Overview
- PepsiCo reported second-quarter results on Thursday, July 9, with revenue of $24.18 billion that topped forecasts and adjusted EPS of $2.20 that missed estimates by one cent.
- Global volumes drove growth, with food up 3% and beverages up 2%, and management said organic volume expanded at its fastest pace since 2022.
- North America weakened: food volumes were flat and beverage volumes fell about 4%, and the company said the U.S. business was "softer than we anticipated" and will take longer to recover.
- Core operating profit rose about 4% to roughly $4.07 billion while core operating margin tightened by about 40 basis points to 16.8%, and executives warned input costs will be higher in the second half of the year.
- PepsiCo is offsetting U.S. softness with price cuts, refreshed branding, higher marketing spend and ongoing capital returns, it reaffirmed full-year guidance of 2%–4% organic revenue growth and 4%–6% core EPS growth, and investors remain focused on domestic demand and margin risk.