Good things came in small sizes for Coca-Cola last quarter. The company reported sales that topped forecasts, thanks in part to a double-digit increase in volume for its 7.5-ounce mini cans.
The smaller-sized cans appeal to more health-conscious consumers who are increasingly watching what they drink and eat but may not want to switch to diet sodas that contain artificial sweeteners and other chemicals. The word “diet” did not appear once in the company’s earnings release and was not mentioned on the conference call with analysts on Friday morning either.
But Coke CEO James Quincey pointed out during the conference call that mini-can sales grew 15% in the United States alone during the quarter.
Sodas in Coke’s mini cans are just 90 calories and have 25 grams of sugar, compared to a standard 12 ounce can that has 140 calories and 39 grams of sugar.
Coke hopes to attract more Millennial customers
Quincey said during the conference call that the strong sales of smaller-sized sodas and Coca-Cola Zero Sugar are examples of “a revitalization of the sparkling business,” adding that the company is starting to win over younger customers that may have been shunning Coke products.
“Has it flip-flopped overnight? No, it hasn’t,” Quincey conceded, but he said he was encouraged to see that the Coke brand was becoming more relevant with Millennials.
Wall Street cheered the results too. Coke’s stock rose nearly 2% Friday. Shares are now up 16% this year. That’s in line with the broader market but is lagging the performance of top rival Pepsi (PEP).
Pepsi, which also owns the Frito-Lay snacks business, Quaker Oats and Gatorade, reported strong sales and earnings earlier this month thanks to its more diverse product mix. The stock is up nearly 25% in 2019.
Coke is also ramping up to launch its own energy drink in America next year as well. The company said Friday that Coca-Cola Energy and Coca-Cola Energy Cherry will be available in the US in January and that there will be zero-calorie versions of them as well.