PepsiCo shares climbed more than 1% in premarket trading Thursday after the snacks and beverage maker reported third-quarter earnings and revenue that topped Wall Street estimates, though it lowered its full-year profit outlook. Core earnings per share came in at $2.34, ahead of the $2.30 analysts expected, while net revenue rose 5.6% to $25.27 billion, above the $24.97 billion consensus, and organic revenue growth accelerated to 3.1%. Core operating profit rose 3% to $4.28 billion, but core operating margin narrowed 35 basis points to 16.9%, with PepsiCo saying a 4-percentage-point benefit from tariff refunds helped core operating profit, offset in part by higher operating costs and increased advertising and marketing spending. The company now expects core constant-currency EPS growth of 1% to 2% for the year, down from prior guidance of the low end of a 4% to 6% range, and core EPS growth of 2.5% to 3.5%, down from the low end of 5% to 7%. PepsiCo narrowed its organic revenue growth forecast to about 3% from a range of 2% to 4%, raised its net revenue growth forecast to about 6% from 4% to 6%, and left planned shareholder returns unchanged at $8.9 billion. Chairman and Chief Executive Ramon Laguarta said the company is acting with urgency to sustainably improve its performance in North America through more investment in innovation, brand building and sharper execution by sales channel, and is identifying additional structural cost cuts to fund growth investments and offset rising input costs.
PepsiCo IncPepsiCo beat Q3 EPS/revenue estimates but cut its full-year profit forecast, a mixed earnings/guidance event.
