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PepsiCo

Priorities to enhance shareholder value, From December 2025

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PepsiCo’s vision

Priorities to enhance shareholder value

PepsiCo sells drinks and convenient foods, from Lay’s and Doritos to Gatorade and Pepsi-Cola, in more than 200 countries and territories, with nearly $92 billion of revenue in 2024. In December 2025, after a review overseen by its board, it set out how it would grow faster and lift its margins, starting with its snacks business in North America.

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Sharper everyday value

Price tiers
Set affordable price tiers by brand and channel at PepsiCo Foods North America, so people buy its mainstream brands more often.
  • 9 July 2026: North America’s convenient foods gained volume market share in the second quarter of 2026, helped by innovation and affordability. Net revenue fell 2%, mainly from lower effective prices.

PepsiCo’s North American businesses grew least

In the second quarter of 2026 the two North American businesses made more than half of PepsiCo’s net revenue. Foods North America’s organic revenue fell 2% as it lowered effective prices. Asia Pacific Foods and the International Beverages Franchise each grew 9%, mostly from volume.

Beverages North Americavolume −2 · price +3+1%$7.2bnFoods North Americavolume 0 · price −2−2%$6.4bnEurope, Middle East and Africavolume +3 · price +3+6%$5.0bnLatin America Foodsvolume 0 · price +4+4%$2.9bnInternational Beveragesvolume +6 · price +3+9%$1.5bnAsia Pacific Foodsvolume +10 · price −1+9%$1.1bn

Each shelf is stocked as far as its division’s net revenue in the twelve weeks to 13 June 2026. Organic growth leaves out currency, acquisitions, and divestitures; volume and price are its two parts, in percentage points.

At least 90% of core net income into free cash flow in 2027

Free cash flow conversion is the share of core net income that becomes free cash flow. PepsiCo expects at least 80% in 2026, which includes a final tax payment of nearly $1 billion, and at least 90% in 2027.

core netincome0%50%80%100%

80¢

of free cash flow, at least, for every dollar of core net income in 2026.

In 2026 PepsiCo expects to return about $8.9 billion to shareholders: $7.9 billion in dividends and $1.0 billion in buybacks.

  1. Aim the plan where it counts.

    PepsiCo’s December 2025 plan centres on PepsiCo Foods North America, which it said would play a critical role in reaching its targets. We recommend a plan that names the part of the business it most needs to move.

  2. Say where the money comes from.

    PepsiCo is cutting nearly a fifth of its US SKUs and closing plants and lines, and putting the savings into lower prices and marketing. We recommend pairing every investment in growth with the savings that will pay for it.

  3. Bring critical shareholders inside.

    PepsiCo worked through its plan with Elliott, a shareholder pressing for change, and announced it with the investor’s support. We recommend engaging critics early, so the plan they back is still the company’s own.

Sources

  1. 1. PepsiCo, Inc. (2025). PepsiCo announces priorities to enhance shareholder value and provides preliminary 2026 financial outlook. Form 8-K, exhibit 99.1, US Securities and Exchange Commission, 8 December 2025. sec.gov
  2. 2. PepsiCo, Inc. (2026). PepsiCo reports fourth quarter and full-year 2025 results. Form 8-K, exhibit 99.1, US Securities and Exchange Commission, 3 February 2026. sec.gov
  3. 3. PepsiCo, Inc. (2026). PepsiCo reports second-quarter 2026 results. Form 8-K, exhibit 99.1, US Securities and Exchange Commission, 9 July 2026. sec.gov

Headwater is not connected with PepsiCo. PepsiCo, Lay’s, Doritos, Cheetos, Tostitos, Simply NKD, Gatorade, Pepsi-Cola, and pep+ are trade marks of their owners. Updated 30 September 2026.

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