San Diego, California — PepsiCo announced on Thursday its quarterly earnings and revenue exceeded analysts’ predictions, despite subdued demand for its products in North America. Following the report, the company saw its stock rise approximately 2% in premarket trading.

The company’s earnings per share reached $2.12, surpassing Wall Street’s expectation of $2.03. Revenues totaled $22.73 billion, directly exceeding projected figures of $22.27 billion. However, net income attributed to the company fell to $1.26 billion, or 92 cents per share, down from $3.08 billion, or $2.23 per share, a year prior.

When adjusting for restructuring charges and other factors, Pepsi’s earnings maintained a stronger position at $2.12 per share. This quarter, net sales managed a modest increase of 1%, while organic revenue—which excludes currency fluctuations and recent acquisitions—rose by 2.1%.

Despite these positive financial metrics, PepsiCo reported a 1.5% decline in global volume for its food products and no growth in beverage volume. North America remained a challenging region, with the company noting a 1% drop in the food division that includes Frito-Lay and Quaker Foods. In the beverage sector, volume fell by 2%, although the flagship Pepsi soda experienced growth during the quarter, alongside notable success for Pepsi Zero Sugar.

To address these market challenges, PepsiCo is focusing on strategies to rejuvenate its North American sales, including tapping into the protein market and expanding multicultural options through brands like Siete Foods and Sabra. The company is also committed to enhancing product visibility and availability within retail spaces.

In an effort to boost efficiency and profitability, PepsiCo has initiated cost-cutting measures, including the closure of two manufacturing plants in its North American food division. The company is also assessing its logistics and transportation strategies to streamline operations effectively.

Moreover, PepsiCo is reevaluating its marketing expenditures to ensure a favorable return on investment, while also exploring synergies between its food and beverage divisions to eliminate redundancies.

Despite the challenges posed by external factors such as economic volatility and changing consumer behavior—exacerbated by recent tariffs—the company reaffirmed its outlook for the remainder of the year. It anticipates that core constant currency earnings per share will remain stable compared to the previous year, with organic revenue projected to increase by a low single-digit percentage.