Core Insights - The Coca-Cola Company reported a 5% organic revenue growth and a 4% year-over-year increase in comparable earnings per share for Q2 2025, despite a 1% decline in volume due to currency headwinds [1][9] Financial Performance - Comparable operating margin expanded by 190 basis points year-over-year, supported by productivity initiatives and favorable investment timing, despite a negative volume growth [3][4] - Comparable gross margin increased by approximately 80 basis points, with one-third of the underlying expansion attributed to faster realization of productivity initiatives [4] Strategic Execution - The company achieved seventeen consecutive quarters of global value share gains, with management emphasizing the importance of rapid, data-driven adjustments in response to market conditions [5][6] - Operational agility was highlighted as a key factor in defending the growth algorithm, allowing the company to mitigate external volatility [6] Portfolio Innovation - The Fairlife brand experienced double-digit volume growth, with capacity constraints expected to be alleviated by the expansion of the New York facility in early 2026 [7][8] - The company’s $30 billion-brand portfolio and disciplined innovation pipeline are designed to meet evolving consumer preferences and capture share in high-growth premium categories [7][8] Future Outlook - Management reaffirmed full-year 2025 organic revenue growth guidance of 5%-6% and raised comparable currency-neutral earnings per share growth guidance to about 8% [9] - Positive volume growth is anticipated in the second half of 2025 as transitory impacts from Q2 fade, with robust free cash flow generation of $3.9 billion in Q2, up $600 million year-over-year [10]

Financial Data and Key Metrics Changes - PepsiCo delivered 2% organic revenue growth for the full year 2024, with a 9% growth in core constant currency earnings per share, exceeding guidance of at least 8% [4] - Over the past five years, net revenue increased by 37% to nearly $92 billion, while core EPS rose by 48% [4][5] Business Line Data and Key Metrics Changes - The international business generated net revenue of $37 billion, accounting for 40% of total net revenue and 39% of core division operating profit mix [5] - Core operating profit for the international business has compounded annually at 10% over the last five years [5] Market Data and Key Metrics Changes - Approximately 60% of PepsiCo's business comes from geographies with only 5% of the global population, indicating significant growth potential in other regions [6] Company Strategy and Development Direction - PepsiCo is focusing on four key pillars: evolving the product portfolio, expanding availability, modernizing the company, and enhancing sustainability through Pep Positive [7] - The company aims to innovate its product offerings, including no sugar beverages and healthier ingredients, while also expanding its presence in high-growth channels and markets [8][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience despite challenges such as the global pandemic and high inflation, believing the runway for growth remains vast [5][6] - The company is committed to transforming its supply chain and evolving its portfolio to support sustainable growth and value [14] Other Important Information - PepsiCo has made significant strides in sustainability, including incorporating recycled materials into packaging and achieving water use efficiency goals ahead of schedule [15][56] - The company has engaged in various initiatives to enhance its positive impact on communities and the environment [15][56] Q&A Session Summary Question: Thoughts on paying down debt instead of buying back stock - The company plans to repay $4 billion of long-term debt and return approximately $8.6 billion to shareholders in 2025, including $1 billion through share repurchases [79] Question: Dividend increase for Pepsi stock - A 5% increase in the annualized dividend per share was announced earlier this year, marking the 53rd consecutive annual increase [80] Question: Impact of GLP-1 drugs on Pepsi products - The company is monitoring GLP-1 trends and has observed that consumers are adjusting their consumption patterns, which the diverse portfolio can address [82] Question: Current debt levels - Total debt stands at $48.5 billion, with $8.3 billion in cash and equivalents, and 81% of the debt is long-term [84]