Coke Calls Tariffs 'Manageable' After Upbeat Quarter

Coca-Cola reported better-than-expected earnings in the first quarter and said the impact of tariffs on its business are likely to be "manageable," per the AP.

• Revenue fell 2% to $11.1 billion in the January-March period, the company said Tuesday. Adjusted for one-time items, including currency fluctuations, Coke reported revenue of $11.2 billion. That beat Wall Street's expectation of $11.15 billion, according to analysts polled by FactSet.
• Coke's unit case volumes grew 2% in the first quarter, led by higher demand in China, India, and Brazil. Coca-Cola Zero Sugar was a standout, with case volumes up 14%. Demand for sports drinks and coffee fell.

• Coke and other beverage makers are facing a 25% tariff on the aluminum they use for cans, among other items. Last week, rival PepsiCo lowered its full-year earnings expectations due to the impact of tariffs.
• "Based on what we know today, the dynamic tariff landscape could impact pockets of our system's cost structure, as well as consumer sentiment in our markets," Coca-Cola CFO John Murphy said Tuesday in a conference call with investors. But Murphy said Coke has "numerous levers to help manage the impact." The company has said previously that it may shift aluminum suppliers or rely more heavily on plastic or glass bottles.
• Net income rose 5% to $3.3 billion for the quarter. Adjusted for one-time items, the Atlanta company earned 73 cents per share; that beat expectations of 72 cents.
• Coke moderated expectations for its full-year profit on Tuesday. The company said it now expects full-year adjusted earnings to grow 7% to 9%, down from 8% to 10% previously.

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