According to a survey of analysts by Refinitiv, here’s how the company’s report compared to Wall Street’s expectations:Earnings per share: $1.78 adjusted versus an expected $1.72Revenue: $27.85 billion compared to an expected $28.4 billionPepsi recorded a net income of $1.3 billion in the fourth quarter, or 94 cents per share, an increase from $518 million, or 37 cents per share, from the previous year. Excluding certain items, the food and beverage company earned $1.78 per share.Net sales decreased by 0.5% to $27.85 billion, with currency exchange rates contributing to a 1.5% decline. In the quarter, Pepsi’s organic revenue, which excludes acquisitions and divestitures, increased by 4.5%, driven by higher prices. However, these elevated prices have led to reduced demand for the company’s products. Pepsi’s volume, which accounts for pricing and currency changes, decreased again this quarter.PepsiCo executives stated in prepared remarks released prior to the conference call that consumers in North America are experiencing financial pressure due to high borrowing costs and lower personal savings. They added that consumers are increasingly opting for smaller pack sizes due to their convenience and affordability.Pepsi’s North American Quaker Foods division reported an 8% decrease in volume, partly due to a voluntary recall of its granola bars and cereals, as well as weaker category growth. Similarly, Frito-Lay North America, which includes brands like Cheetos and Doritos, saw a 2% decline in volume. The North American beverage unit of Pepsi also experienced a 6% decline in volume during the quarter.For 2024, Pepsi anticipates organic revenue growth of at least 4% and core constant currency earnings per share growth of at least 8%. This marks a change from the previous forecast of organic revenue growth in the 4-6% range and core constant currency earnings per share growth in the high single digits.”Consumers are likely to remain cautious with their spending and selective in their purchases,” said Pepsi executives in the prepared remarks.Pepsi expects a softer first half of the year, attributing it to product recalls affecting its North American Quaker Oats business and international conflicts impacting sales in certain regions. Executives anticipate that international organic revenue growth will outpace that of North America for the full year.
