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Basis of Presentation

When used in this report, the terms “we,” “us,” “our,” “PepsiCo” and the “Company” mean PepsiCo, Inc. and its consolidated subsidiaries, collectively.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP) for interim financial information and with the rules and regulations for reporting the Quarterly Report on Form 10-Q (Form 10-Q). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. We have subsidiaries operating in highly inflationary economies, such as Argentina, Egypt and Turkey, and accordingly apply highly inflationary accounting for these subsidiaries. The condensed consolidated balance sheet at December 27, 2025 has been derived from the audited consolidated financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied in our Annual Report on Form 10-K for the fiscal year ended December 27, 2025 (2025 Form 10-K). This report should be read in conjunction with our 2025 Form 10-K. In our opinion, these financial statements include all normal and recurring adjustments necessary for a fair presentation. The results for the 12 and 24 weeks ended June 13, 2026 are not necessarily indicative of the results expected for any future period or the full year.

Raw materials, direct labor and plant overhead, as well as purchasing and receiving costs, costs directly related to production planning, inspection costs and raw materials handling facilities, are included in cost of sales. The costs of moving, storing and delivering finished product, including merchandising activities, are included in selling, general and administrative expenses.

While our financial results in the United States and Canada (North America) are reported on a 12-week basis, all of our international operations are reported on a monthly calendar basis for which the months of March, April and May are reflected in our results for the 12 weeks ended June 13, 2026 and June 14, 2025 and the months of January through May are reflected in our results for the 24 weeks ended June 13, 2026 and June 14, 2025.

The preparation of our condensed consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and related disclosures. Additionally, the business and economic uncertainty resulting from volatile geopolitical conditions, an increasingly complex global tax environment, including changes in how existing laws are interpreted or enforced, expanded or retaliatory tariffs and changes in the interest rate and inflationary cost environment have made such estimates and assumptions more difficult to calculate. Accordingly, actual results and outcomes could differ from those estimates.

Our significant interim accounting policies include the recognition of a pro rata share of certain estimated annual sales incentives and certain advertising and marketing costs in proportion to revenue or volume, as applicable, and the recognition of income taxes using an estimated annual effective tax rate.

Unless otherwise noted, tabular dollars are in millions, except per share amounts. All per share amounts reflect common per share amounts, assume dilution unless otherwise noted, and are based on unrounded amounts. Certain reclassifications were made to the prior year’s financial statements to conform to the current year presentation.

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Our Segments

We are organized into six reportable segments, as follows:

1)PepsiCo Foods North America (PFNA), which includes all of our convenient food businesses in the United States and Canada;

2)PepsiCo Beverages North America (PBNA), which includes all of our beverage businesses in the United States and Canada;

3)International Beverages Franchise (IB Franchise), which includes our international franchise beverage businesses, as well as our SodaStream business;

4)Europe, Middle East and Africa (EMEA), which includes our convenient food businesses and our beverage businesses with company-owned bottlers in Europe, the Middle East and Africa;

5)Latin America Foods (LatAm Foods), which includes all of our convenient food businesses in Latin America; and

6)Asia Pacific Foods, which consists of our convenient food businesses in Asia Pacific, including China, Australia and New Zealand, as well as India.

Net Revenue, Significant Expenses and Operating Profit/(Loss) by Segment

			12 Weeks Ended 6/13/2026
			PFNA						PBNA						IB Franchise						EMEA						LatAm Foods						Asia Pacific Foods						Total
Net revenue			$	6,368					$	7,243					$	1,523					$	4,983					$	2,940					$	1,124					$	24,181
Segment cost of sales (a)			2,498						3,420						437						2,839						1,179						690
Segment selling, general and administrative expenses (a)			2,501						2,831						448						1,377						1,141						300
Restructuring and impairment charges (b)			26						(15)						1						16						4						7
Acquisition and divestiture-related charges/credits (c)			1						(46)						—						—						—						—
Segment operating profit			$	1,342					$	1,053					$	637					$	751					$	616					$	127					$	4,526
Corporate unallocated expenses																																							(503)
Operating profit																																							4,023
Other pension and retiree medical benefits income																																							59
Net interest expense and other																																							(230)
Income before income taxes																																							$	3,852

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			12 Weeks Ended 6/14/2025
			PFNA						PBNA						IB Franchise						EMEA						LatAm Foods						Asia Pacific Foods						Total
Net revenue			$	6,476					$	6,796					$	1,368					$	4,536					$	2,548					$	1,002					$	22,726
Segment cost of sales (a)			2,471						2,990						400						2,638						1,074						627
Segment selling, general and administrative expenses (a)			2,517						2,812						430						1,241						929						282
Restructuring and impairment charges (b)			91						48						3						36						12						3
Acquisition and divestiture-related charges/credits (c)			6						56						—						—						—						—
Impairment and other charges (d)			—						1,529						—						251						—						80
Segment operating profit/(loss)			$	1,391					$	(639)					$	535					$	370					$	533					$	10					$	2,200
Corporate unallocated expenses																																							(411)
Operating profit																																							1,789
Other pension and retiree medical benefits income																																							42
Net interest expense and other																																							(260)
Income before income taxes																																							$	1,571

			24 Weeks Ended 6/13/2026
			PFNA						PBNA						IB Franchise						EMEA						LatAm Foods						Asia Pacific Foods						Total
Net revenue			$	12,700					$	13,634					$	2,347					$	7,806					$	4,874					$	2,263					$	43,624
Segment cost of sales (a)			4,890						6,412						671						4,512						1,959						1,347
Segment selling, general and administrative expenses (a)			4,936						5,591						710						2,226						1,864						564
Restructuring and impairment charges (b)			101						2						8						39						7						8
Acquisition and divestiture-related charges/credits (c)			2						(160)						—						—						—						—
Segment operating profit			$	2,771					$	1,789					$	958					$	1,029					$	1,044					$	344					$	7,935
Corporate unallocated expenses																																							(699)
Operating profit																																							7,236
Other pension and retiree medical benefits income																																							117
Net interest expense and other																																							(531)
Income before income taxes																																							$	6,822

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			24 Weeks Ended 6/14/2025
			PFNA						PBNA						IB Franchise						EMEA						LatAm Foods						Asia Pacific Foods						Total
Net revenue			$	12,689					$	12,672					$	2,127					$	6,924					$	4,209					$	2,024					$	40,645
Segment cost of sales (a)			4,819						5,649						612						4,045						1,772						1,239
Segment selling, general and administrative expenses (a)			4,807						5,434						698						1,989						1,541						531
Restructuring and impairment charges (b)			115						173						5						49						19						4
Acquisition and divestiture-related charges/credits (c)			21						66						—						—						—						—
Impairment and other charges (d)			—						1,529						—						251						—						80
Segment operating profit/(loss)			$	2,927					$	(179)					$	812					$	590					$	877					$	170					$	5,197
Corporate unallocated expenses																																							(825)
Operating profit																																							4,372
Other pension and retiree medical benefits income																																							65
Net interest expense and other																																							(524)
Income before income taxes																																							$	3,913

(a)Does not include items recorded in the cost of sales or selling, general and administrative expenses lines on our income statement that are presented in the restructuring and impairment charges, acquisition and divestiture-related charges/credits and impairment and other charges lines of these tables.

(b)See Note 3 for further information related to restructuring and impairment charges. Income amount represents adjustments for changes in estimates of previously recorded amounts.

(c)See Note 11 for further information related to acquisition and divestiture-related charges/credits.

(d)In the 12 and 24 weeks ended June 14, 2025, we recorded pre-tax charges of $1,860 million ($1,447 million after-tax or $1.05 per share), of which $1,780 million is related to the impairment of the Rockstar brand in our PBNA and EMEA segments. The remaining $80 million is related to the impairment of the Be & Cheery brand in our Asia Pacific Foods segment. See Note 4 for further information.

Disaggregation of Net Revenue

Our primary performance obligation is the distribution and sales of beverage and convenient food products to our customers. The following tables reflect the percentage of net revenue generated between our beverage business and our convenient food business:

			12 Weeks Ended
			6/13/2026												6/14/2025
			Beverages(a)						Convenient Foods						Beverages(a)						Convenient Foods
North America			53		%				47		%				51		%				49		%
International (b)			32		%				68		%				33		%				67		%
PepsiCo			44		%				56		%				43		%				57		%

			24 Weeks Ended
			6/13/2026												6/14/2025
			Beverages(a)						Convenient Foods						Beverages(a)						Convenient Foods
North America			52		%				48		%				50		%				50		%
International (b)			30		%				70		%				31		%				69		%
PepsiCo			43		%				57		%				43		%				57		%

(a)Beverage revenue from company-owned bottlers, which includes our consolidated bottling operations in our PBNA and EMEA segments, was 36% of our consolidated net revenue in each of the 12 and 24 weeks ended June 13, 2026 and June 14, 2025. Generally, our finished goods beverage operations produce higher net revenue but lower operating margins as compared to concentrate sold to authorized bottling partners for the manufacture of finished goods beverages.

(b)Beverage and convenient foods revenue generated from our EMEA segment was 37% and 63% of EMEA net revenue, respectively, in the 12 weeks ended June 13, 2026, 38% and 62% of EMEA net revenue, respectively, in the 12 weeks ended June 14, 2025 and 36% and 64% of EMEA net revenue, respectively, in each of the 24 weeks ended June 13, 2026 and June 14, 2025.

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Other Segment Information

Capital spending and depreciation and amortization of each segment are as follows:

			12 Weeks Ended
			Capital Spending(a)												Depreciation and Amortization
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
PFNA			$	211					$	230					$	229					$	230
PBNA			261						283						275						241
IB Franchise			20						30						28						27
EMEA			151						137						160						135
LatAm Foods			107						115						123						100
Asia Pacific Foods			35						68						42						38
Total segment			785						863						857						771
Corporate			34						41						40						36
Total			$	819					$	904					$	897					$	807

			24 Weeks Ended
			Capital Spending(a)												Depreciation and Amortization
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
PFNA			$	321					$	425					$	456					$	440
PBNA			444						531						527						494
IB Franchise			29						46						46						46
EMEA			217						187						261						216
LatAm Foods			148						161						203						162
Asia Pacific Foods			51						92						70						61
Total segment			1,210						1,442						1,563						1,419
Corporate			56						65						76						72
Total			$	1,266					$	1,507					$	1,639					$	1,491

(a)Asset and other balance sheet information for segments is not provided to our chief operating decision maker.

Adopted

In July 2025, the Financial Accounting Standards Board (FASB) issued guidance to provide for a practical expedient that an entity may assume that conditions as of the balance sheet date remain unchanged over the remaining life of the asset when estimating expected credit losses for current accounts receivable and current contract assets arising from revenue transactions from contracts with customers. We adopted the guidance in the first quarter of 2026, on a prospective basis. The adoption did not have a material impact on our condensed consolidated financial statements.

Not Yet Adopted

In September 2025, the FASB issued guidance to improve the accounting for costs related to internal-use software. The new guidance eliminates project stages and requires capitalizing software costs to begin when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. When evaluating if a project is probable to be completed, significant development uncertainty must be assessed. Additionally, disclosures for property, plant and equipment will be required for all capitalized software costs. The guidance is effective in the first quarter of 2028 with early adoption permitted as of the beginning of an annual reporting period. Upon adoption, the guidance may be applied prospectively,

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retrospectively or using a modified transition approach. We are evaluating the impact of this guidance on our consolidated financial statements.

In November 2024, the FASB issued guidance to improve the disclosure of expenses in commonly presented expense captions. The new guidance requires a public entity to provide tabular disclosure, on an annual and interim basis, of amounts for the following expense categories: (1) purchases of inventory, (2) employee compensation, (3) depreciation and (4) intangible asset amortization, as included in each relevant expense caption. A relevant expense caption is an expense caption presented on the face of the income statement that contains any of the expense categories noted. Additionally, on an annual and interim basis, a qualitative description is required for amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. The guidance also requires certain amounts that are currently required to be disclosed to be included in the same tabular disclosure as these disaggregation requirements. Furthermore, on an annual and interim basis, a public entity is required to separately disclose selling expenses and annually, disclose a description of the selling expenses. The guidance is effective for 2027 annual reporting, and in the first quarter of 2028 for interim reporting, with early adoption permitted, to be applied on a prospective basis, with retrospective application permitted. We will adopt the guidance when it becomes effective, in our 2027 annual reporting and each quarter thereafter, on a prospective basis.

2019 Multi-Year Productivity Plan (2019 Productivity Plan)

The 2019 Productivity Plan leverages new technology and business models to further simplify, harmonize and automate processes; re-engineers our go-to-market and information systems, including deploying the right automation for each market; and simplifies our organization and optimizes our manufacturing and supply chain footprint. To build on the successful implementation of the 2019 Productivity Plan, in 2024, we further expanded and extended the plan through the end of 2030 to take advantage of additional opportunities within the initiatives described above. As a result, we expect to incur pre-tax charges of approximately $6.15 billion, including cash expenditures of approximately $5.1 billion. These pre-tax charges are expected to consist of approximately 50% of severance and other employee-related costs, 15% for asset impairments (all non-cash) resulting from plant closures and related actions, and 35% for other costs associated with the implementation of our initiatives.

The total plan pre-tax charges are expected to be incurred by segment approximately as follows:

			PFNA						PBNA						IB Franchise						EMEA						LatAm Foods						Asia Pacific Foods						Corporate
Expected pre-tax charges			20		%				25		%				2		%				25		%				10		%				3		%				15		%

A summary of our 2019 Productivity Plan charges is as follows:

			12 Weeks Ended												24 Weeks Ended
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
Cost of sales (a)			$	(1)					$	102					$	18					$	103
Selling, general and administrative expenses			50						113						163						309
Other pension and retiree medical benefits (income)/expense (a)			—						(2)						1						14
Total restructuring and impairment charges			$	49					$	213					$	182					$	426
After-tax amount			$	39					$	160					$	141					$	351
Impact on net income attributable to PepsiCo per common share			$	(0.03)					$	(0.12)					$	(0.10)					$	(0.26)

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			12 Weeks Ended												24 Weeks Ended												Plan-to-Date
			6/13/2026						6/14/2025						6/13/2026						6/14/2025						through 6/13/2026
PFNA			$	26					$	91					$	101					$	115					$	877
PBNA (a)			(15)						48						2						173						788
IB Franchise			1						3						8						5						73
EMEA			16						36						39						49						995
LatAm Foods			4						12						7						19						306
Asia Pacific Foods			7						3						8						4						107
Corporate			10						22						16						47						500
			49						215						181						412						3,646
Other pension and retiree medical benefits (income)/expense (a)			—						(2)						1						14						146
Total			$	49					$	213					$	182					$	426					$	3,792

(a)Income amount represents adjustments for changes in estimates of previously recorded amounts.

			12 Weeks Ended												24 Weeks Ended												Plan-to-Date
			6/13/2026						6/14/2025						6/13/2026						6/14/2025						through 6/13/2026
Severance and other employee costs			$	15					$	64					$	51					$	122					$	1,840
Asset impairments			—						85						59						87						605
Other costs			34						64						72						217						1,347
Total			$	49					$	213					$	182					$	426					$	3,792

Severance and other employee costs primarily include severance and other termination benefits. Other costs primarily include costs associated with the implementation of our initiatives, including contract termination costs, consulting and other professional fees.

A summary of our 2019 Productivity Plan activity for the 24 weeks ended June 13, 2026 is as follows:

			Severance and Other Employee Costs						Asset Impairments						Other Costs						Total
Liability as of December 27, 2025			$	308					$	—					$	18					$	326
Restructuring charges			51						59						72						182
Cash payments (a)			(172)						—						(92)						(264)
Non-cash charges and translation			(1)						(59)						12						(48)
Liability as of June 13, 2026			$	186					$	—					$	10					$	196

(a)Excludes cash expenditures of $2 million reported in the cash flow statement in pension and retiree medical plan contributions.

The majority of the restructuring accrual at June 13, 2026 is expected to be paid within a year.

Other Productivity Initiatives

There were no material charges related to other productivity and efficiency initiatives outside the scope of the 2019 Productivity Plan.

We regularly evaluate different productivity initiatives beyond the productivity plan and other initiatives described above.

For information on additional impairment charges, see Notes 1 and 4 for impairment and other charges taken related to the impairments of the Rockstar and Be & Cheery brands.

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A summary of our amortizable intangible assets is as follows:

						6/13/2026																		12/27/2025
						Gross						Accumulated Amortization						Net						Gross						Accumulated Amortization						Net
Acquired franchise rights						$	831					$	(250)					$	581					$	835					$	(244)					$	591
Customer relationships						782						(372)						410						773						(347)						426
Brands						1,086						(1,027)						59						1,084						(1,021)						63
Other identifiable intangibles						434						(297)						137						433						(294)						139
Total						$	3,133					$	(1,946)					$	1,187					$	3,125					$	(1,906)					$	1,219

The components of indefinite-lived intangible assets are as follows:

			6/13/2026						12/27/2025
Goodwill (a)			$	19,093					$	18,916
Other indefinite-lived intangible assets
Reacquired franchise rights			7,532						7,542
Acquired franchise rights (b)			2,239						2,099
Brands			4,219						4,206
Total indefinite-lived intangible assets			$	33,083					$	32,763

(a)Increase primarily reflects appreciation of the Russian ruble and South African rand.

(b)Increase is primarily related to acquired distribution rights for the Alani Nu brand.

During the 12 weeks ended June 14, 2025, business performance in conjunction with lower expectations of future business performance compared to projections, as well as in contemplation of the Celsius Transaction described in Note 4 to our consolidated financial statements in our 2025 Form 10-K, indicated a deterioration of the significant inputs used to determine the fair value of our indefinite-lived intangible assets in certain markets and required us to perform a quantitative assessment on certain assets. The fair value of our indefinite-lived intangible assets was estimated using discounted cash flows under the income approach, which we consider to be a Level 3 (significant unobservable inputs) measurement. We determined that the carrying value exceeded the fair value, which reflected our most current estimates of future sales and their contributions to operating profit and expected future cash flows (including perpetuity growth assumptions), as well as an increase in the weighted-average cost of capital. As a result of the quantitative assessment, we recorded pre-tax impairment charges of $1.9 billion ($1.4 billion after-tax or $1.05 per share) in impairment of intangible assets, primarily comprised of the Rockstar brand in our PBNA and EMEA segments.

We continuously monitor the performance of all our indefinite-lived intangible assets and will perform our annual impairment assessment during our third quarter; for further information on our policies for indefinite-lived intangible assets, see Note 2 to our consolidated financial statements in our 2025 Form 10-K.

Starting with awards granted in 2026, RSUs and stock options will primarily vest ratably over three years and amortized to expense on a straight-line basis. Additionally, certain executive officers and other senior executives who were previously granted 66% PSUs and 34% long-term cash were granted 60% PSUs and 40% RSUs in 2026. For PSUs granted in 2026, the final payout will be determined over a three-year period based on achievement of specified pre-established financial performance metrics, with PepsiCo’s total shareholder return relative to a specific set of peer companies acting as a multiplier. The Monte Carlo valuation model is used to determine the grant date fair value of the award, reflective of the total

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shareholder return market condition. Share-based compensation expense is adjusted for changes in the expected achievement of pre-established financial performance metrics throughout the three-year performance period.

The following table summarizes our total share-based compensation expense, which is primarily recorded in selling, general and administrative expenses:

			12 Weeks Ended												24 Weeks Ended
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
Share-based compensation expense – equity awards			$	69					$	54					$	162					$	131
Share-based compensation expense – liability awards			3						(7)						5						(3)
Restructuring charges			(1)						(1)						—						(2)
Total			$	71					$	46					$	167					$	126

The following table summarizes share-based awards granted under the terms of the PepsiCo, Inc. Long-Term Incentive Plan:

			24 Weeks Ended
			6/13/2026												6/14/2025
			Granted(a)						Weighted-Average Grant Price						Granted(a)						Weighted-Average Grant Price
Stock options			0.9						$	169.25					1.4						$	153.75
RSUs and PSUs			2.4						$	169.25					2.1						$	153.71

(a)In millions. All grant activity is disclosed at target.

For the 12 weeks ended June 13, 2026 and June 14, 2025, our grants of stock options, RSUs and PSUs were nominal.

We granted long-term cash awards to certain executive officers and other senior executives with an aggregate target value of $22 million during the 24 weeks ended June 14, 2025. Long-term cash awards granted for the 12 weeks ended June 14, 2025 were nominal.

Our weighted-average Black-Scholes fair value assumptions are as follows: 

			24 Weeks Ended
			6/13/2026						6/14/2025
Expected life			7 years						7 years
Risk-free interest rate			3.7		%				4.1		%
Expected volatility			16		%				16		%
Expected dividend yield			3.5		%				3.4		%

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The components of net periodic benefit cost/(income) for pension and retiree medical plans are as follows:

			12 Weeks Ended
			Pension																								Retiree Medical
			U.S.												International
			6/13/2026						6/14/2025						6/13/2026						6/14/2025						6/13/2026						6/14/2025
Service cost			$	54					$	73					$	13					$	11					$	9					$	7
Other pension and retiree medical benefits (income)/expense:
Interest cost			120						135						37						36						6						7
Expected return on plan assets			(191)						(186)						(51)						(47)						(2)						(3)
Amortization of prior service cost/(credits)			2						—						—						—						(1)						(1)
Amortization of net losses/(gains)			17						20						8						6						(4)						(6)
Settlement/curtailment gains			—						—						—						(1)						—						—
Special termination benefits			—						(2)						—						—						—						—
Total other pension and retiree medical benefits income			(52)						(33)						(6)						(6)						(1)						(3)
Total			$	2					$	40					$	7					$	5					$	8					$	4

			24 Weeks Ended
			Pension																								Retiree Medical
			U.S.												International
			6/13/2026						6/14/2025						6/13/2026						6/14/2025						6/13/2026						6/14/2025
Service cost			$	108					$	145					$	23					$	19					$	17					$	14
Other pension and retiree medical benefits (income)/expense:
Interest cost			240						270						65						62						12						14
Expected return on plan assets			(382)						(372)						(90)						(83)						(4)						(5)
Amortization of prior service cost/(credits)			4						1						—						—						(2)						(2)
Amortization of net losses/(gains)			34						39						14						10						(9)						(12)
Settlement/curtailment gains			—						—						—						(1)						—						—
Special termination benefits			1						14						—						—						—						—
Total other pension and retiree medical benefits income			(103)						(48)						(11)						(12)						(3)						(5)
Total			$	5					$	97					$	12					$	7					$	14					$	9

We regularly evaluate opportunities to reduce risk and volatility associated with our pension and retiree medical plans. In addition, lump sum payments may result in settlement charges in future periods.

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In the 24 weeks ended June 13, 2026, we issued the following notes:

Interest Rate						Maturity Date						Principal Amount(a) (b)
Floating Rate						February 2028						€500
3.300		%				February 2034						€650
3.700		%				February 2038						€850
4.150		%				February 2047						€500

(a)Excludes debt issuance costs, discounts and premiums.

(b)These notes, issued in euros, were designated as net investment hedges to partially offset the effects of foreign currency on our investments in certain of our foreign subsidiaries.

The net proceeds from the issuances of the above notes were used for general corporate purposes, including the repayment of commercial paper.

In the 24 weeks ended June 13, 2026, $1.6 billion of U.S. dollar-denominated senior notes and €0.5 billion of euro-denominated senior notes matured and were paid.

As of June 13, 2026, we had $6.1 billion of commercial paper outstanding, excluding discounts.

In the 12 and 24 weeks ended June 13, 2026, we entered into a new five-year unsecured revolving credit agreement (2026 Five-Year Credit Agreement), which expires on May 22, 2031. The 2026 Five-Year Credit Agreement enables us and our borrowing subsidiaries to borrow up to $5.0 billion in U.S. dollars and/or euros, including a $1.2 billion swing line subfacility for euro-denominated borrowings permitted to be borrowed on a same-day basis, subject to customary terms and conditions. We may request that commitments under this agreement be increased up to $5.75 billion (or the equivalent amount in euros). Additionally, we may, up to two times during the term of the 2026 Five-Year Credit Agreement, request renewal of the agreement for an additional one-year period. The 2026 Five-Year Credit Agreement replaced our $5.0 billion five-year credit agreement, dated as of May 23, 2025.

Also in the 12 and 24 weeks ended June 13, 2026, we entered into a new 364-day unsecured revolving credit agreement (2026 364-Day Credit Agreement), which expires on May 21, 2027. The 2026 364-Day Credit Agreement enables us and our borrowing subsidiaries to borrow up to $5.0 billion in U.S. dollars and/or euros, subject to customary terms and conditions. We may request that commitments under this agreement be increased up to $5.75 billion (or the equivalent amount in euros). We may request renewal of this facility for an additional 364-day period or convert any amounts outstanding into a term loan for a period of up to one year, which term loan would mature no later than the anniversary of the then effective termination date. The 2026 364-Day Credit Agreement replaced our $5.0 billion 364-day credit agreement, dated as of May 23, 2025.

Funds borrowed under the 2026 Five-Year Credit Agreement and the 2026 364-Day Credit Agreement may be used for general corporate purposes. Subject to certain conditions, we may borrow, prepay and reborrow amounts under these agreements. As of June 13, 2026, there were no outstanding borrowings under the 2026 Five-Year Credit Agreement or the 2026 364-Day Credit Agreement.

We are exposed to market risks arising from adverse changes in:

•commodity prices, affecting the cost of our raw materials and energy;

•foreign exchange rates and currency restrictions; and

•interest rates.

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There have been no material changes during the 24 weeks ended June 13, 2026 with respect to our risk management policies or strategies and valuation techniques used in measuring the fair value of the financial assets or liabilities disclosed in Note 9 to our consolidated financial statements in our 2025 Form 10-K.

Certain of our agreements with our counterparties require us to post full collateral on derivative instruments in a net liability position if our credit rating is at A2 (Moody’s Investors Service, Inc.) or A (S&P Global Ratings) and we have been placed on credit watch for possible downgrade or if our credit rating falls below either of these levels. The fair value of all derivative instruments with credit-risk-related contingent features that were in a net liability position as of June 13, 2026 was $53 million. We have posted no collateral under these contracts and no credit-risk-related contingent features were triggered as of June 13, 2026.

The notional amounts of our financial instruments used to hedge the above risks are as follows:

			Notional Amounts(a)
			6/13/2026						12/27/2025
Commodity contracts			$	1.6					$	1.5
Interest rate swap contracts			$	2.0					$	2.0
Foreign exchange contracts (b)			$	2.9					$	3.1
Cross-currency contracts (c)			$	1.0					$	1.7
Non-derivative debt instruments (b)			$	11.7					$	4.4

(a)In billions.

(b)During the 24 weeks ended June 13, 2026, we designated $4.5 billion of existing euro denominated debt and $2.9 billion of euro denominated debt issued in February 2026 as net investment hedges to partially offset the effects of foreign currency on our investments in certain of our foreign operations. As of June 13, 2026, there are no foreign exchange contracts designated as net investment hedges.

(c)During the 12 and 24 weeks ended June 13, 2026, U.S. dollar for euro cross-currency interest rate swaps with a total notional amount of $0.7 billion matured. Subsequent to June 13, 2026, we entered into Thai baht for U.S. dollar cross-currency interest rate swaps with a total notional amount of $0.3 billion and maturity dates ranging from May 2027 to May 2031. The cross-currency interest rate swaps are designated as net investment hedges to hedge the net assets of certain foreign operations with Thai baht functional currency.

As of June 13, 2026, approximately 17% of total debt was subject to variable rates, after the impact of the related interest rate swap contracts, compared to approximately 11% as of December 27, 2025.

Debt Securities

Available-for-Sale

The activity related to our Level 3 investments in certain available-for-sale debt securities is as follows:

															12 Weeks Ended												24 Weeks Ended
															6/13/2026						6/14/2025						6/13/2026						6/14/2025
Celsius Holdings, Inc. (Celsius):
Balance, beginning of period															$	1,756					$	888					$	1,852					$	785
Net unrealized (loss)/gain															(289)						77						(371)						187
Cash dividends received															(14)						(7)						(28)						(14)
Balance, end of period															1,453						958						1,453						958
Other:
Balance, beginning of period															242						242						275						256
Net unrealized gain/(loss)															17						19						(16)						5
Balance, end of period															259						261						259						261
Total Level 3 available-for-sale balance, end of period															$	1,712					$	1,219					$	1,712					$	1,219

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There were no impairment charges related to our investments in available-for-sale debt securities in both the 24 weeks ended June 13, 2026 and June 14, 2025. There were net unrealized gains of $473 million and $526 million as of June 13, 2026 and June 14, 2025, respectively, associated with our available-for-sale debt securities.

Recurring Fair Value Measurements

The fair values of our financial assets and liabilities are categorized as follows:

			Fair Value Hierarchy Levels(a)						6/13/2026												12/27/2025
									Assets(a)						Liabilities(a)						Assets(a)						Liabilities(a)
Available-for-sale debt securities (b)			3						$	1,712					$	—					$	2,127					$	—
Index funds (c)			1						376						—						341						—
Deferred compensation (d)			2						—						503						—						495
Contingent consideration (e)			3						—						117						—						278
Derivatives designated as fair value hedging instruments:
Interest rate swap contracts (f)			2						—						21						19						3
Derivatives designated as cash flow hedging instruments:
Foreign exchange contracts (g)			2						18						20						6						28
Cross-currency contracts (g)			2						—						—						—						102
Commodity contracts (h)			2						144						2						116						5
									162						22						122						135
Derivatives designated as net investment hedging instruments:
Foreign exchange contracts (g)			2						—						—						—						1
Cross-currency contracts (g)			2						—						104						—						34
									—						104						—						35
Derivatives not designated as hedging instruments:
Foreign exchange contracts (g)			2						16						7						6						32
Commodity contracts (h)			2						29						2						4						9
									45						9						10						41
Total derivatives at fair value (i)									207						156						151						214
Total									$	2,295					$	776					$	2,619					$	987

(a)Fair value hierarchy levels are categorized consistently by Level 1 (quoted prices in active markets for identical assets), Level 2 (significant other observable inputs) and Level 3 in both years. Unless otherwise noted, financial assets are classified on our balance sheet within prepaid expenses and other current assets and other assets. Financial liabilities are classified on our balance sheet within accounts payable and other current liabilities and other liabilities.

(b)Classified as other assets. The fair value of our investment in Celsius is estimated using probability-weighted discounted future cash flows based on a Monte Carlo simulation using significant unobservable inputs, such as an 80% probability that a certain market-based condition will be met and an average estimated discount rate of 8.9% and 8.5% as of June 13, 2026 and December 27, 2025, respectively. The fair value of the other investment is estimated using a lattice model primarily based on the underlying stock price, volatility and certain significant unobservable inputs, such as a discount rate of 8.3% based on an estimated synthetic credit rating. An increase in the probability that certain market-based conditions will be met or a decrease in the discount rate would result in a higher fair value measurement, while a decrease in the probability that certain market-based conditions will be met or an increase in the discount rate would result in a lower fair value measurement.

(c)Based on the price of index funds. These investments are classified as short-term investments and are used to manage a portion of market risk arising from our deferred compensation liability.

(d)Based on the fair value of investments corresponding to employees’ investment elections.

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(e)In connection with our acquisition of VNGR Beverage, LLC (poppi), we recorded a liability at fair value for the contingent consideration of $300 million payable upon achievement of certain performance milestones by the third quarter of 2027. If these performance milestones are not met, no payment will be made. The fair value of the liability is estimated using discounted future cash flows based on a Monte Carlo simulation using significant unobservable inputs such as forecasts of net revenue and margin. An increase in the net revenue and margin forecasts would result in a higher fair value measurement, while a decrease in the net revenue and margin forecasts would result in a lower fair value measurement. As of June 13, 2026, the fair value of the contingent consideration was $117 million, reflecting a fair value decrease of $45 million and $161 million in the 12 and 24 weeks ended June 13, 2026, respectively, recorded in selling, general and administrative expenses.

(f)Based on Secured Overnight Financing Rate forward rates. As of June 13, 2026, the carrying amount of hedged fixed-rate debt was $2.0 billion, which was classified on the balance sheet within long-term debt obligations.

(g)Based on recently reported market transactions of spot and/or forward rates.

(h)Primarily based on recently reported market transactions of swap arrangements.

(i)Derivative assets and liabilities are presented on a gross basis on our balance sheet. Amounts subject to enforceable master netting arrangements or similar agreements which are not offset on our balance sheet as of June 13, 2026 and December 27, 2025 were not material. Collateral received or posted against our asset or liability positions was not material. Exchange-traded commodity futures are cash-settled on a daily basis and, therefore, not included in the table.

The carrying amounts of our cash and cash equivalents and short-term investments recorded at amortized cost approximate fair value (classified as Level 2 in the fair value hierarchy) due to their short-term maturity. The fair value of our debt obligations as of June 13, 2026 and December 27, 2025 was $49 billion and $46 billion, respectively, based upon prices of identical or similar instruments in the marketplace, which are considered Level 2 inputs.

Losses/(gains) on our fair value hedges recognized in the income statement are as follows:

															12 Weeks Ended												24 Weeks Ended
															6/13/2026						6/14/2025						6/13/2026						6/14/2025
Interest rate swap contracts (a)															$	16					$	(7)					$	37					$	(43)

(a)Interest rate derivative losses/(gains) are included in net interest expense and other. These losses/(gains) are substantially offset by decreases/increases in the value of the underlying debt, which are also included in net interest expense and other.

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Losses/(gains) on our cash flow hedges are categorized as follows:

			12 Weeks Ended
			Recognized in Accumulated Other Comprehensive Loss												Reclassified from Accumulated Other Comprehensive Loss into Income Statement(a)
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
Foreign exchange contracts			$	(11)					$	54					$	16					$	(8)
Cross-currency contracts			(6)						(36)						(5)						(34)
Commodity contracts			(76)						(45)						(63)						(11)
Total			$	(93)					$	(27)					$	(52)					$	(53)

															24 Weeks Ended
									Recognized in Accumulated Other Comprehensive Loss												Reclassified from Accumulated Other Comprehensive Loss into Income Statement(a)
															6/13/2026						6/14/2025						6/13/2026						6/14/2025
Foreign exchange contracts															$	6					$	70					$	30					$	(24)
Cross-currency contracts															5						(55)						5						(55)
Commodity contracts															(212)						(100)						(124)						(5)
Total															$	(201)					$	(85)					$	(89)					$	(84)

(a)Foreign exchange derivative losses/(gains) are included in net revenue and cost of sales. Cross-currency interest rate swap derivative losses/(gains) are included in selling, general and administrative expenses. Commodity derivative losses/(gains) are included in either cost of sales or selling, general and administrative expenses, depending on the underlying commodity. See Note 10 for further information.

As of June 13, 2026, we expect to reclassify net gains of $215 million related to our cash flow hedges from accumulated other comprehensive loss within common shareholders’ equity into net income during the next 12 months.

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Losses/(gains) on our net investment hedges are categorized as follows:

															12 Weeks Ended
									Recognized in Accumulated Other Comprehensive Loss												Recognized in Income Statement(a)
															6/13/2026						6/14/2025						6/13/2026						6/14/2025
Non-derivative debt instruments															$	23					$	174					$	—					$	—
Cross-currency contracts															32						12						(4)						(2)
Total															$	55					$	186					$	(4)					$	(2)

															24 Weeks Ended
									Recognized in Accumulated Other Comprehensive Loss												Recognized in Income Statement(a)
															6/13/2026						6/14/2025						6/13/2026						6/14/2025
Non-derivative debt instruments															$	(159)					$	284					$	—					$	—
Cross-currency contracts															70						9						(8)						(4)
Foreign exchange contracts															(11)						—						(2)						—
Total															$	(100)					$	293					$	(10)					$	(4)

(a)Amount excluded from the assessment of effectiveness recognized in earnings associated with cross-currency interest rate swaps and forward contracts.

Losses/(gains) recognized in the income statement related to our non-designated hedges are categorized as follows:

			12 Weeks Ended
			6/13/2026																		6/14/2025
			Cost of sales						Selling, general and administrative expenses						Total						Cost of sales						Selling, general and administrative expenses						Total
Foreign exchange contracts			$	—					$	(10)					$	(10)					$	1					$	43					$	44
Commodity contracts			3						(16)						(13)						5						(8)						(3)
Total			$	3					$	(26)					$	(23)					$	6					$	35					$	41

			24 Weeks Ended
			6/13/2026																		6/14/2025
			Cost of sales						Selling, general and administrative expenses						Total						Cost of sales						Selling, general and administrative expenses						Total
Foreign exchange contracts			$	—					$	(13)					$	(13)					$	1					$	54					$	55
Commodity contracts			(28)						(175)						(203)						(4)						(10)						(14)
Total			$	(28)					$	(188)					$	(216)					$	(3)					$	44					$	41

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The computations of basic and diluted net income attributable to PepsiCo per common share are as follows:

			12 Weeks Ended
			6/13/2026												6/14/2025
			Income						Shares(a)						Income						Shares(a)
Basic net income attributable to PepsiCo per common share			$	2.18											$	0.92
Net income available for PepsiCo common shareholders			$	2,981					1,366						$	1,263					1,371
Dilutive securities:
Stock options, RSUs, PSUs and other (b)			—						3						—						2
Diluted			$	2,981					1,369						$	1,263					1,373
Diluted net income attributable to PepsiCo per common share			$	2.18											$	0.92

			24 Weeks Ended
			6/13/2026												6/14/2025
			Income						Shares(a)						Income						Shares(a)
Basic net income attributable to PepsiCo per common share			$	3.88											$	2.26
Net income available for PepsiCo common shareholders			$	5,308					1,367						$	3,097					1,371
Dilutive securities:
Stock options, RSUs, PSUs and other (b)			—						3						—						3
Diluted			$	5,308					1,370						$	3,097					1,374
Diluted net income attributable to PepsiCo per common share			$	3.88											$	2.25

(a)Weighted-average common shares outstanding (in millions).

(b)The dilutive effect of these securities is calculated using the treasury stock method.

The weighted-average amount of antidilutive securities excluded from the calculation of diluted earnings per common share was 9 million for both the 12 weeks ended June 13, 2026 and June 14, 2025, and 8 million for both the 24 weeks ended June 13, 2026 and June 14, 2025.

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The changes in the balances of each component of accumulated other comprehensive loss attributable to PepsiCo are as follows:

			Currency Translation Adjustment						Cash Flow Hedges						Pension and Retiree Medical												Available-for-Sale Debt Securities and Other(a)						Accumulated Other Comprehensive Loss Attributable to PepsiCo
Balance as of December 27, 2025 (b)			$	(13,494)					$	126					$	(2,262)											$	606					$	(15,024)
Other comprehensive income/(loss) before reclassifications (c)			757						108						(10)												(129)						726
Amounts reclassified from accumulated other comprehensive loss			—						(37)						19												—						(18)
Net other comprehensive income/(loss)			757						71						9												(129)						708
Tax amounts			(38)						(16)						(3)												31						(26)
Balance as of March 21, 2026 (b)			(12,775)						181						(2,256)												508						(14,342)
Other comprehensive income/(loss) before reclassifications (d)			145						93						4												(285)						(43)
Amounts reclassified from accumulated other comprehensive loss			—						(52)						22												—						(30)
Net other comprehensive income/(loss)			145						41						26												(285)						(73)
Tax amounts			10						(1)						(5)												68						72
Balance as of June 13, 2026 (b)			$	(12,620)					$	221					$	(2,235)											$	291					$	(14,343)

(a)The movements primarily represent fair value changes in available-for-sale debt securities, including our investment in Celsius convertible preferred stock. See Note 8 for further information.

(b)Pension and retiree medical amounts are net of taxes of $1,138 million as of December 27, 2025, $1,135 million as of March 21, 2026 and $1,130 million as of June 13, 2026.

(c)Currency translation adjustment primarily reflects appreciation of the euro, Mexican peso and Russian ruble.

(d)Currency translation adjustment primarily reflects appreciation of the Russian ruble.

			Currency Translation Adjustment						Cash Flow Hedges						Pension and Retiree Medical												Available-for-Sale Debt Securities and Other(a)						Accumulated Other Comprehensive Loss Attributable to PepsiCo
Balance as of December 28, 2024 (b)			$	(15,217)					$	82					$	(2,714)											$	237					$	(17,612)
Other comprehensive income/(loss) before reclassifications (c)			410						58						(4)												87						551
Amounts reclassified from accumulated other comprehensive loss			—						(31)						17												—						(14)
Net other comprehensive income			410						27						13												87						537
Tax amounts			26						(5)						(3)												(21)						(3)
Balance as of March 22, 2025 (b)			(14,781)						104						(2,704)												303						(17,078)
Other comprehensive income/(loss) before reclassifications (d)			915						27						(42)												84						984
Amounts reclassified from accumulated other comprehensive loss			—						(53)						18												—						(35)
Net other comprehensive income/(loss)			915						(26)						(24)												84						949
Tax amounts			46						8						5												(20)						39
Balance as of June 14, 2025 (b)			$	(13,820)					$	86					$	(2,723)											$	367					$	(16,090)

(a)The movements primarily represent fair value changes in available-for-sale debt securities, including our investment in Celsius convertible preferred stock. See Note 8 for further information.

(b)Pension and retiree medical amounts are net of taxes of $1,282 million as of December 28, 2024, $1,279 million as of March 22, 2025 and $1,284 million as of June 14, 2025.

(c)Currency translation adjustment primarily reflects appreciation of the Russian ruble and depreciation of the euro.

(d)Currency translation adjustment primarily reflects appreciation of the Russian ruble, Mexican peso and Canadian dollar.

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The reclassifications from accumulated other comprehensive loss to the income statement are summarized as follows:

						12 Weeks Ended												24 Weeks Ended
						6/13/2026						6/14/2025						6/13/2026						6/14/2025						Affected Line Item in the Income Statement
Cash flow hedges:
Foreign exchange contracts						$	—					$	(2)					$	—					$	(2)					Net revenue
Foreign exchange contracts						16						(6)						30						(22)						Cost of sales
Cross-currency contracts						(5)						(34)						5						(55)						Selling, general and administrative expenses
Commodity contracts						(63)						(11)						(122)						(6)						Cost of sales
Commodity contracts						—						—						(2)						1						Selling, general and administrative expenses
Net gains before tax						(52)						(53)						(89)						(84)
Tax amounts						21						13						29						22
Net gains after tax						(31)						(40)						(60)						(62)
Pension and retiree medical items:
Amortization of net prior service cost/(credits)						1						(1)						2						(1)						Other pension and retiree medical benefits income
Amortization of net losses						21						20						39						37						Other pension and retiree medical benefits income
Settlement/curtailment gains						—						(1)						—						(1)						Other pension and retiree medical benefits income
Net losses before tax						22						18						41						35
Tax amounts						(5)						(4)						(9)						(8)
Net losses after tax						17						14						32						27
Total net gains reclassified, net of tax						$	(14)					$	(26)					$	(28)					$	(35)

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2025 Acquisitions

On January 17, 2025, we acquired all of the outstanding equity interest in Garza Food Ventures LLC (Siete), a Mexican-American foods business, for total consideration of $1.2 billion in cash.

On May 19, 2025, we acquired all of the outstanding equity interest in poppi, a prebiotic soda business, for cash consideration of $1.9 billion and contingent consideration with an acquisition date fair value of $0.2 billion. See Note 8 for further information on the contingent consideration. In connection with this acquisition, other payments may be incurred, subject to the achievement of certain conditions.

We accounted for the 2025 acquisitions as business combinations. We recognized and measured the identifiable assets acquired and liabilities assumed at their estimated fair values on the respective dates of acquisition. The purchase price allocations for Siete and poppi were finalized in the first and second quarter of 2026, respectively.

The fair value of identifiable assets acquired and liabilities assumed in the acquisitions of Siete and poppi and the resulting goodwill as of the respective acquisition dates is summarized as follows:

			Siete			poppi
Acquisition date			January 17, 2025			May 19, 2025
Segment			PFNA			PBNA
Inventories			$	28		$	114
Property, plant and equipment			7			3
Amortizable intangible asset			65			150
Other indefinite-lived intangible asset (brand)			470			1,700
Other assets and liabilities			46			(32)
Total identifiable net assets			616			1,935
Goodwill			630			185
Total purchase price			$	1,246		$	2,120

Goodwill is calculated as the excess of the aggregate fair value of the consideration transferred over the fair value of the net assets recognized. The goodwill recorded as part of the acquisitions of Siete and poppi primarily reflects our expectation of future economic benefits arising from growth opportunities, expanded consumer reach and the strengthening of our overall product offerings across our food and beverage businesses. All of the goodwill associated with our acquisitions of Siete and poppi is recorded in our PFNA and PBNA segments, respectively, and is deductible for tax purposes.

Acquisition and Divestiture-Related Charges/Credits

Acquisition and divestiture-related charges/credits include merger and integration charges, transaction expenses, such as consulting, advisory and other professional fees, as well as fair value adjustments to contingent consideration. Merger and integration charges include distribution agreement termination fees, employee-related costs, closing costs and other integration costs.

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A summary of charges/credits is as follows:

			12 Weeks Ended												24 Weeks Ended
			6/13/2026						6/14/2025						6/13/2026						6/14/2025
PFNA			$	1					$	6					$	2					$	21
PBNA (a)			(46)						56						(160)						66
Total (b)			$	(45)					$	62					$	(158)					$	87
After-tax amount			$	(35)					$	48					$	(121)					$	67
Impact on net income attributable to PepsiCo per common share			$	0.03					$	(0.03)					$	0.09					$	(0.05)

(a)Income amounts primarily relate to the change in the fair value of contingent consideration associated with our acquisition of poppi. See Note 8 for further information.

(b)Recorded in selling, general and administrative expenses.

We maintain voluntary supply chain finance agreements with several participating global financial institutions. Under these agreements, our suppliers, at their sole discretion, may elect to sell their accounts receivable with PepsiCo to these participating global financial institutions. As of June 13, 2026 and December 27, 2025, $1.8 billion and $1.7 billion, respectively, of our accounts payable are to suppliers participating in these financing arrangements. For further information on the key terms of these supply chain financing programs, see Note 14 to our consolidated financial statements in our 2025 Form 10-K.

The Company is party to a variety of litigation, claims, legal or regulatory proceedings, inquiries and investigations. While the results of such litigation, claims, legal or regulatory proceedings, inquiries and investigations cannot be predicted with certainty, management believes that the final outcome of the foregoing is not expected to have a material adverse effect on our financial condition, results of operations or cash flows.

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