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(Reuters) – Keurig Dr Pepper (NASDAQ:) beat Wall Street estimates for third-quarter sales on Thursday, as higher prices and steady demand for its sodas and drinks helped limit the hit from a slowing coffee business.
Shares of the Schweppes maker edged up about 3% in premarket trading.
The company and rivals Coca-Cola (NYSE:) and PepsiCo (NASDAQ:) have been raising prices to counter higher commodity, freight and labor costs following the pandemic-induced supply chain snags that were compounded by Russia’s invasion of Ukraine.
Both Coca-Cola and PepsiCo also topped third-quarter estimates this month.
Keurig Dr Pepper has also largely withstood a trade-down to private label and has not witnessed a decline in demand from the price hikes.
Net sales for the third quarter increased 5.1% to $3.81 billion, beating estimates of $3.77 billion, according to LSEG data. Excluding items, the company reported a profit of 48 cents per share topping estimates of 47 cents.
However, the U.S. coffee segment remained under pressure, with net sales falling 3.2% to $1.01 billion.
Coffee sales boomed during the pandemic as people spent more time at home but demand eased as people ventured out more.
Keurig Dr Pepper, however, reaffirmed its fiscal 2023 adjusted earnings per share to rise 6% to 7% and net sales to grow 5% to 6%.
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