Beverage Giants in 3Q23: How Coca-Cola, PepsiCo Stack Up

Beverage giants Coca-Cola and PepsiCo reported significant increases in their revenue for the third quarter, with PepsiCo leading the way with nearly double the revenue at US$23.3 billion (MX$428 billion), while Coca-Cola reported US$12 billion globally. PepsiCo plans to continue this growth, while Coca-Cola aims to “win the marketplace.”

Coca-Cola’s most recent earnings report revealed an 8% growth in net revenues, reaching US$12 billion. This growth was attributed to a 9% increase in price/mix, which represents changes in net operating revenues due to factors such as price adjustments, product and package mix, sales channels and geographic regions, as well as a 2% growth in concentrate sales. 

 “We delivered an overall solid quarter and are raising our full-year topline and bottom-line guidance in light of our year-to-date performance,” says James Quincey, Chairman and CEO, Coca-Cola Company. “Our leading portfolio of brands, coupled with an aligned and motivated system, positions us to win in the marketplace today while also laying the groundwork for the long term.” 

Coca-Cola’s gross profit reached US$7.06 billion, with a slight decline in the operating margin from 27.9% to 27.4% compared to the previous year. This decline was primarily attributed to items impacting comparability and currency headwinds, offset by increased marketing investments and currency fluctuations.

In contrast, PepsiCo reported a net revenue of US$23.4 billion and a gross profit of US$10.6 billion during 3Q23. This represents a 6.4% increase in revenue compared to the same period last year and a 3.4% increase in gross profit. Out of the revenue, US$3.05 billion is attributable to sales in Latin America. 

“We are pleased with our performance as our businesses and associates displayed tremendous agility and resilience across geographies and categories in an evolving and dynamic environment,” says Ramon Laguarta, Chairman and CEO, PepsiCo, in the company’s press release. “We expect our full-year 2023 core constant currency earnings per share (EPS) to increase 13% (previously 12%) and continue to expect our full-year 2023 organic revenue to increase 10%.”

PepsiCo maintains its previous guidance for 2023, expecting a 10% organic revenue growth, a core annual effective tax rate of 20%, and total cash returns to shareholders of about US$7.7 billion, consisting of dividends of US$6.7 billion and share repurchases of US$1 billion.

Both beverage giants face complex factors affecting their operating margins, including shifts in customer behavior due to weight-loss drugs. 

Are you ready to set yourself up for success in 2024? Join us at Mexico Business Summit 2023, the must-attend B2B conference for Mexico’s business leaders!

Taking place on Nov. 28-30, 2023, at Expo Santa Fe in Mexico City, this high-level multi-industry conference offers unmatched opportunities to get inside perspectives on key industry trends, access actionable business intelligence, generate pre-qualified leads and identify new opportunities in a unique cross-industry networking environment.

Mexico Business News offers you an exclusive MX$2,000 ticket discount by using this code: MBS2023MBN2000. 

Don't miss this opportunity and get your tickets here: https://mexicobusiness.events/MBS/2023