The Coca-Cola Company (NYSE: KO) is expected to report stronger second-quarter profit as the world's largest soft-drink maker tries to offset higher commodity prices and currency headwinds by expanding aggressively into key international markets.

The Coca-Cola Company (NYSE: KO), which reports earnings Tuesday, July 17, 2012,  before the markets open, is likely to book a profit of $1.19 a share, up 1.7 percent from a year ago when Coca-Cola reported earnings of $1.17 per share, according to analysts polled by Thomson Reuters.

The consensus estimate remains unchanged over the past month, but it has moved down from three months ago when it was $1.21.

Revenue is projected to come in at $12.99 billion for the second quarter, 2 percent above the year-earlier total of $12.74 billion.

For the year, analysts expect Coca-Cola to earn $4.07 a share on revenue of $48.38 billion.

The Atlanta-based company does not provide quarterly guidance, but holds a long-term growth rates view of 3 percent to 4 percent volume growth, 5 percent to 6 percent revenue growth, 6 percent to 8 percent operating-income growth and high single digits earnings-per-share growth.

Forty-three percent of stores in the world carry Coca-Cola products. Everyday Coca-Cola sells 1.8 billion servings of its beverages all over the world.

Heading into Tuesday's earnings announcement, Coca-Cola is looking to report its fifth straight quarter of revenue increases. Profits have also been on the rise. Over the past three fiscal years, Coca-Cola has seen its profits rise from $5.8 billion in 2008 to over $11.8 billion in its last fiscal year.

Emerging Markets

There have been a lot of cautious comments regarding the U.S. and Western Europe markets.

With respect to Europe, we are observing ongoing macroeconomic uncertainty as 2012 unfolds, Muhtar Kent, chairman and CEO of Coca-Cola said during the company's first quarter earnings conference call in April.

Austerity measures implemented across the region are weighing on consumer confidence, which recently reached its lowest level since the first quarter of 2009, Kent added.

In the U.S., soft drink consumption in 2011 declined to its lowest level since 1996, according to Beverage Digest, as Americans continue to move towards healthier beverage options.

As Coca-Cola reports its second-quarter earnings results, investors will be looking for comments on whether these developed markets are stabilizing or improving.

The other half of the story is emerging markets.

Profit from key regions such as China and India, where the ranks of middle-class consumers are growing rapidly, is expected to offset a decline in carbonated beverage consumption at home.

While we think near-term results will be affected by sluggishness in Europe, we believe long-term prospects remain bright for U.S. beverage companies in foreign markets, where we see significant opportunities for consumption growth in developing and emerging markets, Esther Kwon, analyst at S&P Capital IQ, wrote in a June 16 note.

Coca-Cola said in June it would accelerate its investment in India to $5 billion by 2020. That's more than double the $2 billion it has invested since re-entering the country in 1993.

In most international markets, Coca-Cola leads rival PepsiCo, Inc. (NYSE: PEP) by a wide margin in market share. Coca-Cola has 52 percent of the global market share for carbonated soft drinks, while PepsiCo has only 21.4 percent, according to Beverage Digest.

However, due to PepsiCo CEO Indra Nooyi's Indian roots, Coca-Cola has a smaller -- 16 percent -- lead in India. This move would help Coca-Cola reinforce its dominance in India.

While India is home to 1.2 billion people -- 17 percent of the world's population -- its citizens currently consume far fewer Coca-Cola products than the rest of the world.

The average Indian drinks only around 12 eight-ounce servings of Coca-Cola products annually, well below the global average of roughly 90 servings per person per year, according to Morningstar analyst Thomas Mullarkey.

Coca-Cola also plans to invest $4 billion in China, where its business has doubled in the past five years.

China is a great growth story over the last 2 decades and our business continues to do very well in China, Kent said during the company's annual general meeting in April.

Despite noting the recent economic slowdown in China could lead to more moderate volume growth, Kent remained confident that China will continue to serve as a double-digit growth market for Coca-Cola's business over the long term.

In the first quarter, Coca-Cola said its worldwide volume grew 5 percent, and volume rose in all key markets, including a 20 percent jump in India and a 9 percent increase in China. North America saw volume grow by 2 percent.

Productivity

Challenges from rising commodity costs and volatility in foreign exchange continue to mount.

Last year, the company projected $350 million to $450 million of commodity pressure in 2012.

While management seemed somewhat optimistic in the first quarter and said that some commodity prices seemed to be easing, the recent surge in corn price has once again clouded the outlook as Coca-Cola beverages use high-fructose corn syrup.

The four main raw materials that Coca-Cola uses in production are aluminum, sweetener, juice and PET -- also known as polyethylene terephthalate, a durable, lightweight plastic.

As for currencies, based on our hedge positions, current spot rates and the cycling of our prior year rates, we continue to expect currencies to have a mid single-digit negative impact on operating income for the full year, Coca-Cola Chief Financial Officer Gary Fayard said in a conference call in April. Furthermore, we expect to see this impact come in at the high end of this mid single-digit range in the second quarter.

Coca-Cola announced a cost-cutting plan in February, aiming at reducing costs of $550 million to $650 million by 2015. This came after the company completed a $500 million four-year savings program in 2011.

Coca-Cola said savings from the program will be reinvested into marketing and help offset rising commodity costs.

While this is a multi-year project, look for comments on what has been accomplished in the past quarter.

First Quarter Recap

Coca-Cola delivered better-than-expected operating earnings of 89 cents per share in the first quarter, which exceeded analysts' estimate of 87 cents per share and prior-year earnings of 82 cents per share. The results were also ahead of the long-term targets of Coca-Cola.

Revenue rose 5.9 percent to $11.14 billion from $10.52 billion. The company raised global pricing by 3 percent in the quarter, outpacing last year's 1.5 increase.

Coca-Cola has topped earnings estimates in the last four quarters.

Stock Performance

Coca-Cola announced a two-for-one stock split in April, citing its expectation to double revenue over this decade.

The split, which is the 11th in Coca-Cola stock's 92-year history and the first in 16 years, increases the number of Coca-Cola shares to 11.2 billion from 5.6 billion. Shareholders will receive one additional share of stock on Aug. 10 for each share held.

Companies split stocks when they think their share price has gotten too expensive or if the stock is trading too far above similar companies' stock. Shares of Coca-Cola hit a 52-week high of $79.36 on July 3.

Earlier this year, Coca-Cola also announced its 50th consecutive annual dividend increase, raising the dividend to 8.5 percent.

Coca-Cola's major competitor, PepsiCo, Inc. (NYSE: PEP), is set to report its second-quarter earnings results on July 25 before the market open.

Other competitors include: Dr. Pepper Snapple Group Inc. (NYSE: DPS), Monster Beverage Corp. (NASDAQ:  MNST), Coca-Cola Enterprises Inc. (NYSE: CCE), Unilever N.V. (NYSE: UN), and Kraft Foods Inc. (NYSE: KFT).

The Coca-Cola Company (NYSE: KO) closed up 0.84 percent, to $77.28 a share, in Friday's trading. Year to date, the stock price has gained 10.45 percent in value.