$PEP · PEPSICO INC

PepsiCo reported Q3 2026 results with net revenue of $25.27B (+5.6% YoY) and GAAP EPS of $2.23 (+17%). Organic revenue grew 3.1%, driven by international strength and volume growth across both global beverages and convenient foods. However, core EPS rose only 2% to $2.34, and core constant currency EPS grew just 1.5%. The company slashed its FY2026 core constant currency EPS guidance to +1%–2% from the prior low-end of +4%–6%, citing rising input cost inflation and the need for additional structural cost reductions.

Extended-hours trading shows PEP at $123.70, essentially flat (-0.02%) vs the regular close of $123.73, suggesting the guidance cut was largely anticipated or offset by the strong headline revenue beat. The regular session had already priced in a -1.58% decline before the release.

A 300–400 bps guidance cut at a $169B consumer staple giant signals that input cost inflation is biting even the most scaled operators, with North America as the clear weak spot.

The guidance cut reflects broader packaged-food sector pressures from input cost inflation and a cautious consumer. PepsiCo's international segments (Asia Pacific Foods +10%, LatAm Foods +14%, EMEA +8%) are outperforming North America, where PBNA beverages posted just 1% organic growth and PFNA flat

Rising input cost inflation is explicitly cited as a headwind requiring additional structural cost cuts. Core operating margin contracted 35 bps in Q3 and 25 bps YTD, signaling profitability pressure even as GAAP margins expanded on non-recurring items. North America convenient foods faces lower net