Cola on Tuesday raised its full-year outlook after beating Wall Street expectations for quarterly results and revenue.
The company also gave a look to 2023, saying it expects inflation to continue to push spending and commodity prices to remain volatile. Foreign exchange is also estimated to weigh on Coke’s revenue and earnings. However, the company won’t give its full outlook for next year until early 2023.
Shares in the company rose 3% in pre-market trading.
Here’s what the company reported compared to what Wall Street expected, based on a survey of analysts by Refinitiv:
- Earnings per share: 69 cents adjusted vs. 64 cents expected
- Revenue: $11.05 billion adjusted versus $10.52 billion expected
The beverage giant reported third-quarter net income of $2.83 billion, or 65 cents per share, up from $2.47 billion, or 57 cents per share, a year earlier.
Excluding items, Coke earned 69 cents per share.
Adjusted net sales rose 10% to $11.05 billion, topping expectations of $10.52 billion. Organic revenue rose 16%, driven by higher prices across Coke’s portfolio.
Unit case volume, which strips out the impact of currency and price changes, grew 4% in the quarter. Other consumer giants, such as Tide maker Procter & Gamble, have seen their volumes fall as consumers feel inflation hitting their wallets. Coke said it has tried to appeal to budget-conscious consumers through product offerings such as value packs in North America.
Coke’s fizzy drinks segment, which includes namesake soft drinks, reported volume growth of 3%. Cola Zero Sugar was once again outstanding, with volume up 11% in the quarter.
The company’s hydration, sports, coffee and tea division saw volume growth of 5%, driven by Powerade, Bodyarmor and the expansion of Costa Coffee.
Coke’s nutrition, juice, dairy and plant-based beverages division reported flat volume for the quarter. Coke said the weak performance was due to declining demand for local brands in Eastern Europe.
For 2022, Coke now expects comparable earnings per share growth of 6% to 7%, up from the previous range of 5% to 6%. The company also raised its outlook for organic revenue growth to 14% to 15% from a range of 12% to 13%.
In the fourth quarter, Coke estimates foreign currency will weigh comparable net sales by 8% and comparable earnings per share by 9%, including the effect of hedged positions.