PepsiCo plans to cut around 1,000 jobs in North America amid restructuring

PepsiCo plans to eliminate around 1,000 jobs across its North American food and beverage businesses as it seeks to streamline operations and revive growth in the region.

The estimated number of job cuts was reported by The Wall Street Journal and Bloomberg, while an internal memo obtained by Reuters outlined the timing and rationale for the restructuring.

Ram Krishnan, chief executive of PepsiCo North America, told employees on Monday, Nov. 9, that the company would introduce organizational changes over the following week. He said the restructuring would bring teams closer together, clarify decision-making responsibilities and allow managers to act more quickly.

“The goal is to move faster, execute better, and invest behind the opportunities that will drive our growth,” Krishnan said in the memo.

PepsiCo employed approximately 306,000 people worldwide at the end of 2025, including around 125,000 in the United States, according to its annual report.

North American sales and volumes under pressure

The planned cuts follow an October warning that sales growth and profit margins in North America were recovering more slowly than the company had anticipated.

Sluggish soda sales and weaker demand for higher-priced snacks have weighed on volume growth, while rising input costs have added pressure on profitability. Chief Financial Officer Steve Schmitt said the company expected North American core operating margins to remain under pressure in the fourth quarter.

North American beverage volumes declined 2% year over year in the third quarter, although reported revenue for the division increased 5%, partly reflecting acquisitions. Organic revenue, which excludes the impact of acquisitions and currency movements, was flat.

The North American food division also reported flat volumes and revenue.

By contrast, PepsiCo’s Europe, Middle East and Africa division recorded stronger results, with organic revenue rising 9%. Beverage volumes increased 4%, while food volumes declined 1%.

Across the group, quarterly net revenue rose 5.6% to $25.3 billion, while organic revenue increased 3.1%.

PepsiCo now expects core earnings per share to grow by 1% to 2% in fiscal 2026, excluding currency movements, down from its previous forecast of growth at the lower end of a 4% to 6% range.

The company maintained its forecast for organic revenue growth of around 3% and kept its planned shareholder returns at $8.9 billion, including $7.9 billion in dividends and $1 billion in share buybacks.

Restructuring follows pressure from activist investor

The latest restructuring comes after Elliott Investment Management disclosed a $4 billion investment in PepsiCo in September 2025 and called for changes to improve the company’s performance.

The activist investor urged PepsiCo to review its North American bottling network, including the possibility of transferring some operations to franchise partners. It also called for food manufacturing costs to be better aligned with demand and for greater investment in the company’s strongest brands.

In December 2025, PepsiCo outlined a turnaround plan backed by Elliott. The company said it had closed three manufacturing plants and several production lines during the year, while announcing plans to reduce the number of products sold in the United States by nearly 20%.

The company said savings from these measures would help fund marketing and make its products more affordable.

PepsiCo began introducing lower suggested retail prices in the United States in February, reducing prices by up to nearly 15% on selected snacks, including Lay’s, Doritos, Cheetos and Tostitos. Pack sizes remained unchanged, with retailers retaining control over final shelf prices.

By the third quarter, the company said affordability measures and new product launches had helped its North American food business gain volume market share year to date, although lower effective prices offset some of the gains in revenue.

Productivity programme continues through 2030

Krishnan was given responsibility for bringing parts of PepsiCo’s food and beverage operations closer together when he was appointed North America chief executive in December 2025. His remit includes field sales for both businesses, franchise operations and PepsiCo Canada.

The company has also been testing combined food and beverage operations in its Texoma region.

Separately, PepsiCo’s longer-term productivity programme, which includes automation and changes to its manufacturing and distribution networks, is scheduled to continue through 2030.

The company recorded $185 million in restructuring and impairment charges under the programme in the third quarter, compared with $141 million a year earlier. Those figures cover the period ended Sept. 5, before employees were informed of the latest planned job cuts.