PepsiCo (NASDAQ:PEP) Inc shares climbed after it reported first-quarter financial results that saw revenue rise nearly 10.2% on a year-over-year basis, handily beating Wall Street estimates.
For the period ending March 31, 2023, the Purchase, New York-based beverage and snacks giant reported earnings of $1.50 per share on revenue of $17.8 billion. The consensus earnings estimate was $1.37 per share on revenue of $17.2 billion.
Frito-Lay North America was a strong revenue contributor as it logged a 16% jump in revenue energized by winning brands like Lay’s, Doritos, and Cheetos, as well as Sun Chips and PopCorners.
Volumes rose 1% in Pepsi’s beverage business, while they dropped 3% in its food segment. Prices were up 16% overall.
Investors reacted to the news, sending Pepsi shares up 1.6% to $188.51 in early trading Tuesday.
“We are very pleased with our performance and business momentum as our categories and geographies remained resilient during the first quarter,” Pepsi CEO Ramon Laguarta said in a statement.
“Given our strong start to the year, we now expect our full-year 2023 organic revenue to increase 8% (previously 6%) and core constant currency EPS to increase 9% (previously 8%).”
Laguarta also noted that the results demonstrated that the investments “with pep+ are laying the foundation for durable and sustainable growth.” Earlier in April, Pepsi set a goal to design 100% of its packaging to be recyclable, compostable, biodegradable or reusable by 2025.
Bubbly outlook
The company said it expects 2023 earnings of roughly $7.27 per share on revenue of $93.30 billion. Pepsi’s previous guidance was earnings of around $7.20 per share on revenue of $89.85 billion. The current consensus earnings estimate is $7.23 per share on revenue of $89.89 billion for the year ending December 31, 2023.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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