PepsiCo, Inc. (PEP)

PepsiCo reported on 8 October 2026 that third-quarter net revenue rose 5.6 percent to $25.27 billion, and diluted earnings per share increased 17 percent to $2.23 3. Organic revenue, the company's own measure that leaves out currencies and companies bought or sold, rose 3.1 percent 3. The company cut its 2026 outlook for core constant currency earnings per share growth to 1 to 2 percent, from the low end of 4 to 6 percent 3.

The split is between the world and home: international organic revenue grew 8 percent, while Reuters reported North American food volume flat and beverage volume down 2 percent 418. Finance chief Steve Schmitt said the North American recovery "is taking more time than we planned" 18.

Chairman and chief executive Ramon Laguarta said more structural cost cuts "are being identified and will be implemented in the coming months" 3. The bigger open question is the delivery network: PepsiCo said in December 2025 it intends to give analysts and investors a full update on its North American supply chain and go-to-market systems in late 2026 5. That update, after a year of pressure from the activist investor Elliott Investment Management, decides how the drinks and snacks reach stores 519.

PepsiCo was incorporated in Delaware in 1919 and moved its incorporation to North Carolina in 1986 1. The company in its present shape was formed in 1965, and it has paid a cash dividend every quarter since 11.

On 2 August 2001 PepsiCo completed its merger with The Quaker Oats Company, paying 2.3 of its own shares for each Quaker share 11. The deal brought oats and Gatorade, which the 2001 report grouped with Tropicana in one North American unit 11. Net sales were $26.9 billion that year 11.

On 26 February 2010 PepsiCo completed its purchases of two big bottlers, The Pepsi Bottling Group and PepsiAmericas, and began to report their results as its own 12. Net revenue rose to $57.8 billion in 2010 from $43.2 billion in 2009, the bottlers' sales of finished drinks now counted inside PepsiCo 12. In February 2011 it raised its ownership of the Russian dairy and juice company Wimm-Bill-Dann to about 77 percent, for about $3.8 billion 12.

The middle of the decade shrank the top line, from $66.7 billion in 2014 to $62.8 billion in 2016 13. The 2016 report blames the strong dollar and taking its Venezuelan businesses off the books at the end of the third quarter of 2015 13.

Then came a run of purchases: SodaStream, the home sparkling water machine maker, in December 2018 for about $3.2 billion net of cash 14. In 2020 it bought Rockstar Energy for about $3.85 billion up front, Pioneer Foods of South Africa, and Be & Cheery, one of China's largest online snack sellers 15. Net revenue still rose 5 percent in 2020, to $70.4 billion, despite the pandemic 15.

Inflation turned into pricing: net revenue rose 9 percent in 2022 to $86.4 billion 16. Organic revenue rose 14 percent, with effective net pricing, the mix of price changes, promotions and packs, carrying all 14 points 16. In the first quarter of 2022 PepsiCo sold Tropicana, Naked and other juice brands to PAI Partners, keeping 39 percent of the new Tropicana Brands Group, and booked a $3.3 billion gain 16.

Growth then stalled: net revenue was $91.5 billion in 2023, $91.9 billion in 2024 and $93.9 billion in 2025 1. In 2024 the Quaker foods unit's revenue fell 14 percent, hit by a voluntary recall of some bars and cereals 17.

In 2025 net income fell 14 percent to $8.24 billion, mainly because of $1.9 billion of impairment charges, write-downs of brand values led by Rockstar 1. The same year PepsiCo paid $1.95 billion for poppi, a prebiotic soda, and $1.2 billion for Siete, a Mexican-American foods maker 1.

In September 2025 Elliott Investment Management disclosed a stake of about $4 billion and urged PepsiCo to consider handing its company-owned bottling to independent bottlers and selling weaker food assets 21. In December 2025, after talks with Elliott, PepsiCo said it was cutting nearly 20 percent of its U.S. products and promised at least 100 basis points of core operating margin growth over three years 5.

Snacks and foods in North America

PepsiCo Foods North America makes Lay's, Doritos, Cheetos, Tostitos, Ruffles, Quaker oats and cereals, Pearl Milling Company syrups and Sabra dips for the United States and Canada 1. It had net revenue of $27.5 billion in 2025, against $27.4 billion in 2024, as savory snack volume fell 3 percent 1.

To win shoppers back, PepsiCo cut the cost of Lay's, Doritos, Cheetos and Tostitos "by up to nearly 15%" in February 2026, NPR reported 23. In the third quarter the unit's revenue was $6.50 billion against $6.53 billion, savory snack volume grew 1 percent and lower net pricing pulled revenue down 2.

Multipacks, bags of mixed small portions, exceed $3.5 billion in yearly net revenue, and SunChips alone has retail sales of nearly $800 million, the company says 4. The newest lines lean on protein, fiber and no artificial colors, such as Doritos Protein and the NKD versions of Doritos and Cheetos 4.

Drinks in North America

PepsiCo Beverages North America sells Pepsi, Mountain Dew, Gatorade, Aquafina, Bubly and Propel, bottles much of it itself, and distributes Dr Pepper and Crush under licence from Keurig Dr Pepper 1. It had net revenue of $28.2 billion in 2025, its largest unit, though unit volume fell 3 percent 1.

In energy drinks, PepsiCo distributes Celsius and Alani Nu, and its partnership with Celsius holds nearly 20 percent of the category, the company says 14. Propel water has estimated yearly retail sales above $1 billion 4. Cola is the weak spot: Food Dive, citing Beverage Digest, reported Pepsi had fallen to fourth place behind Coke, Dr Pepper and Sprite 20.

Drinks abroad and SodaStream

International Beverages Franchise sells concentrate, the flavored base, to bottlers that make Pepsi, 7UP, Mirinda and Sting Energy abroad, and it makes SodaStream machines 1. It had net revenue of $5.0 billion in 2025, small for its reach because bottlers pay only for the concentrate 1.

Europe, Middle East and Africa

This unit sells Walkers and Lay's crisps, Pepsi from its own bottlers and Russian dairy brands such as Agusha 1. Its net revenue rose 8 percent to $18.0 billion in 2025, mainly on pricing 1. Russia made up 5 percent of PepsiCo's net revenue that year 1.

Latin America and Asia Pacific foods

Latin America Foods sells Sabritas, Gamesa biscuits and Doritos, with net revenue of $10.5 billion in 2025 1. Asia Pacific Foods sells Lay's, Kurkure in India and Smith's in Australia, with $4.6 billion 1. In the third quarter their revenue rose 14 percent and 10 percent 3.

Plants, people and customers

PepsiCo owns its head office in Purchase, New York, and its Plano, Texas, sites, plus snack plants such as Cedar Rapids, Iowa, and Leicester in Britain and concentrate plants in Cork, Ireland 1. It employed about 306,000 people at the end of 2025, about 125,000 in the United States 1. Walmart and Sam's Club bought about 14 percent of everything it sold 1.

Rivals

The Coca-Cola Company is the main drinks rival, with about 20 percent of U.S. liquid refreshment sales in measured channels in 2025 against PepsiCo's 16 percent 1. Keurig Dr Pepper, Monster, Red Bull, Mondelez, Mars, Kraft Heinz and Utz compete across the shelves, and store brands press from below 119.

People in charge

Ramon Laguarta has been chief executive since 2018 and chairman since 2019 1. Steve Schmitt, previously finance chief of Walmart U.S., became finance chief on 10 November 2025, and Ram Krishnan runs North America since December 2025 61. Johnson & Johnson's chief executive Joaquin Duato joins the board on 1 December 2026 7.

Current problems

New York's attorney general, Baltimore, Los Angeles County and the U.S. Virgin Islands have sued PepsiCo over plastic pollution, and the company says it has strong defenses 1. New York's case was dismissed in November 2024 and is on appeal 1. Tariffs raised input costs, though the company recovered most IEEPA tariffs after the Supreme Court ruled them invalid 2.

The umbrella, in words

The 10-K names more than a hundred trademarks the company owns, from Cap'n Crunch and Cracker Jack to Walkers, Sabritas, Siete, poppi and SodaStream 1. The subsidiaries exhibit lists, among others, Frito-Lay North America, The Quaker Oats Company, Stokely-Van Camp, VNGR Beverage, the poppi company, and Garza Food Ventures, the Siete company 261.

PepsiCo owns 39 percent of Tropicana Brands Group and accounts for it as an equity investment 1. It invested in Celsius Holdings through convertible preferred shares, carried at $1,482 million on 5 September 2026 2. It has agreed joint ventures with Unilever for Lipton tea and with Starbucks for ready-to-drink coffee 1.

No founder or special share class controls the votes: the 2026 proxy names The Vanguard Group with 10.1 percent and BlackRock with 8.2 percent as the only holders above 5 percent 10. Shareholders rejected an independent chair proposal at the May 2026 meeting, as filed 8.

For 2026 the company now guides to organic revenue growth of about 3 percent and net revenue growth of about 6 percent 3. It guides core earnings per share growth of 2.5 to 3.5 percent and capital spending below 5 percent of net revenue 3.

PepsiCo plans to return $8.9 billion to shareholders in 2026, $7.9 billion in dividends and $1.0 billion in buybacks 3. The annual dividend rose 4 percent to $5.92 a share, and a $10 billion buyback program runs to February 2030 1.

The company said in December 2025 it intends to give a full update on its North American supply chain and go-to-market systems in late 2026 5. It expects free cash flow conversion of at least 90 percent in 2027, and it expects to raise yearly cash returns in 2026 and 2027, subject to the board 5.

Its cost program, the 2019 Productivity Plan extended to 2030, is expected to cost about $6.15 billion before tax, with about $500 million more in charges in the rest of 2026 2. The quarterly report also expects a $50 million pre-tax gain in the fourth quarter of 2026 from hedging an investment it converted into shares 2.

PepsiCo owes poppi's sellers $300 million only if performance milestones are met by the third quarter of 2027, and on 5 September 2026 it valued that promise at $12 million 2. On 16 October 2026 it issued 1 billion euros (computed) of notes due 2029 and 2035, mainly to repay commercial paper 9.

Finance chief Steve Schmitt said North America's core operating margin is expected "to remain under pressure in the fourth quarter" 19. The company now expects a core tax rate of about 21 percent for 2026, against about 22 percent before 3.

PepsiCo also said in December 2025 that it intends to keep renewing its board with global leaders who can help it meet its growth and profit goals, and Elliott said it welcomed that commitment 5. Duato joins the board and its audit committee on 1 December 2026 7.

Past

PepsiCo's revenue rose from $63 billion in fiscal 2016 to $94 billion in fiscal 2025, up 4.6% a year, and it was profitable in all ten of those years. Over the three fiscal years to 2025, the diluted share count shrank about 0.3% a year, and dividends and buybacks returned about 65% of operating cash flow. The company's filings since 2017 show one warning event, a notice about its exchange listing on 2017-12-08. 1

Present

In its latest annual figures for the fiscal year ended 2025-12-27, PepsiCo reported revenue of $94 billion and a profit of $8.2 billion. The company earned about 40 cents of profit for every dollar of shareholders' money and its products earned about 47 cents per dollar of everything it owns, while it owed about 81 cents per dollar of assets, and its share count shrank 0.4% over the year. Its revenue of $94 billion in fiscal 2025 ranks in the top 3% by size among 19 companies in its industry family, its net margin of 8.8% ranks in the top 50%, and its revenue growth of 2.8% a year over the last three filed years ranks in the bottom 39%. The chief executive, Ramon Laguarta, has held that title since 2018-10-11, and the 25 officers and directors filing in the last fifteen months have been on the record a median of 7 years. 21

Future

The annual report for the fiscal year ending 2026-12-26 is due by 2027-02-24. The quarterly report for the quarter ending 2027-03-31 is due by 2027-05-10. On 8 October PepsiCo reported third-quarter net revenue of $25.27 billion, 5.6 percent more than a year earlier, and the company lowered its outlook for per-share profit growth and narrowed its organic revenue outlook to about 3 percent for 2026. 34

How the company operates

PepsiCo is a product business classed by the SEC under Beverages. The company reported 6 lines of business in fiscal 2025: Pepsi Co Beverages North America at $28 billion, Pepsi Co Foods North America at $28 billion, Europe Middle East Africa at $18 billion, and three more, with 5 of 6 lines growing in the latest filed year and the largest line at 30% of revenue. By geography, the United States accounted for 56% of revenue, All Other Countries 19%, Mexico 7%, Russia 5%, Canada 4%, China 3%, United Kingdom 2%, and Brazil 2%. 21

New moves

On 8 October the company reported third-quarter net revenue of $25.27 billion, organic revenue up 3.1 percent, and international organic revenue up 8 percent, while North American food volume was about flat and beverage volume was down 2 percent. The company said new structural cost reduction actions would take effect in the coming months. 4