Coke's sales are dipping as the Chinese and Latin American consumers prefer non-carbonated drinks. (Photo : Getty Images)
Coca-Cola Co. declared low revenue this quarter due to low sales in China and Latin America. The beverage giant is not expecting any improvement for the rest of the year.
The company's global shares fell by 3.63 percent in the past three months.
According to Chief Operating Officer Muhtar Kent, wholesalers are decreasing their inventories because of low sales and a "weakening consumer environment."
The dip in sales is also due to the recent slowdown of China's growth, which is only 6.7 percent in the second quarter. This is the lowest growth rate that the country has ever experienced.
Coke also observed a change in consumer tastes in China. More consumers are preferring premium water than juices and other beverages.
The company is planning to redirect its sales to second to third-level areas by making their drinks more affordable.
In the Latin American market, Coke is struggling with the rise of inflation especially in countries such as Argentina.
Latin America comprised 9 percent of Coke's sales in 2015.
Kent said, "Strong performance in some of our largest and most developed markets, including the United States, Mexico and Japan, was offset by difficult external conditions in many of our emerging and developing markets, including China and Argentina."
The beverage company's net income amounted to $11.54 billion and fell by 5 percent for the fifth straight quarter.
Coke has been building its non-carbonated drinks portfolio by improving other drinks and getting external bottling suppliers. More health-conscious consumers now prefer teas, smoothies and fruit juices.
Kent said that the company will be "reassessing local market initiatives where needed and continuing our efforts in driving productivity."
