Basis of Presentation and Our Divisions

6 Months Ended

Jun. 13, 2026

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Other Divisions

Basis of Presentation and Our Segments

Basis of Presentation

When used in this report, the terms “we,” “us,” “our,” “PepsiCo” and the “Company” mean PepsiCo, Inc. and its consolidated subsidiaries, collectively.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) for interim financial information and with the rules and regulations for reporting the Quarterly Report on Form 10-Q (Form 10-Q). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. We have subsidiaries operating in highly inflationary economies, such as Argentina, Egypt and Turkey, and accordingly apply highly inflationary accounting for these subsidiaries. The condensed consolidated balance sheet at December 27, 2025 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in our Annual Report on Form 10-K for the fiscal year ended December 27, 2025 (2025 Form 10-K). This report should be read in conjunction with our 2025 Form 10-K. In our opinion, these financial statements include all normal and recurring adjustments necessary for a fair presentation. The results for the 12 and 24 weeks ended June 13, 2026 are not necessarily indicative of the results expected for any future period or the full year.

Raw materials, direct labor and plant overhead, as well as purchasing and receiving costs, costs directly related to production planning, inspection costs and raw materials handling facilities, are included in cost of sales. The costs of moving, storing and delivering finished product, including merchandising activities, are included in selling, general and administrative expenses.

While our financial results in the United States and Canada (North America) are reported on a 12-week basis, all of our international operations are reported on a monthly calendar basis for which the months of March, April and May are reflected in our results for the 12 weeks ended June 13, 2026 and June 14, 2025 and the months of January through May are reflected in our results for the 24 weeks ended June 13, 2026 and June 14, 2025.

The preparation of our condensed consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and related disclosures. Additionally, the business and economic uncertainty resulting from volatile geopolitical conditions, an increasingly complex global tax environment, including changes in how existing laws are interpreted or enforced, expanded or retaliatory tariffs and changes in the interest rate and inflationary cost environment have made such estimates and assumptions more difficult to calculate. Accordingly, actual results and outcomes could differ from those estimates.

Our significant interim accounting policies include the recognition of a pro rata share of certain estimated annual sales incentives and certain advertising and marketing costs in proportion to revenue or volume, as applicable, and the recognition of income taxes using an estimated annual effective tax rate.

Unless otherwise noted, tabular dollars are in millions, except per share amounts. All per share amounts reflect common per share amounts, assume dilution unless otherwise noted, and are based on unrounded amounts. Certain reclassifications were made to the prior year’s financial statements to conform to the current year presentation.

Our Segments

We are organized into six reportable segments, as follows:

1)PepsiCo Foods North America (PFNA), which includes all of our convenient food businesses in the United States and Canada;

2)PepsiCo Beverages North America (PBNA), which includes all of our beverage businesses in the United States and Canada;

3)International Beverages Franchise (IB Franchise), which includes our international franchise beverage businesses, as well as our SodaStream business;

4)Europe, Middle East and Africa (EMEA), which includes our convenient food businesses and our beverage businesses with company-owned bottlers in Europe, the Middle East and Africa;

5)Latin America Foods (LatAm Foods), which includes all of our convenient food businesses in Latin America; and

6)Asia Pacific Foods, which consists of our convenient food businesses in Asia Pacific, including China, Australia and New Zealand, as well as India.

Net Revenue, Significant Expenses and Operating Profit/(Loss) by Segment


	12 Weeks Ended 6/13/2026
	PFNA		PBNA		IB Franchise		EMEA		LatAm Foods		Asia Pacific Foods		Total
Net revenue	$	6,368	$	7,243	$	1,523	$	4,983	$	2,940	$	1,124	$	24,181
Segment cost of sales (a)	2,498		3,420		437		2,839		1,179		690
Segment selling, general and administrative expenses (a)	2,501		2,831		448		1,377		1,141		300
Restructuring and impairment charges (b)	26		(15)		1		16		4		7
Acquisition and divestiture-related charges/credits (c)	1		(46)		—		—		—		—


Segment operating profit	$	1,342	$	1,053	$	637	$	751	$	616	$	127	$	4,526
Corporate unallocated expenses													(503)
Operating profit													4,023
Other pension and retiree medical benefits income													59
Net interest expense and other													(230)
Income before income taxes													$	3,852


	12 Weeks Ended 6/14/2025
	PFNA		PBNA		IB Franchise		EMEA		LatAm Foods		Asia Pacific Foods		Total
Net revenue	$	6,476	$	6,796	$	1,368	$	4,536	$	2,548	$	1,002	$	22,726
Segment cost of sales (a)	2,471		2,990		400		2,638		1,074		627
Segment selling, general and administrative expenses (a)	2,517		2,812		430		1,241		929		282
Restructuring and impairment charges (b)	91		48		3		36		12		3
Acquisition and divestiture-related charges/credits (c)	6		56		—		—		—		—
Impairment and other charges (d)	—		1,529		—		251		—		80

Segment operating profit/(loss)	$	1,391	$	(639)	$	535	$	370	$	533	$	10	$	2,200
Corporate unallocated expenses													(411)
Operating profit													1,789
Other pension and retiree medical benefits income													42
Net interest expense and other													(260)
Income before income taxes													$	1,571


	24 Weeks Ended 6/13/2026
	PFNA		PBNA		IB Franchise		EMEA		LatAm Foods		Asia Pacific Foods		Total
Net revenue	$	12,700	$	13,634	$	2,347	$	7,806	$	4,874	$	2,263	$	43,624
Segment cost of sales (a)	4,890		6,412		671		4,512		1,959		1,347
Segment selling, general and administrative expenses (a)	4,936		5,591		710		2,226		1,864		564
Restructuring and impairment charges (b)	101		2		8		39		7		8
Acquisition and divestiture-related charges/credits (c)	2		(160)		—		—		—		—


Segment operating profit	$	2,771	$	1,789	$	958	$	1,029	$	1,044	$	344	$	7,935
Corporate unallocated expenses													(699)
Operating profit													7,236
Other pension and retiree medical benefits income													117
Net interest expense and other													(531)
Income before income taxes													$	6,822


	24 Weeks Ended 6/14/2025
	PFNA		PBNA		IB Franchise		EMEA		LatAm Foods		Asia Pacific Foods		Total
Net revenue	$	12,689	$	12,672	$	2,127	$	6,924	$	4,209	$	2,024	$	40,645
Segment cost of sales (a)	4,819		5,649		612		4,045		1,772		1,239
Segment selling, general and administrative expenses (a)	4,807		5,434		698		1,989		1,541		531
Restructuring and impairment charges (b)	115		173		5		49		19		4
Acquisition and divestiture-related charges/credits (c)	21		66		—		—		—		—
Impairment and other charges (d)	—		1,529		—		251		—		80


Segment operating profit/(loss)	$	2,927	$	(179)	$	812	$	590	$	877	$	170	$	5,197
Corporate unallocated expenses													(825)
Operating profit													4,372
Other pension and retiree medical benefits income													65
Net interest expense and other													(524)
Income before income taxes													$	3,913

(a)Does not include items recorded in the cost of sales or selling, general and administrative expenses lines on our income statement that are presented in the restructuring and impairment charges, acquisition and divestiture-related charges/credits and impairment and other charges lines of these tables.

(b)See Note 3 for further information related to restructuring and impairment charges. Income amount represents adjustments for changes in estimates of previously recorded amounts.

(c)See Note 11 for further information related to acquisition and divestiture-related charges/credits.

(d)In the 12 and 24 weeks ended June 14, 2025, we recorded pre-tax charges of $1,860 million ($1,447 million after-tax or $1.05 per share), of which $1,780 million is related to the impairment of the Rockstar brand in our PBNA and EMEA segments. The remaining $80 million is related to the impairment of the Be & Cheery brand in our Asia Pacific Foods segment. See Note 4 for further information.

Disaggregation of Net Revenue

Our primary performance obligation is the distribution and sales of beverage and convenient food products to our customers. The following tables reflect the percentage of net revenue generated between our beverage business and our convenient food business:


	12 Weeks Ended
	6/13/2026				6/14/2025
	Beverages(a)		Convenient Foods		Beverages(a)		Convenient Foods




North America	53	%	47	%	51	%	49	%
International (b)	32	%	68	%	33	%	67	%
PepsiCo	44	%	56	%	43	%	57	%


	24 Weeks Ended
	6/13/2026				6/14/2025
	Beverages(a)		Convenient Foods		Beverages(a)		Convenient Foods




North America	52	%	48	%	50	%	50	%
International (b)	30	%	70	%	31	%	69	%
PepsiCo	43	%	57	%	43	%	57	%

(a)Beverage revenue from company-owned bottlers, which includes our consolidated bottling operations in our PBNA and EMEA segments, was 36% of our consolidated net revenue in each of the 12 and 24 weeks ended June 13, 2026 and June 14, 2025. Generally, our finished goods beverage operations produce higher net revenue but lower operating margins as compared to concentrate sold to authorized bottling partners for the manufacture of finished goods beverages.

(b)Beverage and convenient foods revenue generated from our EMEA segment was 37% and 63% of EMEA net revenue, respectively, in the 12 weeks ended June 13, 2026, 38% and 62% of EMEA net revenue, respectively, in the 12 weeks ended June 14, 2025 and 36% and 64% of EMEA net revenue, respectively, in each of the 24 weeks ended June 13, 2026 and June 14, 2025.

Other Segment Information

Capital spending and depreciation and amortization of each segment are as follows:


	12 Weeks Ended
	Capital Spending(a)				Depreciation and Amortization
	6/13/2026		6/14/2025		6/13/2026		6/14/2025
PFNA	$	211	$	230	$	229	$	230
PBNA	261		283		275		241
IB Franchise	20		30		28		27
EMEA	151		137		160		135
LatAm Foods	107		115		123		100
Asia Pacific Foods	35		68		42		38
Total segment	785		863		857		771
Corporate	34		41		40		36
Total	$	819	$	904	$	897	$	807


	24 Weeks Ended
	Capital Spending(a)				Depreciation and Amortization
	6/13/2026		6/14/2025		6/13/2026		6/14/2025
PFNA	$	321	$	425	$	456	$	440
PBNA	444		531		527		494
IB Franchise	29		46		46		46
EMEA	217		187		261		216
LatAm Foods	148		161		203		162
Asia Pacific Foods	51		92		70		61
Total segment	1,210		1,442		1,563		1,419
Corporate	56		65		76		72
Total	$	1,266	$	1,507	$	1,639	$	1,491

(a)Asset and other balance sheet information for segments is not provided to our chief operating decision maker.