PepsiCo Inc: A Global Leader in Beverages and Convenient Foods

PepsiCo, Inc. is a global powerhouse in the food and beverage industry, renowned for its extensive portfolio of iconic brands, innovative strategies, and steadfast commitment to sustainability. Operating in over 200 countries and territories, PepsiCo has solidified its position as a leader in delivering convenient foods and beverages that cater to diverse consumer preferences.

From household staples like Pepsi, Lay’s, and Gatorade to innovative offerings such as SodaStream and Sabra, PepsiCo continues to evolve, adapt, and thrive in a dynamic global market. This in-depth exploration provides a comprehensive look at PepsiCo’s history, operations, financial performance, sustainability initiatives, product and service offerings, leadership, Board of Directors, subsidiaries, detailed financial statements, and future aspirations, offering a detailed perspective on what makes PepsiCo a resilient and forward-thinking organization.

The Legacy of PepsiCo: A Brief History

PepsiCo’s journey began in 1919 with its incorporation in Delaware, followed by reincorporation in North Carolina in 1986. Over the past century, the company has transformed from a single beverage brand into a global conglomerate with a vast portfolio of beverages and convenient foods. The 1965 merger of Pepsi-Cola and Frito-Lay was a defining moment, uniting two industry giants to create a diversified powerhouse. Today, PepsiCo operates under the mission to “Create More Smiles with Every Sip and Every Bite,” reflecting its dedication to consumer satisfaction, innovation, and positive societal impact.

PepsiCo’s growth has been propelled by strategic acquisitions, such as Tropicana, Quaker Oats, and Gatorade, which expanded its portfolio beyond carbonated beverages into juices, snacks, and functional hydration. In 2024, PepsiCo further strengthened its offerings by acquiring full ownership of Sabra Dipping Company, LLC, and Siete Foods, enhancing its presence in better-for-you and multicultural food segments. These strategic moves underscore PepsiCo’s ability to anticipate consumer trends and adapt its portfolio to meet evolving demands.

Detailed Company Profile

Company Overview

PepsiCo, Inc. is a leading global beverage and convenient food company headquartered at 700 Anderson Hill Road, Purchase, NY 10577. Incorporated in Delaware in 1919 and reincorporated in North Carolina in 1986, PepsiCo operates in over 200 countries and territories, serving customers with a complementary portfolio of brands.

The company’s mission, “Create More Smiles with Every Sip and Every Bite,” drives its focus on delivering innovative, enjoyable products while advancing sustainability and community impact. With a market capitalization of $224.8 billion as of June 14, 2024, and 1,371,499,838 shares outstanding as of January 28, 2025, PepsiCo is a well-known seasoned issuer listed on the Nasdaq Stock Market under the ticker PEP.

PepsiCo’s portfolio includes iconic brands such as Pepsi-Cola, Lay’s, Doritos, Cheetos, Gatorade, Quaker, and SodaStream. Strategic acquisitions, including Tropicana, Quaker Oats, and, in 2024, full ownership of Sabra and Siete Foods, have bolstered its offerings, particularly in health-conscious and multicultural segments. Through its operations, authorized bottlers, contract manufacturers, and third parties, PepsiCo manufactures, markets, distributes, and sells a wide variety of beverages and convenient foods, catering to diverse consumer preferences worldwide.

Subsidiaries

PepsiCo operates through a network of subsidiaries that support its global operations, manage regional markets, and drive brand-specific initiatives. These subsidiaries are integral to PepsiCo’s ability to execute its strategy across diverse geographies and product categories. Below is a detailed overview of key subsidiaries:

• Frito-Lay, Inc.: A wholly-owned subsidiary under the Frito-Lay North America (FLNA) segment, based in Plano, Texas, responsible for manufacturing and distributing snacks like Lay’s, Doritos, and Cheetos. It employs approximately 55,000 people and integrated Sabra Dipping Company, LLC in 2024.
• Sabra Dipping Company, LLC: A wholly-owned subsidiary as of December 2024, based in White Plains, New York, specializing in hummus, guacamole, and plant-based dips, with a manufacturing facility in Virginia.
• Quaker Oats Company: A wholly-owned subsidiary under the Quaker Foods North America (QFNA) segment, headquartered in Chicago, Illinois, managing Quaker oatmeal, Cap’n Crunch, and Rice-A-Roni.
• Pepsi-Cola Metropolitan Bottling Company, Inc.: A PepsiCo Beverages North America (PBNA) subsidiary in Purchase, New York, operating bottling and distribution facilities for Pepsi, Gatorade, and Aquafina.
• Tropicana Brands Group (TBG): A joint venture with a 39% PepsiCo stake, based in Chicago, Illinois, managing Tropicana and Naked juices, with PepsiCo as the exclusive U.S. distributor in small-format channels.
• Siete Foods: A 2024 acquisition, based in Austin, Texas, offering Mexican-American foods like grain-free tortillas and chips.
• SodaStream International Ltd.: A wholly-owned subsidiary in Israel, manufacturing sparkling water makers under the Europe segment.
• PepsiCo Global Concentrate Solutions (GCS): Produces beverage concentrates for global bottlers, supporting Pepsi, 7UP, and Mirinda.
• PepsiCo International, Ltd.: Oversees international operations across Latin America (LatAm), Europe, Africa, Middle East, and South Asia (AMESA), and Asia Pacific, Australia, New Zealand, and China (APAC), managing regional brands.
• Wimm-Bill-Dann Foods OJSC: A Russian subsidiary under Europe, producing dairy products like Agusha and Chudo.
• Pioneer Foods Group Ltd.: A South African subsidiary under AMESA, manufacturing Sasko bread and White Star maize meal.

These subsidiaries enable PepsiCo to localize offerings and drive innovation, supported by joint ventures like Lipton with Unilever and Starbucks ready-to-drink coffee.

Products and Services

PepsiCo’s offerings span beverages, convenient foods, and dips across seven reportable segments:

1. Frito-Lay North America (FLNA)

FLNA, managed by Frito-Lay, Inc., offers snacks and dips, including Lay’s potato chips (Sour Cream & Onion), Doritos (Nacho Cheese), Cheetos (Flamin’ Hot), Tostitos with salsa, Fritos, Ruffles, and Sabra hummus and guacamole.

2. Quaker Foods North America (QFNA)

QFNA, managed by Quaker Oats Company, provides Quaker oatmeal (Maple & Brown Sugar), Cap’n Crunch cereal, Life cereal, Pearl Milling Company pancake mixes, Quaker Chewy granola bars, and Rice-A-Roni sides.

3. PepsiCo Beverages North America (PBNA)

PBNA, supported by Pepsi-Cola Metropolitan Bottling Company, Inc., offers Pepsi-Cola, Gatorade (Thirst Quencher), Mountain Dew (Code Red), Aquafina, Bubly sparkling water, Propel, Lipton teas, Starbucks drinks, and licensed brands like Dr Pepper.

4. Latin America (LatAm)

LatAm, managed by PepsiCo International, Ltd., provides Sabritas chips, Marias Gamesa cookies, Pepsi, Gatorade, 7UP, and Manzanita Sol.

5. Europe

Europe, supported by SodaStream International Ltd. and Wimm-Bill-Dann, offers Walkers chips, Lay’s, SodaStream, Pepsi, 7UP, and dairy products like Agusha yogurts.

6. Africa, Middle East, and South Asia (AMESA)

AMESA, supported by Pioneer Foods Group Ltd., provides Kurkure snacks, Chipsy, Sasko bread, Pepsi, 7UP, and Sting Energy.

7. Asia Pacific, Australia, New Zealand, and China Region (APAC)

APAC, managed by PepsiCo International, Ltd., offers Smith’s chips, BaiCaoWei, Lay’s, Pepsi, and Aquafina.

Services

PepsiCo’s services include:

• Manufacturing and Bottling: Operated by subsidiaries like Pepsi-Cola Metropolitan Bottling.
• Distribution: Through bottlers and distributors, including Tropicana Brands Group.
• Direct-to-Consumer: Online sales for SodaStream and Gatorade powders.
• Foodservice: Tosticentros in Mexico for Tostitos-based meals.
• Innovation: SodaStream and Drips mixology stations.

Global Operations: A Diversified Structure

PepsiCo’s seven segments generated $91.654 billion in net revenue in 2024, with international businesses contributing 40%, supported by subsidiaries like Frito-Lay, Inc., and PepsiCo International, Ltd.

Financial Performance in 2024: Resilience Amid Challenges

PepsiCo’s 2024 financial performance reflects its ability to navigate macroeconomic challenges. Below are the consolidated financial statements for 2024, providing a detailed view of its Profit and Loss, Balance Sheet, and Cash Flow Statement.

Consolidated Statement of Income (P&L)

The consolidated statement of income summarizes PepsiCo’s revenue, expenses, and net income for the fiscal year ended December 28, 2024.

(in millions, except per share amounts)	2024	2023
Net Revenue	$91,654	$91,471
Cost of Sales	41,155	41,881
Gross Profit	50,499	49,590
Selling, General and Administrative Expenses	35,839	35,962
Operating Profit	14,660	13,628
Other Pension and Retiree Medical Benefits Income/(Expense)	(88)	(132)
Net Interest Expense and Other	(829)	(819)
Income Before Income Taxes	13,743	12,677
Provision for Income Taxes	3,183	3,615
Net Income	10,560	9,062
Net Income Attributable to Noncontrolling Interests	31	7
Net Income Attributable to PepsiCo	$10,529	$9,055
Net Income Attributable to PepsiCo per Common Share:
Basic	$7.65	$6.57
Diluted	$7.62	$6.56

Note: Core operating profit was $14,698 million in 2024, up 6% from $13,675 million in 2023, reflecting non-GAAP adjustments for restructuring and impairment charges.

Consolidated Balance Sheet

The consolidated balance sheet as of December 28, 2024, provides a snapshot of PepsiCo’s assets, liabilities, and equity.

(in millions)	2024	2023
Assets
Cash and Cash Equivalents	$6,901	$9,707
Short-Term Investments	305	292
Accounts and Notes Receivable, Net	10,815	10,815
Inventories	5,443	5,334
Prepaid Expenses and Other Current Assets	1,155	798
Total Current Assets	24,619	26,946
Property, Plant and Equipment, Net	27,575	27,039
Amortizable Intangible Assets, Net	1,355	1,199
Goodwill	18,503	17,728
Other Indefinite-Lived Intangible Assets	14,165	14,006
Investments in Noncontrolled Affiliates	2,364	2,703
Deferred Income Taxes	4,318	4,474
Other Assets	5,093	5,636
Total Assets	$97,992	$99,731
Liabilities
Short-Term Debt Obligations	$6,510	$6,510
Accounts Payable and Other Current Liabilities	21,124	20,896
Total Current Liabilities	27,634	27,406
Long-Term Debt Obligations	37,511	37,595
Deferred Income Taxes	4,232	4,117
Other Liabilities	7,644	8,721
Total Liabilities	77,021	77,839
Equity
Common Shareholders’ Equity	20,716	21,693
Noncontrolling Interests	255	199
Total Equity	20,971	21,892
Total Liabilities and Equity	$97,992	$99,731

Consolidated Statement of Cash Flows

The consolidated statement of cash flows details PepsiCo’s cash inflows and outflows for 2024.

(in millions)	2024	2023
Operating Activities
Net Income	$10,560	$9,062
Depreciation and Amortization	3,245	3,253
Share-Based Compensation Expense	374	374
Restructuring and Impairment Charges	425	433
Cash Payments for Restructuring Charges	(346)	(389)
Pension and Retiree Medical Plan Expenses	104	132
Pension and Retiree Medical Plan Contributions	(460)	(446)
Deferred Income Taxes and Other Tax Charges and Credits	(1,033)	(262)
Other, Net	(188)	1,143
Changes in Operating Assets and Liabilities:
Accounts and Notes Receivable	(294)	(618)
Inventories	(207)	339
Prepaid Expenses and Other Current Assets	(374)	(18)
Accounts Payable and Other Current Liabilities	759	(1,054)
Net Cash Provided by Operating Activities	12,565	11,949
Investing Activities
Capital Spending	(5,318)	(5,518)
Purchases of Property, Plant and Equipment	(5,210)	(5,302)
Acquisitions, Net of Cash Acquired, Investments in Noncontrolled Affiliates, and Divestitures	(1,299)	(208)
Other Investing, Net	(44)	(178)
Net Cash Used for Investing Activities	(6,661)	(5,904)
Financing Activities
Proceeds from Issuances of Long-Term Debt	2,986	5,484
Payments of Long-Term Debt	(2,656)	(2,278)
Short-Term Borrowings, Net	(563)	2,599
Cash Dividends Paid	(7,229)	(6,682)
Share Repurchases	(1,000)	(1,000)
Other Financing, Net	(46)	(160)
Net Cash Used for Financing Activities	(8,508)	(2,037)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(202)	(10)
Net Increase/(Decrease) in Cash and Cash Equivalents	(2,806)	3,998
Cash and Cash Equivalents, Beginning of Year	9,707	5,709
Cash and Cash Equivalents, End of Year	$6,901	$9,707
Free Cash Flow (Non-GAAP)	$7,531	$8,122

Note: Free cash flow is calculated as net cash provided by operating activities less capital spending and certain other items.

Financial Performance Summary

PepsiCo’s 2024 financial highlights include:

• Net Revenue: $91.654 billion, flat compared to $91.471 billion in 2023, indicating stable demand.
• Core Operating Profit: $14.698 billion, up 6% from $13.675 billion, driven by operational efficiencies.
• Reported EPS: $6.95, up 6% from $6.56.
• Core EPS: $8.16, up 7% from $7.62, reflecting strong profitability.
• Free Cash Flow: $7.531 billion, down 7% from $8.122 billion, due to increased growth investments.
• Capital Spending: $5.318 billion, down 4% from $5.518 billion, showing disciplined allocation.
• Dividends Paid: $7.229 billion, up 8% from $6.682 billion, underscoring shareholder commitment.
• Share Repurchases: $1 billion, consistent with 2023 levels.

Over the past five years, PepsiCo’s net revenue has grown by 37% to nearly $92 billion, while core EPS has increased by 48%. The international business, contributing 40% of net revenue and 39% of core division operating profit, has delivered a 10% compound annual growth rate in core operating profit.

PepsiCo Positive (pep+): Driving Sustainability

PepsiCo Positive (pep+) integrates sustainability into three pillars:

Positive Agriculture

In 2024, PepsiCo launched the Climate Resilience Platform (CRP), providing farmers with climate insights to boost yields and reduce environmental impact.

Positive Value Chain

PepsiCo achieved its 2025 water efficiency goals early and incorporated recycled plastic (rPET) in packaging across approximately 60 countries.

Positive Choices

The company introduced Gatorade Hydration Booster, Quaker Oat “Rice” in Brazil, and acquired Sabra and Siete Foods to expand its healthier product portfolio.

Strategic Pillars for Future Growth

PepsiCo’s growth strategy focuses on four pillars:

• Evolving the Portfolio: Expanding no-sugar beverages (Pepsi Zero Sugar, Bubly), functional products (Gatorade Hydration Booster), and multicultural offerings (Sabritas, Siete Foods).
• Expanding Availability: Targeting high-growth channels like foodservice and new markets in AMESA and APAC.
• Modernizing the Company: Leveraging digital platforms and standardized processes for efficiency.
• Sustainability with pep+: Embedding sustainable practices to enhance resilience.

These pillars position PepsiCo to capitalize on a $1.3 trillion global market, with significant growth potential in emerging regions.

Leadership and Governance

PepsiCo’s success is driven by a talented leadership team, led by Ramon L. Laguarta, Chairman and CEO, who has advanced sustainability and global strategy. The executive team includes:

• James T. Caulfield: EVP and Chief Financial Officer, overseeing financial strategy.
• Jim Andrew: EVP and Chief Sustainability Officer, leading pep+ initiatives.
• Ram Krishnan: CEO, U.S. Beverages, managing PBNA operations.
• Rachel Ferdinando: CEO, U.S. Foods, overseeing FLNA and QFNA.
• René Lammers: EVP and Chief Science Officer, driving product innovation.

Board of Directors

As of March 28, 2025, PepsiCo’s Board of Directors comprises 15 members with diverse expertise:

• Segun Agbaje: Group CEO, Guaranty Trust Holding Company Plc, with expertise in African financial services.
• Jennifer Bailey: Vice President, Internet Services, Apple Pay, Apple, Inc., offering technology and digital payments insights.
• Cesar Conde: Chairman, NBCUniversal News Group, contributing media expertise.
• Ian M. Cook: Former Chairman, President, and CEO, Colgate-Palmolive Company, with consumer goods experience.
• Edith W. Cooper: Former EVP, Goldman Sachs, bringing HR and diversity expertise.
• Susan M. Diamond: CEO, Humana Inc., offering healthcare perspectives.
• Dina Dublon: Former EVP and CFO, JPMorgan Chase & Co., providing financial acumen.
• Michelle Gass: President and CEO, Levi Strauss & Co., contributing retail expertise.
• Ramon L. Laguarta: Chairman and CEO, PepsiCo, with 28 years of industry experience.
• Dave J. Lewis: Former Group CEO, Tesco PLC, with retail and supply chain expertise.
• David C. Page, M.D.: Director, Whitehead Institute, offering scientific innovation perspectives.
• Robert C. Pohlad: Former Chairman and CEO, PepsiAmericas, Inc., with beverage industry knowledge.
• Daniel L. Vasella, M.D.: Former Chairman and CEO, Novartis AG, providing healthcare insights.
• Darren Walker: President, Ford Foundation, contributing social impact expertise.
• Alberto Weisser: Former Chairman and CEO, Bunge Limited, offering agribusiness knowledge.

The Board serves on committees like Audit, Compensation, and Sustainability, ensuring robust oversight.

Corporate Citizenship and Community Impact

PepsiCo’s 2024 giving totaled $142 million, including donations from the PepsiCo Foundation, corporate, and division levels, and in-kind support. Initiatives like donating Quaker Oat “Rice” profits in Brazil to address food insecurity highlight its social impact focus. Brand-led efforts, such as Gatorade’s youth sports programs and Lay’s support for local agriculture, reinforce PepsiCo’s role as a responsible corporate citizen.

Market Opportunity and Future Outlook

PepsiCo operates in a $1.3 trillion global market, with 60% of its business from regions representing 5% of the population, leaving vast growth potential. Future goals include:

• Innovation: Launching functional and plant-based products.
• Global Expansion: Deepening penetration in AMESA and APAC.
• Sustainability: Targeting net-zero emissions by 2040 and 100% recyclable packaging by 2025.
• Efficiency: Leveraging digital transformation for profitability.

Conclusion

PepsiCo is a resilient, innovative leader with a diverse portfolio, robust subsidiaries, strong governance, and solid financial performance. Its global operations, pep+ strategy, and commitment to consumer and planetary needs ensure continued leadership in the food and beverage industry, delivering smiles with every sip and bite.