PepsiCo has lowered its organic revenue forecast for the year after US consumers continued to buy fewer of its snacks and drinks.
The company, based in Purchase, New York, said on Tuesday it now expects its organic revenue -which is adjusted for foreign currency exchanges and the impact of product acquisitions or divestments – to increase in the low single-digit range for the year. It had expected an increase of 4%.
PepsiCo said its performance in North America was “subdued”, hit by a big recall of its Quaker Oats granola bars and cereals as well as weak demand for its Frito-Lay snacks and drinks.
Frito-Lay North America’s sales volumes slipped 1.5%, while North American beverage volumes fell 3%.
Consumers began to reject paying higher prices in the summer after years of increases, and PepsiCo vowed to lower the cost of some products like potato crisps and tortilla chips.
Revenue was flat in the third quarter, at 23.3 billion US dollars (£17.8 billion). Wall Street had expected revenue of 23.8 billion dollars (£18.2 billion), according to analysts polled by FactSet.
Net income fell 5% to 2.9 billion dollars (£2.2 billion), or 2.13 dollars (£1.63) per share – also short of analysts’ forecasts of 2.28 dollars (£1.74).
PepsiCo shares fell 1% in premarket trading on Tuesday.
