High costs are causing concern at PepsiCo

Despite a better-than-expected third quarter, PepsiCo is lowering its full-year guidance due to persistently weak demand for snacks and beverages in North America and sharply rising costs.

Cost savings

PepsiCo reported a strong third quarter with a 5.6% increase in revenue and a 17% rise in earnings per share. While these results are at the high end of expectations, the maker of Pepsi, Quaker, Doritos, and Lays is seeing sharply rising costs put pressure on margins, while consumers—particularly in North America—remain cautious due to higher gas prices. International operations performed better.