Harrison, New York, October 8 — PepsiCo’s third-quarter 2026 earnings forecast has been cut by 5% due to slower-than-expected progress in its North American turnaround strategy, the company announced. The revision comes despite PepsiCo reporting $66.3 billion in revenue for fiscal 2025, a figure that underscores the scale of its global operations even as its largest regional division underperforms. PepsiCo’s North American business, which generates over 40% of the company’s total revenue, has been central to recent efforts to boost profitability through product innovation, cost reductions, and digital upgrades.
However, these initiatives have not yet delivered the anticipated financial results, prompting the cautious outlook. Chief Financial Officer Randeep Rishi acknowledged in the earnings release that rising input costs, intensified competition, and shifting consumer demand for healthier and more sustainable options have weighed on performance.
While the company remains committed to its long-term targets, Rishi said current market conditions require a more measured approach to near-term goals. PepsiCo, headquartered in Harrison, New York, in the hamlet of Purchase, was formed in 1965 through the merger of the Pepsi-Cola Company and Frito-Lay, Inc. Since then, it has grown into a diversified portfolio that includes beverages, snacks, and nutrition brands.
Key acquisitions such as Tropicana in 1998, Quaker Oats in 2001 — which brought Gatorade into the fold — and Pioneer Foods in 2020 for $1.7 billion have expanded its reach across categories. As of January 2021, PepsiCo managed 23 brands each generating over $1 billion in annual sales, distributing products in more than 200 countries and territories.
The company ranks as the second-largest food and beverage business globally by revenue, profit, and market capitalization, behind Nestlé. In the United States and Canada, however, PepsiCo leads as the largest food and beverage company by net revenue, despite Coca-Cola outselling Pepsi Cola in the U.S. market. Investors will note that the forecast adjustment led to a slight decline in PepsiCo’s share price during early trading on October 8.
The company maintains confidence in its ability to meet long-term objectives but stressed that further strategic adjustments may be necessary as market dynamics evolve. Watch for updates on cost-saving initiatives and product pipeline progress in the coming quarters as PepsiCo seeks to realign its North American performance with its broader corporate goals.
