PepsiCo beat analysts’ expectations for Q4, but the company’s outlook for next year is weaker than expected.
For the quarter, PepsiCo reported net revenue of $25.25 billion, representing 12.4% growth over Q4 of 2020. Analysts had expected revenue of $24.24 billion. Net income for the quarter decreased by 28% year-over-year. For the full year, net revenue was $79.47 billion, a 12.9% increase from 2020, while net income climbed 7%.
In North America, revenue for Frito-Lay and PepsiCo Beverages grew 13%, while Quaker Foods grew 9%. Globally, revenue grew in the double digits in Latin America (16%); Africa, the Middle East, and South Asia (18%); and the Asia Pacific, Australia and New Zealand, and China region (13%), while Europe saw growth of 8%.
Operating profits increased in certain areas and decreased in others. In North America, Frito-Lay operating profit was up 10% and Quaker Foods up 8%, driven by revenue growth, pricing, and productivity savings. Meanwhile, PepsiCo Beverages operating profit decreased 10%. The company noted the impact of operating cost increases including higher commodity and transportation costs as well as higher advertising and marketing expenses.
Looking forward, the company expects organic revenue growth of 6% in 2022. PepsiCo will also increase its annualized dividend by 7% and buy back up to $10 billion of its common stock.
PepsiCo chairman and CEO Ramon Laguarta commented: “Moving forward, we remain committed to building advantaged capabilities that can help us win in the marketplace and become an even faster, even stronger and even better organization. Importantly, this includes putting sustainability and human capital at the center of everything we do with the recent implementation of PepsiCo Positive (pep+), a fundamental end-to-end transformation of what we do and how we do it to create growth and shared value.”
