PepsiCo earnings beat estimates as North American food business improves

PepsiCo on Thursday reported quarterly earnings and revenue that topped analysts' expectations as its struggling North American food business reported a return to volume growth.

Shares of the company dipped slightly in premarket trading.

Here's what the company reported compared with what Wall Street was expecting, based on a survey of analysts by LSEG:

Pepsi reported first-quarter net income attributable to the company of $2.33 billion, or $1.70 per share, up from $1.83 billion, or $1.33 per share, a year earlier.

Excluding items including restructuring and divestitures, the company earned $1.61 per share.

Net sales rose 8.5% to $19.44 billion. Pepsi's organic revenue, which strips out acquisitions, divestitures and currency fluctuations, increased 2.6%.

For the first time in more than two years, Pepsi's North American food business reported an increase in volume. The division, a combination of its North American Frito-Lay and Quaker Oats units, has faced pushback from consumers for hefty price increases when inflation spiked in 2022. In February, Pepsi cut prices on Lay's, Tostitos, Doritos and Cheetos by as much as 15% to try to win back shoppers.

Pepsi's North American food business reported volume growth of 2% for the quarter. The metric excludes pricing and foreign exchange fluctuations to reflect demand more accurately.

The company's North American beverage business reported that volume fell 2.5%.

For the full year, Pepsi reiterated its prior forecast that organic revenue will rise between 2% and 4% and core constant currency earnings per share will increase in a range of 4% to 6%.