PepsiCo Inc. (NASDAQ:PEP)

The financial results over the observed quarters reveal several noteworthy trends in revenues, costs, profitability, and expenses. The net revenue generally shows a seasonal upward movement each year, with peaks typically observed in the fourth quarter. Over time, there is a consistent increase in net revenue from early 2020 through 2025, reflecting growth in the company’s top line.

Cost of sales moves in tandem with net revenue, also demonstrating a rising trend. The pattern indicates that direct costs grow as sales expand, maintaining a somewhat proportional relationship. However, gross profit exhibits steady growth, which suggests effective cost management relative to increasing revenues. Gross profit margins appear resilient, as gross profit rises consistently despite fluctuations in cost of sales.

Selling, general, and administrative expenses (SG&A) also increase over time in line with revenue growth. The growth in SG&A expenses is steady and somewhat proportional to sales growth. However, spikes in expenses are noted in the fourth quarters of some years, consistent with typical year-end costs or strategic spending periods.

Operating profit fluctuates considerably across quarters with notable volatility around 2022, where an extraordinary gain related to a juice transaction positively impacted the performance. However, impairment charges related to intangible assets negatively affected reported operating profit in multiple quarters during 2022 and 2023, contributing to dips in operating profitability in those periods. Despite these fluctuations, the underlying trend over the longer term is positive growth in operating profit, reflecting overall operational strength.

Net interest expense and other financial charges remain relatively stable with only slight variations across quarters, suggesting consistent financing costs over the period. Pension and retiree medical benefits income or expense fluctuate but tend to be a small component relative to overall profitability and do not materially affect net income trends.

Income before taxes closely mirrors operating profit trends, with pronounced gains in quarters featuring the juice transaction gain and impairments causing volatility. The provision for income taxes varies but generally follows income before taxes, with some quarters showing tax benefits or lower tax charges, likely related to the timing of certain income and expenses or discrete tax events.

Net income attributable to PepsiCo rises steadily with some volatility noted in 2022 and 2023, corresponding with the gain and impairment events described earlier. The overall pattern illustrates strong profitability growth over the observed period, with increases aligned with revenue and operating profit trends. Variability in net income attributable to noncontrolling interests is minor and does not materially impact the consolidated net income.

Revenue Growth

Shows consistent upward movement with seasonal peaks in the fourth quarter, indicating expanding sales.

Cost of Sales and Gross Profit

Costs rise proportionally with revenues but gross profit consistently grows, reflecting effective cost control and healthy margins.

Selling, General & Administrative Expenses

SG&A expenses increase steadily, generally in line with revenue growth, with periodic spikes often seen in year-end quarters.

Operating Profit

Subject to significant volatility due to one-time gains and impairment charges but overall trending upward, demonstrating resilient core operations.

Net Interest and Pension

Relatively stable financial expense and minor pension-related fluctuations, indicating steady financial management.

Income Tax Provision

Varies with income before taxes, with quarters of tax benefits and adjustments reflecting certain discrete tax events.

Net Income

Steady long-term growth with fluctuations linked to unusual gain and impairment events, underlining strong profitability expansion.