billion. Analysts had been expecting even worse numbers, making Coca-Cola’s results a pleasant surprise. As a result, the company’s performance in Europe was breathtaking. Europe, Middle East and Africa (EMEA) segment saw a 3% volume growth.
Not all regions performed equally well. At Coca-Cola’s Latin American unit, they had to deal with a 2% drop in case volume. At the same time, the Asia Pacific market fell more sharply by 3%. Perhaps most damaging was the company’s 1% decline in North American volume. This drop was due in part to a lowered demand for its legendary, if diabetes-inducing, namesake soda. Value-added dairy and plant-based beverages… Their juice division was down, with the segment posting a 4% drop in volume. On the other hand, sparkling water, sports, coffee and tea categories were all sluggish with zero volume growth for the quarter.
Though the results have clearly been a mixed bag, Coca-Cola is still proclaiming an upbeat theme for their future. The firm doubled down on its guidance that organic rev would be 5%-6% growth by 2025. Coca-Cola cut its full year comparable earnings per share growth guidance down to 3%. This wariness is understandable, but it belies the company’s long-term strategic moves to pivot towards changing consumer preferences and macroeconomic headwinds.
In premarket trading, Coca-Cola’s stock fell just under 1%. This potentially positive movement indicates that investors are digesting the confusing whiplash of signals from the company’s highly-varied performance across geographic and product markets.