PepsiCo Announces Moves to Boost Sales, Cut Costs in 2026

PepsiCo CEO Ramon Laguarta announced a plan to boost sales growth and cut costs. (Fabrice Coffrini / AFP / Getty Images)

Key Points

• PepsiCo announced new measures for sales growth, cost reduction, and profit increase starting in 2026.
• Shareholder Elliott Investment Management praised PepsiCo’s plan to invest in affordability, innovation, and cost reduction.
• PepsiCo’s stock was up 0.3% late Monday, after closing up 0.4% at $145.63 in regular trading.

Beverage and snack foods company PepsiCo has announced new measures to boost sales growth, cut costs, and increase profits starting in 2026, after “constructive engagement” with shareholder Elliott Investment Management.

“PepsiCo Foods North America will play a critical role towards achieving these targets and we feel encouraged about the actions and initiatives we are implementing with urgency to improve both marketplace and financial performance,” said Ramon Laguarta, chairman and CEO of PepsiCo. Laguarta will discuss the new initiatives at 7:30 a.m. Eastern time on Tuesday.

To accelerate its organic revenue growth and improve its core operating margin expansion, PepsiCo said it is “acting with a high sense of urgency to improve the marketplace competitiveness and financial performance of PepsiCo Foods North America.”

Plans include implementing affordable price tiers to stimulate sales and increase how frequently consumers buy its mainstream brands, including Lay’s, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, and SodaStream.

It plans to remove artificial colors and flavors, offer simpler ingredients, and increase protein, fiber, and whole grains in some of its products such as Simply NKD Cheetos and Doritos, and the 2026 rollout of Doritos Protein.

PepsiCo also plans to “aggressively” reduce its operating costs. It recently closed three manufacturing plants and shut down several manufacturing lines this year. The company is also reducing the number of its U.S. products by nearly 20% by early 2026.

The changes are expected to deliver full-year organic growth of 2% to 4% in 2026, and be on the high end of that range in the second half of 2026. Acquisitions and currency exchange rates are expected to add up to net revenue growth of 4% to 6% in fiscal 2026. PepsiCo expects core earnings per share to increase approximately 5% to 7% in fiscal 2026.

“We aim to deliver a record year of productivity savings in 2026, benefiting in part from the actions taken in the second half of 2025,” the company said.

Elliott partner Marc Steinberg praised the “collaborative engagement” and “urgency” demonstrated by PepsiCo management. Elliott revealed its $4 billion stake in Pepsi in September, urging it to revive its soft drink business and boost its share price.

“We believe the plan announced today to invest in affordability, accelerate innovation and aggressively reduce costs will drive greater revenue and profit growth,” Steinberg said.

He also said the company would conduct a comprehensive review of its North America supply chain and go-to-market systems, and has committed to refreshing its board, saying the moves “will create substantial value for shareholders as it executes on this plan.”

PepsiCo shares rose 0.3% in after-hours trading on Monday, after closing up 0.4% at $145.63 in regular trading. The company’s stock is down 4.2% through Monday’s close, and down 8.7% over the past 12 months.

PepsiCo will release fourth-quarter and full-year 2025 financial results for the year ended Dec. 27 on Feb. 3.

Write to Janet H. Cho at janet.cho@dowjones.com