Indra Nooyi is leaving on a high note.
PepsiCo Inc.’s struggling North American beverage unit returned to growth in the third quarter, helping the company beat earnings estimates as the longtime chief executive officer hands the reins to deputy Ramon Laguarta on Wednesday. The maker of Mountain Dew and Tostitos also got a boost from its Frito-Lay unit, the salty-snack powerhouse that has buoyed the company amid a drop in soda consumption.
Core earnings per share were US$1.59, topping the consensus estimate from analysts. Revenue of $16.5 billion also outpaced expectations. However, Pepsi warned that full-year core earnings per share would be US$5.65, down from its prior expectation of US$5.70, citing currency headwinds. The company’s shares slipped 0.7 per cent in light premarket trading Tuesday, having fallen 7.7 per cent this year through the close of trading on Monday.
Amid its recent slump, Nooyi has vowed to fix the beverage unit. The key business has been a sore spot for Pepsi as consumers increasingly turn away from sugary drinks. In addition to pursuing cost cuts to boost profit, Nooyi has diversified the company’s portfolio, adding healthier options to adapt to changing preferences.