PepsiCo reported mixed results for its latest quarterly earnings, reflecting challenges in its North American food and beverage segments amidst robust international demand. CEO Ramon Laguarta noted that the performance in the U.S. was affected by tightening consumer budgets, largely due to rising inflation. The company shared these insights in remarks posted on its website.
The second quarter saw significant volatility in global oil prices, exacerbated by geopolitical tensions, with U.S. gas prices reaching a four-year peak of $4.56 per gallon in late May. This economic landscape has led consumers to exercise caution in their spending, impacting Pepsi’s financial performance. Following the announcement, Pepsi’s shares declined by over 4%.
For the quarter ending June 13, PepsiCo reported adjusted earnings per share of $2.20, slightly below analyst expectations of $2.21. Revenue reached $24.18 billion, surpassing estimates of $23.95 billion. The company’s net income attributable to shareholders increased to $2.98 billion, or $2.18 per share, up from $1.26 billion a year earlier. Organic revenue grew by 2.4%, while global volume for food products rose by 3% and beverages by 2%.
However, domestic performance was notably weaker, with flat volume in the North American food sector and a 4% decline in beverages. CFO Steve Schmitt expressed hopes for recovery, stating the company anticipates a gradual improvement in North American volumes, even as recent trends remain disappointing.
PepsiCo reaffirmed its forecast for the full year, expecting organic revenue growth between 2% and 4%, and core constant currency earnings per share to rise by 4% to 6%.
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