Pepsi tops third-quarter earnings, announces new CFO

While sales in North America continue to fall, Pepsi still beat analyst expectations in the third quarter, thanks to continued strength in international markets.

The food and beverage giant reported earnings of $2.29 per share, narrowly beating the consensus estimate of $2.26. Revenues came in at $23.94 billion, versus an expected $23.83 billion.

Still, inflation and economic uncertainty is making many consumers think twice before grabbing a drink or a snack. Worldwide volume for food and drink was down 1% in the quarter, with the biggest declines here in the U.S. Pepsi Foods North America, which includes brands like Doritos and Quaker Oats, saw its volume fall 3% in the fiscal third quarter. Improving the performance of the North American food segment “is a top priority for the business,” executives said in a statement.

Beverage sales, meanwhile, were down 3% in North America. That includes both Pepsi soda brands and Gatorade.

Despite those declines, Pepsi reiterated its full-year outlook , saying it expects earnings per share to be flat, with slight growth in revenue. Chief Executive Ramon Laguarta said the company will cut costs in the months to come and plans to speed up the transformation of its product portfolio, which will include price changes and adjustment to pack sizes.

“As we look ahead to the balance of this year and beyond, our top priorities are to accelerate growth and aggressively optimize our cost structure. To accomplish this, we are introducing a strong pipeline of innovation to accelerate portfolio transformation, continuously sharpening our price pack architecture to provide good value to consumers, and right sizing our entire cost base to help fund our activities,” said CEO Ramon Laguarta.

Shares were up about 1.5% in pre-market trading Thursday.

As part of its earnings announcement, Pepsi also disclosed its Chief Financial Officer Jamie Caulfield plans to retire. Steve Schmitt, who currently serves as executive vice president and chief financial officer for Walmart, will take over the job beginning Nov. 10.

He joins as pressure is building from activist investor Elliott Management, which has disclosed a $4 billion stake in Pepsi. That group is calling for a turnaround at the company.