In a refreshing twist for investors, PepsiCo dazzled the market on Tuesday with quarterly results that outshone expectations, prompting a 2% surge in premarket trading.
Earnings & Revenue Leapfrog Expectations
PepsiCo’s quarterly earnings report delivered a delightful surprise, leaving Wall Street analysts in awe. Adjusted earnings per share soared to $2.25, trumping the expected $2.15. Revenue danced to its own upbeat rhythm, hitting $23.45 billion against the forecasted $23.39 billion.
Raising the Bar for 2023
Looking ahead, PepsiCo is painting a rosier picture for 2023. The company now anticipates a 13% growth in constant currency earnings per share, a step up from its previous estimate of 12%. This marks the third consecutive quarter that PepsiCo has jazzed up its full-year forecast.
Financial Flourish in Q3
PepsiCo’s financial performance in the third quarter deserves a standing ovation. Net income attributable to the company stood tall at $3.09 billion, or $2.24 per share, marking a triumphant ascent from $2.7 billion, or $1.95 per share, in the same period a year ago. Stripping away the extras, the company earned a harmonious $2.25 per share. Net sales hit a high note, rising 6.7% to $23.45 billion, while organic revenue, a melody unsullied by acquisitions and divestitures, climbed 8.8%.
Volume Dips, but Some Stars Shine Bright
Not all notes were perfectly pitched for PepsiCo, though. Volume, discounting pricing and currency variations, dipped again this quarter, mirroring a trend. The North American beverages unit, for instance, reported a 6% volume decline. However, amid the sea of dimmed lights, there were some bright spots. Gatorade, a standout performer, witnessed double-digit revenue growth. PepsiCo is also ready to rekindle the flame with fans by relaunching the beloved Mountain Dew Baja Blast, exclusive to Taco Bell.
Mixed Performance in North America
PepsiCo’s North American beverages unit might have faced a volume blues, with a 6% decline, but the food divisions struck a different chord. Quaker Foods North America’s volume saw a 1% rise, while Frito-Lay North America’s volume maintained its rhythm. In the food lineup, Quaker Foods’ brands grabbed market share in crucial categories like pancake mix and syrup, showcasing a notable performance.
In the intricate dance of earnings reports, PepsiCo seems to have hit the right steps, leaving investors and analysts applauding its financial performance.
