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PepsiCo Tops Q4 Profit Forecast, Boosts Dividend, As Frito Lay Sales Impress

Solid revenue gains at Frito Lay helped PepsiCo deliver stronger-than-expected Q4 earnings and a 7% dividend boost.

Updated at 11:18 am EST

PepsiCo  (PEP) - Get Free Report posted stronger-than-expected fourth quarter earnings Thursday, and unveiled plans for a $10 billion buyback and a dividend boost, as the drinks and snacks giant continues to grapple with surging input costs and uneven demand. 

PepsiCo said core earnings for the three months ending in December were pegged at $1.53 per share, up 4.1% from the same period last year and 1 penny ahead of the Street consensus forecast.

Group revenues, PepsiCo said, rose 12.4% to $25.25 billion, again topping analysts forecasts of a $24.3 billion tally. North American revenues at Frito Lay, its snacks division, came in at $6.12 billion.

Looking into the 2022 financial year, PepsiCo said it sees organic revenue growth of around 6%, with core earnings growing by 8%, delivering a year-end tally of $6.67 per share, around 6 cents shy of the Refinitiv forecast. 

“Our full year net revenue growth meaningfully accelerated in 2021 versus the previous year and this gives us added confidence that the investments we’ve made in our people, brands, innovation, supply chain, go-to-market systems and digitization initiatives are working,” said CEO Ramon Laguarta. 

“Moving forward, we remain committed to building advantaged capabilities that can help us win in the marketplace and become an even faster, even stronger and even better organization," he added. "Importantly, this includes putting sustainability and human capital at the center of everything we do with the recent implementation of PepsiCo Positive (pep+), a fundamental end-to-end transformation of what we do and how we do it to create growth and shared value."

PepsiCo shares were marked 1.45% lower in late morning trading Thursday to change hands at $169.40 each, a move that trims the stock's six-month gain to around 9.9%

PepsiCo also said it would buyback around $10 billion in shares between now and 2026, and boosted its annual dividend by 7%, its 50th consecutive increase.