On this episode of Stock Movers:
- Coca-Cola Co. said it’s launching a new Coke product for American consumers made with US cane sugar this fall.
Tuesday’s announcement came less than a week after President Donald Trump said in a Truth Social post that the company agreed to use cane sugar in its US Coke beverages. On a call with analysts, Chief Executive Officer James Quincey thanked the president for his “enthusiasm for our Coca-Cola brand.”
The company also posted second-quarter sales growth and profit that beat Wall Street expectations as consumers continued to pay higher prices for the company’s soft drinks. It now expects full-year comparable earnings per share growth of about 3%, up from a range of 2% to 3%.
- General Motors Co. said it suffered a $1.1 billion profit hit from Donald Trump’s tariffs and revealed no plan for a near-term fix to return to pre-tariff profit levels.
The Detroit-based automaker said Tuesday it earned $2.53 per share on an adjusted basis, above the Bloomberg consensus forecast of $2.33 but short of the $3.06 it made a year ago. GM’s profits also suffered from higher warranty costs and a buildup in inventory of electric vehicles, which are set to lose federal subsidies under Trump’s recently passed budget bill.
GM’s results showcase the difficulty automakers face to maintain profits in an environment that newly penalizes globally integrated parts supply chains and cross-border vehicle sales. Even though the automaker beat profit expectations, earnings in its all-important US business suffered from import duties on vehicles made in Canada, Mexico and South Korea.
GM hasn’t moved to raise already high average sticker prices enough to recoup tariff costs, instead opting to absorb the blow by cutting costs and repatriating some production. Chief Executive Mary Barra hinted at the challenges adjusting to the new reality in a letter to shareholders.
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