PepsiCo Inc
Q4 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: −2.03%.
Did PEP Beat Earnings? Q4 2025 Results
PepsiCo closed out fiscal 2025 on a strong note, posting Q4 earnings per share of $2.26 against a consensus estimate of $2.24 — a modest beat of 0.89% — while revenue of $29.34 billion topped the $24.01 billion consensus by 22.20% and grew 5.6% year over year. The quarter's outperformance was driven by a sequential acceleration in both reported and organic revenue growth, with core EPS reflecting 11% constant currency growth fueled by meaningful operating margin expansion and record productivity savings. Segment dynamics were notably uneven: PBNA swung dramatically from a prior-year operating loss, while international segments — particularly EMEA, where operating profit surged 72% — provided meaningful lift. As a <a href="https://247wallst.com/investing/2025/12/30/the-dividend-aristocrat-with-53-margins-just-widened-the-gap-on-the-frozen-dividend-competitor/">longtime dividend growth stalwart</a>, PepsiCo also announced its 54th consecutive annual dividend increase, lifting the payout to $5.92 per share alongside a new $10 billion buyback authorization. Looking ahead, the company guided for 2–4% organic revenue growth and 4–6% core constant currency EPS growth in fiscal 2026, with tariff-driven commodity costs and consumer affordability remaining key watch items.
- Sequential acceleration in reported and organic revenue growth in Q4
- Strong productivity savings driving operating margin expansion
- Effective net pricing across multiple segments
- Favorable foreign exchange translation in EMEA and LatAm Foods
- Favorable comparisons to prior-year TBG impairment charges in PBNA and EMEA
“PepsiCo's fourth quarter results reflected a sequential acceleration in reported and organic revenue growth, with improvements in both the North America and International businesses. Accelerated net revenue growth and strong productivity savings led to strong operating margin expansion and double-digit EPS growth in the fourth quarter.”
PepsiCo CEO, on the earnings call
Forward Guidance & Outlook
For fiscal 2026, PepsiCo expects organic revenue to increase 2-4%, core constant currency EPS to increase 4-6%, a core annual effective tax rate of approximately 22%, capital spending below 5% of net revenue, and a free cash flow conversion ratio of at least 80%. Total cash returns to shareholders are expected at approximately $8.9 billion, comprising $7.9 billion in dividends and $1.0 billion in share repurchases. Foreign exchange translation is expected to provide approximately 1 percentage point tailwind to reported net revenue and core EPS growth. Acquisitions net of divestitures from 2025 are expected to contribute 1 percentage point to reported net revenue growth. These assumptions imply net revenue growth of 4-6% and core EPS growth of approximately 5-7%, or approximately 7-9% excluding global minimum tax regulations.
PEP YoY Financials
PEP Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.