We are pleased to report that organic revenues grew by 9% and comparable EPS increased by 5% to $0.77. Despite facing currency headwinds and challenges in July, we remain confident in achieving the higher end of our growth guidance. Our revised 2024 guidance now projects approximately 10% organic revenue growth and 14% to 15% EPS growth, taking into account currency headwinds.
We continue to focus on strategic investments in brand growth and operational efficiency to drive long-term value for our stakeholders. Our “all-weather strategy” allows us to adapt to economic uncertainties and changing macroeconomic conditions. We are optimistic about our long-term growth prospects and remain committed to maintaining a strong balance sheet with a net debt leverage of 1.7 times EBITDA.
While we have faced challenges, particularly in discretionary spending and maintaining growth rates for certain products, we have also seen positive developments. Our price/mix growth reached 10% in the third quarter, and our gross margin and operating margin improved significantly. Fairlife’s retail sales surpassed $1 billion, contributing to our revenue mix in North America.
We are excited about the future and remain focused on creating sustainable value for our stakeholders. Our strong financial performance, robust market capitalization, and consistent dividend growth underscore our commitment to delivering shareholder returns. We believe that our strategic focus on long-term growth, combined with our strong brand and market leadership, positions us well for continued success in the future. Thank you for your continued support and confidence in The Coca-Cola Company. Our year-to-date performance in 2024 has been strong, giving us confidence that we will meet or exceed our previous top line guidance and achieve earnings growth of 5% to 6%, despite facing approximately 9% in currency headwinds. As we move forward, we will provide updates on the global consumer landscape and review our third-quarter business performance. We are committed to staying agile and improving the execution of our strategy across all aspects of our growth flywheel.
During the quarter, global consumer sentiment and spending remained strong, and our industry continued to grow. We achieved robust organic revenue growth and gained value share in both at-home and away-from-home channels. Despite facing currency headwinds and the impact of bottler refranchising, we saw a 5% growth in comparable earnings per share. Our system remains well-positioned in the beverage industry, and we are focused on capturing long-term balanced growth.
In North America, we experienced robust top-line growth and gained value share, with Trademark Coca-Cola and sparkling flavors driving volume growth. In Latin America, we saw solid revenue growth led by Coca-Cola Zero Sugar and Powerade. In EMEA, we had improved performance in Europe and strong growth in Africa, while facing challenges in Eurasia and the Middle East. In Asia Pacific, we grew organic revenue and operating income, despite challenges in China.
Our marketing and innovation efforts continue to drive growth, with a focus on integrating digital, live, and retail experiences to connect with consumers in unique ways. Our refreshed marketing model has been successful, as seen in our activations for the Olympic and Paralympic Games and the success of Topo Chico as the number one premium sparkling water brand in the U.S.
While we continue to face challenges and test our agility, our all-weather strategy is working, and we remain committed to delivering on our objectives through world-class marketing, innovation, and execution. Our focus on bold innovations and learning from failures has allowed us to drive growth and connect with consumers in meaningful ways. Fuze Tea has been a successful multiyear endeavor, expanding across over 80 markets, while Minute Maid Zero Sugars is showing promise. Additionally, Sprite Chill has achieved over $50 million in retail sales within 21 weeks and has been extended after a successful limited run. Innovation plays a key role in our strategy, whether it’s to create short-term buzz with limited edition products like Coca-Cola Zero Sugar Oreo or Fanta Beetlejuice, or to invest in long-term partnerships such as the upcoming debut of Bacardi Mix with Coca-Cola in 2025. In 2024, our focus on innovation has led to strong velocities and improved success rates compared to the previous year.
We are also prioritizing step-changing execution by integrating marketing and commercial plans, investing in customer growth, and leveraging data and digital solutions like AI to enhance our capabilities. By integrating digital advertising with point-of-sale messaging and tailoring brand price pack architecture to meet individual customer needs, we aim to drive retail sales uplifts for our customers. Our system’s emphasis on increasing availability through investments in cold drink equipment and visible inventory has led to $11 billion in incremental retail sales for customers in the past year.
Looking ahead, we remain committed to mastering the fundamentals that drive business success while also pushing our capabilities to the next level. With our strong portfolio, unique capabilities, and dedicated employees, we are confident in our ability to achieve our 2024 guidance and long-term priorities. In the third quarter, we saw 9% organic revenue growth, driven by pricing actions and mix improvements. Comparable gross margin and operating margin also showed expansion, leading to a 5% increase in comparable EPS year-over-year.
As we move forward, we expect to deliver approximately 10% organic revenue growth and 14-15% comparable currency-neutral EPS growth for 2024, despite currency headwinds. While it’s early to provide specific guidance for 2025, we anticipate moderating pricing from intense inflationary markets and stability in commodity prices. Our focus will remain on brand investment, productivity initiatives, and leveraging our strong position to capitalize on long-term growth opportunities. We anticipate an increase in net interest expense due to deposits made in connection with the ongoing IRS tax dispute and the upcoming fairlife contingent consideration payment. Additionally, based on current hedge rates, we expect a slight negative impact on comparable net revenues and earnings per share for 2025 due to currency fluctuations. However, many factors could influence our currency outlook and overall business performance before we provide guidance in February. Despite these challenges, our all-weather strategy has consistently delivered earnings growth over the years. We have various strategies in place to maintain this growth trajectory. In summary, we are confident in our ability to achieve our objectives in 2024 and beyond, thanks to our well-defined strategy and ongoing investments with our bottling partners. We are prepared to address any questions from the audience.
Operator: Our first question is from Steve Powers of Deutsche Bank. Please proceed with your question.
Steve Powers: Thank you for the opportunity. James, it seems that momentum improved throughout the third quarter in terms of unit case volume, which is encouraging. Looking ahead, how confident are you in returning to positive growth in the fourth quarter? To what extent is this improvement within your control through various initiatives, as opposed to external factors like the macroeconomic environment?
James Quincey: Thank you for your question, Steve. While we were not entirely satisfied with the volume performance in the third quarter, we saw improvements as the quarter progressed. The month of July was challenging, but we saw positive trends in August and September. I believe that returning to growth is largely within our control. The macro environment, while complex, does show signs of resilience. By focusing on our marketing, innovation, pricing strategies, and execution, we are confident that we can achieve growth in the fourth quarter and beyond.
Operator: Our next question is from Dara Mohsenian of Morgan Stanley. Please go ahead with your question.
Dara Mohsenian: Good morning. I would like to delve into the mix component of price mix, which was a key driver of growth in the third quarter. How sustainable is this mix improvement as we look ahead to 2025?
James Quincey: Thank you for your question, Dara. The mix component of price mix includes various factors such as country, category, channel, and pricing strategies. In the third quarter, we saw a mix improvement driven by our focus on affordability and premiumization. We believe that the ongoing management of affordability options and premium segments will continue to drive mix improvement. Additionally, the atypical performance of emerging markets relative to developed economies also contributed to the mix improvement. As we move forward, we expect a more normalized mix performance based on the growth trajectory of different markets.
Operator: Our final question is from Lauren Lieberman of Barclays. Please proceed with your question.
Lauren Lieberman: Thank you. Could you provide more details on the initiatives you have implemented to adapt quickly and drive positive results? Additionally, what is your outlook on the macroeconomic environment moving forward?
James Quincey: Thank you for your question, Lauren. Our ability to adapt quickly and drive positive results is a result of our focus on marketing, innovation, pricing strategies, and execution. We are constantly evaluating market trends and consumer preferences to make necessary adjustments to our business. As for the macroeconomic environment, we see overall resilience at a global level, with varying dynamics across different regions and income levels. While there are challenges, we believe that the macro environment is relatively stable, providing opportunities for growth. The outcome for next year is uncertain, but we anticipate resilience overall. We are considering various factors such as affordability and expanding affordable options, investing in cold drink equipment to increase availability, adjusting marketing messaging, and adapting to different economic situations in various countries. In North America, there may be some softness in discretionary spending, but the beverage industry remains robust. Our all-weather strategy has helped us overcome challenges in the past, and we are confident in our ability to navigate future headwinds, including FX and interest expense. Our focus on innovation, pricing, and revenue growth management has been key to our success. We will continue to adapt and evolve to address changing market dynamics in regions like Mexico, India, and the Middle East. There is a noticeable difference in FX impact depending on whether it is coming from G10 economies or emerging markets. In G10 economies like Europe, a big devaluation may not result in immediate pass-through inflation, making it harder to manage. On the other hand, in emerging markets, there tends to be more immediate pass-through inflation. In 2024, almost all the FX headwinds are due to devaluations in emerging markets, while the G10 bucket remains broadly flat. This difference in FX impact also affects the top-line growth, with emerging markets potentially driving above-normal pricing.
Despite the challenges posed by FX fluctuations, the company is focused on pursuing an all-weather strategy to drive growth. By investing in the right brands, understanding profit drivers, and staying focused on productivity, the company aims to sustain and expand margins. In North America, strong organic sales growth of 12% in Q3 was driven by a combination of price and mix, with investments in key brands contributing to positive mix. The company is also conscious of maintaining affordability and is continuously evaluating its pricing strategy and revenue growth management capabilities. And if we focus on price for a moment, we can see that it’s about half of what it was before, which aligns with the trajectory of CPI coming down. Looking ahead, we expect inflation in input costs such as labor, agricultural commodities, and packaging, but at a slower rate. We anticipate a more normalized level of pricing next year, similar to CPI rates. We will continue to invest strategically in affordability and premiumization options. Mix will likely remain around four or five points, with continued growth in the North American business.
Regarding margin expansion, we are on track to achieve our highest gross margin level since pre-COVID, driven by our RGM and cost efficiency efforts. In 2025, we expect normal pricing, offsetting FX headwinds with underlying expansion through RGM and cost efficiency. We are exploring various levers on revenue and cost lines, such as RGM optimization, promotional simplification, and supplier collaboration, to drive margin expansion.
As for Q4, while volumes improved towards the end of the quarter, organic sales growth may be closer to 6% compared to 9% in Q3, taking into account the extra two days. The impact of high inflation markets is expected to lessen in Q4. In Mexico, potential bans on CSDs and snacks in schools are not expected to have a significant impact on our business, as we predominantly offer no-sugar portfolios to schools. Overall, we anticipate a strong outlook for Q4, with growth aligning with our growth algorithm. Charlie, in terms of the volume performance in Q3, we saw good performance in developed economies like North America, Europe, Japan, and Australia. The pressure on volume came from emerging markets, with some markets facing temporal factors like Mexico and India. In China and Eurasia, there are ongoing pressures impacting volume. In China, we focused on growing our sparkling beverages and deprioritized some case pack water. Overall, our performance in the developed markets was strong, with growth in both sparkling beverages and premium stills contributing to our positive volume performance. So, the focus in China needs to be on what we can control to improve marketing, innovation, and execution. Long-term investment opportunities are promising for the China business. The Eurasia business faces challenges due to various factors, including the spillover from the Middle East conflict and macroeconomic adjustments in certain markets.
Regarding Fairlife, it has surpassed the $1 billion mark and continues to have a significant impact on North American sales. The brand is contributing to overall growth and profitability, alongside other brands in the region. Expansion of capacity and ongoing relevance in the marketplace will drive continued growth for Fairlife.
In terms of the alcohol strategy, it is still early days, and most successful ventures take time to reach scale. The company is taking a measured approach, learning from successes and failures. Rather than focusing on one standout brand, the strategy involves a diverse portfolio of partnered and proprietary brands to cater to different consumer preferences globally. Variety and choice will be key in driving success in the alcohol category. Can we create a bundle that is not only effective in terms of market share, but also helps ARTD become a relevant size category? Kevin Grundy: Very good. Thank you. Operator: Our next question is from Robert Moskow at TD Cowen. Please go ahead. Robert Moskow: You anticipate a deceleration in price/mix next year, primarily due to North America and hyperinflationary markets. Do you expect any volume benefit from this? Are there elasticity assumptions? You seemed optimistic about volume growth in 2025. James Quincey: Yes, there is a connection between price/mix and volume. I anticipate that in 2025, emerging markets will grow faster than developed economies, leading to volume growth but not positive price/mix. It will be a more stable relationship compared to this year, with some stabilization in high-inflationary countries. Robert Moskow: Thank you. Operator: Our final question is from Carlos Laboy at HSBC. Please go ahead. Carlos Laboy: Can you elaborate on the digital capabilities being developed in North America to drive volume and revenue growth? How are you incentivizing bottlers to invest in these capabilities? James Quincey: The focus is on enhancing digital engagement with retailers, particularly in the traditional trade sector. This includes a platform for retailers to engage with ordering systems 24/7, AI suggestions for orders, and overall enhancement of market developers’ productivity. Bottlers are actively investing in these capabilities. In conclusion, we believe we are on track to achieve our goals for 2024 and beyond, despite near-term uncertainty. Thank you for your interest and investment in our company. Operator: This concludes today’s conference call. Thank you for participating.