Food and beverage company PepsiCo (NASDAW:PEP) has reported that its per-share income in the fourth quarter exceeded estimates, although organic revenue growth was lower than anticipated as cost-conscious U.S. shoppers responded to price hikes.
The company, which sells brands such as Mountain Dew soda and Frito-Lay potato chips posted a 2.1% rise in organic sales during the final quarter of 2024. This was lower than the Bloomberg consensus estimates of 2.27%.
Analysts had called for growth for the year of 3.22% but it only climbed 2%.
However, in a statement the company’s CEO Ramon Laguarta said that the company remained “resilient” in 2024 despite “subdued” performance in its key North American operations. Price hikes in food and other products had caused many consumers to opt for cheaper products and shop less at convenience stores, which hit PepsiCo’s beverage sales.
Laguarta noted that the impact of a product recall at its Quaker Foods North America division last year continued to weigh on the wider business. Disruptions from geopolitical conflicts in some international markets also hit returns.
However, cost control measures together with price increases have helped to maintain the company’s profits. Core earnings per share for the fourth quarter came in at $1.96, above Wall Street forecasts of $1.94.
“Our multiyear productivity initiatives will help fund disciplined commercial investments and aid our profitability,” Laguarta said.
Shares in PepsiCo dipped by more than 2% in early U.S. trading on Tuesday.