Keurig Dr Pepper Reports Steady Earnings Amid Price Increases

Keurig Dr Pepper announced its quarterly earnings on Thursday, revealing results that aligned with analysts' expectations, driven by higher prices in its U.S. soda sales. The beverage company reported a second-quarter net income of $515 million, translating to 38 cents per share, an increase from $503 million, or 36 cents per share, in the same period last year. Adjusted earnings per share stood at 45 cents, matching forecasts, while net sales rose 3.5% to reach $3.92 billion. The U.S. refreshment beverages division, which includes popular brands like Snapple and Canada Dry, experienced a sales growth of 3.3%, with drink prices increasing by 2.9% compared to the previous year. Notably, the Dr Pepper Creamy Coconut drink emerged as the company's top-performing limited-time offering. However, executives noted that while soda sales remain robust, the market for still beverages and energy drinks is facing challenges due to a fluctuating consumer environment. In contrast, the U.S. coffee division saw a decline in sales, dropping 2.1% to $1 billion, primarily due to a 2.9% decrease in pricing. Shipments of K-Cup pods remained stable, attributed to strong market share trends. The company is focusing on marketing strategies that highlight the cost-effectiveness of home-brewed coffee compared to coffee shop purchases, aiming to attract budget-conscious consumers. Keurig Dr Pepper's international division reported a significant sales increase of 15.5% for the quarter, although it still represents less than one-sixth of the company's total revenue. CEO Tim Cofer emphasized the potential for growth in the cold coffee segment, which currently lags behind cold drink sales at major coffee chains.