NEW YORK (AP) — PepsiCo Inc. reported a higher-than-expected profit for its third quarter, as stronger sales of its Frito-Lay snacks helped offset weaker results in its North American beverage unit.
The company, which also makes Gatorade, Mountain Dew and Tropicana, said revenue in its Americas food division rose on a mix of price increases and stronger sales volumes. Despite the company's name, PepsiCo gets about half its revenue from food.
In its closely watched Americas beverage unit, however, revenue slipped as higher prices failed to fully offset a 4 percent volume decline. In North America, soda volume fell in the "mid-single digits."
On Tuesday, Coca-Cola had said its soda volume in North America was flat and that it had gained market share.
PepsiCo has a diverse portfolio of snacks and drinks but its underperforming North American beverage unit has been a sore spot for the company. Activist investor Nelson Peltz's Trian Fund Management is pushing the company to spin off its beverage unit entirely and merge its remaining food business with Oreo cookie maker Mondelez International.
Executives at PepsiCo have shot down the suggestion, saying the company plans to move ahead as a combined drinks and snacks maker. In an interview on Bloomberg TV early Wednesday, Chief Financial Officer Hugh Johnston again addressed Peltz's plans, saying that that management was focused on "meeting the needs of the largest group of shareholders, not necessarily one or two of the loudest."
Still, the company is reviewing a restructuring of its North American beverage unit, including a possible spinoff. That would mean PepsiCo would still be able to sell its drinks in other parts of the world, such as China and Russia, where the products are faring better.
An update of the review isn't expected until early next year.
For its third quarter, PepsiCo earned $1.91 billion, or $1.23 per share. That compares with $1.9 billion, or $1.21 per share, a year ago.
Not including one-time items, the company said it earned $1.24 per share. Analysts expected $1.17 per share.
Revenue rose 2 percent to $16.91 billion, less than the $17.02 billion Wall Street expected. The company stood by its full-year earnings forecast.