PepsiCo reported stronger-than-expected quarterly earnings and revenues on Thursday, marking a significant rebound in its North American food division. This news has resulted in a slight uptick in the company’s shares during premarket trading. In its latest report, Pepsi revealed earnings per share of $1.61, surpassing analysts’ expectations of $1.55. Additionally, the company recorded revenues of $19.44 billion, outpacing the anticipated $18.94 billion.
The company’s net income for the first quarter rose to $2.33 billion, or $1.70 per share, compared to $1.83 billion, or $1.33 per share, a year prior. After excluding various items such as restructuring costs, Pepsi’s adjusted earnings amounted to $1.61 per share. The 8.5% increase in net sales was largely driven by the acquisition of Poppi, the new distribution of the Alani Nu energy drink, and the divestiture of Rockstar. Organic revenue, which excludes acquisitions, divestitures, and currency effects, increased by 2.6%.
For the first time in over two years, Pepsi’s North American food segment, which includes Frito-Lay and Quaker Oats, reported a 2% increase in volume. This turnaround comes after the company experienced backlash from consumers due to significant price hikes in 2022. In a strategic move to regain consumer trust, Pepsi lowered prices on several products, including Lay’s, Tostitos, Doritos, and Cheetos, by as much as 15%. These changes have begun to yield positive results, reflecting improved demand for its snack offerings.
Despite the uptick in its food business, Pepsi’s North American beverage division reported a 2.5% decline in volume. This segment, which includes core products like Pepsi soda, Starry, and Poppi, has struggled with weakened demand amid rising prices. To stimulate sales, Pepsi has announced plans to “restage” the Gatorade brand. This strategy will target nonathletic consumers, emphasizing hydration benefits, introducing a lower-sugar variant, and phasing out artificial colors, among other initiatives. The company is also focusing on trends that favor higher protein and fiber content, evident in its recent product launches like Pepsi Prebiotic and SunChips Fiber.
Looking ahead, Pepsi reiterated its guidance for the year, expecting organic revenue growth of 2% to 4% and core constant currency earnings per share to rise by 4% to 6%. However, the company acknowledged the challenges posed by a tumultuous global economy, particularly due to ongoing geopolitical conflicts, including the war in the Middle East. Executives expressed concern over the unpredictable nature of the macroeconomic landscape but also indicated that systematic commodity hedging could offer some protection against volatility in input costs.
As PepsiCo navigates the evolving market landscape, the company remains committed to adapting its strategies to meet consumer demand and enhance shareholder value.
Original Source: https://www.cnbc.com/2026/04/16/pepsico-pep-q1-2026-earnings.html
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Publish Date: 2026-04-16 17:01:00
