Coca-Cola (KO -0.82%) reported on Tuesday that its second-quarter revenue dropped 28% compared with the year-ago quarter, with organic revenue (which excludes currency impacts, acquisitions, or divestitures) down 26%. This drop marks the largest decline in more than 25 years, according to CNBC. But CEO James Quincey, sounding a note of optimism for the rest of 2020, said the second quarter "will prove to be the most challenging of the year." 

Rival PepsiCo (PEP -0.45%) last week said it saw flat organic sales in its second quarter. Coca-Cola said its revenue declines were led by a 22% drop in concentrate sales, largely caused by weak away-from-home sales, as bars and restaurants remained closed or relied solely on takeout during the pandemic. Those sales represent about half the company's revenue stream, it said. 

soft drink bottle pouring cola into a glass

Image source: Getty Images.

Coca-Cola said unit case volume sales dropped 16% for the quarter, but gradually increased throughout the time period. Not surprisingly, that was driven by local pandemic-related situations: As lockdown measures decreased, sales volume for unit cases (equivalent to 24 eight-ounce bottles) increased, the company said. After dropping by 25% in April, global volumes were down only 10% in June, and have improved to a mid-single-digit decline so far in July, it said.

Management believes that at-home sales have maintained the strength seen during the pandemic lockdown periods, and as economies reopen, it is being reflected in rebounding away-from-home channels. 

The company said it aims to return to pre-pandemic levels of sales before there's an established economic recovery. It plans to optimize its portfolio by focusing on fewer "bigger and stronger" brands, while improving how it grows "smaller, enduring" brands, it said.