Coca-Cola stock jumped more than 4% in premarket trading Tuesday after the company beat Wall Street earnings expectations and raised its full-year guidance. The driver was consumer demand for lower-calorie options, with Coca-Cola Zero Sugar volume up 16% in the quarter and Diet Coke and Coca-Cola Light up 7%.
CFO John Murphy spoke to Yahoo Finance about the results. "Diet Coke was up 7% for the quarter, also, having its moment," he said. "We have Coke Zero in certain parts of Europe beginning to build scale. You're going to hear a lot more about that in the next 12 to 18 months."
Murphy was direct about why Coke Zero has resonated with consumers. "Coke Zero, the current iteration of Coke Zero, has a taste profile that people like," he said. "It's not much more complicated than that."
Global unit case volume rose 5%, above the 3% gain the company posted in the previous quarter and well ahead of the 2.5% growth Wall Street expected, according to Bloomberg consensus data. North American volume grew 3%. The company also benefited from consumers leaning into America 250 and FIFA World Cup celebrations.
Coca-Cola now expects full-year revenue to grow 5%, up from a previous range of 4% to 5%. Earnings are projected to grow in the 9% to 10% range, just above the 8% to 9% the company had previously forecast.
On the innovation front, Murphy was asked about a recent trademark filing for the term "Spricy." He gave little away but left the door open. "We're open to exploration," he said. "Explore, learn, and move on if it's not [working]. Spricy is one of those potential opportunities in the future. Nothing much more to say about it at the moment."
One unresolved issue from the quarter was a ransomware attack that hit Coca-Cola's Fairlife production facilities last week. Murphy said it will not have a "material financial impact" on the quarter and noted that most production is back up and running, but said the company is "still working through and reviewing all that has happened."
Looking further ahead, Murphy flagged input costs as a growing concern for 2027. "We are very mindful of the input costs that come our way, and the conflict in the Middle East this year … has had a pretty significant impact on fuel prices," he said. Those pressures have also driven up aluminum prices, which he called "pretty substantial input drivers for our bottling partners." Murphy said raising prices on consumers is just one lever available to offset higher costs, and that decisions vary by region based on the competitive environment and consumer conditions.
