Coca-Cola on Tuesday reported quarterly earnings and revenue that topped analysts’ expectations, as global demand for its drinks rose.
Shares of the company climbed nearly 5% for the day.
Here’s what Coca-Cola reported for the quarter ended Dec. 31 compared with what Wall Street was expecting, based on a survey of analysts by LSEG:
- Earnings per share: 55 cents adjusted vs. 52 cents expected
- Revenue: $11.54 billion vs. $10.68 billion expected
The beverage giant reported fourth-quarter net income attributable to shareholders of $2.20 billion, or 51 cents per share, up from $1.97 billion, or 46 cents per share, a year earlier.
Excluding restructuring charges, refranchising gains and other items, Coke earned 55 cents per share.
Net sales rose 6% to $11.54 billion.
Organic revenue, which strips out acquisitions, divestitures and foreign currency, climbed 14% in the quarter, largely fueled by higher prices. Coke’s pricing rose 9% in the quarter, 4% of which came from markets dealing with hyperinflation. The rest came from price hikes and “favorable mix,” meaning that customers bought products that were more expensive.
While most of Coke’s organic revenue growth came from pricing, the company did see higher demand, unlike many consumer companies including rival PepsiCo.
Coke’s unit case volume grew 2%, reversing last quarter’s decline. The metric strips out the impact of pricing and foreign currency to reflect demand. The company attributed its increasing volume to growing demand in China, Brazil and the U.S.
“In North America, we grew both transactions and volume and had robust top line and profit growth during the quarter. Trademark Coca-Cola and Fairlife remain leaders in at home retail sales growth,” Coke CEO James Quincey said on the company’s conference call.
The company’s sparkling soft drinks segment, which includes its namesake soda, saw volume rise 2% in the quarter. Coke Zero Sugar’s volume climbed 13% during the period.
Coke’s water, sports, coffee and tea division reported 2% volume growth. Both water, which includes its Smartwater brand, and tea reported increasing demand, but sports drinks and coffee volume both declined in the quarter.
Coke’s juice, value-added dairy and plant-based beverages division saw volume shrink 1%. The company said declines in Europe, the Middle East and Africa offset growth in North America.
Looking to 2025, Coke projects organic revenue will grow 5% to 6%. The company also expects comparable earnings per share will rise 2% to 3%, which includes a 6% to 7% headwind from currency exchange and a slight headwind from acquisitions, divestitures and structural changes.
“It seems more likely in ’25, there’ll be a little more price and a little less volume, but there will be volume growth,” Quincey told analysts.
Coke could also face some rising costs in 2025. For example, President Donald Trump raised tariffs on all aluminum imports to 25%, which are expected to go into effect next month.
“As it relates to our strategies around ensuring affordability and ensuring consumer demand, if one package suffers some increase in input costs, we continue to have other packaging offerings that will allow us to compete in the affordability space,” Quincey said. “For example, if aluminum cans become more expensive, we can put more emphasis on PET [plastic] bottles, et cetera.”