North America food revenue fell 2% year-over-year, driven by lower unit sales and heightened consumer price sensitivity.
PepsiCo reported a 2% decline in North America food revenue for the second quarter, citing weaker grocery demand. CEO Ramon Laguarta attributed the pullback to rising fuel costs and softer consumer spending, particularly among price-sensitive shoppers.
Industry-wide data showed grocery unit sales fell 1.8% in June year-over-year, reversing a 0.1% gain in June 2025. While prices continue rising at 2-3% annually, the decline in volume sales offset revenue growth. Analysts noted cumulative price hikes since 2019, with a $300 grocery trip now costing $400, straining household budgets.
Executives highlighted increased promotional activity to counter weaker demand, signaling a shift in consumer behavior. Lower-income households faced additional pressure from reduced SNAP benefits, exacerbating the downturn.