PepsiCo Reports Volume Growth but Lowers Full-Year Profit Guidance
In its third quarter of fiscal 2026, PepsiCo reported adjusted earnings per share (EPS) of $2.34 and revenue of $25.27 billion, both exceeding Wall Street estimates. The company saw volume growth in convenience foods by 1% year over year and beverage sales up by 3%. Despite these gains, management reduced its full-year core EPS guidance from a projected range of 5%-7% to 2.5%-3.5%, citing challenges such as higher operating expenses and flat performance in the North America division. The North American segment struggled with declining beverage volume (down 2%) and stagnant convenience food sales, while increased marketing costs contributed to a contraction in core operating margins by 0.35% to 16.9%. CEO Ramon Laguarta acknowledged underperformance in this region and announced plans to cut corporate overheads for reinvestment into the North American business. PepsiCo also faces broader industry pressures, including shifting consumer preferences, inflation-driven price adjustments, and activist investor pressure from Elliott Management.
Tickers: $PEP
Topics: financial performance guidance change PepsiCo volume growth