What Happened?
Shares of food and beverage company PepsiCo (NASDAQ: PEP) jumped 7% in the afternoon session after the company reported second-quarter earnings that surpassed analyst expectations and raised its profit forecast for the full year.
The beverage and snack giant posted adjusted earnings of $2.12 per share on $22.73 billion in revenue. This performance exceeded Wall Street estimates, which had projected earnings of $2.03 per share on revenue of $22.28 billion. The better-than-expected results were driven by continued momentum in its international business and improving performance in North America. Looking ahead, PepsiCo improved its full-year 2025 guidance. The company now anticipates a smaller negative impact from foreign exchange rates, expecting a 1.5% headwind compared to the 3% previously forecast. This adjustment led to an improved outlook for its core earnings per share, which are now expected to see a smaller decline of 1.5% for the year. The company reaffirmed its expectation for low-single-digit organic revenue growth.
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What Is The Market Telling Us
PepsiCo’s shares are not very volatile and have had no moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
PepsiCo is down 3.8% since the beginning of the year, and at $144.50 per share, it is trading 19.4% below its 52-week high of $179.30 from September 2024. Investors who bought $1,000 worth of PepsiCo’s shares 5 years ago would now be looking at an investment worth $1,073.
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