PepsiCo cut its full-year organic revenue forecast on Tuesday after the company reported softer-than-expected sales figures and business disruptions from geopolitical tensions that impacted the company in the third quarter.
The snack and beverage giant's 2024 organic revenue growth outlook changed from 4% to a "low-single-digit increase." It projected that international organic revenue growth would surpass that of North America for the year. The company also doubled-down on expectations for growth of "at least" 8% in its core constant currency earnings-per-share for the year.
"Our businesses remained resilient in the third quarter, despite subdued category performance trends in North America, the continued impacts related to certain recalls at Quaker Foods North America and business disruptions due to rising geopolitical tensions in certain international markets," PepsiCo CEO Ramon Laguarta said Tuesday.
In the quarter, PepsiCo generated $23.32 billion in net revenue, a 0.6% decline from the same period a year ago and below Wall Street estimates of $23.76 billion. It earned $2.31 per share on an adjusted basis, above analysts' expectations of $2.29 a share.
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The company took inflationary pressures on consumers, geopolitical tension in certain international markets and other factors into consideration as it pared back its overall organic revenue forecast for the full year.
"We expect consumers to remain choiceful and value conscious as the cumulative effects of inflationary pressures continue to impact budgets and spending patterns," Laguarta and CFO James Caulfield said. "Pockets of elevated geopolitical tension and macroeconomic pressure are also expected to persist in certain international markets."
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The company has a wide range of brands under its umbrella, including Pepsi, Doritos, Gatorade, Mountain Dew and Quaker. Its products can be found in over 200 countries and territories.
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"As we look ahead, we will remain focused on providing good value to consumers through our great-tasting products that offer variety, convenience, and affordability," the executives said. "We will also continue to elevate and accelerate our productivity initiatives across the organization to support disciplined commercial and advertising and marketing investments – including investments to accelerate the presence and variety of our positive choice and multicultural offerings."
