Price Hikes Keep Coca-Cola Afloat

April 26, 2022
Coca-Cola did well in the last quarter, largely by raising prices for its products – but it won’t be able to do so indefinitely, its CEO warned.

Coca-Cola did well in the last quarter, largely by raising prices for its products – but it won’t be able to do so indefinitely, its CEO warned.

Sales for the most recent quarter were 16% ahead of the same quarter last year, reaching $10.5 billion. Net income was $2.78 billion, up 24% from last quarter.

Much of this improvement was attributable to a price/mix increase of 7%. Some of that increase was attained through price increases, and some of it through selling smaller bottles for the same price, CEO James Quincey told analysts. Coca-Cola’s margins also improved slightly, from 31% to 31.4%.

Coca-Cola has been able to stay ahead of inflation so far, but consumers won’t “swallow inflation endlessly,” Quincey told CNBC.

Unit case volume was up 8%, indicating high demand. Out-of-home sales, in restaurants and other venues, are still down from pre-pandemic levels – but, as the Wall Street Journal noted, that could be interpreted as another area of potential growth.

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