PepsiCo will cut prices on Lay's and Cheetos after demand slows / Photo: ArDanMe / Shutterstock
PepsiCo's profit and revenue for the fourth quarter of 2025 exceeded analysts' expectations, according to the company's report. Such indicators contributed to the improvement of organic sales in all areas of business, writes CNBC. In the future, PepsiCo expects to increase sales even more - this time by reducing prices for Lay's chips, Cheetos, Doritos and other snacks by 15%, notes The Wall Street Journal.
Details
- PepsiCo's adjusted earnings per share for the fourth quarter of 2025 were $2.26 versus the $2.24 expected by analysts at LSEG, CNBC reports.
- Net revenues reached $29.34 billion (+5.6% year-over-year) versus expectations of $28.97 billion. Organic revenues, which exclude currency fluctuations and the company's asset purchases and sales, increased 2.1% for the quarter.
- At the same time, PepsiCo recorded a decrease in sales of products in the world, primarily in North America. Thus, the division of PepsiCo Foods North America, which portfolio includes brands from Quaker Oats to Cheetos, reported a 1% decrease in sales volumes. PepsiCo Beverages North America, which includes sports drink and soda brands including Gatorade, Starry and Poppi, reported a 4% decline in sales, although organic sales were up 2%.
- The company's global food sales in the fourth quarter of 2025 declined 2%, while global beverage sales, in contrast, grew 1%.
- PepsiCo also reiterated the 2026 outlook it presented last December: the company still expects organic revenue growth in the 2-4% range, as well as a 4-6% increase in basic earnings per share in constant currency.
Price reduction
Pepsi's domestic market was again the weak link in the company's quarterly reports, although its performance shows signs of improvement, CNBC writes. Inflation-fatigued customers have become less likely to consume Pepsi products, indicating consumer dissatisfaction with higher prices, the channel points out.
Against this backdrop, PepsiCo announced plans to cut prices on its products to "improve the competitiveness and purchase frequency of the company's brands," top executives said. The Wall Street Journal explains that they are talking about cutting prices on Lay's potato chips, Doritos, Flamin' Hot Cheetos and other snacks by 15%. The price cuts, according to company executives, will be offset by "productivity savings," CNBC writes.
Rising food prices have become a major irritant for consumers, the Wall Street Journal points out. Top executives at PepsiCo noticed that the prices of the company's snack foods were rising following general inflation and increased production costs. However, sales growth has since slowed.
"It's gotten a little more expensive than we would have liked," PepsiCo CEO Ramon Laguarta noted.
What about the stock
The company's shares added more than 1% on the pre-market on February 3. Over the last 12 months they have grown by 8%. By comparison, the U.S. broad market index S&P 500 for the same period added 16.4%, and shares of PepsiCo's main competitor - Coca Cola - rose by 20%.
Of the 29 analysts covering PepsiCo securities, ten are neutral and recommend holding them in a portfolio, eight advise buying and only one advises selling.
This article was AI-translated and verified by a human editor
