Coca-Cola Boosts Sales Forecast Amid Strong International Demand

Coca-Cola announced an increase in its annual organic sales and profit forecasts on Tuesday, reflecting a growing willingness among consumers to pay more for its premium beverages, including sodas, energy drinks, and juices, particularly in international markets. Following the announcement, the company's shares rose nearly 1% in premarket trading, buoyed by a surprising uptick in quarterly revenue. The beverage giant has been expanding its presence in Asia and Europe while introducing reformulated products like Coke Spiced and Georgia Coffee to cater to price-sensitive consumers. In the second quarter, Coca-Cola reported a 9% rise in its average selling price, alongside a 2% increase in unit case volumes. However, the North American market presented challenges, with volumes declining by 1% as consumers exhibited caution in their spending habits. This trend of price sensitivity was echoed by PepsiCo CEO Ramon Laguarta, who noted that it spans across various income groups in the U.S., not just among lower-income consumers. In contrast, PepsiCo faced difficulties in the same quarter, missing revenue estimates due to frequent price hikes and competition from private-label brands, which negatively impacted its snack and soda sales in the U.S. Coca-Cola's optimistic forecast for fiscal 2024 now anticipates organic sales growth of 9% to 10%, up from a previous estimate of 8% to 9%, and an adjusted profit increase of 5% to 6%, compared to the earlier forecast of 4% to 5%. The company's second-quarter net revenue climbed 2.9% to $12.31 billion, surpassing LSEG estimates of $11.76 billion, with adjusted earnings of 84 cents per share, exceeding expectations of 81 cents.