PepsiCo beat analysts’ expectations with higher earnings and revenue, driven by improved organic sales. To combat sluggish demand for snacks due to higher prices, Pepsi plans to lower prices on products like chips in North America. The company’s stock closed nearly 5% higher on Tuesday.

In the fourth quarter, Pepsi reported net income of $2.54 billion, or $1.85 per share, up from $1.52 billion, or $1.11 per share, a year earlier. Excluding charges, the company earned $2.26 per share. Net sales rose 5.6% to $29.34 billion, with organic revenue up 2.1%.

CEO Ramon Laguarta noted improvements in both North America and international businesses. However, volume declines were seen in North America, with global food volume down 2% and drinks up 1%. The North American food division reported a 1% volume decrease, although organic sales rose 2%.

Pepsi’s price cuts have been positively received by retailers, leading to increased shelf space for its products. The company plans to further boost demand by reducing prices on select snack brands like Lay’s and Doritos, while also refreshing key brands with simpler ingredients and new packaging.

Pepsi reiterated its 2026 outlook, forecasting a 2%-4% rise in organic revenue and 4%-6% increase in core constant currency earnings per share. Following a deal with Elliott Investment Management in December, Pepsi is focusing on improving its North American business and maintaining resilience internationally.

Read more at CNBC: PepsiCo (PEP) Q4 2025 earnings