Abdelrahman
Coca-Cola’s Strong Quarterly Performance Exceeds Expectations
James Quincey, the CEO of Coca-Cola, made earlier remarks on CNBC’s "Squawk Box" during the World Economic Forum in Davos, Switzerland, on January 22, 2025.
Coca-Cola Reports Impressively High Earnings
On Tuesday, Coca-Cola announced its quarterly earnings and revenue, surpassing analysts’ forecasts amid rising global demand for its beverages. Following the announcement, the company’s shares jumped by more than 3% in premarket trading.
Key Financial Highlights
For the quarter ending December 31, Coca-Cola reported the following results compared to Wall Street’s expectations, based on a survey by LSEG:
- Adjusted Earnings per Share: 55 cents, compared to the anticipated 52 cents.
- Revenue: $11.54 billion, exceeding the expected $10.68 billion.
The beverage powerhouse recorded a net income attributable to shareholders of $2.20 billion, translating to 51 cents per share, an increase from $1.97 billion, or 46 cents per share, the previous year.
When excluding restructuring charges and refranchising gains, Coca-Cola still managed to post earnings of 55 cents per share. Additionally, net sales grew by 6% to reach $11.54 billion.
Organic Revenue Growth
Coca-Cola’s organic revenue, which excludes acquisitions, divestitures, and foreign currency transactions, experienced a significant rise of 14% during the quarter. This growth was largely driven by pricing adjustments, although the company also benefited from increased consumer demand, setting it apart from competitors like PepsiCo.
The company reported a 2% increase in unit case volume, reflecting a rebound from the previous quarter’s decline. This metric considers demand without the influence of pricing and currency fluctuations, and Coke attributed this positive trend to rising demand in China, Brazil, and the United States.
Segment Performance Overview
- Sparkling Soft Drinks: In this category, which includes iconic products like Coca-Cola, volume increased by 2% for the quarter, with Coke Zero Sugar leading the charge at a 13% volume growth.
- Water, Sports, Coffee, and Tea: This segment also saw a 2% volume rise, driven by higher demand for water (including Smartwater) and tea, while both sports drinks and coffee experienced a decline.
- Juice and Plant-Based Beverages: In contrast, this division reported a 1% volume decrease, primarily due to falling demand in Europe, the Middle East, and Africa, which overshadowed growth in North America.
Outlook for 2025
Looking ahead, Coca-Cola anticipates organic revenue growth between 5% and 6% for 2025. The company also forecasts that its comparable earnings per share will increase by 2% to 3%, factoring in a 6% to 7% headwind from currency fluctuations, along with minor impacts from acquisitions, divestitures, and structural adjustments.
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