Coca-Cola Co. (NYSE: KO) shares climbed over 3% in intra-day trading on Tuesday after the beverage giant reported third-quarter results that came in slightly ahead of Wall Street expectations, even as it described the operating environment as “challenging.”

The company has faced weaker volumes in key markets such as the U.S. and Latin America, as inflationary pressures have prompted many consumers to trade down from higher-priced sodas.

A broader health initiative spearheaded by U.S. Health Secretary Robert F. Kennedy Jr. has also influenced Coca-Cola's product strategy, with the company pledging to introduce a new Coke variant made with natural cane sugar instead of corn syrup. Analysts noted that the shift would likely increase production costs.

Despite these challenges, demand remained stable in the U.S. and select international markets. Price increases for brands such as Topo Chico sparkling water and Fairlife milk helped offset softness in other segments. Unit case volumes rose 1%, slightly ahead of forecasts, as gains in water, sports drinks, coffee, and tea offset declines in juice, dairy, and plant-based beverages. Sparkling soft drink volumes were flat year-over-year.

Net revenue rose 5% to $12.45 billion, slightly above the consensus estimate of $12.48 billion. Comparable earnings per share were $0.82, beating expectations of $0.78.

Coca-Cola reaffirmed its full-year 2025 guidance for comparable EPS growth of around 3% and organic revenue growth between 5% and 6%.