PepsiCo Q4 Earnings & Revenues Beat on Strength Across Segments

Core Insights - PepsiCo, Inc. reported strong fourth-quarter 2025 results with revenues and earnings per share (EPS) exceeding expectations and showing year-over-year improvement [1][3] - The company experienced accelerated net revenue growth, demonstrating its ability to adapt in a challenging environment [1] Financial Performance - PepsiCo's fourth-quarter core EPS was $2.26, surpassing the Zacks Consensus Estimate of $2.24 and reflecting a 15.3% year-over-year increase [3] - Reported EPS was $1.85, marking a 68% year-over-year surge in the fourth quarter [3] - Net revenues reached $29.34 billion, a 5.6% increase year over year, slightly above the Zacks Consensus Estimate of $29 billion [7] - Organic revenue growth was 2.1% year over year, driven by a 4.5% increase in effective net pricing, despite a 2% decline in organic volume [7] Segment Performance - Revenue growth was observed across all segments, with notable increases in EMEA (12%), LatAm Foods (11%), and PBNA (4%) [12] - Organic revenues improved in most segments, except for PFNA, which saw a 1% decline [13] Operational Efficiency - Reported operating income rose 58% year over year to $3.6 billion, while core operating income increased 17.7% to $4.1 billion [10] - The operating margin expanded significantly to 12.1% from 8.1% in the previous year [10] Future Outlook - For 2026, PepsiCo anticipates organic revenue growth of 2-4%, with a focus on innovation and productivity to enhance competitiveness [20] - The company expects core constant-currency EPS to increase by 4-6%, with core EPS growth projected at 5-7% [21] - Capital spending is expected to remain below 5% of net revenues, with a target free cash flow conversion ratio of at least 80% [22] Shareholder Returns - PepsiCo announced a 4% increase in its annualized dividend to $5.92 per share, marking the 54th consecutive year of dividend growth [15] - The company plans to return a total of $8.9 billion to shareholders in 2026, including $7.9 billion in dividends and $1 billion in share repurchases [23]