01—Abstract
Summary
Summary of the 10-K filed February 4, 2025. Cited figures are marked; the original filing is the authoritative source.
PepsiCo, Inc. (PEP) reported solid financial performance in its fiscal year ending December 28, 2024.
The company navigated a challenging operating environment, characterized by ongoing supply chain disruptions, inflation, and evolving consumer preferences, by focusing on productivity, operational optimization, and strategic brand investments. The company's diversified portfolio across beverages and convenient foods, along with its global reach, contributed to its resilience.
PepsiCo highlighted its continued commitment to its pep+ (PepsiCo Positive) transformation, emphasizing sustainability initiatives and portfolio evolution towards healthier options. The company also announced a 5%a increase in its annualized dividend, signaling confidence in its financial health and commitment to shareholder returns, supported by robust free cash flow generation.
02—Key points
Key Highlights
- PepsiCo announced a 5% increase in its annualized dividend to $5.69 per share, signaling confidence in future performance.
- The company plans to return approximately $8.6 billion to shareholders in 2025 through dividends ($7.6 billion) and share repurchases ($1.0 billion).
- Operating profit increased by 8%, driven by effective net pricing and productivity savings, despite a decline in organic volume.
- The Frito-Lay North America (FLNA) and Quaker Foods North America (QFNA) divisions experienced revenue declines, partly due to a voluntary recall of certain Quaker products.
- PepsiCo Beverages North America (PBNA) saw a slight net revenue increase driven by pricing, but experienced a 3% decline in unit volume.
- The company is undergoing significant organizational realignments, including combining its North American food businesses into 'PepsiCo Foods North America' and restructuring international operations.
- PepsiCo continues to invest in productivity initiatives, expanding its 2019 Multi-Year Productivity Plan through 2030 with an estimated pre-tax charge of $6.15 billion.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Pepsico Inc kept $0.10.
- Revenue$91.85B100.0%
- Cost of revenue−$41.74B45.4%
- Gross profit$50.11B54.6%
- Operating costs−$37.22B40.5%
- Operating income$12.89B14.0%
- Interest, other & tax−$3.31B3.6%
- Net income$9.58B10.4%
Where FY2024 revenue went
$91.85B- Cost of revenue: $41.74B, 45% of revenue
- SG&A: $37.19B, 40% of revenue
- Net income: $9.58B, 10% of revenue
- R&D: $813.0M, 0.9% of revenue
- Interest, other & tax: $3.31B, 3.6% of revenue
Kept 10% as net incomeNet income $9.58B · 10%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 4, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $91.85B$91.47B | +0.4% |
| Cost of Revenue | $41.74B$41.88B | −0.3% |
| Gross Profit | $50.11B$49.59B | +1.0% |
| R&D Expenses | $813.00M$804.00M | +1.1% |
| SG&A Expenses | $37.19B$36.68B | +1.4% |
| Operating Income | $12.89B$11.99B | +7.5% |
| Interest Expense | $919.00M$819.00M | +12.2% |
| Net Income | $9.58B$9.07B | +5.6% |
| EPS (Basic) | $6.97$6.59 | +5.8% |
| EPS (Diluted) | $6.95$6.56 | +5.9% |
| Shares Outstanding (Basic) | 1.37B1.38B | −0.2% |
| Shares Outstanding (Diluted) | 1.38B1.38B | −0.4% |
05—Questions
Frequently Asked Questions
What was PepsiCo's overall financial performance for the fiscal year 2024?
PepsiCo reported an 8% increase in operating profit, driven by effective net pricing and productivity savings. While net revenue remained flat year-over-year, the company successfully navigated various market challenges. Net income attributable to PepsiCo increased by 5.5%.
How is PepsiCo returning value to shareholders?
PepsiCo is committed to returning value to shareholders through dividends and share repurchases. For 2025, the company plans to return approximately $8.6 billion to shareholders, comprising $7.6 billion in dividends and $1.0 billion in share repurchases. This includes a 5% increase in the annualized dividend to $5.69 per share.
What were the key divisional performances?
Frito-Lay North America (FLNA) and Quaker Foods North America (QFNA) saw revenue declines, with QFNA particularly impacted by a product recall. PepsiCo Beverages North America (PBNA) experienced a slight revenue increase due to pricing, despite a decrease in organic volume. International divisions like Europe and AMESA showed modest revenue growth, driven by pricing and volume, though unfavorable foreign exchange impacted some regions.
What are the significant risks and challenges highlighted in the report?
PepsiCo faces various risks including shifts in consumer preferences, damage to brand reputation, product recalls, intense competition, supply chain disruptions, commodity price volatility, climate change impacts, cybersecurity threats, and regulatory changes, including potential taxes on products with specific ingredients. The company also notes the ongoing impacts of geopolitical events.
06—Continue