PepsiCo posted a surprise drop in third-quarter revenue on Tuesday and cut its forecast for annual sales growth as cautious consumer spending hurt demand.
The Lays chips-maker, with its competitors, has been working to regain sales volumes following a number of price hikes intended to offset high input costs.
Increased prices caused customers to baulk at branded products and switch to cheaper private-label alternatives.
Brands such as PepsiCo and Nestlé are now trying to win shoppers back as inflationary pressures ease.
Shares of the company fell about 1% in premarket trading.
The packaged food giant expects fiscal 2024 organic sales to grow in a low single-digit range. It had previously forecast a 4% rise.
Quarterly revenue was hurt by subdued trends in North America, fallout from product recalls in its Quaker Foods business earlier this year and business disruptions due to rising geopolitical tensions in certain international markets, CEO Ramon Laguarta said.
The Quaker Foods North America segment saw organic revenue slump 13% during the quarter, following an 18% decline in the second quarter.
Net revenue came in at $23.32 bullion in the quarter ending 7 September from $23.45 billion last year.
Analysts estimated a 1.3% jump in revenue to $23.76 billion, according to data compiled by the London Stock Exchange Group.
Read More: PepsiCo To Buy Tortilla Chip-Maker Siete Foods For $1.2bln
