PepsiCo has lowered its revenue outlook for the year after a second straight quarter of weaker-than-expected sales.
The fmcg giant saw volumes slip in the third quarter of 2023 across most divisions, leading to organic revenue growth of 1.3%, which was less than analysts’ estimates.
PepsiCo now expects a “low-single-digit” rise in organic revenue for 2024, down from its previous target of 4%.
Europe was a rare bright spot with volumes up 1% in Q3, the company said in today’s update.
Overall, volumes across both its food and beverage divisions declined 2% due to weakening demand in the US and the repercussions of recalls at Quaker Foods North America.
Like many brands, PepsiCo is struggling as higher prices push consumers to trim spending and switch to cheaper own-label alternatives.
CEO Ramon Laguarta said in a statement, the business would “focus on tightly managing our costs to better align with the subdued growth environment that we are currently operating in”.
PepsiCo also cited “business disruptions due to rising geopolitical tensions in certain international markets”, with boycotts in the Middle East affecting numerous North American brands.
The company still expects earnings to grow at least 8% this year on a constant currency basis.
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