Coca-Cola—Earnings & Outlook

July 26, 2023

Coca-Cola reported earnings this morning

The Coca-Cola Company reported earnings this morning.🥤Coca-Cola raised guidance for the rest of the year and exceeded analysts’ expectations for quarterly earnings and organic revenue.

💰At a high level, investment analysts were looking for Coca-Cola to maintain a positive inflation adjusted pricing mix, raise year-end guidance, and show organic growth of unit case volume and concentrate shipments, topline revenue growth, and margin expansion, especially as post-pandemic consumers return to live events—it checked nearly all the boxes (except for slight margin erosion from currency headwinds)!

🌍Stronger volume trends in Latin America (LATAM), Middle East, and Asia made up for muted growth in the U.S. (one-third of sales) and Europe.

💸Overall, Coca-Cola’s 10% rise in selling prices is outpacing volume growth, but the risk of softening consumer demand or to put it another way, consumers looking for better deals and straying to other brands, rises as prices increase. Substitution risk is something to watch carefully.

🗓️Through the rest of the year, margins should benefit from easing supply chains and better input pricing, but adverse currency-translation from a weakening U.S. dollar could restrain earnings growth.

🧬Consumers and investors will also want management to provide guidance on continued product innovation including their MinuteMaid rebrand, “What the Fanta” mystery flavors, alcohol ready to drink beverages, and rehydration, functional, and energy drinks.

🥵Big picture, global warming and record breaking heatwaves should create more demand for beverages and rehydration.

🏭Over the past few years, Coca-Cola has experienced a significant and positive transformation through various strategic initiatives including enhancing its sales portfolio, global re-franchising and consolidation of bottling assets, implementing new systems and procurement processes in the US, shifting their focus from volume to value growth, and making changes in senior management.

Coca-Cola Polar Love
Coca-Cola Polar Love — Graphics by

I’d like to buy the world a home
and furnish it with love
grow apple trees and honey bees
and snow white turtle doves
I’d like to teach the world to sing
in perfect harmony
I’d like to buy the world a coke
and keep it company
that’s the real thing!


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