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The company’s shares rose 1.3% in premarket trading after it also raised its annualized dividend by 10% to $5.06 per share.
However, the Frito-Lay maker forecast annual profit below Wall Street estimates, signaling multiple price hikes were likely to dampen demand for its sodas and snacks amid a cost-of-living crisis.
A near duopoly in the carbonated drinks market with Coca-Cola (NYSE:KO) Co helped PepsiCo (NASDAQ:PEP) raise prices over the last few quarters with little pushback as it battles higher freight, commodity and labor costs, as well as the impact of a stronger dollar on international revenue.
PepsiCo’s Quaker Foods North America unit saw fourth-quarter operating profit fall about 3% to $188 million as higher production costs take a bite out of its margins.
On an adjusted basis, the company earned $1.67 per share, beating estimates of $1.65, according to Refinitiv data.
PepsiCo reported net revenue of about $28 billion, compared with estimates of $26.84 billion.
The company’s average prices jumped 16%, while organic volume slipped 2%.
PepsiCo said it expects fiscal 2023 core constant currency earnings of $7.20 per share, compared with estimates of $7.28.
