Coca-Cola (NYSE:KO) on Thursday reported that its third-quarter revenue fell 9% as the coronavirus pandemic weighed on demand for fountain soft drinks, Powerade and Dasani.
But the company topped earnings estimates, sending shares up in Thursday trading.
Coke reported third-quarter net income of $1.74 billion, or 40 cents per share, down from $2.59 billion, or 60 cents per share, a year earlier.
Excluding asset impairments, severance costs related to its restructuring plan and other items, the beverage giant earned 55 cents per share, topping the 46 cents per share expected by analysts.
Net sales dropped 9% to $8.65 billion, beating expectations of $8.36 billion. Organic sales fell 6%, and unit case volume, which helps measure demand without the impact of pricing or foreign currency, declined 4%.
All four of Coke’s drink categories reported declines in unit case volume. Sparkling soft drinks was the least affected, with its volume falling only 1%. Demand for Coke Zero Sugar and trademark Coke drinks lifted the category, although overall it was hurt by the decline in the North American fountain business.
Juice, dairy and plant-based drinks saw volumes shrink by 6%, hurt by pressure in Asia Pacific and Latin America. Unit case volume of water, enhanced water and sports drinks fell by 11%. Tea and coffee was the hardest hit, with demand dropping 15%, primarily due to the company’s Costa cafes.
The company noted quarter-over-quarter improvements in demand. While the pandemic continues to limit drink purchases at movie theaters, restaurants and office buildings, Coke said at-home demand is still elevated.
KO shares picked up 62 cents, or 1.2%, to $50.61 soon after Thursday’s opening.