This audio is generated automatically. Please let me know if you have any comments.
PepsiCo has cut the number of products it sells by nearly 20% as part of a broader cost-cutting review in response to a slowdown in consumer spending and pressure from activist investors.
The makers of Doritos and Mountain Dew said the move was.which includes measures to provide more affordable products to consumers, will help accelerate organic revenue growth and improve operating margin expansion. PepsiCo also aims to achieve a “record year of productivity savings in 2026” and plans to accelerate its automation and digitalization initiatives.
“We are encouraged by the actions and initiatives we are taking with urgency to improve both our market and financial performance,” said Ramon Laguarta, Chairman and CEO of PepsiCo.
PepsiCo has struggled in North America as consumers demand healthier products and look for products with more value. The company suffered slowing growth and margin erosion in its food segment and “continuous” share loss and margin erosion in its beverage segment, according to Beverage Digest data, with PepsiCo falling to fourth behind Coca-Cola, Dr. Pepper and Sprite.
In recent months, the New York-based company has taken steps to cut costs and overhaul its portfolio with better products for customers. PepsiCo announced Cheetos and Doritos versions We plan to expand our snack options by adding more protein, fiber and whole grains without using artificial colors. also A prebiotic version of the same name cola.
PepsiCo reportedly plans to announce layoffs in North America as early as this week. According to Bloomberg. A PepsiCo spokesperson did not respond to Food Dive’s request for comment.
If the workforce cuts are made, it will be the CPG giant’s latest move to cut costs and scale back operations. PepsiCo made the announcement last month. Frito-Lay closes a pair of facilities 500 positions were eliminated in Orlando, Florida.
PepsiCo has been in talks with activist Elliott Investment Management. We built $4 billion in equity and drove change. From food and beverage manufacturers. In PepsiCo’s statement announcing the changes, Elliott said it supports the productivity measure.
“We believe the plans announced today to invest at affordable prices, accelerate innovation and aggressively reduce costs will deliver greater revenue and profit growth,” said Marc Steinberg, Partner at Elliott.
PepsiCo said it expects organic sales growth of 2% to 4% in fiscal 2026, with the top end of that range expected to be achieved in the second half of the year.
In a note to investors, TD Cowen analyst Robert Moskow said Elliott’s involvement “increased the company’s sense of urgency to execute on its strategy,” but noted that PepsiCo’s growth plans have not changed to “revolutionary levels.”
