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PepsiCo Releases Q1 2022 Results, Surpasses Analysts’ Expectations on Revenue & EPS

UTC by Tolu Ajiboye · 3 min read
PepsiCo Releases Q1 2022 Results, Surpasses Analysts’ Expectations on Revenue & EPS
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PepsiCo has raised raised its revenue forecast for the rest of 2022 from 6% to 8% following strong figures from its Q1 2022 earnings report.

PepsiCo Inc (NASDAQ: PEP) reported its Q1 earnings for 2022 on Tuesday, exceeding Wall Street expectations. The positive quarterly performance for the food, snack, and beverage corporation came from strong product sales. These include Doritos, Quaker oatmeal, Gatorade, and its staple Pepsi carbonated soft drink. In light of a strong Q1 showing, PepsiCo raised its revenue forecast for 2022. The beverage company’s organic revenue growth forecast now stands at 8%, from its initial 6% target.

PepsiCo Q1 2022 Performance

For the first quarter of this year, PepsiCo reported earnings per share of $1.29 adjusted versus the $1.23 expected by analysts. In addition, the globally-renowned beverage corporation raked in revenue of $16.2 billion for the same period. Once more, this sum surpassed the general consensus estimate of $15.56 billion.

Pepsi also reported a Q1 attributable net income of $4.26 billion, or $3.06 per share. This figure marked an increase from the $1.71 billion, or $1.24 per share, reported a year earlier. Furthermore, the company also reported an impairment charge of $193 million after taxes on some of its Russian-based juice and dairy brands. According to Pepsi, the charge affected its overall bottom line, pulling down earnings by up to 14 cents per share.

PepsiCo shares were flat during the premarket trading session.

Russia Business Operations

Pepsi is one of several Western companies that suspended or discontinued operations in Russia over the Ukraine war. However, unlike these other Western brands, including rivals Coca-Cola (NYSE: KO), Pepsi did not entirely halt sales in the Eastern European country. The New York-headquartered food and beverage giant stated that it intends to keep selling essential products. These include baby formula, milk, and baby food. However, sales of Pepsi-Cola, 7UP, and Mirinda in Russia remain suspended by the company. Furthermore, PepsiCo also suspended capital investments as well as all advertising and promotional activities. At the time, Pepsi CEO Ramon Laguarta explained in a memo to employees:

“As a food and beverage company, now more than ever we must stay true to the humanitarian aspect of our business.”

Russia presently represents one of the few markets where Pepsi has a bigger presence than Coca-Cola. The former generates approximately 4% of its annual revenue in the Eastern European nation. On the other hand, Coca-Cola stated that its business in Ukraine and Russia accounted for 1% to 2% of its consolidated net operating revenue and operating income in 2021. Upon total suspension of its own activities in Russia back in March, Coca-Cola said in a statement:

“Our hearts are with the people who are enduring unconscionable effects from these tragic events in Ukraine. We will continue to monitor and assess the situation as circumstances evolve.”

Coca-Cola also posted earnings that surpassed expectations. The company recorded heavy demand for several of its product, including, Coke regular, Coke Zero Sugar, Costa coffee, and Powerade. Its EPS hit 64 cents compared with the expected 58 cents, with a total of $10.5 billion revenue.

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