PepsiCo's (NASDAQ:PEP) Q3 Earnings Results: Revenue In Line With Expectations

Food and beverage company PepsiCo (NASDAQ:PEP) met Wall Street’s revenue expectations in Q3 CY2025, with sales up 2.7% year on year to $23.94 billion. Its non-GAAP profit of $2.29 per share was 1.3% above analysts’ consensus estimates.

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Company Overview

With a history that goes back more than a century, PepsiCo (NASDAQ:PEP) is a household name in food and beverages today and best known for its flagship soda.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.

With $92.37 billion in revenue over the past 12 months, PepsiCo is one of the most widely recognized consumer staples companies. Its influence over consumers gives it negotiating leverage with distributors, enabling it to pick and choose where it sells its products (a luxury many don’t have). However, its scale is a double-edged sword because it’s harder to find incremental growth when your existing brands have penetrated most of the market. To expand meaningfully, PepsiCo likely needs to tweak its prices, innovate with new products, or enter new markets.

As you can see below, PepsiCo’s sales grew at a sluggish 3.4% compounded annual growth rate over the last three years as consumers bought less of its products. We’ll explore what this means in the "Volume Growth" section.

This quarter, PepsiCo grew its revenue by 2.7% year on year, and its $23.94 billion of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 3.2% over the next 12 months, similar to its three-year rate. This projection is underwhelming and indicates its newer products will not accelerate its top-line performance yet.

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Volume Growth

Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there’s a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.

To analyze whether PepsiCo generated its growth from changes in price or volume, we can compare its volume growth to its organic revenue growth, which excludes non-fundamental impacts on company financials like mergers and currency fluctuations.

Over the last two years, PepsiCo’s average quarterly sales volumes have shrunk by 2.3%. This decrease isn’t ideal as the quantity demanded for consumer staples products is typically stable. Luckily, PepsiCo was able to offset fewer customers purchasing its products by charging higher prices, enabling it to generate 2.1% average organic revenue growth. We hope the company can grow its volumes soon, however, as consistent price increases (on top of inflation) aren’t sustainable over the long term unless the business is really really special.

In PepsiCo’s Q3 2025, sales volumes dropped 3% year on year. This result represents a further deceleration from its historical levels, showing the business is struggling to move its products.

Key Takeaways from PepsiCo’s Q3 Results

Organic revenue missed slightly, although total revenue ended up in line with expectations and EPS beat slightly. Overall, this was a mixed quarter. The stock remained flat at $139.94 immediately after reporting.

So do we think PepsiCo is an attractive buy at the current price? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it’s free for active Edge members.