PepsiCo reported mixed results for the second quarter of 2026, as strong demand in international markets helped balance weaker performance in its North American food and beverage business.
The company reported adjusted earnings of $2.20 per share, slightly below Wall Street’s estimate of $2.21 per share. However, revenue came in at $24.18 billion, beating analysts’ expectation of $23.95 billion.
Net income rose to $2.98 billion, or $2.18 per share, compared with $1.26 billion, or 92 cents per share, in the same quarter last year.
Profit rises as one-time charges disappear
PepsiCo’s profit more than doubled from a year ago because the company did not record the large one-time impairment charges it had taken in 2025.
Last year, PepsiCo booked a $1.86 billion impairment charge related to its Rockstar energy drink and Be & Cheery snack brands. Without a similar charge this year, operating profit increased sharply.
After excluding one-time items such as restructuring and impairment charges, the company’s core operating profit grew 4%, showing steady growth in its main business.
International business supports growth
PepsiCo’s international business remained the biggest growth driver during the quarter. Its Asia Pacific Foods, Europe, Middle East and Africa businesses, along with its International Beverages Franchise, reported double-digit revenue growth. Higher sales volumes and favourable currency movements supported the increase.
The company’s Latin America Foods business also improved as sales volumes recovered.
North America continues to face challenges
PepsiCo’s North American business remained under pressure. Its food division gained market share and sold more products through new launches and affordable options, but revenue still fell 2% because of lower pricing.
The North American beverage business performed better, with revenue growth mainly supported by acquisitions completed in 2025.
“However, results were tempered in the quarter as U.S. food and beverage category performance moderated with consumer budgets tightening due to rising inflationary pressures,” CEO Ramon Laguarta said in prepared remarks shared on the company’s website on Thursday.
Company sees strong demand for healthier products
Chairman and CEO Ramon Laguarta said PepsiCo continued to see strong demand for products focused on hydration, protein, fibre, energy and zero-sugar options. He added that the company’s global organic volume growth so far this year is the strongest since 2022, helped by its international business and wide range of products.
The company plans to support future growth through new product launches, brand relaunches, affordable pricing and better operating efficiency.
PepsiCo keeps full-year forecast unchanged
PepsiCo maintained its full-year 2026 guidance. The company continues to expect organic revenue growth of 2% to 4% and core constant-currency earnings per share growth of 4% to 6%.
It also expects a core effective tax rate of around 22%, capital spending below 5% of net revenue and free cash flow conversion of at least 80%.
PepsiCo plans to return about $8.9 billion to shareholders this year, including $7.9 billion through dividends and $1 billion through share buybacks.
The company said favourable currency movements and acquisitions completed in 2025 are expected to help reported revenue grow 4% to 6% this year, while core earnings are expected to increase by around 5% to 7%.