PepsiCo (PEP) Q1 earnings report 2023

Pepsi sodas displayed for purchase at a Walmart SuperCenter on December 06, 2022 in Austin, Texas.

Brandon Bell | Getty Images

PepsiCo on Tuesday boosted its outlook for the year as it posted earnings and revenue that beat expectations.

Shares of the company rose more than 2% Tuesday, hitting a new 52-week high.

Here’s what the company reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:

  • Earnings¬†per share: $1.50 adjusted vs. $1.39 expected
  • Revenue: $17.85 billion vs. $17.22 billion expected

For the period ended March 25, PepsiCo reported net income of $1.93 billion, or $1.40 a share, compared with $4.26 billion, or $3.06 a share, in the year-earlier period. Excluding one-time items, the company posted $1.50 in earnings per share.

Net sales rose 10.2% to $17.85 billion. Organic revenue, which doesn’t include the impact of acquisitions and divestitures, rose 14.3%.

Volumes rose 1% in PepsiCo’s beverage business, while they declined 3% in its food segment. Overall, volumes were down 2% across all categories, while prices were up 16% overall.

Frito-Lay North America reported an organic revenue increase of 16%, fueled by market share gains and double-digit net revenue growth across key brands like Lay’s, Doritos, and Cheetos, as well as brands such as Sun Chips and PopCorners.

PepsiCo Beverages North America’s organic revenue increased 12%, with with Pepsi delivering double-digit net revenue growth and brands like Gatorade and Aquafina delivering high single-digit net revenue growth.

“Our intention is not to build a large portfolio of products or a complex portfolio, but it is to focus on a few good brands, develop with strategic partners, and then leverage our distribution capabilities,” CFO Hugh Johnston said in a conference call with analysts.

The company said it expects its full-year 2023 organic revenue to increase 8%, up from 6%, and core constant currency EPS to increase 9% up from 8%.

Earlier this month, the company also set a goal to design 100% of its packaging to be recyclable, compostable, biodegradable or reusable by 2025.

“These things are hard, they’re not easy, but what I would tell you is we’re fully committed to it,” PepsiCo Foods North America CEO Steven Williams said at the time.

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