PepsiCo’s full year profit outlook has a little less fizz as the the beverage and snacks giant battles higher than expected inflation.
On Tuesday, the company cut its full year “core” earnings outlook to $6.63 a share from $6.67 previously. The outlook cut — which is somewhat out of character for the steady Eddie PepsiCo —is that much more disappointing considering the company raised its full-year organic sales growth projection.
For the year, PepsiCo now sees organic sales growth of 8% compared to 6% previously.
PepsiCo CEO Ramon Laguarta acknowledged “higher than expected input cost inflation for the balance of 2022” on the earnings release.
Here is how PepsiCo performed compared to Wall Street estimates:
Net Sales: $16.20 billion vs. $15.57 billion
Organic Sales Growth: +13.7% vs. +9.68%
Diluted EPS: $1.29 vs. $1.23
Shares of PepsiCo were relatively unchanged in pre-market trading.
Inflationary pressures on PepsiCo’s business in the first quarter weren’t hard to spot.
Core operating profits grew at a much slower pace than organic sales at the company’s key Frito Lay North America, Quaker Foods North America and Asia Pacific businesses.
PepsiCo North America Beverages was a bright spot with organic sales increased 13% and operating profits rising 21%.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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