PEP 8-K: Smart Summary

PepsiCo reported third-quarter 2025 results for the 12 and 36 weeks ended September 6, 2025, with GAAP net revenue up 2.6% in Q3 and organic revenue up 1.3%. The company affirmed its full-year 2025 financial guidance while updating its expected foreign exchange translation impact to approximately 0.5 percentage points of headwind (improved from a prior 1.5 percentage point headwind), implying a 0.5% decline in core EPS versus 2024 core EPS of $8.16.

• Q3 net revenue: $23,937M vs. $23,319M prior year, +2.6% reported; organic revenue +1.3%
• YTD net revenue: $64,582M vs. $64,070M prior year, +0.8% reported; organic revenue +1.5%
• Q3 GAAP operating profit: $3,569M vs. $3,872M prior year, -8%; reported operating margin 14.9% vs. 16.6%
• Q3 core operating profit (non-GAAP): $4,137M vs. $4,176M prior year; core operating margin 17.3% vs. 17.9%
• Q3 GAAP EPS: $1.90 vs. $2.13 prior year, -11%; Q3 core EPS (non-GAAP): $2.29 vs. $2.31 prior year
• YTD GAAP EPS: $4.15 vs. $5.84 prior year, -29%; YTD core EPS (non-GAAP): $5.88 vs. $6.20 prior year
• Q3 GAAP gross profit: $12,824M (53.6% margin) vs. $12,923M (55.4% margin) prior year; core gross profit: $12,904M (53.9%) vs. $12,951M (55.5%)
• YTD net cash provided by operating activities: $5,468M vs. $6,220M prior year
• Q3 impairment of intangible assets: $133M (primarily Rockstar brand) vs. $24M prior year; YTD impairment: $1,993M vs. $24M prior year

• PFNA Q3: reported net revenue $6,526M (~flat YoY); organic revenue -3%; reported operating profit -5%; core constant currency operating profit -3.5%
• PBNA Q3: reported net revenue $7,327M, +2% YoY; organic revenue +2%; reported operating profit -20%; core constant currency operating profit -7%
• IB Franchise Q3: reported net revenue $1,291M, ~flat YoY; organic revenue -1%; reported operating profit -5%; core constant currency operating profit +7%
• EMEA Q3: reported net revenue $5,022M, +9% YoY; organic revenue +5.5%; reported operating profit +1%; core constant currency operating profit +3%
• LatAm Foods Q3: reported net revenue $2,656M, +2% YoY; organic revenue +4%; reported operating profit -12%; core constant currency operating profit +9%
• Asia Pacific Foods Q3: reported net revenue $1,115M, +2% YoY; organic revenue +1%; reported operating profit +16%; core constant currency operating profit +18%
• Total Q3 organic revenue: $23,627M; total Q3 organic volume -1% (convenient foods) and -1% (beverages); effective net pricing contributed +4%

• Full-year 2025 total cash returns to shareholders: approximately $8.6B
• Dividends: approximately $7.6B; YTD cash dividends paid: $5,692M vs. $5,369M prior year
• Share repurchases: approximately $1B full-year target; YTD share repurchases: $752M vs. $760M prior year
• Long-term debt at end of Q3 2025: $44,113M vs. $37,224M at fiscal year-end 2024
• Cash and cash equivalents at end of Q3 2025: $8,126M vs. $8,505M at fiscal year-end 2024
• YTD proceeds from issuances of long-term debt: $8,179M; payments of long-term debt: $3,245M

• Ramon Laguarta (Chairman and CEO)
  • "Our reported net revenue growth accelerated and reflects the resilience of our international business, improved momentum within North America Beverages and the benefits of our portfolio reshaping actions."
  • "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."

• Full-year 2025 organic revenue growth: low-single-digit increase expected
• Core constant currency EPS growth: approximately even with the prior year
• Core annual effective tax rate: approximately 20%
• Foreign exchange translation headwind updated to approximately 0.5 percentage points on both reported net revenue and core EPS (previously approximately 1.5 percentage points)
• Updated FX assumption implies a 0.5% decline in core EPS in 2025 vs. 2024 core EPS of $8.16 (previously implied a 1.5% decline)

• Executive Vice President and Chief Financial Officer Stephen (
• Steve
• ) Schmitt
• age 52 — appointed by the Board on October 7
• 2025
• effective November 10
• 2025
• as PepsiCo
• s principal financial officer; previously served as Executive Vice President and Chief Financial Officer for Walmart U.S. since 2021
• EVP and CFO for Walmart U.S. Omni-Channel during 2021
• SVP and CFO for Walmart U.S. eCommerce from 2019 to 2020
• SVP and CFO for Sam
• s Club from 2018 to 2019
• and in investor relations at Walmart from 2016; prior to Walmart held various roles at Yum! Brands from 2006 to 2016; no family relationships with any PepsiCo director or executive officer; no related person transactions

• Stephen Schmitt — annual base salary of $900,000; annual incentive target of 150% of base salary; annual incentive award for fiscal year ending December 27, 2025 will not be prorated and will be determined by achievement of PepsiCo's pre-established performance goals; sign-on bonus of $2,000,000 paid immediately and $1,500,000 paid on the first anniversary of the effective date (November 10, 2025), each subject to clawback if he resigns or is terminated for cause within 24 months after the Effective Date; eligible to participate in PepsiCo's long-term incentive program with an expected March 1, 2026 award with a target grant date value of $5,000,000; special one-time RSU grant with a target grant date value of $7,000,000 following commencement of employment, vesting 50% on the first anniversary and 50% on the second anniversary of the grant date, contingent on continued employment; in the event of termination without cause, entitled to full payment of any unpaid portion of the sign-on bonus and to vest in any unvested portion of the RSU grant; RSU grant is the only equity grant being made in connection with commencement of employment and is intended to offset compensation forfeited upon departure from prior employer
• Jamie Caulfield — pursuant to a transition agreement, will continue to perform services for PepsiCo through May 15, 2026; will continue to receive his current base salary during the transition period; will continue to be eligible to participate in PepsiCo's annual and long-term incentive programs and certain retirement and health and welfare plans; transition agreement includes customary confidentiality, non-competition, non-disparagement, and non-solicitation provisions and a general release of any potential claims against PepsiCo

• Executive Vice President and Chief Financial Officer Jamie Caulfield — retiring from PepsiCo upon completion of a transition arrangement through May 15, 2026; will be succeeded as principal financial officer by Stephen Schmitt on November 10, 2025
• Board Director Darren Walker — notified PepsiCo on October 3, 2025 of his intent to retire from the Board, effective November 19, 2025; retirement was not due to any disagreement with PepsiCo on any matter relating to its operations, policies, or practices; decision based on his desire to pursue other professional opportunities as his tenure as president of the Ford Foundation comes to an end