PepsiCo reported a strong first quarter with accelerating net and organic revenue growth, driven by effective pricing, improved volume trends in North America, and resilient international performance. The company affirmed its full-year guidance, signaling confidence in its ongoing commercial agenda and cost management strategies.
Net revenue increased 8.5% to $19,443 million, accelerating from prior periods.
positiveOrganic revenue increased 2.6%, reflecting benefits from effective net pricing and slight organic volume growth.
positiveOperating profit increased 24% to $3,213 million, with operating margin expanding 210 basis points to 16.5%.
positiveEPS increased 27% to $1.70, and core EPS increased 9% to $1.61.
positiveNorth America Foods volume growth improved sequentially, and Beverages volume trends also improved sequentially and versus the prior year.
positiveInternational businesses performed well, with each segment delivering sequential acceleration in net revenue growth.
positiveCompany affirms fiscal 2026 financial guidance, expecting organic revenue to increase between 2% and 4% and core constant currency EPS to increase between 4% and 6%.
positiveOrganic revenue growth reflects benefits associated with effective net pricing and a slight contribution from organic volume growth, indicating volume is not the primary driver.
attentionCore operating margin expansion was only 10 basis points, despite significant reported operating margin expansion, due to mark-to-market gains and acquisition/divestiture impacts.
attentionNet cash provided by operating activities was $41 million, a significant decrease from $1,843 million in the prior year period, indicating a substantial deterioration in operating cash flow generation.
negativeNet cash used for investing activities was $477 million, compared to $1,232 million in the prior year, primarily due to lower acquisitions.
attentionInventories increased by $315 million in the current quarter compared to a decrease of $238 million in the prior year, suggesting potential inventory build-up.
attentionMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
| Segment | Current | Prior Yr | YoY | % Total | CC |
|---|---|---|---|---|---|
PepsiCo Foods North America (PFNA) | N/A | — | — | — | +1.0% |
PepsiCo Beverages North America (PBNA) | N/A | — | — | — | +2.0% |
International Beverages Franchise (IB Franchise) | N/A | — | — | — | +5.0% |
Europe, Middle East and Africa (EMEA) | N/A | — | — | — | +7.0% |
Latin America Foods (LatAm Foods) | N/A | — | — | — | +3.0% |
Asia Pacific Foods | N/A | — | — | — | +7.0% |
| Total Revenue | $0.00M | — | — | 100.0% | — |
Segment performance shows business unit health and growth drivers. Constant currency (CC) removes FX impact for like-for-like comparison.
Forward-looking guidance is subject to change and does not constitute a guarantee. Actual results may differ materially from these estimates.
| Metric | Value | Period | Specificity | vs Prior |
|---|---|---|---|---|
| revenue | 2% to 4% | FY2026 | — | — |
| volume growth | positive volume growth ex case pack water | FY2026 | — | — |
| volume growth | sequential improvement | FY2026 | — | — |
Special items are non-recurring events that may distort period-over-period comparisons. Analysts typically adjust for these when calculating normalized earnings.
We are pleased with our first-quarter results, which featured an acceleration in both net revenue and organic revenue growth – with a notable improvement in convenient foods organic volume.
An extensive commercial agenda, which includes the restaging of large global brands, innovation activity and certain affordability initiatives, is being executed well and business performance improved.
We are encouraged with the resilience of the International business while North America continued to make progress in the first quarter.
Commentary excerpts from earnings call transcripts provide management's perspective on performance, strategy, and outlook. Always review full transcripts for complete context.
Operational metrics provide insight into business drivers and customer engagement beyond traditional financial measures.