Keurig Dr Pepper (KDP) reported better-than-expected fourth-quarter results on Tuesday buoyed by volume and price gains, while the beverage company projects annual earnings and sales growth in 2025.

Adjusted earnings increased to $0.58 a share for the December quarter from $0.55 the year before, just ahead of the FactSet-polled consensus of $0.57. Sales increased 5.2% year over year to $4.07 billion, topping the Street's view for $4.01 billion.

Shares of the company were up 5.1% in Tuesday's trading session.

"Enterprise volume mix grew 5.3%, reflecting healthy base business brands and an ongoing contribution from new partnerships," Chief Financial Officer Sudhanshu Priyadarshi said during an earnings call, according to a FactSet transcript. "Net price realization was also a positive contributor, increasing 0.9%."

For the full year 2025, Keurig Dr Pepper anticipates adjusted EPS and sales to rise by high-single and mid-single digits, respectively, on a constant currency basis. Foreign exchange is set to be a headwind of roughly one to two percentage points on sales and earnings. In 2024, adjusted EPS advanced 7.8% year over year to $1.92 while revenue improved 3.9% in constant currency terms to $15.35 billion.

"The balance between inflation, pricing and productivity generation is slated to improve over the course of the year," Priyadarshi said on the call. "As a result, we anticipate a stronger top-line and bottom-line momentum in (the second quarter) through (the fourth quarter), particularly as the contribution from Ghost builds following the transition to our distribution network."

The company completed its acquisition of a majority stake in the energy drink business Ghost at the end of December, according to a regulatory filing with the Securities and Exchange Commission.

For the fourth quarter, sales in the US refreshment beverages segment climbed 10% to $2.44 billion, boosted by volume and price growth. Revenue in the US coffee division declined 2.4% to $1.13 billion as a 0.7% increase in volume and mix was more than offset by an unfavorable net price realization of 3.1%. International sales edged 0.8% higher to $499 million.

"These are decent results from (Keurig Dr Pepper) considering the tough backdrop (inflationary in coffee and difficult foreign exchange) and we're pleased to see the streak of volume growth across all three segments continue," Truist Securities said in a client note.