(Reuters) -PepsiCo Inc beat analysts’ estimates for quarterly revenue by more than $1 billion on Thursday, helped by higher prices and robust demand for its snacks and sodas.
The company’s shares rose 1.4% in premarket trading, even as it forecast full-year earnings below estimates, signaling the impact from runaway cost inflation.
PepsiCo, which raised prices on its sodas and snacks in the fall and winter, plans more increases this year as costs skyrocket for everything, from aluminum cans to labor and shipping, due to the pandemic and the spread of the Omicron coronavirus variant.
The Lay’s chips maker previously said demand has so far held up better than feared in the face of higher prices, but signs the fastest inflation rise in a generation may not ease soon have triggered worries that consumers may soon cut back on purchases.
PepsiCo forecast organic sales to rise 6% in 2022, slowing from the near 10% growth it saw last year. It expects fiscal 2022 core earnings of $6.67 per share, compared with analysts’ expectations of $6.73, according to IBES data from Refinitiv.
Still, the company’s net revenue rose 12.4% to $25.25 billion in the fourth quarter ended Dec. 25 , beating estimates of $24.24 billion.
The company on Thursday also announced a 7% increase in annual dividend and a new $10 billion stock buyback program.
(Reporting by Uday Sampath in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta)
