PepsiCo (NASDAQ:PEP) reported third-quarter earnings that exceeded Street expectations, though revenue fell short as it faced sluggish category trends in North America and challenges from international market disruptions. The company also adjusted its full-year revenue growth forecast, signaling caution amid a challenging operating landscape.
For the third quarter, PepsiCo delivered adjusted earnings per share of $2.31, narrowly beating the expected $2.29. Revenue, however, came in at $23.32 billion, below the $23.9 billion consensus.
Chairman and CEO Ramon Laguarta acknowledged the challenges, highlighting resilience across PepsiCo’s businesses but noting the impact of weaker North American category trends, recent Quaker Foods recalls, and international disruptions stemming from geopolitical tensions. As a result, PepsiCo revised its 2024 organic revenue growth outlook to a low-single-digit increase from an earlier projection of around 4%.
Despite adjusting revenue expectations, PepsiCo reaffirmed its guidance for at least 8% core constant currency EPS growth for 2024. Laguarta emphasized a strategy focused on rigorous cost management to navigate the current environment.
Looking ahead, PepsiCo forecasts core EPS of at least $8.15 for fiscal year 2024, slightly above the Street consensus of $8.14, and representing a 7% increase over 2023’s core EPS of $7.62.