Shares of PepsiCo, Inc. (NASDAQ: PEP) rose over 3% on Thursday after the company delivered better-than-expected earnings results for the third quarter of 2025. The beverages giant’s international business remained resilient against softness in the North America division. For the balance of the year and beyond, the company’s main priorities are to accelerate growth and optimize its cost structure.
Q3 numbers
In Q3 2025, PepsiCo’s net revenues increased 3% year-over-year to $23.9 billion, coming above expectations of $23.8 billion. Organic revenues grew 1.3%. GAAP earnings per share declined 11% to $1.90 versus last year. Core EPS dropped 2% YoY to $2.29 but surpassed projections of $2.26.
Segment performance and priorities
In Q3, PepsiCo saw revenue growth across all its segments on both a reported and organic basis, except for the PepsiCo Foods North America and International Beverages Franchise segments, where revenues remained flat on a reported basis and declined on an organic basis. The PepsiCo Foods North America business has been seeing softness in packaged foods categories due to pressure on consumers’ discretionary spend.
The company continues to revamp its portfolio by rolling out new snack offerings that are healthier and natural. It is working on offering its products in suitable pack sizes and at affordable prices in order to help with portion control and offer value. It is also investing in driving growth in its away-from-home business.
PEP’s international business remains resilient with growth driven by markets such as Argentina, Germany, Australia and Egypt. It sees opportunity for continued profitable growth in this $37 billion business.
PepsiCo’s top priorities for this year and beyond are to accelerate growth and optimize its cost structure. The company plans to do this through product innovation and portfolio transformation, refining its pack sizes and price points, and reducing costs.
Outlook
PepsiCo expects its business to remain resilient for the rest of the year. The International business is expected to perform well while the North America business is anticipated to see improvement as the company implements its growth initiatives.
For fiscal year 2025, PEP continues to expect a low-single-digit increase in organic revenue. The company now forecasts a 0.5% decline in core EPS for the year versus its previous expectation of a 1.5% decrease.
New CFO
PepsiCo has appointed Steve Schmitt as its new Chief Financial Officer. He will succeed Jamie Caulfield, who plans to retire next year.