PepsiCo (NASDAQ:PEP) shares dipped Tuesday after the company’s second-quarter earnings topped estimates, as healthier snacks and sparkling water helped fuel sales growth and offset a drag from foreign exchange.
With a market value of $185.8 billion, its stock is up 20% so far this year. The stock of rival Coca-Cola (NYSE:KO), which has a market value $36 billion higher, has risen only 10% in the same time.
Earnings per share came in at $1.54, adjusted, vs. $1.50 expected.
Revenue was $16.449 billion vs. $16.426 billion expected
The comeback of its North American beverage business continued during the second quarter, helped by its Starbucks (NASDAQ:SBUX) coffee drinks and water business. Its organic revenue grew by 2.2%. As consumers drink less soda, Pepsi has turned to higher-growth beverage categories instead, releasing energy drinks like Mtn Dew Game Fuel and jumping in on the sparkling water trend with Bubly.
Frito-Lay North America was the strongest performer, reporting 5% organic revenue growth. The Cheetos maker credited sales growth in convenience and dollar stores for the unit’s success. Pepsi has also been expanding its line-up of healthier options through brands like Bare, which makes baked fruit and vegetable snacks.
In its North American Quaker Foods business, its cereal and Aunt Jemima maple syrup returned to growth, giving the segment its strongest quarter of organic revenue in three years.
PepsiCo shares lost 69 cents to $131.87 early Tuesday.
