James Quincey, CEO of Coca-Cola Co., speaking at “Squawk Box” at the WEF in Davos, Switzerland, on January 18, 2023.
Adam Galica | CNBC
Inflation is moderating in most markets, after a period in which the beverage maker relied on price increases to generate higher revenue. Coca Cola CEO James Quincey said Tuesday.
Coca-Cola reported its fourth-quarter results on Tuesday and said higher prices helped the company beat Wall Street estimates for its quarterly sales. But Coca-Cola's price increases have slowed from the double-digit increases of the past two years.
Overall Coca-Cola prices rose 9% in the fourth quarter, but Quincey said that was due to hyperinflation in markets like Argentina. In most of Coca-Cola's markets, shoppers were only paying about 3.5% more for its drinks than the previous year.
“When you think about 95% of the business, 3.5% globally is close to what we had before Covid, before this inflation spike,” Quincey said on CNBC's “Squawk on the Street.”
The US consumer price index rose 3.1% in January compared to the same period a year earlier, according to US Labor Department data released Tuesday.
In July, Coca-Cola executives said the company had finished raising prices by 2023. Consumers in Europe and the United States had begun switching to cheaper private-label juices and bottled water instead of buying its Simply brands. and Smartwater.
Quincey also said Tuesday that the American consumer has gone in two different directions. Those with more disposable income are purchasing Coca-Cola's premium drinks, such as Fairlife milk, while those on tighter budgets are reducing their spending and purchasing cheaper packages.
As a result, Coca-Cola's North American volume declined 1% in the quarter.
Coca-Cola shares fell less than 1% in morning trading.
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