PepsiCo Reports Third-Quarter 2026 Results
“Our third-quarter results featured strong net revenue growth, an acceleration in organic revenue growth with organic volume growth across both global beverages and convenient foods. The results reflect the scale and resilience of the international business, the ongoing evolution of the global portfolio and an improved presence in underpenetrated channels and occasions,” said Chairman and CEO Ramon Laguarta.
Laguarta continued, “Looking ahead, we remain focused on building upon the strength of the International business while acting with urgency to sustainably improve our performance in North America through more investments in innovation, effective brand building, and sharper marketplace execution by channel. Additional structural cost reduction actions are being identified and will be implemented in the coming months to help fund investments that aim to accelerate organic revenue growth and mitigate the impacts of rising input cost inflation.”
2 Please refer to the reconciliation of generally accepted accounting principles (GAAP) and non-GAAP information in the attached exhibits and to the Glossary for the definitions of non-GAAP financial measures, including “Organic revenue performance,” “Core” and “Constant currency,” and to “Guidance and Outlook” for additional information regarding PepsiCo’s full-year 2026 financial guidance. PepsiCo provides guidance on a non-GAAP basis as we cannot predict certain elements which are included in reported GAAP results, including the impact of foreign exchange and commodity mark-to-market net impacts. Please refer to PepsiCo’s Quarterly Report on Form 10-Q for the 12 and 36 weeks ended September 5, 2026 (Q3 2026 Form 10-Q) filed with the Securities and Exchange Commission (SEC) for additional information regarding PepsiCo’s financial results. 1
• Net revenue increased 5.6% due to 3.1% organic revenue growth, a 1.7-percentage-point net benefit from acquisitions and divestitures and a 0.7-percentage-point benefit from foreign exchange translation. Organic revenue growth reflects the benefits associated with effective net pricing and a contribution from organic volume growth.
◦ In North America, convenient foods net revenue trends improved sequentially, reflecting savory snacks volume growth and volume market share improvement, offset by lower effective net pricing. The beverages business delivered 5 percent net revenue growth, primarily reflecting the benefits of acquisitions made in 2025.
◦ The international businesses performed well with each segment delivering strong net revenue growth - aided by organic volume growth within Asia Pacific Foods, International Beverages Franchise and Latin America Foods.
• Operating profit increased 19% and operating margin expanded 195 basis points, primarily reflecting a favorable net impact of acquisition and divestiture- related charges/credits and a favorable impact of net mark-to-market gains on commodity derivatives. Core operating profit increased 3%, with core operating margin contracting 35 basis points. The core operating profit performance reflects productivity savings, effective net pricing and a 4-percentage-point favorable impact of tariff refunds. These impacts were partially offset by certain operating cost increases and higher advertising and marketing expenses.
• EPS increased 17% and core EPS increased 2%, primarily driven by operating profit growth.
• Net revenue increased 6.7% due to 2.7% organic revenue growth, a 2.0-percentage-point benefit from foreign exchange translation and a 2.0-percentage-point net benefit from acquisitions and divestitures. Organic revenue growth reflects the benefits associated with effective net pricing and a contribution from organic volume growth.
◦ In North America convenient foods, organic volume and volume market share increased aided by innovation and affordability initiatives. Convenient foods net revenue reflects organic volume growth and the benefits of an acquisition, offset by lower effective net pricing. The beverages business delivered 7 percent net revenue growth, primarily reflecting the benefits of acquisitions made in 2025 with organic revenue growth increasing 1 percent.
◦ The international businesses performed well with each segment delivering strong net revenue growth - aided by organic volume growth within Asia Pacific Foods, International Beverages Franchise and EMEA.
• Operating profit increased 45% and operating margin expanded 440 basis points, primarily reflecting prior-year impairment charges related to the Rockstar and Be & Cheery brands and a favorable net impact of acquisition and divestiture- related charges/credits. Core operating profit increased 5%, with core operating margin contracting 25 basis points. The core operating profit performance was primarily driven by productivity savings and effective net pricing, partially offset by certain operating cost increases.
• EPS increased 47% and core EPS increased 5%, primarily driven by operating profit growth. 2
Revenue Volume(… GAAP Percen… Organic Reported Point % Change % Change % Change Impact Foreign Acquis… Conveni… Exchange and Foods Bevera… Transla… Divest… Pepsi… Foods North — — — — — Ameri… (PFNA) Pepsi… Bever… North 5 — -6 — -2 Ameri… (PBNA) Inter… Bever… Franc… 8 -1 — 7 5 (IB Franc… Europ… Middle East 8 1 — 9 -1 4 and Africa (EMEA) Latin Ameri… Foods 14 -8 — 6 3 (LatAm Foods) Asia Pacif… 10 -1 — 9 11 Foods Total 6 -1 -2 3 1 3
Operating Profit and EPS GAAP Reported Percentage Core Constant % Change Point Impact Currency % Change Items Foreign Affecting Exchange Comparability Translation PFNA -13 1 — -12 PBNA 45 -41 — 4 IB Franchise 29 -19 -1.5 9 EMEA 25 -8 2 19 LatAm Foods 47 -27 -9 10 Asia Pacific 15 -1 -2 12 Foods Corporate unallocated -10 15 — 5 expenses Total 19 -16 -1 2.5 EPS 17 -15 -1 1.5
(a) Excludes the impact of acquisitions and divestitures. In certain instances, the volume change shown here differs from the impact of organic volume change on net revenue performance disclosed in the Organic Revenue Performance table on page A-7, due to the impacts of product mix, nonconsolidated joint venture volume, and, for our franchise beverage businesses, temporary timing differences between bottler case sales (BCS) and concentrate shipments and equivalents (CSE). We report net revenue from our franchise beverage businesses based on CSE. The volume sold by our nonconsolidated joint ventures has no direct impact on our net revenue.
Organic revenue and core constant currency results are non-GAAP financial measures. Please refer to the reconciliation of GAAP and non-GAAP information in the attached exhibits and to the Glossary for definitions of “Organic revenue performance,” “Core” and “Constant currency.” 3
Revenue Volume(… GAAP Percen… Organic Reported Point % Change % Change % Change Impact Foreign Acquis… Conveni… Exchange and Foods Bevera… Transla… Divest… PFNA — — — — 1 PBNA 7 — -6 1 -3 IB 10 -2 — 8 4 Franc… EMEA 11 -3 — 7 3 2 LatAm 15 -11 — 4.5 — Foods Asia Pacif… 11 -3 — 9 10 Foods Total 7 -2 -2 3 3 2
Operating Profit and EPS GAAP Reported Percentage Core Constant % Change Point Impact Currency % Change Items Foreign Affecting Exchange Comparability Translation PFNA -8 — — -8 PBNA 416 -413 — 3 IB Franchise 22 -7 -2 13 EMEA 47 -29 -2 17 LatAm Foods 28 -10 -12 6 Asia Pacific 62 -32 -4 25 Foods Corporate unallocated -13 16 — 3 expenses Total 45 -40 -2 3 EPS 47 -42 -2.5 2
(a) Excludes the impact of acquisitions and divestitures. In certain instances, the volume change shown here differs from the impact of organic volume change on net revenue performance disclosed in the Organic Revenue Performance table on page A-7, due to the impacts of product mix, nonconsolidated joint venture volume, and, for our franchise beverage businesses, temporary timing differences between BCS and CSE. We report net revenue from our franchise beverage businesses based on CSE. The volume sold by our nonconsolidated joint ventures has no direct impact on our net revenue.
Organic revenue and core constant currency results are non-GAAP financial measures. Please refer to the reconciliation of GAAP and non-GAAP information in the attached exhibits and to the Glossary for definitions of “Organic revenue performance,” “Core” and “Constant currency.” 4
The Company provides guidance on a non-GAAP basis as we cannot predict certain elements which are included in reported GAAP results, including the impact of foreign exchange translation and commodity mark-to-market net impacts. PepsiCo’s current and previous fiscal 2026 outlook is summarized below.
Current Previous Organic Revenue Approximately +3% +2% to +4% Foreign Exchange Approximately +1.5% to Approximately +1% to Translation(a) net revenue and core net revenue and core EPS growth EPS growth Acquisitions, net of Approximately +1.5% to Approximately +1% to Divestitures(b) net revenue growth net revenue growth Net Revenue Approximately +6% +4% to +6% Core Annual Effective Approximately 21% Approximately 22% Tax Rate(c) Core Constant Currency +1% to +2% Low-end of +4% to +6% EPS Core EPS +2.5% to +3.5% Low-end of +5% to +7% Capital Spending Below 5% of net revenue Below 5% of net revenue Free Cash Flow At least 80 percent At least 80 percent Conversion Ratio Cash Returns to $8.9 billion $8.9 billion Shareholders(d)
(a) Assumptions are based on current foreign exchange rates, as we are unable to predict the impact of exchange translation rates.
(d) Comprised of dividends of $7.9 billion and share repurchases of $1.0 billion.
At approximately 6:00 a.m. (Eastern time) on October 8, 2026, the Company will post prepared management remarks (in pdf format) regarding its third quarter results and business update, including its outlook for 2026, at https://www.pepsico.com/investors. At 8:15 a.m. (Eastern time) on October 8, 2026, the Company will host a live question and answer session with investors and financial analysts. Further details will be accessible on the Company’s website at https://www.pepsico.com/investors.
Contacts: Investor Relations Communications investor@pepsico.com pepsicomediarelations@pepsico.com
(a) For the 12 and 36 weeks ended September 6, 2025, we recognized charges primarily related to the impairment of our Rockstar brand. A - 1
Operating Activities 36 Weeks Ended 9/5/2026 9/6/2025 ────────────────────────────────────────────────────────────────────────────── Net income $ 8,412 $ 5,740 Depreciation and 2,531 2,315 amortization Impairment and — 1,960 other charges Operating lease right-of-use 531 489 asset amortization Share-based compensation 240 207 expense Restructuring and impairment 367 567 charges Cash payments for restructuring -373 -554 charges Acquisition and divestiture-rela… -254 308 charges/credits Cash payments for acquisition and -24 -80 divestiture-rela… charges Pension and retiree medical 227 164 plan expenses Pension and retiree medical -355 -400 plan contributions Deferred income taxes and other 663 30 tax charges/credits Tax payments related to the -965 -772 Tax Cuts and Jobs Act Change in assets and liabilities: Accounts and -2,124 -1,747 notes receivable Inventories -588 -449 Prepaid expenses and other current 27 -223 assets Accounts payable and other current -358 -1,647 liabilities Income taxes 415 6 payable Other, net -422 -446 Net Cash Provided by Operating 7,950 5,468 Activities Investing Activities Capital spending -2,182 -2,499 Sales of property, plant 89 272 and equipment Acquisitions, net of cash acquired, investments in noncontrolled affiliates -148 -3,176 and purchases of intangible and other assets Short-term investments, by original maturity:
More than three months - -105 -190 purchases More than three months - 17 425 maturities More than three 14 — months - sales Three months or -5 43 less, net Other investing, -27 -112 net Net Cash Used for Investing -2,347 -5,237 Activities
More than three 4,562 5,528 months - proceeds More than three -3,817 -5,417 months - payments Three months or 1,365 445 less, net Cash dividends -5,935 -5,692 paid Share repurchases -739 -752 Proceeds from exercises of 107 76 stock options Withholding tax payments on restricted stock units and -96 -112 performance stock units converted Other financing -1 -18 Net Cash Used for Financing -3,904 -1,008 Activities Effect of exchange rate changes on cash -175 395 and cash equivalents and restricted cash Net Increase/(Decrea… in Cash and Cash 1,524 -382 Equivalents and Restricted Cash Cash and Cash Equivalents and Restricted 9,204 8,553 Cash, Beginning of Year Cash and Cash Equivalents and Restricted $ 10,728 $ 8,171 Cash, End of Period Supplemental Non-Cash Activity Right-of-use assets obtained in exchange $ 625 $ 542 for lease obligations Investment obtained for $ — $ 554 certain assets
ASSETS (unaudited) Current Assets 9/5/2026 12/27/2025 ────────────────────────────────────────────────────────────────────────────── Cash and cash $ 10,675 $ 9,159 equivalents Short-term investments 488 371 Accounts and notes 13,623 11,506 receivable, net Inventories: Raw materials and 2,792 2,581 packaging Work-in-process 175 143 Finished goods 3,467 3,121 6,434 5,845 Prepaid expenses and other current 1,339 1,068 assets Total Current Assets 32,559 27,949 Property, Plant and 29,731 29,905 Equipment, net Amortizable Intangible 1,165 1,219 Assets, net Goodwill 18,884 18,916 Other Indefinite-Lived 13,977 13,847 Intangible Assets Investments in Noncontrolled 2,215 2,038 Affiliates Deferred Income Taxes 4,328 4,541 Other Assets 9,117 8,984 Total Assets $ 111,976 $ 107,399 LIABILITIES AND EQUITY Current Liabilities Short-term debt $ 9,223 $ 6,861 obligations Accounts payable and other current 25,306 25,903 liabilities Total Current 34,529 32,764 Liabilities Long-Term Debt 42,658 42,321 Obligations Deferred Income Taxes 4,107 3,802 Other Liabilities 8,195 7,965 Total Liabilities 89,489 86,852 Commitments and contingencies PepsiCo Common Shareholders’ Equity Common stock, par value 12/3¢ per share (authorized 3,600 shares; issued, net of 23 23 repurchased common stock at par value: 1,364 and 1,367 shares, respectively) Capital in excess of 4,522 4,451 par value Retained earnings 75,140 72,788 Accumulated other -14,987 -15,024 comprehensive loss Repurchased common stock, in excess of par value (503 and 500 -42,406 -41,832 shares, respectively) Total PepsiCo Common Shareholders’ 22,292 20,406 Equity Noncontrolling 195 141 interests Total Equity 22,487 20,547 Total Liabilities and $ 111,976 $ 107,399 Equity
In discussing financial results and guidance, the Company refers to the following measures which are not in accordance with U.S. Generally Accepted Accounting Principles (GAAP): organic revenue performance, core results, core constant currency results, free cash flow and free cash flow conversion. We use non-GAAP financial measures internally to make operating and strategic decisions, including the preparation of our annual operating plan, evaluation of our overall business performance and as a factor in determining compensation for certain employees. We believe presenting non-GAAP financial measures provides additional information to facilitate comparison of our historical operating results and trends in our underlying operating results and provides additional transparency on how we evaluate our business. We also believe presenting these measures allows investors to view our performance using the same measures that we use in evaluating our financial and business performance and trends.
We consider quantitative and qualitative factors in assessing whether to adjust for the impact of items that may be significant or that could affect an understanding of our ongoing financial and business performance or trends. Examples of items for which we may make adjustments include: amounts related to mark-to-market gains or losses (non-cash); charges related to restructuring plans; charges and credits associated with acquisitions and divestitures; gains associated with divestitures; asset impairment charges (non-cash); product recall-related impact; pension and retiree medical-related amounts, including all settlement and curtailment gains and losses; charges or adjustments related to the enactment of new laws, rules or regulations, such as tax law changes; amounts related to the resolution of tax positions; tax benefits related to reorganizations of our operations; and debt redemptions, cash tender or exchange offers. See below for a description of adjustments to our GAAP financial measures included herein.
Non-GAAP information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. In addition, our non-GAAP financial measures may not be the same as or comparable to similar non-GAAP measures presented by other companies.
We use the following definitions when referring to our non-GAAP financial measures:
Acquisitions and divestitures: mergers and acquisitions activity, as well as divestitures and other structural changes, including changes in ownership or control in consolidated subsidiaries and nonconsolidated equity investees.
Bottler case sales (BCS): Measure of physical beverage volume shipped to retailers and independent distributors from both PepsiCo and our independent bottlers.
Concentrate shipments and equivalents (CSE): Measure of our physical beverage volume shipments to independent bottlers.
Constant currency: Financial results assuming constant foreign currency exchange rates used for translation based on the rates in effect for the comparable prior-year period. In order to compute our constant currency results, we multiply or divide, as appropriate, our current-year U.S. dollar results by the current-year average foreign exchange rates and then multiply or divide, as appropriate, those amounts by the prior-year average foreign exchange rates. We also apply the constant currency calculation for our subsidiaries operating in highly inflationary economies.
Core: Core results are non-GAAP financial measures which exclude certain items from our financial results. For further information regarding these excluded items, refer to “Items Affecting Comparability” in “Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Q3 2026 Form 10-Q and in “Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K for the fiscal year ended December 27, 2025. For the periods presented, core results exclude the following items:
Mark-to-market net gains and losses on commodity derivatives in corporate unallocated expenses. These gains and losses are subsequently reflected in segment results when the segments recognize the cost of the underlying commodity in operating profit.
Expenses related to the multi-year productivity plan publicly announced in 2019, which was expanded and extended through the end of 2030 to take advantage of additional opportunities within the initiatives of the plan.
Acquisition and divestiture-related charges/credits include merger and integration charges, transaction expenses, such as consulting, advisory and other professional fees, as well as fair value adjustments to contingent consideration and to the acquired inventory included in the acquisition-date balance sheets. Merger and integration charges include distribution agreement termination fees, impairment of certain acquisition-related intangibles, employee-related costs, closing costs and other integration costs. A - 5 Impairment and other charges
We recognized impairment charges primarily as a result of our quantitative assessments of certain of our indefinite-lived intangible assets, related to the Rockstar and Be & Cheery brands .
We recognized additional expenses related to an indirect and income tax audit settlement in our LatAm Foods segment.
Pension and retiree medical-related impact includes settlement charges related to lump sum distributions exceeding the total of annual service and interest costs, as well as net curtailment losses.
Effective net pricing: Reflects the year-over-year impact of discrete pricing actions, sales incentive activities and mix resulting from selling varying products in different package sizes and in different countries.
Free cash flow: Net cash from operating activities less capital spending, plus sales of property, plant and equipment. Since net capital spending (capital spending less cash proceeds from sales of property, plant and equipment) is essential to our product innovation initiatives and maintaining our operational capabilities, we believe that it is a recurring and necessary use of cash. As such, we believe investors should also consider net capital spending when evaluating our cash from operating activities. Free cash flow is used by us primarily for acquisitions and financing activities, including debt repayments, dividends and share repurchases. Free cash flow is not a measure of cash available for discretionary expenditures since we have certain non-discretionary obligations such as debt service that are not deducted from the measure.
Free cash flow conversion ratio: Free cash flow divided by core net income attributable to PepsiCo.
Organic revenue performance: A measure that adjusts for the impacts of foreign exchange translation (on a constant currency basis, as defined above), acquisitions and divestitures, and every five or six years, the impact of an additional week of results. We also apply the constant currency calculation for our subsidiaries operating in highly inflationary economies. We believe organic revenue performance provides useful information in evaluating the results of our business because it adjusts for items that we believe are not indicative of ongoing performance or that we believe impact comparability with the prior year.
Our 2026 organic revenue performance guidance adjusts for the impacts of foreign exchange translation (on a constant currency basis, as defined above) and acquisitions and divestitures. Our 2026 core effective tax rate guidance, our 2026 core constant currency EPS growth guidance and our projected 2026 core net income attributable to PepsiCo (a component of free cash flow conversion ratio) exclude the mark-to-market net impact included in corporate unallocated expenses, restructuring and impairment charges and other items noted above. Our 2026 core constant currency EPS growth guidance also excludes the impact of foreign exchange translation. We are unable to reconcile our full year projected 2026 organic revenue growth to our full year projected 2026 reported net revenue growth because we are unable to predict the 2026 impact of foreign exchange due to the unpredictability of future changes in foreign exchange rates and because we are unable to predict the occurrence or impact of any acquisitions and divestitures. We are also not able to reconcile our full year projected 2026 core effective tax rate to our full year projected 2026 reported effective tax rate, our full year projected 2026 core constant currency EPS growth to our full year projected 2026 reported EPS growth and our full year projected 2026 core net income attributable to PepsiCo (a component of free cash flow conversion ratio) to our full year projected 2026 reported net income, because we are unable to predict the 2026 impact of foreign exchange or the mark-to-market net impact on commodity derivatives due to the unpredictability of future changes in foreign exchange rates and commodity prices. Therefore, we are unable to provide a reconciliation of these measures, without unreasonable effort. A - 6
(a) Represents the adjustment needed to reflect translation of revenue using prior-year period foreign currency exchange rates.
(b) Represents underlying amount, not in accordance with GAAP, used in the calculation of Organic Revenue Performance, which is a financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(c) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(d) Excludes the impact of acquisitions and divestitures. In certain instances, the impact of organic volume change on net revenue performance differs from the unit volume change disclosed in the Summary Third-Quarter 2026 Performance table and Summary Year-to-Date 2026 Performance table on pages 3 and 4 respectively, due to the impacts of product mix, nonconsolidated joint venture volume, and, for our franchise beverage businesses, temporary timing differences between BCS and CSE. We report net revenue from our franchise beverage businesses based on CSE. The volume sold by our nonconsolidated joint ventures has no direct impact on our net revenue.
(a) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(b) Represents the adjustment needed to reflect translation of operating profit using prior-year period foreign currency exchange rates.
(a) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(a) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(b) Represents the adjustment needed to reflect translation of operating profit using prior-year period foreign currency exchange rates.
(a) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(a) Provision for income taxes is the expected tax charge/benefit on the underlying item based on the tax laws and income tax rates applicable to the underlying item in its corresponding tax jurisdiction.
(b) The impact of items affecting comparability on our effective tax rate represents the difference in the effective tax rate resulting from a higher or lower tax rate as applicable to the items affecting comparability.
(c) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(d) Provision for income taxes reflects the unfavorable impact of an income tax audit settlement in our LatAm Foods segment.
(a) Provision for income taxes is the expected tax charge/benefit on the underlying item based on the tax laws and income tax rates applicable to the underlying item in its corresponding tax jurisdiction.
(b) The impact of items affecting comparability on our effective tax rate represents the difference in the effective tax rate resulting from a higher or lower tax rate as applicable to the items affecting comparability.
(c) A financial measure that is not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(d) Provision for income taxes reflects the unfavorable impact of an income tax audit settlement in our LatAm Foods segment.
Statements in this communication that are “forward-looking statements,” including our 2026 guidance and outlook are based on currently available information, operating plans and projections about future events and trends. Terminology such as “aim,” “anticipate,” “believe,” “drive,” “estimate,” “expect,” “expressed confidence,” “forecast,” “future,” “goal,” “guidance,” “intend,” “may,” “objective,” “outlook,” “plan,” “position,” “potential,” “project,” “seek,” “should,” “strategy,” “target,” “will” or similar statements or variations of such words and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such terms. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from those predicted in such forward-looking statements. Such risks and uncertainties include, but are not limited to: future demand for PepsiCo’s products; damage to PepsiCo’s reputation or brand image; product recalls or other issues or concerns with respect to product quality and safety; PepsiCo’s ability to compete effectively; PepsiCo’s ability to attract, develop and maintain a highly skilled workforce or effectively manage changes in our workforce; water scarcity; changes in the retail landscape or in sales to any key customer; disruption of PepsiCo’s manufacturing operations or supply chain, including increased commodity, packaging, transportation, labor and other input costs; political, social or geopolitical conditions in the markets where PepsiCo’s products are made, manufactured, distributed or sold; PepsiCo’s ability to grow its business in developing and emerging markets; changes in economic conditions in the countries in which PepsiCo operates; changes in tariffs and global trade relations; future cyber incidents and other disruptions to our information systems; failure to successfully complete or manage strategic transactions; PepsiCo’s reliance on third-party service providers and enterprise-wide systems; climate change or measures to address climate change and other sustainability matters; strikes or work stoppages; failure to realize benefits from PepsiCo’s productivity initiatives or organizational restructurings; deterioration in estimates and underlying assumptions regarding future performance of our business or investments that can result in impairment charges; fluctuations or other changes in exchange rates; any downgrade or potential downgrade of PepsiCo’s credit ratings; imposition or proposed imposition of new or increased taxes aimed at PepsiCo’s products; imposition of limitations on the marketing or sale of PepsiCo’s products; changes in laws and regulations related to the use or disposal of plastics or other packaging materials; failure to comply with personal data protection and privacy laws; increase in income tax rates, changes in income tax laws or disagreements with tax authorities; failure to adequately protect PepsiCo’s intellectual property rights or infringement on intellectual property rights of others; failure to comply with applicable laws and regulations; and potential liabilities and costs from litigation, claims, legal or regulatory proceedings, inquiries or investigations.
For additional information on these and other factors that could cause PepsiCo’s actual results to materially differ from those set forth herein, please see PepsiCo’s filings with the SEC, including its most recent annual report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. Investors are cautioned not to place undue reliance on any such forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update any forward- looking statement, whether as a result of new information, future events or otherwise. A - 14
Full text with the tables
Exhibit 99.1
PepsiCo Reports Third-Quarter 2026 Results
Third-Quarter and Year-to-Date Results
1
•
Net revenue increased 5.6% and 6.7%, respectively
• Organic revenue 2 increased 3.1% and 2.7%, respectively
• Earnings per share (EPS) increased 17% and 47%, respectively
• Core 2 EPS increased 2% and 5%, respectively
• Core constant currency 2 EPS increased 1.5% and 2%, respectively
Guidance
• Company updates fiscal 2026 financial guidance 2
PURCHASE, N.Y. - October 8, 2026
- PepsiCo, Inc. (NASDAQ: PEP) today reported results for third-quarter 2026.
“Our third-quarter results featured strong net revenue growth, an acceleration
in organic revenue growth with organic volume growth across both global
beverages and convenient foods. The results reflect the scale and resilience of
the international business, the ongoing evolution of the global portfolio and an
improved presence in underpenetrated channels and occasions,” said Chairman and
CEO Ramon Laguarta.
Laguarta continued, “Looking ahead, we remain focused on building upon the
strength of the International business while acting with urgency to sustainably
improve our performance in North America through more investments in innovation,
effective brand building, and sharper marketplace execution by channel.
Additional structural cost reduction actions are being identified and will be
implemented in the coming months to help fund investments that aim to accelerate
organic revenue growth and mitigate the impacts of rising input cost inflation.”
Third-Q… Year-to…
($ in
millio… Q3 2026 Q3 2025 Change Q3 2026 Q3 2025 Change
except
EPS)
Net $25,274 $23,937 5.6% $68,898 $64,582 6.7%
revenue
Organic
revenue 3.1% 2.7%
perfor…
Operat… $4,260 $3,569 19% $11,496 $7,941 45%
profit
Operat… 16.9% 14.9% 195 bps 16.7% 12.3% 440 bps
margin
Core
operat… $4,277 $4,137 3% $11,394 $10,837 5%
profit
Core (25)
operat… 16.9% 17.3% (35) bps 16.5% 16.8% bps
margin
EPS $2.23 $1.90 17% $6.10 $4.15 47%
Core $2.34 $2.29 2% $6.15 $5.88 5%
EPS
Core
consta… 1.5% 2%
curren…
EPS
1 Versus the prior year.
2 Please refer to the reconciliation of generally accepted accounting principles
(GAAP) and non-GAAP information in the attached exhibits and to the Glossary for
the definitions of non-GAAP financial measures, including “Organic revenue
performance,” “Core” and “Constant currency,” and to “Guidance and Outlook” for
additional information regarding PepsiCo’s full-year 2026 financial guidance.
PepsiCo provides guidance on a non-GAAP basis as we cannot predict certain
elements which are included in reported GAAP results, including the impact of
foreign exchange and commodity mark-to-market net impacts. Please refer to
PepsiCo’s Quarterly Report on Form 10-Q for the 12 and 36 weeks ended September
5, 2026 (Q3 2026 Form 10-Q) filed with the Securities and Exchange Commission
(SEC) for additional information regarding PepsiCo’s financial results.
1
Third-Quarter Results Discussion
• Net revenue increased 5.6% due to 3.1% organic revenue growth, a
1.7-percentage-point net benefit from acquisitions and divestitures and a
0.7-percentage-point benefit from foreign exchange translation. Organic revenue
growth reflects the benefits associated with effective net pricing and a
contribution from organic volume growth.
◦ In North America, convenient foods net revenue trends improved sequentially,
reflecting savory snacks volume growth and volume market share improvement,
offset by lower effective net pricing. The beverages business delivered 5
percent net revenue growth, primarily reflecting the benefits of acquisitions
made in 2025.
◦ The international businesses performed well with each segment delivering
strong net revenue growth - aided by organic volume growth within Asia Pacific
Foods, International Beverages Franchise and Latin America Foods.
• Operating profit increased 19% and operating margin expanded 195 basis points,
primarily reflecting a favorable net impact of acquisition and divestiture-
related charges/credits and a favorable impact of net mark-to-market gains on
commodity derivatives. Core operating profit increased 3%, with core operating
margin contracting 35 basis points. The core operating profit performance
reflects productivity savings, effective net pricing and a 4-percentage-point
favorable impact of tariff refunds. These impacts were partially offset by
certain operating cost increases and higher advertising and marketing expenses.
• EPS increased 17% and core EPS increased 2%, primarily driven by operating
profit growth.
Year-to-Date Results Discussion
• Net revenue increased 6.7% due to 2.7% organic revenue growth, a
2.0-percentage-point benefit from foreign exchange translation and a
2.0-percentage-point net benefit from acquisitions and divestitures. Organic
revenue growth reflects the benefits associated with effective net pricing and a
contribution from organic volume growth.
◦ In North America convenient foods, organic volume and volume market share
increased aided by innovation and affordability initiatives. Convenient foods
net revenue reflects organic volume growth and the benefits of an acquisition,
offset by lower effective net pricing. The beverages business delivered 7
percent net revenue growth, primarily reflecting the benefits of acquisitions
made in 2025 with organic revenue growth increasing 1 percent.
◦ The international businesses performed well with each segment delivering
strong net revenue growth - aided by organic volume growth within Asia Pacific
Foods, International Beverages Franchise and EMEA.
• Operating profit increased 45% and operating margin expanded 440 basis points,
primarily reflecting prior-year impairment charges related to the Rockstar and
Be & Cheery brands and a favorable net impact of acquisition and divestiture-
related charges/credits. Core operating profit increased 5%, with core operating
margin contracting 25 basis points. The core operating profit performance was
primarily driven by productivity savings and effective net pricing, partially
offset by certain operating cost increases.
• EPS increased 47% and core EPS increased 5%, primarily driven by operating
profit growth.
2
Summary Third-Quarter 2026 Performance
Revenue Volume(…
GAAP Percen… Organic
Reported Point % Change % Change
% Change Impact
Foreign Acquis… Conveni…
Exchange and Foods Bevera…
Transla… Divest…
Pepsi…
Foods
North — — — — —
Ameri…
(PFNA)
Pepsi…
Bever…
North 5 — -6 — -2
Ameri…
(PBNA)
Inter…
Bever…
Franc… 8 -1 — 7 5
(IB
Franc…
Europ…
Middle
East 8 1 — 9 -1 4
and
Africa
(EMEA)
Latin
Ameri…
Foods 14 -8 — 6 3
(LatAm
Foods)
Asia
Pacif… 10 -1 — 9 11
Foods
Total 6 -1 -2 3 1 3
Operating
Profit and EPS
GAAP Reported Percentage Core Constant
% Change Point Impact Currency
% Change
Items Foreign
Affecting Exchange
Comparability Translation
PFNA -13 1 — -12
PBNA 45 -41 — 4
IB Franchise 29 -19 -1.5 9
EMEA 25 -8 2 19
LatAm Foods 47 -27 -9 10
Asia Pacific 15 -1 -2 12
Foods
Corporate
unallocated -10 15 — 5
expenses
Total 19 -16 -1 2.5
EPS 17 -15 -1 1.5
(a) Excludes the impact of acquisitions and divestitures. In certain instances,
the volume change shown here differs from the impact of organic volume change on
net revenue performance disclosed in the Organic Revenue Performance table on
page A-7, due to the impacts of product mix, nonconsolidated joint venture
volume, and, for our franchise beverage businesses, temporary timing differences
between bottler case sales (BCS) and concentrate shipments and equivalents
(CSE). We report net revenue from our franchise beverage businesses based on
CSE. The volume sold by our nonconsolidated joint ventures has no direct impact
on our net revenue.
Note: Amounts may not sum due to rounding.
Organic revenue and core constant currency results are non-GAAP financial
measures. Please refer to the reconciliation of GAAP and non-GAAP information in
the attached exhibits and to the Glossary for definitions of “Organic revenue
performance,” “Core” and “Constant currency.”
3
Summary Year-to-Date 2026 Performance
Revenue Volume(…
GAAP Percen… Organic
Reported Point % Change % Change
% Change Impact
Foreign Acquis… Conveni…
Exchange and Foods Bevera…
Transla… Divest…
PFNA — — — — 1
PBNA 7 — -6 1 -3
IB 10 -2 — 8 4
Franc…
EMEA 11 -3 — 7 3 2
LatAm 15 -11 — 4.5 —
Foods
Asia
Pacif… 11 -3 — 9 10
Foods
Total 7 -2 -2 3 3 2
Operating
Profit and EPS
GAAP Reported Percentage Core Constant
% Change Point Impact Currency
% Change
Items Foreign
Affecting Exchange
Comparability Translation
PFNA -8 — — -8
PBNA 416 -413 — 3
IB Franchise 22 -7 -2 13
EMEA 47 -29 -2 17
LatAm Foods 28 -10 -12 6
Asia Pacific 62 -32 -4 25
Foods
Corporate
unallocated -13 16 — 3
expenses
Total 45 -40 -2 3
EPS 47 -42 -2.5 2
(a) Excludes the impact of acquisitions and divestitures. In certain instances,
the volume change shown here differs from the impact of organic volume change on
net revenue performance disclosed in the Organic Revenue Performance table on
page A-7, due to the impacts of product mix, nonconsolidated joint venture
volume, and, for our franchise beverage businesses, temporary timing differences
between BCS and CSE. We report net revenue from our franchise beverage
businesses based on CSE. The volume sold by our nonconsolidated joint ventures
has no direct impact on our net revenue.
Note: Amounts may not sum due to rounding.
Organic revenue and core constant currency results are non-GAAP financial
measures. Please refer to the reconciliation of GAAP and non-GAAP information in
the attached exhibits and to the Glossary for definitions of “Organic revenue
performance,” “Core” and “Constant currency.”
4
Guidance and Outlook
The Company provides guidance on a non-GAAP basis as we cannot predict certain
elements which are included in reported GAAP results, including the impact of
foreign exchange translation and commodity mark-to-market net impacts. PepsiCo’s
current and previous fiscal 2026 outlook is summarized below.
Fiscal 2026 Guidance (
changes are bolded & italicized below)
Current Previous
Organic Revenue Approximately +3% +2% to +4%
Foreign Exchange Approximately +1.5% to Approximately +1% to
Translation(a) net revenue and core net revenue and core
EPS growth EPS growth
Acquisitions, net of Approximately +1.5% to Approximately +1% to
Divestitures(b) net revenue growth net revenue growth
Net Revenue Approximately +6% +4% to +6%
Core Annual Effective Approximately 21% Approximately 22%
Tax Rate(c)
Core Constant Currency +1% to +2% Low-end of +4% to +6%
EPS
Core EPS +2.5% to +3.5% Low-end of +5% to +7%
Capital Spending Below 5% of net revenue Below 5% of net revenue
Free Cash Flow At least 80 percent At least 80 percent
Conversion Ratio
Cash Returns to $8.9 billion $8.9 billion
Shareholders(d)
(a) Assumptions are based on current foreign exchange rates, as we are unable to
predict the impact of exchange translation rates.
(b) Refers to acquisitions, net of divestitures, that occurred in 2025.
(c) Includes the anticipated impact of global minimum tax regulations.
(d) Comprised of dividends of $7.9 billion and share repurchases of $1.0
billion.
Prepared Management Remarks and Live Question and Answer Webcast
At approximately 6:00 a.m. (Eastern time) on October 8, 2026, the Company will
post prepared management remarks (in pdf format) regarding its third quarter
results and business update, including its outlook for 2026, at
https://www.pepsico.com/investors. At 8:15 a.m. (Eastern time) on October 8,
2026, the Company will host a live question and answer session with investors
and financial analysts. Further details will be accessible on the Company’s
website at https://www.pepsico.com/investors.
Contacts: Investor Relations Communications
investor@pepsico.com pepsicomediarelations@pepsico.com
5
PepsiCo, Inc. and Subsidiaries
Condensed Consolidated Statement of Income
(in millions, except per share amounts, unaudited)
12 36
Wee… Wee…
End… 9/5… 9/6… End… 9/5… 9/…
──────────────────────────────────────────────────────────────────────────────
Net $ 25,… $ 23,… $ 68,… $ 64,…
Re…
Co…
of 11,… 11,… 31,… 29,…
sa…
Gr… 13,… 12,… 37,… 35,…
pr…
Se…
ge…
and 9,4… 9,1… 26,… 25,…
ad…
ex…
Im…
of — 133 — 1,9…
in…
as…
Op… 4,2… 3,5… 11,… 7,9…
Pr…
Ot…
pe…
and
re… -114 26 3 91
me…
be…
(e…
Net
in…
ex… -242 -264 -773 -788
and
ot…
In…
be… 3,9… 3,3… 10,… 7,2…
in…
ta…
Pr…
for 834 713 2,3… 1,5…
in…
ta…
Net 3,0… 2,6… 8,4… 5,7…
in…
Le…
Net
in…
at… 22 15 56 40
to
no…
in…
Net
In…
At… $ 3,0… $ 2,6… $ 8,3… $ 5,7…
to
Pe…
Di…
Net
in…
at…
to $ 2.23 $ 1.90 $ 6.10 $ 4.15
Pe…
per
co…
sh…
We…
co… 1,3… 1,3… 1,3… 1,3…
sh…
ou…
(a) For the 12 and 36 weeks ended September 6, 2025, we recognized charges
primarily related to the impairment of our Rockstar brand.
A - 1
PepsiCo, Inc. and Subsidiaries
Condensed Consolidated Statement of Cash Flows
(in millions, unaudited)
Operating
Activities 36 Weeks Ended 9/5/2026 9/6/2025
──────────────────────────────────────────────────────────────────────────────
Net income $ 8,412 $ 5,740
Depreciation and 2,531 2,315
amortization
Impairment and — 1,960
other charges
Operating lease
right-of-use 531 489
asset
amortization
Share-based
compensation 240 207
expense
Restructuring and
impairment 367 567
charges
Cash payments for
restructuring -373 -554
charges
Acquisition and
divestiture-rela… -254 308
charges/credits
Cash payments for
acquisition and -24 -80
divestiture-rela…
charges
Pension and
retiree medical 227 164
plan
expenses
Pension and
retiree medical -355 -400
plan
contributions
Deferred income
taxes and other 663 30
tax
charges/credits
Tax payments
related to the -965 -772
Tax Cuts and
Jobs Act
Change in assets
and liabilities:
Accounts and -2,124 -1,747
notes receivable
Inventories -588 -449
Prepaid expenses
and other current 27 -223
assets
Accounts payable
and other current -358 -1,647
liabilities
Income taxes 415 6
payable
Other, net -422 -446
Net Cash Provided
by Operating 7,950 5,468
Activities
Investing
Activities
Capital spending -2,182 -2,499
Sales of
property, plant 89 272
and equipment
Acquisitions, net
of cash acquired,
investments in
noncontrolled
affiliates -148 -3,176
and purchases of
intangible and
other
assets
Short-term
investments, by
original
maturity:
More than three
months - -105 -190
purchases
More than three
months - 17 425
maturities
More than three 14 —
months - sales
Three months or -5 43
less, net
Other investing, -27 -112
net
Net Cash Used for
Investing -2,347 -5,237
Activities
(Continued on following page)
A - 2
PepsiCo, Inc. and Subsidiaries
Condensed Consolidated Statement of Cash Flows (continued)
(in millions, unaudited)
Financing
Activities 36 Weeks Ended 9/5/2026 9/6/2025
──────────────────────────────────────────────────────────────────────────────
Proceeds from
issuances of $ 2,978 $ 8,179
long-term
debt
Payments of -2,328 -3,245
long-term debt
Short-term
borrowings, by
original
maturity:
More than three 4,562 5,528
months - proceeds
More than three -3,817 -5,417
months - payments
Three months or 1,365 445
less, net
Cash dividends -5,935 -5,692
paid
Share repurchases -739 -752
Proceeds from
exercises of 107 76
stock options
Withholding tax
payments on
restricted
stock units and -96 -112
performance stock
units
converted
Other financing -1 -18
Net Cash Used for
Financing -3,904 -1,008
Activities
Effect of
exchange rate
changes on cash -175 395
and cash
equivalents and
restricted cash
Net
Increase/(Decrea…
in Cash and Cash 1,524 -382
Equivalents and
Restricted Cash
Cash and Cash
Equivalents and
Restricted 9,204 8,553
Cash, Beginning
of Year
Cash and Cash
Equivalents and
Restricted $ 10,728 $ 8,171
Cash, End of
Period
Supplemental
Non-Cash Activity
Right-of-use
assets obtained
in exchange $ 625 $ 542
for lease
obligations
Investment
obtained for $ — $ 554
certain assets
A - 3
PepsiCo, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet
(in millions, except per share amounts)
ASSETS (unaudited)
Current Assets 9/5/2026 12/27/2025
──────────────────────────────────────────────────────────────────────────────
Cash and cash $ 10,675 $ 9,159
equivalents
Short-term investments 488 371
Accounts and notes 13,623 11,506
receivable, net
Inventories:
Raw materials and 2,792 2,581
packaging
Work-in-process 175 143
Finished goods 3,467 3,121
6,434 5,845
Prepaid expenses and
other current 1,339 1,068
assets
Total Current Assets 32,559 27,949
Property, Plant and 29,731 29,905
Equipment, net
Amortizable Intangible 1,165 1,219
Assets, net
Goodwill 18,884 18,916
Other Indefinite-Lived 13,977 13,847
Intangible Assets
Investments in
Noncontrolled 2,215 2,038
Affiliates
Deferred Income Taxes 4,328 4,541
Other Assets 9,117 8,984
Total Assets $ 111,976 $ 107,399
LIABILITIES AND EQUITY
Current Liabilities
Short-term debt $ 9,223 $ 6,861
obligations
Accounts payable and
other current 25,306 25,903
liabilities
Total Current 34,529 32,764
Liabilities
Long-Term Debt 42,658 42,321
Obligations
Deferred Income Taxes 4,107 3,802
Other Liabilities 8,195 7,965
Total Liabilities 89,489 86,852
Commitments and
contingencies
PepsiCo Common
Shareholders’ Equity
Common stock, par value
12/3¢ per share
(authorized 3,600
shares; issued, net of 23 23
repurchased common
stock at par value:
1,364 and 1,367 shares,
respectively)
Capital in excess of 4,522 4,451
par value
Retained earnings 75,140 72,788
Accumulated other -14,987 -15,024
comprehensive loss
Repurchased common
stock, in excess of
par value (503 and 500 -42,406 -41,832
shares,
respectively)
Total PepsiCo Common
Shareholders’ 22,292 20,406
Equity
Noncontrolling 195 141
interests
Total Equity 22,487 20,547
Total Liabilities and $ 111,976 $ 107,399
Equity
A - 4
Non-GAAP Measures
In discussing financial results and guidance, the Company refers to the
following measures which are not in accordance with U.S. Generally Accepted
Accounting Principles (GAAP): organic revenue performance, core results, core
constant currency results, free cash flow and free cash flow conversion. We use
non-GAAP financial measures internally to make operating and strategic
decisions, including the preparation of our annual operating plan, evaluation of
our overall business performance and as a factor in determining compensation for
certain employees. We believe presenting non-GAAP financial measures provides
additional information to facilitate comparison of our historical operating
results and trends in our underlying operating results and provides additional
transparency on how we evaluate our business. We also believe presenting these
measures allows investors to view our performance using the same measures that
we use in evaluating our financial and business performance and trends.
We consider quantitative and qualitative factors in assessing whether to adjust
for the impact of items that may be significant or that could affect an
understanding of our ongoing financial and business performance or trends.
Examples of items for which we may make adjustments include: amounts related to
mark-to-market gains or losses (non-cash); charges related to restructuring
plans; charges and credits associated with acquisitions and divestitures; gains
associated with divestitures; asset impairment charges (non-cash); product
recall-related impact; pension and retiree medical-related amounts, including
all settlement and curtailment gains and losses; charges or adjustments related
to the enactment of new laws, rules or regulations, such as tax law changes;
amounts related to the resolution of tax positions; tax benefits related to
reorganizations of our operations; and debt redemptions, cash tender or exchange
offers. See below for a description of adjustments to our GAAP financial
measures included herein.
Non-GAAP information should be considered as supplemental in nature and is not
meant to be considered in isolation or as a substitute for the related financial
information prepared in accordance with GAAP. In addition, our non-GAAP
financial measures may not be the same as or comparable to similar non-GAAP
measures presented by other companies.
Glossary
We use the following definitions when referring to our non-GAAP financial
measures:
Acquisitions and divestitures: mergers and acquisitions activity, as well as
divestitures and other structural changes, including changes in ownership or
control in consolidated subsidiaries and nonconsolidated equity investees.
Bottler case sales (BCS): Measure of physical beverage volume shipped to
retailers and independent distributors from both PepsiCo and our independent
bottlers.
Concentrate shipments and equivalents (CSE): Measure of our physical beverage
volume shipments to independent bottlers.
Constant currency: Financial results assuming constant foreign currency exchange
rates used for translation based on the rates in effect for the comparable
prior-year period. In order to compute our constant currency results, we
multiply or divide, as appropriate, our current-year U.S. dollar results by the
current-year average foreign exchange rates and then multiply or divide, as
appropriate, those amounts by the prior-year average foreign exchange rates. We
also apply the constant currency calculation for our subsidiaries operating in
highly inflationary economies.
Core: Core results are non-GAAP financial measures which exclude certain items
from our financial results. For further information regarding these excluded
items, refer to “Items Affecting Comparability” in “Item 2 – Management’s
Discussion and Analysis of Financial Condition and Results of Operations” in our
Q3 2026 Form 10-Q and in “Item 7 – Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in our annual report on Form 10-K
for the fiscal year ended December 27, 2025. For the periods presented, core
results exclude the following items:
Mark-to-market net impact
Mark-to-market net gains and losses on commodity derivatives in corporate
unallocated expenses. These gains and losses are subsequently reflected in
segment results when the segments recognize the cost of the underlying commodity
in operating profit.
Restructuring and impairment charges
Expenses related to the multi-year productivity plan publicly announced in 2019,
which was expanded and extended through the end of 2030 to take advantage of
additional opportunities within the initiatives of the plan.
Acquisition and divestiture-related charges/credits
Acquisition and divestiture-related charges/credits include merger and
integration charges, transaction expenses, such as consulting, advisory and
other professional fees, as well as fair value adjustments to contingent
consideration and to the acquired inventory included in the acquisition-date
balance sheets. Merger and integration charges include distribution agreement
termination fees, impairment of certain acquisition-related intangibles,
employee-related costs, closing costs and other integration costs.
A - 5
Impairment and other charges
We recognized impairment charges primarily as a result of our quantitative
assessments of certain of our indefinite-lived intangible assets, related to the
Rockstar and Be & Cheery brands .
Indirect and income tax impact
We recognized additional expenses related to an indirect and income tax audit
settlement in our LatAm Foods segment.
Pension and retiree medical-related impact
Pension and retiree medical-related impact includes settlement charges related
to lump sum distributions exceeding the total of annual service and interest
costs, as well as net curtailment losses.
Effective net pricing: Reflects the year-over-year impact of discrete pricing
actions, sales incentive activities and mix resulting from selling varying
products in different package sizes and in different countries.
Free cash flow: Net cash from operating activities less capital spending, plus
sales of property, plant and equipment. Since net capital spending (capital
spending less cash proceeds from sales of property, plant and equipment) is
essential to our product innovation initiatives and maintaining our operational
capabilities, we believe that it is a recurring and necessary use of cash. As
such, we believe investors should also consider net capital spending when
evaluating our cash from operating activities. Free cash flow is used by us
primarily for acquisitions and financing activities, including debt repayments,
dividends and share repurchases. Free cash flow is not a measure of cash
available for discretionary expenditures since we have certain non-discretionary
obligations such as debt service that are not deducted from the measure.
Free cash flow conversion ratio: Free cash flow divided by core net income
attributable to PepsiCo.
Organic revenue performance: A measure that adjusts for the impacts of foreign
exchange translation (on a constant currency basis, as defined above),
acquisitions and divestitures, and every five or six years, the impact of an
additional week of results. We also apply the constant currency calculation for
our subsidiaries operating in highly inflationary economies. We believe organic
revenue performance provides useful information in evaluating the results of our
business because it adjusts for items that we believe are not indicative of
ongoing performance or that we believe impact comparability with the prior year.
2026 guidance
Our 2026 organic revenue performance guidance adjusts for the impacts of foreign
exchange translation (on a constant currency basis, as defined above) and
acquisitions and divestitures. Our 2026 core effective tax rate guidance, our
2026 core constant currency EPS growth guidance and our projected 2026 core net
income attributable to PepsiCo (a component of free cash flow conversion ratio)
exclude the mark-to-market net impact included in corporate unallocated
expenses, restructuring and impairment charges and other items noted above. Our
2026 core constant currency EPS growth guidance also excludes the impact of
foreign exchange translation. We are unable to reconcile our full year projected
2026 organic revenue growth to our full year projected 2026 reported net revenue
growth because we are unable to predict the 2026 impact of foreign exchange due
to the unpredictability of future changes in foreign exchange rates and because
we are unable to predict the occurrence or impact of any acquisitions and
divestitures. We are also not able to reconcile our full year projected 2026
core effective tax rate to our full year projected 2026 reported effective tax
rate, our full year projected 2026 core constant currency EPS growth to our full
year projected 2026 reported EPS growth and our full year projected 2026 core
net income attributable to PepsiCo (a component of free cash flow conversion
ratio) to our full year projected 2026 reported net income, because we are
unable to predict the 2026 impact of foreign exchange or the mark-to-market net
impact on commodity derivatives due to the unpredictability of future changes in
foreign exchange rates and commodity prices. Therefore, we are unable to provide
a reconciliation of these measures, without unreasonable effort.
A - 6
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information
Organic Revenue Performance
12 and 36 Weeks Ended September 5, 2026
(dollars in millions, unaudited)
12
W…
E… A…
9… IB L… P…
P… P… F… E… F… F… T…
──────────────────────────────────────────────────────────────────────────────
…
…
… $ 6… $ 7… $ 1,… $ 5,… $ 3,… $ 1,… $ 25…
…
…
…
…
… 10 11 -14 42 -2… -13 -1…
…
…
…
…
… — -… — — — — -4…
…
…
…
…
… $ 6… $ 7… $ 1,… $ 5,… $ 2,… $ 1,… $ 24…
…
…
…
…
…
… $ 6… $ 7… $ 1,… $ 5,… $ 2,… $ 1,… $ 23…
…
…
…
…
… — -… — — — — -15
…
…
…
… $ 6… $ 7… $ 1,… $ 5,… $ 2,… $ 1,… $ 23…
…
…
…
…
…
…
% — 5 8 8 14 10 6
…
…
…
…
…
… — — -1 1 -8 -1 -1
…
…
…
…
… — -6 — — — — -2
…
…
…
…
% — — 7 9 6 9 3
…
…
…
…
…
%
…
…
…
… 0… -3 5.5 1 2.5 11 0.5
…
…
… -1 3 2 7 3 -2 3
…
36
W…
E… A…
9… IB L… P…
P… P… F… E… F… F… T…
──────────────────────────────────────────────────────────────────────────────
…
…
… $ 1… $ 2… $ 3,… $ 13… $ 7,… $ 3,… $ 68…
…
…
…
…
… -… -… -71 -3… -7… -83 -1…
…
…
…
…
… -… -… — — — — -1…
…
…
…
…
… $ 1… $ 2… $ 3,… $ 12… $ 7,… $ 3,… $ 66…
…
…
…
…
…
… $ 1… $ 1… $ 3,… $ 11… $ 6,… $ 3,… $ 64…
…
…
…
…
… — -… — — — — -37
…
…
…
… $ 1… $ 1… $ 3,… $ 11… $ 6,… $ 3,… $ 64…
…
…
…
…
…
…
% — 7 10 11 15 11 7
…
…
…
…
…
… — — -2 -3 -11 -3 -2
…
…
…
…
… — -6 — — — — -2
…
…
…
…
% — 1 8 7 4.5 9 3
…
…
…
…
…
%
…
…
…
… 1 -3 4 3 — 10 0.5
…
…
… -1 4 4 4 4 -2 2
…
(a) Represents the adjustment needed to reflect translation of revenue using
prior-year period foreign currency exchange rates.
(b) Represents underlying amount, not in accordance with GAAP, used in the
calculation of Organic Revenue Performance, which is a financial measure that is
not in accordance with GAAP. See pages A-5 through A-6 for further discussion.
(c) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
(d) Excludes the impact of acquisitions and divestitures. In certain instances,
the impact of organic volume change on net revenue performance differs from the
unit volume change disclosed in the Summary Third-Quarter 2026 Performance table
and Summary Year-to-Date 2026 Performance table on pages 3 and 4 respectively,
due to the impacts of product mix, nonconsolidated joint venture volume, and,
for our franchise beverage businesses, temporary timing differences between BCS
and CSE. We report net revenue from our franchise beverage businesses based on
CSE. The volume sold by our nonconsolidated joint ventures has no direct impact
on our net revenue.
Note – Amounts may not sum due to rounding.
A - 7
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items by Segment
12 Weeks Ended September 5, 2026
(dollars in millions, unaudited)
… …
… … … …
… … … … … … … …
──────────────────────────────────────────────────────────────────────────────
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … — … 1 — — …
$ … $ … $ … $ … $ … $ … $ — $ …
…
…
$ … $ … $ … $ … $ … $ … $ … $ … 5… %
— — — — — — … … -…
2 5 — 3 … — — 9 —
$ … $ … $ … $ … $ … $ … $ — $ … 5… %
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … … … … … … …
… … — — — — — …
$ … $ … $ … $ … $ … $ … $ … $ …
…
…
$ … $ … $ … $ … $ … $ … $ … $ … 1… %
— — — — — — … … -…
… … 2 … 2 5 … … 0…
1 … — — — — — … -…
… … … … … … … … 1… %
2 3 … … … … — …
$ … $ … $ … $ … $ … $ … $ … $ …
… … … … … … … …
… 4 … … … … 5 3
… 4 9 … … … 5 …
(a) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
(b) Represents the adjustment needed to reflect translation of operating profit
using prior-year period foreign currency exchange rates.
Note – Amounts may not sum due to rounding.
A - 8
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items by Segment (continued)
12 Weeks Ended September 6, 2025
(dollars in millions, unaudited)
… …
… … … …
… … … … … … … …
──────────────────────────────────────────────────────────────────────────────
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… 1 — … — — — …
— … — — — — — …
$ … $ … $ … $ … $ … $ … $ — $ …
…
…
$ … $ … $ … $ … $ … $ … $ … $ … 5… %
— — — — — — … … 0…
… … — 7 — — — … 0…
— … — — — — — … 0…
$ … $ … $ … $ … $ … $ … $ — $ … 5… %
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … … … … … 2 …
… … — — — — — …
— 2 — … — — — …
— — — — … — — …
$ … $ … $ … $ … $ … $ … $ … $ …
$ — $ … $ … $ — $ — $ — $ — $ …
— … — — — — — …
— … … — — — — …
$ — $ — $ — $ — $ — $ — $ — $ —
…
…
$ … $ … $ … $ … $ … $ … $ … $ … 1… %
— — — — — — … … 0…
… … 2 … … 5 … … 0…
2 … — — — — — … 0…
— 8 … … — — — … 0…
— — — — … — — … 0…
$ … $ … $ … $ … $ … $ … $ … $ … 1… %
(a) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
Note – Amounts may not sum due to rounding.
A - 9
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items by Segment (continued)
36 Weeks Ended September 5, 2026
(dollars in millions, unaudited)
… …
… … … …
… … … … … … … …
──────────────────────────────────────────────────────────────────────────────
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … — … 8 — — …
$ … $ … $ … $ … $ … $ … $ — $ …
G…
M…
$ … $ … $ … $ … $ … $ … $ … $ … … %
— — — — — — … … …
… 4 — … … — — … —
$ … $ … $ … $ … $ … $ … $ — $ … … %
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … … … … … … …
… … — — — — — …
$ … $ … $ … $ … $ … $ … $ … $ …
O…
M…
$ … $ … $ … $ … $ … $ … $ … $ … … %
— — — — — — … … …
… … … … 9 … … … …
3 … — — — — — … …
… … … … … … … … … %
… — … … … … — …
$ … $ … $ … $ … $ … $ … $ … $ …
… … … … … … … …
… 3 … … … … 3 5
… 3 … … 6 … 3 3
(a) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
(b) Represents the adjustment needed to reflect translation of operating profit
using prior-year period foreign currency exchange rates.
Note – Amounts may not sum due to rounding.
A - 10
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items by Segment (continued)
36 Weeks Ended September 6, 2025
(dollars in millions, unaudited)
… …
… … … …
… … … … … … … …
──────────────────────────────────────────────────────────────────────────────
$ … $ … $ … $ … $ … $ … $ 9 $ …
— — — — — — … …
… … — … — — — …
— … — — — — — …
$ … $ … $ … $ … $ … $ … $ — $ …
G…
M…
$ … $ … $ … $ … $ … $ … $ … $ … … %
— — — — — — 9 9 —
… 6 — … — — — … …
— … — — — — — … …
$ … $ … $ … $ … $ … $ … $ — $ … … %
$ … $ … $ … $ … $ … $ … $ … $ …
— — — — — — … …
… … … … … … … …
… … — — — — — …
— 2 — … — — — …
— — — — … — — …
$ … $ … $ … $ … $ … $ … $ … $ …
$ — $ … $ … $ … $ — $ … $ — $ …
— … — — — — — …
— … … … — … — …
$ — $ — $ — $ — $ — $ — $ — $ —
O…
M…
$ … $ … $ … $ … $ … $ … $ … $ … … %
— — — — — — … … —
… … 7 … … 9 … … …
… … — — — — — … …
— … … … — … — … …
— — — — … — — … …
$ … $ … $ … $ … $ … $ … $ … $ … … %
(a) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
Note – Amounts may not sum due to rounding.
A - 11
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items
12 Weeks Ended September 5, 2026 and September 6, 2025
(dollars in millions, except per share amounts, unaudited)
12
Wee…
End… Net
9/5… inc…
Oth… att…
pen… to
and Pep…
ret… Net per
med… Pro… inc… com…
ben… for att… sha… Eff…
(ex… inc… to - tax
inc… tax… Pep… dil… rat…
──────────────────────────────────────────────────────────────────────────────
Re…
GA… $ -114 $ 834 $ 3,0… $ 2.23 21.4 %
me…
It…
Af…
Co…
Ma…
net — -19 -60 -0.04 -0.1
im…
Re…
and -7 36 149 0.11 -0.1
im…
ch…
Ac…
and — -23 -73 -0.05 -0.1
di…
ch…
Pe…
and
re… 179 40 139 0.10 —
me…
im…
Co…
no… $ 58 $ 868 $ 3,2… $ 2.34 21.2 %
me…
12
Weeks Net
Ended inco…
9/6/… attr…
Other to
pens… Peps…
and Net per
reti… Pro… inco… comm…
medi… for attr… share Eff…
bene… inc… to - tax
inco… tax… Peps… dilu… rat…
──────────────────────────────────────────────────────────────────────────────
Re…
GA… $ 26 $ 713 $ 2,6… $ 1.90 21.4 %
me…
It…
Af…
Co…
Ma…
net — 6 17 0.01 —
im…
Re…
and -1 25 116 0.08 -0.1
im…
ch…
Ac…
and — 52 169 0.12 0.3
di…
ch…
Im…
and — 8 92 0.07 -0.4
ot…
ch…
In…
and
in… — -47 129 0.09 -1.9
tax
im…
Pe…
and
re… 13 2 11 0.01 —
me…
im…
Co…
no… $ 38 $ 759 $ 3,1… $ 2.29 19.4 %
me…
(a) Provision for income taxes is the expected tax charge/benefit on the
underlying item based on the tax laws and income tax rates applicable to the
underlying item in its corresponding tax jurisdiction.
(b) The impact of items affecting comparability on our effective tax rate
represents the difference in the effective tax rate resulting from a higher or
lower tax rate as applicable to the items affecting comparability.
(c) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
(d) Provision for income taxes reflects the unfavorable impact of an income tax
audit settlement in our LatAm Foods segment.
Note – Amounts may not sum due to rounding.
A - 12
PepsiCo, Inc. and Subsidiaries
Reconciliation of GAAP and Non-GAAP Information (continued)
Certain Line Items (continued)
36 Weeks Ended September 5, 2026 and September 6, 2025
(dollars in millions, except per share amounts, unaudited)
36
Wee… Net
End… inc…
9/5… att…
Oth… to
pen… Pep…
and Net per
ret… Pro… inc… com…
med… for att… sha… Eff…
ben… inc… to - tax
inc… tax… Pep… dil… rat…
──────────────────────────────────────────────────────────────────────────────
Re…
GA… $ 3 $ 2,3… $ 8,3… $ 6.10 21.6 %
me…
It…
Af…
Co…
Ma…
net — -53 -168 -0.12 -0.1
im…
Re…
and -6 77 290 0.21 —
im…
ch…
Ac…
and — -60 -194 -0.14 -0.1
di…
ch…
Pe…
and
re… 179 40 139 0.10 —
me…
im…
Co…
no… $ 176 $ 2,3… $ 8,4… $ 6.15 21.5 %
me…
36
Wee… Net
End… inco…
9/6… attr…
Oth… to
pen… Peps…
and Net per
ret… Pro… inc… comm…
med… for att… share Eff…
ben… inc… to - tax
inc… tax… Pep… dilu… rat…
──────────────────────────────────────────────────────────────────────────────
Re…
GA… $ 91 $ 1,5… $ 5,7… $ 4.15 20.8 %
me…
It…
Af…
Co…
Ma…
net — -2 -6 — —
im…
Re…
and 13 100 467 0.34 -0.2
im…
ch…
Ac…
and — 72 236 0.17 0.1
di…
ch…
Im…
and — 421 1,5… 1.12 0.4
ot…
ch…
In…
and
in… — -47 129 0.09 -0.9
tax
im…
Pe…
and
re… 12 2 10 0.01 —
me…
im…
Co…
no… $ 116 $ 2,0… $ 8,0… $ 5.88 20.2 %
me…
(a) Provision for income taxes is the expected tax charge/benefit on the
underlying item based on the tax laws and income tax rates applicable to the
underlying item in its corresponding tax jurisdiction.
(b) The impact of items affecting comparability on our effective tax rate
represents the difference in the effective tax rate resulting from a higher or
lower tax rate as applicable to the items affecting comparability.
(c) A financial measure that is not in accordance with GAAP. See pages A-5
through A-6 for further discussion.
(d) Provision for income taxes reflects the unfavorable impact of an income tax
audit settlement in our LatAm Foods segment.
Note – Amounts may not sum due to rounding.
A - 13
Cautionary Statement
Statements in this communication that are “forward-looking statements,”
including our 2026 guidance and outlook are based on currently available
information, operating plans and projections about future events and trends.
Terminology such as “aim,” “anticipate,” “believe,” “drive,” “estimate,”
“expect,” “expressed confidence,” “forecast,” “future,” “goal,” “guidance,”
“intend,” “may,” “objective,” “outlook,” “plan,” “position,” “potential,”
“project,” “seek,” “should,” “strategy,” “target,” “will” or similar statements
or variations of such words and other similar expressions are intended to
identify forward-looking statements, although not all forward-looking statements
contain such terms. Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially from those
predicted in such forward-looking statements. Such risks and uncertainties
include, but are not limited to: future demand for PepsiCo’s products; damage to
PepsiCo’s reputation or brand image; product recalls or other issues or concerns
with respect to product quality and safety; PepsiCo’s ability to compete
effectively; PepsiCo’s ability to attract, develop and maintain a highly skilled
workforce or effectively manage changes in our workforce; water scarcity;
changes in the retail landscape or in sales to any key customer; disruption of
PepsiCo’s manufacturing operations or supply chain, including increased
commodity, packaging, transportation, labor and other input costs; political,
social or geopolitical conditions in the markets where PepsiCo’s products are
made, manufactured, distributed or sold; PepsiCo’s ability to grow its business
in developing and emerging markets; changes in economic conditions in the
countries in which PepsiCo operates; changes in tariffs and global trade
relations; future cyber incidents and other disruptions to our information
systems; failure to successfully complete or manage strategic transactions;
PepsiCo’s reliance on third-party service providers and enterprise-wide systems;
climate change or measures to address climate change and other sustainability
matters; strikes or work stoppages; failure to realize benefits from PepsiCo’s
productivity initiatives or organizational restructurings; deterioration in
estimates and underlying assumptions regarding future performance of our
business or investments that can result in impairment charges; fluctuations or
other changes in exchange rates; any downgrade or potential downgrade of
PepsiCo’s credit ratings; imposition or proposed imposition of new or increased
taxes aimed at PepsiCo’s products; imposition of limitations on the marketing or
sale of PepsiCo’s products; changes in laws and regulations related to the use
or disposal of plastics or other packaging materials; failure to comply with
personal data protection and privacy laws; increase in income tax rates, changes
in income tax laws or disagreements with tax authorities; failure to adequately
protect PepsiCo’s intellectual property rights or infringement on intellectual
property rights of others; failure to comply with applicable laws and
regulations; and potential liabilities and costs from litigation, claims, legal
or regulatory proceedings, inquiries or investigations.
For additional information on these and other factors that could cause PepsiCo’s
actual results to materially differ from those set forth herein, please see
PepsiCo’s filings with the SEC, including its most recent annual report on Form
10-K and subsequent reports on Forms 10-Q and 8-K. Investors are cautioned not
to place undue reliance on any such forward-looking statements, which speak only
as of the date they are made. We undertake no obligation to update any forward-
looking statement, whether as a result of new information, future events or
otherwise.
A - 14