Coca-Cola reported better-than-expected earnings in the first quarter and said the impact of new tariffs on its business are likely to be “manageable.”

Coke and other beverage makers are facing a 25 percent tariff on the aluminum they use for cans, among other items. Last month, rival PepsiCo lowered its full-year earnings expectations due to the impact of tariffs.

“Based on what we know today, the dynamic tariff landscape could impact pockets of our system’s cost structure, as well as consumer sentiment in our markets,” Coke Chief Financial Officer John Murphy said in a conference call with investors.

Murphy also said Coke has “numerous levers to help manage the impact.” The company previously has said it may shift aluminum suppliers or rely more heavily on plastic or glass bottles.

Coke’s unit case volumes grew 2 percent in the first quarter, led by higher demand in China, India and Brazil. Coca-Cola Zero Sugar was a standout, with case volumes up 14 percent. Demand for sports drinks and coffee fell.

In North America, case volumes fell 3 percent. Prices rose 8 percent, partly because Coke sold a higher mix of premium beverages such as Topo Chico sparkling water and Fairlife milk.

Coke Chairman and CEO James Quincey said a video that was circulating on social media in February hurt United States sales, particularly among Hispanic consumers in the South. The video claimed that Coke was reporting its own workers to U.S. Immigration and Customs Enforcement officers and called for a boycott of the company.

Quincey said the claims in the video were false and the controversy has largely abated.

The video aside, Quincey said there was a pullback in purchasing on both sides of the U.S.-Mexico border due to consumer uncertainty.

“I think some of the geopolitical tension was just causing people to be a little more cautious with their spend,” he said “A little less going out, a little more keeping the money in the pocket.”

Revenue fell 2 percent to $11.1 billion in the January-March period, the company said. Adjusted for one-time items, including currency fluctuations, Coke reported revenue of $11.2 billion. That beat Wall Street’s expectation of $11.15 billion, according to analysts polled by data firm FactSet.

Net income rose 5 percent to $3.3 billion for the quarter. Adjusted for one-time items, the Atlanta company earned 73 cents per share. That beat expectations of 72 cents.

Coke also moderated expectations for its full-year profit.

The company said it now expects full-year adjusted earnings to grow 7 percent to 9 percent, down from 8 percent to 10 percent previously. Coke earned $2.88 per share in 2024.