Higher prices lifted PepsiCo's revenue in the second quarter but dented consumer demand, and the company said Thursday that price increases could start to moderate in the second half of this year.
File - Diet Pepsi Wild Cherry is displayed at a market in Pittsburgh on Thursday, Jan. 26, 2023.
The Purchase, New York, company reported better-than-expected revenue and raised its full-year earnings forecasts. Pepsi’s revenue rose 10% to $22.3 billion, topping Wall Street’s projections for $21.7 billion, according to analysts polled by FactSet.CEO Ramon Laguarta said the company has been surprised by consumers' willingness to keep buying its brands despite higher prices.
Chief Financial Officer Hugh Johnston said the company's price hikes in the second quarter reflected the higher prices it is paying for commodities like cooking oil. But he also said price increases will likely return to the single-digit range in the second half of the year. “It will be important for corporations to continue to bring their markups back down after having raised them to unusually elevated levels over the past 2 years, which would help in reducing inflation,” Brainard said.
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