Coca-Cola's Results Indicate Soda Isn't Dead, But Hold the Sugar
(Bloomberg) -- Soda isn’t dead, at least if it’s zero sugar. Coca-Cola Co. posted profit that beat estimates as the company got a boost from its diet sodas, with Coke Zero Sugar logging its best quarter in 10 years.
- The strong diet soda performance belies the notion that consumers have turned away from artificial sweeteners. Diet Coke has also been bouncing back, even as overall soda consumption slides in the U.S. As a result, the so-called Cola War with longtime rival PepsiCo Inc. is back in full swing.
- Coke’s Chief Executive Officer James Quincey, who took over last year, has been shifting the product portfolio toward healthier drinks. This summer, it announced a $5.1 billion deal to buy U.K. coffee chain Costa.
- Coke’s results also benefited from higher prices. The company has raised prices in response to paying more for freight and aluminum, as the trucker shortage and tariffs drive up costs.
- The shares gained as much as 2 percent to $47.37 in New York Tuesday. The stock had already climbed 1.3 percent this year through Monday’s close.
- It can be tricky being a global company. Currency headwinds are expected to pull down comparable operating income by as much as 11 percent in the fourth quarter, with economic turmoil in Turkey and Argentina hurting the company. “It’s very rare to have a year where something isn’t going wrong somewhere,” Quincey said in an interview.
- For more details on the results, click here.
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