PepsiCo (PEP) Q1 2026 earnings

PepsiCo The struggling North American food business reported a return to volume growth on Thursday, reporting quarterly earnings and revenue that beat analysts’ expectations.

The company’s shares rose slightly in premarket trading.

Here are the company’s reported results compared to Wall Street expectations, based on a survey of analysts by LSEG:

• Earnings per share: $1.61, expected $1.55
• Revenue: $19.44 billion, expected $18.94 billion

Pepsi reported first-quarter net income attributable to the company was $2.33 billion, or $1.70 per share, compared to $1.83 billion, or $1.33 per share, a year earlier.

Excluding items including restructurings and divestitures, the company earned $1.61 per share.

net sales It rose 8.5% to $19.44 billion, driven by its acquisition of Poppi, new distribution of Alani Nu energy drink and divestiture of Rockstar. Pepsi’s organic revenue, which excludes acquisitions, divestitures and currency fluctuations, increased 2.6%.

Pepsi’s North American food business reported an increase in volume for the first time in more than two years. The division, which is a combination of North American Frito-Lay and Quaker Oats units, has faced pressure from consumers over steep price increases as inflation soars in 2022. In February, Pepsi slashed prices on Lay’s, Tostitos, Doritos and Cheetos by up to 15% to win back shoppers; The efforts are already bearing fruit.

Pepsi’s North American food business reported 2% volume growth in the quarter. The metric excludes pricing and currency fluctuations to more accurately reflect demand.

The company’s North American beverage business reported that volume fell 2.5%. The division, which also includes eponymous sodas Starry and Poppi, also faced weak demand due to high prices.

Pepsi on Thursday said it would “relaunch” its Gatorade brand in a bid to boost sales of the sports drink. The company plans to market Gatorade’s hydration benefits to non-athletes, release a lower-sugar version and begin removing artificial colors, among other changes.

Pepsi is also leaning into snack and beverage trends, especially those with higher protein and fiber content. Recent launches include Pepsi Prebiotic, Starbucks Coffee & Protein, Doritos Protein and SunChips Fiber.

For the full year, Pepsi reiterated its previous forecast that organic revenue would grow between 2% and 4% and underlying constant currency earnings per share would rise between 4% and 6%. It was noted that it has become difficult to predict the global economy due to the war in the Middle East.

“Looking ahead, the macroeconomic environment has become more volatile and uncertain due to ongoing geopolitical conflicts,” executives said in prepared statements. he said. “Systematic commodity hedging programs for market-traded commodities are expected to provide some short-term protection and visibility on certain input costs.”