PepsiCo Beats Q2 Revenue Estimates Despite North American Slump

PepsiCo Inc. reported second-quarter 2026 net revenue of $24.18 billion, a 6.4% increase that exceeded Wall Street estimates. The company saw net income rise to $2.98 billion from $1.26 billion the previous year, with adjusted earnings per share reaching $2.20. Despite the revenue beat, the company's stock fell sharply—reaching its worst one-day performance in 15 months—after management declined to increase its full-year outlook.

Performance was split geographically. International markets saw strong growth, particularly in India, China, and Germany, with the Asia Pacific food business recording a 12% net revenue increase. Conversely, the North American market lagged, with food sales dropping 2% and beverage volumes falling 4%. CEO Ramon Laguarta attributed this decline to tightening consumer budgets and high gas prices, which reduced foot traffic at convenience stores.

To combat the U.S. slump, PepsiCo slashed prices on brands like Lay's and Doritos by up to 15% and is currently "restaging" brands including Gatorade and Quaker to attract broader consumer bases. While the company reaffirmed its full-year organic revenue growth guidance of 2% to 4%, it warned of accelerating input cost inflation in the second half of the year. CFO Steve Schmitt stated that productivity gains and tariff refunds would help mitigate these costs.