Coca-Cola Co KO reported first-quarter earnings results before the open on Monday. CEO James Quincey called the quarter a success and teased some of the company’s plans for incorporating artificial intelligence.
What Happened: Coca-Cola said first-quarter revenue increased 5% year-over-year to $11 billion, which beat consensus estimates of $10.8 billion, according to Benzinga Pro. The iconic beverage company reported quarterly earnings of 68 cents per share, which beat estimates of 64 cents per share.
Operating margins ticked higher to 31.8% from 31.4% in the comparable quarter. Cash flow from operations totaled $160 million. Coca-Cola said it gained share in the nonalcoholic ready-to-drink beverage category during the quarter.
Why It Matters: Not only did Coca-Cola benefit from higher prices, it also saw volumes increase during the quarter, Quincey said Monday on CNBC’s “Squawk On The Street” following the company’s quarterly results.
Global unit case volume grew 3% year-over-year as the company saw significant strength in Latin America and the Asia Pacific regions.
“Frankly, it’s growth that we’ve earned with our marketing, our innovation and our commercial strategies,” Quincey said.
One of the ways Coca-Cola is enhancing its marketing efforts is by using Microsoft Corp MSFT-backed OpenAI’s ChatGPT.
“We’re starting to experiment. We want to be on the front end of this change because we see it being profound,” the Coca-Cola CEO said.
He highlighted the company’s “Create Real Magic” platform which allows consumers to leverage AI to generate original artwork on Coca-Cola cans.
“If we combine creative skills for the employees, we can do much better on effectiveness and efficiency and this is just the beginning,” Quincey said.
AI is going to change the way the company advertises and engages with consumers, as well as the way it organizes and analyzes internal data, he said, comparing it to the smartphone revolution.
“Think of how much we’ve changed in the 14 years since the smartphone … imagine if that’s now about to happen to my entire marketing ecosystem, that in 10 years time, it’ll be completely different. That’s a journey we need to start on now. That’s why I say it’s profound,” Quincey said.
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