Yahoo Finance Coca-Cola sees signs of Powell's 'disinflationary process'
Spotted at Coca-Cola (KO): The "disinflationary process" recently touted by Federal Reserve Chair Jerome Powell.
The maker of Coke Zero and Costa coffee said it sees 2023 mid-single-digit percentage commodity cost inflation. In 2022, higher costs for things like sweeteners and aluminum for cans led to the beverage giant feeling a roughly high-single-digit percentage year-on-year increase for its commodities basket.
Coke's improved inflation outlook comes alongside a generally solid earnings report as it pushed price increases on consumers globally and streamlined its beverage portfolio.
The company's key measure of adjusted organic revenue growth easily surpassed analyst forecasts on the back of strong demand for Coke Zero and coffee beverages. Adjusted operating margins improved 60 basis points from a year ago.
Here is how Coca-Cola performed compared to Wall Street estimates:
Net Sales: $10.1 billion vs. $10.02 billion
Adjusted Organic Revenue: +15% vs. +10.6%
Diluted EPS: $0.45 vs. $0.45
The company said it sees full-year organic sales growth of 7% to 8%, above analyst estimates for 7.2%. Earnings are expected to rise 4% to 5%.
Shares of Coca-Cola rose slightly in pre-market trading. The stock is likely being held back from a larger pop amid quarterly weakness in sales for sports drinks, tea, and juice.
Wall Street will be keyed in on plans to reignite growth in these slower growing businesses on the company's earnings call, which kicks off at 8:30 a.m. ET today.
Programming note: Coca-Cola president and CFO John Murphy will be on Yahoo Finance Live today in the 10am ET hour.
Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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