PepsiCo {{ m-tag option="price" ticker="PEP" currency="USD" }} reported mixed results for the second quarter of 2024, highlighting achievements and challenges. The company faces declining demand in North America and has adjusted its revenue outlook for the year.

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Performance Overview

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Earnings per share (EPS):

• Reported: $2.28
• Expected: $2.16

Revenue:

• Reported: $22.5 billion
• Expected: $22.57 billion

Net Income:

• Current year: $3.08 billion or $2.23 per share
• Previous year: $2.75 billion or $1.99 per share

Excluding items:

• EPS remained at $2.28

Net Sales:

• Increased by nearly 1%

Organic Revenue:

• Increased by 1.9%
• Driven by international markets

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Challenges in North America

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Despite global gains, PepsiCo struggled domestically. The company’s North American beverage unit saw volume shrink by 3%, while Frito-Lay North America experienced a 4% decline in volume. The consumer shift towards more value-conscious spending has reduced purchases of PepsiCo’s products and increased preference for cheaper, private-label options.

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Strategic Adjustments

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In response to these challenges, PepsiCo is focusing on higher-margin packaging, in-store promotions, and its flagship brands like Cheetos and Doritos. CEO Ramon Laguarta noted improvements in volume for North American drinks and highlighted a successful July 4th sales period.

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Future Outlook

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PepsiCo narrowed its revenue growth outlook to approximately 4% for the year, down from at least 4%. The company maintains its guidance for core constant currency earnings growth of at least 8%; therefore, PepsiCo anticipates a recovery in the latter half of the year.

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