PepsiCo (PEP) Q3 2025 Report Shows Resilience

by MarketNewsData

PepsiCo (PEP) Q3 2025 results show resilience despite impairment charges; organic revenue steady, acquisitions strengthen portfolio

Key Points

  • Net revenue: $23.94 billion, up 3% year over year.
  • Operating profit: $3.57 billion, down 8% year over year due to impairment and acquisition-related charges.
  • Net income: $2.60 billion, or $1.90 per diluted share, compared with $2.93 billion or $2.13 per share a year ago.
  • Core EPS (non-GAAP): $2.29 vs. $2.31 last year, nearly flat.
  • Organic revenue growth: 1%, led by effective pricing and international expansion.
  • Impairment: $1.9 billion charge primarily related to the Rockstar and Be & Cheery brands.
  • Acquisitions: Completed poppi and Siete for a combined $3.15 billion to expand health‑oriented beverage and food offerings.
  • Free cash flow: $5.5 billion for the first 36 weeks of 2025.
  • Stock reaction: Shares closed up $1.68 (+1.0%) at $174.82.

Quarter Highlights

  • Reported revenue: $23.94B (vs. $23.32B in Q3 2024), driven by 3% growth from pricing.
  • Gross profit: $12.82B; gross margin 53.6%.
  • Operating profit: $3.57B; operating margin 14.9% (down from 16.6%).
  • EPS: $1.90 (GAAP); Core EPS $2.29.
  • Organic revenue: up 1%; effective pricing offset a 3% volume decline.
  • Beverages: North America stable; international markets grew mid‑single digits.
  • Convenient foods: Slightly lower volume in North America offset by strong pricing.
  • Impairment: $1.9B charge, mainly for Rockstar energy brand and Be & Cheery in Asia.

CEO Statement and Outlook

“We continued to execute well across our global portfolio despite a challenging environment,” said Ramon Laguarta, Chairman and CEO of PepsiCo. “Our investments in brands like poppi and Siete strengthen our long‑term growth pipeline and reflect our focus on innovation and consumer preferences.”

“While 2025 remains a transition year with certain impairment and cost pressures, our productivity initiatives and disciplined pricing position us for a return to stronger earnings growth in 2026.”

Financial Summary

MetricQ3 2025Q3 2024
Net Revenue$23.94 B$23.32 B
Gross Profit$12.82 B$12.92 B
Operating Profit$3.57 B$3.87 B
Net Income$2.60 B$2.93 B
EPS (Diluted, GAAP)$1.90$2.13
Core EPS (Non‑GAAP)$2.29$2.31
Free Cash Flow (36 wks)$5.5 B$6.2 B
Operating Margin14.9%16.6%
Organic Revenue Growth+1%—

Capital Return

  • Dividend: Declared quarterly dividend of $1.4225 per share, payable in December 2025; annualized rate of $5.69, up 5% from 2024.
  • Share repurchases: $752 million during the first 36 weeks of 2025; ongoing $10 billion authorization through February 2026.
  • Total cash returned to shareholders YTD: $6.4 billion (dividends + buybacks).

About PepsiCo

PepsiCo (NASDAQ: PEP) is a global food and beverage leader with a complementary portfolio that includes Lay’s, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, and SodaStream. PepsiCo’s products are enjoyed more than one billion times a day in over 200 countries and territories worldwide. In 2024, the company generated over $91 billion in net revenue. PepsiCo’s vision is to Be the Global Leader in Beverages and Convenient Foods by Winning with pep+ (PepsiCo Positive), its strategic end‑to‑end transformation placing sustainability and human capital at the center of how it creates value and growth.

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