PepsiCo Inc. (NASDAQ:PEP) reported a mixed fourth quarter, missing revenue while beating earnings per share estimates. The management highlighted key strategic changes to its snack business Frito-Lay North America, which manufactures popular products like Lays, Cheetos, and Doritos.
What Happened: Frito-Lay North America (FLNA) experienced a decline in organic revenue for both the full year 2024 and the fourth quarter. Full-year organic revenue decreased by 0.5%, a significant drop from the 9% growth seen in 2023. In the fourth quarter alone, organic revenue was down 2%.
PepsiCo reinvested heavily in FLNA in Q4, funded partly by one-time gains, to revitalize volume growth. This included tactical spending and strategic groundwork for 2025.
The chairman and CEO of the company, Ramon Luis Laguarta in response to an analyst during its earnings call said, “We reinvested most of the one-time gains in building the infrastructure to capture those opportunities in 25.”
The management also highlighted that FLNA is emphasizing value offerings at different price points ...