PepsiCo to cut costs as weak N.America business hurts annual core profit forecast

On Thursday, PepsiCo announced plans to implement further cost cuts as its annual core profit forecast was reduced due to low demand for its snacks and beverages in North America and increasing production costs. Industry players, including PepsiCo, General Mills, McCormick, and Conagra Brands, face a challenging situation characterized by surging costs and cautious consumer spending amid rising fuel prices, which is negatively impacting demand.

PepsiCo's CEO, Ramon Laguarta, disclosed in a statement that the company is identifying additional structural cost reduction measures to be executed in the upcoming months. These initiatives are intended to support investments aimed at enhancing organic revenue growth and moderating the consequences of rising input cost inflation.

The company anticipates that its fiscal 2026 core earnings per share, adjusted for currency fluctuations, will increase by 1% to 2%, as opposed to its earlier forecast of a low-end growth of 4% to 6%. Additionally, PepsiCo expects its annual organic revenue to expand by around 3%, in contrast to the previous forecast of a 2% to 4% rise.