Coca-Cola lifts profit forecast on demand from India, Brazil
Coca-Cola raised its 2026 annual profit forecast on Tuesday, citing strong soft drink demand in India and Brazil. Global unit case volumes rose about 5 per cent in the third quarter, while North American volumes were flat.
Coca-Cola on Tuesday raised its annual profit forecast, citing strong soft drink demand in markets such as India and Brazil. The company now expects comparable currency-neutral earnings per share to grow at least 9 per cent in 2026, up from a previous forecast of 7 per cent to 8 per cent.
Global unit case volumes rose about 5 per cent in the third quarter, the company said, driven by growth in India, China, Mexico and Brazil. North American volumes were flat, despite growth in its trademark sodas. Higher sales of pricier beverages such as fairlife milk offset rising input costs in North America.
Coca-Cola's strong volume growth this year across its trademark sodas and other beverage brands contrasts with rival PepsiCo's struggles with weak snack demand in the United States, analysts noted. The company has sought to win over increasingly selective consumers with smaller, cheaper packs in the United States alongside pricier offerings such as Coca-Cola Cherry Float and new Topo Chico and fairlife varieties.
"The gap between Coke and peers is widening. As the market debates price increases, those delivering volume growth should outperform," Jefferies analyst Kaumil Gajrawala said.
Coca-Cola also now targets annual organic revenue growth of at least 5 per cent, compared with roughly 5 per cent expected earlier. Revenue for the quarter ended 2 October reached US$13.38 billion, beating analysts' estimate of US$12.92 billion, according to LSEG data. Adjusted earnings of 91 cents per share also beat estimates of 88 cents.
The company faces higher packaging costs as the US war in Iran drives up commodity prices. Coca-Cola said in July that aluminum and PET costs had risen more than expected this year. A 7.4 per cent increase in third-quarter revenue, however, helped support its operating margin, which rose to 33.4 per cent.
Coca-Cola's shares were largely unchanged in premarket trading. The stock has jumped about 33 per cent in 2026 and is on track for a third straight year of gains despite broader weakness in consumer spending and market volatility stemming from the Iran war, Reuters reported. RBC Capital Markets analyst Nik Modi said some investors may have been looking for a larger raise in annual targets, but maintaining prudence was understandable given the macro environment.