PepsiCo Beats Q3 Estimates but Cuts FY2026 Core EPS Growth Outlook as North America Stalls

PEP reported third-quarter core earnings of $2.34 per share, ahead of the $2.29 analysts expected, on net revenue of $25.27 billion, up 5.6% from a year earlier and above estimates near $24.96 billion. Organic revenue grew 3.1%. Reported EPS was $2.23.

The beat came with a weaker profit outlook. PepsiCo now expects FY2026 core EPS growth of 2.5% to 3.5%, down from the low end of a 5% to 7% range, and core constant-currency EPS growth of 1% to 2%, down from the low end of 4% to 6%. The company cited input cost inflation and the need to invest in North America. The top-line outlook moved the other way: net revenue growth is now about 6%, the top of the prior 4% to 6% range, and organic revenue growth about 3%.

The split is geographic. Organic revenue was flat in both PepsiCo Foods North America and PepsiCo Beverages North America in the quarter, while International Beverages grew 7%, Europe and Asia Pacific Foods 9% each, and Latin America Foods 6%. Shares fell about 1.6% in premarket trading on October 8.

The quarter shows international growth carrying the company while the U.S. business needs reinvestment. Watch North American volume and pricing in Q4, how much of the guidance cut reflects spending PepsiCo chooses to make versus costs it cannot pass on, and whether input cost inflation eases into 2027.