PepsiCo (PEP) Earnings Q3 2019
A woman grabs a bottle of Diet Pepsi in Atlanta, Georgia.
Chris Rank | Bloomberg | Getty Images
On Thursday, PepsiCo announced quarterly revenue and revenue that exceeded expectations as they increased advertising and marketing spending for brands like Gatorade.
Shares in the food and beverage giant jumped 3% in the pre-market trade.
19659002] "Given our performance to date, we now expect to meet or exceed our organic revenue growth target of 4% for the full year," CEO Ramon Laguarta said in a statement.
The company confirmed the revenue outlook for the financial year 201[ads1]9. It expects adjusted earnings per share, assuming constant exchange rates, to fall by 1%.
This is what the company reported compared to what Wall Street expected, based on a survey of Refinitive Analysts: [19659008] Earnings per share: $ 1.56, adjusted, against $ 1.50 expected
n, or $ 1.75 per share, the previous year. The company's strategy for sales growth includes investing more in marketing and advertising the products.
Excluding the impact of currency, restructuring costs and other items, Pepsi earned $ 1.56 per share, topping $ 1.50 per share expected by analysts surveyed by Refinitive.
Net sales rose 4.3% to $ 17.19 billion, topping expectations of $ 16.93 billion.
Frito Lay North America, which includes brands such as Cheetos and Doritos, had a sales growth of 5.5%. Pepsi has expanded the snack lineup with healthier options through brands such as Bare and Off the Eaten Path. Revenue growth from healthier snacks and well-known chip brands helped offset double-digit sales declines from Sabra hummus and guacamole declines. Pepsi owns a 50% stake in the hummus producer through a joint venture with the Strauss Group.
Its North American beverage business also had good results with 3.5% revenue growth. Gatorade improved its market share and had a positive net sales growth during the quarter. The brand's non-sugar line, Gatorade Zero, launched in May 2018, surpassed half a billion dollars in retail sales.
Bubly, which the company expects will be one of the next billion-dollar brands, continues to win the market share in the flavored water category with sparkling water against competitors like La Croix.
Pepsi's organic revenue also grew by 4.3% during the quarter.
