Pepsi products at a convenience store in Crockett, California, US, on Friday, June 16, 2023.
David Paul Morris | Bloomberg | Getty Images
PepsiCo on Thursday reported quarterly earnings and revenue that topped analysts’ expectations, despite falling demand for its drinks and food.
The beverage giant also raised its full-year outlook for the second consecutive quarter.
Shares of the company rose more than 2% in premarket trading.
Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
- Earnings per share: $2.09 adjusted vs. $1.96 expected
- Revenue: $22.32 billion vs. $21.73 billion expected
For 2023, Pepsi now expects 10% organic revenue growth, up from its prior forecast of 8%. The company also hiked its core constant currency earnings outlook to 12% growth from its previous expectation of 9%.
Pepsi reported second-quarter net income attributable to the company of $2.75 billion, or $1.99 per share, up from $1.43 billion, or $1.03 per share, a year earlier.
Excluding items, the beverage giant earned $2.09 per share.
Net sales rose 10.4% to $22.32 billion. The company’s organic revenue, which strips out the impact of acquisitions and divestitures, rose 13% in the quarter.
But the company’s volume fell as higher prices for its snacks and drinks hurt demand. Volume, which excludes pricing and currency fluctuations, dropped 3% for Pepsi’s food divisions and 1% for its beverages.
Quaker Foods North America’s volume shrank 5%, and Pepsi’s North American beverage unit reported volume fell 4.5% in the quarter.
However, Frito-Lay North America was one bright spot, reporting 1% volume growth.
The company said brands like Doritos and Ruffles saw double-digit revenue growth. Pepsi has been introducing new packaging sizing, adding its Flamin’ Hot flavor to brands across the division and launching Frito-Lay Minis to keep its snacking sales high.
Pepsi’s spending on advertising and marketing across its portfolio rose by double digits during the quarter.