Corporate earnings surge as world goes back to work 

From United Airlines to Coca-Cola, earnings by major firms point to a flourishing economy as consumers shrug off Covid gloom 

Coca-Cola has seen a huge post-lockdown boost in sales.

US corporate earnings — from Johnson & Johnson to United Airlines — are surging once again on the back of consumers shrugging off Covid gloom and returning to regular spending patterns.

Johnson & Johnson has raised its annual adjusted earnings and revenue forecast as quarterly sales rebounded strongly from a year ago, when the pandemic stifled non-Covid procedures.

J&J boosted by vaccine business

The healthcare giant boosted its profit forecast to $9.60 to $9.70 a share, up from as much as $9.57, helped by the performance of its drug and medical-device units and sales of Covid-19 shots. The company also raised its revenue outlook to as much as $94.6bn (€80.3bn) from an earlier range that topped out at $91.6bn.

J&J expects its single-dose Covid vaccine, which uses a different technology from messenger RNA shots developed by Pfizer and Moderna, to generate $2.5bn in 2021, with half those sales in the fourth quarter. That’s still a fraction of the revenue that will be generated by its rivals, which are selling more doses and reaping gains from higher price tags.

Coca-Cola beats expectations 

Coca-Cola’s sales beat expectations in the second quarter and the soft drinks giant raised its revenue forecast for the year as it saw a significant bounce back in its business, a stark contrast to the pandemic-related lockdowns that diminished sales last year.

Coke’s organic revenue, which excludes the impact of currency or acquisitions, climbed 37% in the quarter ended July 2. Analysts had expected growth of around 29%.

“Our results in the second quarter show how our business is rebounding faster than the overall economic recovery,” chief executive James Quincey said.

UA at 'a meaningful turning point'

  

Meanwhile, US carrier United Airlines said it expects to end a year and a half of losses this quarter despite rising investor anxiety about whether Covid infections will upend a travel resurgence.

The forecast for an adjusted pre-tax profit in the third quarter and another in the fourth quarter excludes any benefit from billions of dollars in federal airline aid, United said as it reported earnings. While the carrier didn’t quantify how much it expected to earn, any profit would top the second-half losses expected by Wall Street.

“Our airline has reached a meaningful turning point,” United chief executive Scott Kirby said: 

We’re expecting to be back to making a profit once again. 

The improved outlook underscores the robust rebound in domestic travel buoying US airlines, as families reunite and take summer holidays after more than a year of largely staying close to home.

• Bloomberg