PepsiCo lowered its organic revenue forecast for the year after U.S. consumers continued to pull back on buying its snacks and drinks.
The company, based in Purchase, New York, said Tuesday it now expects its organic revenue — which is adjusted for foreign currency exchanges and the impact of product acquisitions or divestments – to increase in the low single-digit range for the year. It had expected an increase of 4%.
PepsiCo said its performance in North America was “subdued,” hurt by a big recall of its Quaker Oats granola bars and cereals as well as weak demand for its Frito-Lay snacks and drinks. Frito-Lay North America’s sales volumes slipped 1.5%, while North American beverage volumes fell 3%.
Consumers began to push back on higher prices this summer after years of increases, and PepsiCo it vowed to lower the cost of some products like potato chips and tortilla chips.
Third quarter revenue was flat at $23.3 billion. Wall Street had expected revenue of $23.8 billion, according to analysts polled by FactSet.
Net income fell 5% to $2.9 billion, or $2.13 per share. That was also short of analyst forecasts of $2.28.
PepsiCo shares fell 1% in premarket trading.
