logo-loader
viewThe Coca-Cola Company

Coca-Cola shares rise despite 2Q demand hit as coronavirus closures begin to reverse

The company makes a big chunk of its money from selling its soft drinks to restaurants, movie theaters and others, many of which had to close during the pandemic

Coca-Cola truck
Coca-Cola saw adjusted revenue drop 28% to $7.18 billion, in line with analyst expectations, and earnings per share fall 32% to $0.42, which narrowly beat Street projections

The Coca-Cola Company (NYSE:KO) stock rose even after a major second-quarter sales slump due to coronavirus-related business closures, as the beverage giant indicated that a rebound was underway. 

The company makes a big chunk of its money from selling its soft drinks to restaurants, movie theaters and others, many of which had to close during the pandemic, according to a report from Reuters

However, there are indications that things are on the rise. Unit case volume, which is considered an indicator of demand, swooned 25% in April but dipped just 10% in June as restaurants in many states have begun to open in some capacity, Reuters reported. Thus far in July, the volume decline has ticked up to the single digits.

READ: Amazon-led rally boosts Jeff Bezos and Big tech’s billionaire boys

For the quarter as a whole, volume dipped 16%, with its flagship Coca-Cola losing 7%. Teas and coffees dropped 31%, which the company attributed to the closing of Costa stores in Western Europe.

"I'm proud of the people of the Coca-Cola system as we continue to adjust and accelerate our strategies in this fast-changing landscape," CEO James Quincey said in a statement. "We believe the second quarter will prove to be the most challenging of the year; however, we still have work to do."

The Atlanta-based company saw adjusted revenue drop 28% to $7.18 billion, in line with analyst expectations, and earnings per share fall 32% to $0.42, which narrowly beat Street projections of $0.40. Net income dropped 32% year-over-year to $1.78 billion.

Coca-Cola shares rose 2.8% to $47.42 midday Tuesday.

Contact Andrew Kessel at [email protected]

Follow him on Twitter @andrew_kessel

Quick facts: The Coca-Cola Company

Price: 48.45 USD

NYSE:KO
Market: NYSE
Market Cap: $208.11 billion
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Auryn Resources spins our Peruvian assets creating a new company called Fury...

Auryn Resources (TSE: AUG- NYSEAMERICAN: AUG) Executive Chairman Ivan Bebek and new company Fury Gold Mines CEO Mike Timmins joined Steve Darling from Proactive Vancouver with news Auryn is creating a new gold-focused exploration and development company called Fury Gold Mines. Bebek discusses...

14 hours, 23 minutes ago

2 min read