Coca-Cola Co. has emerged the winner in this summer's battle of the soft drink giants, posting a 14 per cent gain in profit for the third quarter, while rival PepsiCo announced job cuts and factory closings as earnings fell.
Coca-Cola, America's biggest drink maker, said Wednesday it made $1.89 billion US, or 81 cents per share, in the quarter ended Sept. 26. That compares with $1.65 billion, or 71 cents per share, in the same period a year ago. Revenue was $8.39 billion, up nine per cent.
Analysts surveyed by Thomson Reuters were expecting earnings of 77 cents a share on revenue of $8.53 billion.
On Tuesday, No. 2 U.S. drink company PepsiCo, which makes Pepsi-Cola, Doritos, Sun Chips and Tropicana and Quaker brands, reported a third-quarter profit of $1.58 billion US, or 99 cents a share, down from $1.74 billion, or $1.06 per share, a year ago. Revenue was $11.2 billion, up from $10.17 billion a year earlier.
Pepsi also issued a downbeat profit outlook for the fourth quarter and full year, saying that the U.S. dollar's recent surge against other major currencies will hurt profits from its rapidly growing international business, which posted a 20 per cent increase in quarterly sales.
The company announced it plans to eliminate 3,300 jobs and close six plants in an effort to save $1.2 billion US over three years.
The job cuts amount to roughly 1.8 per cent of Pepsi's global work force of about 185,000 employees, and will affect managerial and factory jobs both inside and outside the U.S. Most will be eliminated in the coming months.
"This will enable our competitiveness and give us breathing room to respond," chief executive Indra Nooyi said on a conference call. "It is no news to you the economy is turbulent and there are uncertainties and volatility in every part of the environment."
Shares of Coca-Cola closed up 48 cents to $44.21 US on the New York Stock Exchange, while Pepsi shares lost $3.15, or almost six per cent, to $51.25.
With files from the Associated PressShare Tools
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