The company’s year-to-date revenue has dropped two per cent while net income was also down 14 per cent to $2.1bn.
On the earnings call, chairman and chief executive Muhtar Kent said that the quarterly performance was “below expectations” and as a result it will be forging ahead with a $3bn cost-saving plan.
“We have taken a hard look at our progress to date and realise that while the strategies we laid out at the beginning of the year are on the right track, the scope and pace of our actions must increase,” he said.
As part of a cost-saving exercise, which will be implemented over the next five years, the drinks giant will streamline its operations.
A portion of the savings will be directed into marketing in a bid to drive sales.
Kent explained that during the second quarter of this year it began to ramp up its media investments, having increased its spend by double digits compared to the previous year .
He said that these investments, predominantly the Fifa World Cup push, “will take time to pay off” but that “there’s no question” it needs to improve execution in many markets, “especially consumer marketing and commercial strategies”.
“We’re working to drive even more discipline and efficiency in direct marketing investments. As a result of these initiatives we plan to fund the marketing programme and the innovation required to reinvigorate and deliver sustainable net revenue growth,” he explained, although didn’t go into any further detail.
Specifically, in its sparkling beverages category, Kent said it looking to improve the quality of marketing and scale global investments through a network marketing model.
Shares fell 6.6 per cent to $40.45 - the most in six years - after the cost-saving plan was revealed,