1) Strategic Overview and Leadership Insights - PepsiCo reported nearly 7% revenue growth in the first half of 2026, with global volume growth of 3% in foods and 2% in beverages. - The company is focusing on two main pillars: affordability investments and growth in permissible and portion control products. - CEO Ramon Laguarta emphasized the importance of optimizing return on investment for pricing initiatives, particularly in light of changing consumer behaviors due to inflation.

2) Financial Performance and Segment Results - North America saw a gradual improvement in performance, although it was slower than expected, particularly in the convenience and gas channels. - International business remains strong with 7% growth, driven by effective procurement and agility in response to inflation. - Reported EPS grew 6% in the first half, while constant currency EPS grew 3%.

3) Challenges and Headwinds - Rising inflation and gas prices have negatively impacted consumer behavior, particularly in impulse channels. - The North American business is experiencing softer performance than anticipated, necessitating adjustments in pricing strategies and marketing investments. - The company faces ongoing commodity pressures, although tariff refunds are expected to provide some relief.

4) Operational Plans and Product Innovations - PepsiCo is scaling successful innovations in its portfolio, including Naked and Doritos protein, and expanding its permissible portfolio, which has reached $3 billion in sales. - The company is also focusing on enhancing its presence in the away-from-home segment, which slowed in Q2 but is expected to accelerate in the second half. - Plans for increased advertising and marketing expenditures in North America are in place to support growth.

5) Guidance and Outlook - PepsiCo reaffirmed its full-year guidance, anticipating continued strong international performance and gradual improvement in North America. - The company expects EPS growth to be more back-loaded into Q4, with tariff refunds contributing approximately 1 point to EPS growth for the year. - There is an ongoing focus on productivity improvements to fund growth investments without compromising overall profitability.

Bottom line: PepsiCo is navigating a challenging consumer environment with strategic investments in affordability and innovation, while maintaining a strong international growth trajectory. The company is poised for gradual improvement in North America, supported by productivity initiatives and a reaffirmed outlook for the year.