PepsiCo, the parent company of brands like Pepsi, Lays, and Quakers, shared a mixed earnings report for the second quarter on Thursday. The company’s adjusted earnings per share exceeded expectations, but earnings came below what analysts estimated. This caused PepsiCo’s stock to dip by 2% after the report was made public.
PepsiCo was hurt by a weakening demand for snacks and drinks across North America in the second quarter as customers decided to cut back on spending on non-essentials in the wake of heightening inflation. It also didn’t help that the prices of PepsiCo’s products have been hiked on a constant basis in recent years.
The company’s adjusted earnings per share came at $2.28, while analysts estimated it to be $2.16. The revenue of $22.5 billion didn’t clear the expected mark of $22.57 billion. As a result, PepsiCo is now forecasting its organic revenue to grow “approximately 4%” compared to its previous prediction of at “least 4%.”
“During the second quarter, our business delivered net revenue growth, strong gross and operating margin expansion, and double-digit EPS growth, remaining agile despite facing difficult net revenue growth comparisons versus the prior year, subdued category performance within North America convenient foods and the impacts associated with certain product recalls at Quaker Foods North America,” said PepsiCo’s Chairman and CEO Ramon Laguarta.