PURCHASE (dpa-AFX) - PepsiCo Inc. (PEP) announced that it has reached a collaborative agreement with shareholder Elliott Investment Management to accelerate shareholder value creation through sweeping commercial and financial actions. The plan includes aggressive expense reductions, plant closures, SKU rationalization, and reportedly job cuts tied to operational streamlining, alongside a preliminary 2026 financial outlook. PepsiCo expects organic revenue growth of 2-4 percent next year, supported by productivity savings and margin expansion initiatives.
Chairman and CEO Ramon Laguarta emphasized that PepsiCo Foods North America will be central to delivering record productivity savings and improved operating margins. Actions include sharper pricing strategies to boost affordability, a stronger innovation pipeline with cleaner ingredient offerings, and significant cost reductions. Already, three manufacturing plants have been closed, several production lines shut down, and nearly 20 percent of SKUs are scheduled for elimination in the U.S. by early 2026. Media reports also indicate that job cuts are part of these restructuring efforts.
PepsiCo projects net revenue growth of 4-6 percent in fiscal 2026, aided by acquisitions, divestitures, and favorable currency translation. Core earnings per share is expected to rise 5-7 percent, or 7-9 percent excluding global minimum tax impacts.
The company also anticipates delivering record productivity savings through automation, digitalization, and simplification, with at least 100 basis points of margin expansion over the next three years.
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