(Reuters) – PepsiCo Inc on Thursday raised its annual revenue and profit forecasts for the second time, banking on resilient demand for its snacks and beverages as well as price hikes.
Shares rose 2% in premarket trading after the company also beat second-quarter results.
Packaged food companies, including PepsiCo, have hiked prices to counter a jump in costs of everything from commodities such as sugar to transportation costs caused by supply chain snags and the Russia-Ukraine war.
Meanwhile, U.S. consumers have been spending on sodas and snacks from the company and rival Coca-Cola even as rising interest rates and food prices hammered non-essential spending.
In April, the Frito-Lay maker said it would raise prices in some regions still experiencing higher inflation.
PepsiCo’s average prices jumped 15% for the quarter ended June 17, while organic volume slipped 2.5%.
The company said it expects 2023 organic revenue to rise 10%, compared with prior forecast of an 8% increase.
It estimated annual core earnings per share of $7.47, compared with earlier expectation of $7.27.
The 7UP maker’s net revenue rose to $22.32 billion from $20.23 billion in the second quarter, compared with analysts’ average estimate of $21.73 billion, according to Refinitiv data.
(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Sriraj Kalluvila)
