PepsiCo Beats Estimates Citing Strong International Growth
PepsiCo says it continues to expect 'incremental supply-chain costs', including from tariffs, for the balance of 2025.
PepsiCo Inc. maintained its annual outlook and reported sales growth that beat Wall Street estimates, citing strong international growth.
The company, which owns the Gatorade, Lipton and Quaker brands, reported organic sales growth of 2.1% in the second quarter ended June 14, outpacing the average analyst estimate. Earnings per share were $2.12, also higher than market expectations.
“Our international business momentum continued, while our North America businesses improved their execution and competitiveness in key subcategories and channels,” PepsiCo Chief Executive Officer Ramon Laguarta said in a statement.
Shares rose 2% at 6:53 a.m. in premarket trading in New York. The stock has declined 11% this year through Wednesday’s close, compared to a 6.5% rise in the S&P 500 Index over the same period.
The company reiterated its guidance for fiscal year 2025 of low-single-digit organic revenue growth and core earnings roughly even with the prior year. PepsiCo said it continues to expect “incremental supply chain costs,” including from tariffs, for the balance of 2025.
With a broad range of products from breakfast cereals and fruit juices to salty snacks and soft drinks, the company is working to overcome a trend toward healthier, less processed foods, as well as lower cost private-label options. Executives have said recently they were seeking to offer a greater variety of price points to entice penny-pinching shoppers.
The soda and snacks maker said it was removing synthetic dyes from its US school foods by the start of the upcoming school year and plans to introduce “extensions” of Cheetos and Doritos with no artificial colors or flavors. PepsiCo said it also would expand the use of avocado and olive oil across certain brands and add protein, fiber and whole grains to some of its products.
The company also called out its bid to increase the amount of low and no sugar offerings, which has helped its trademark Pepsi brand gain share.
The comments came a day after President Donald Trump said in a Truth Social post that Pepsi’s rival, Coca-Cola Co., agreed to use cane sugar in Coke beverages sold in the US instead of corn syrup. Coke hasn’t confirmed the agreement.
