PepsiCo's revenue grew 5.6% year-over-year in the third quarter of 2026. That is a record quarter paired with a slower growth rate than the quarter before. Margins barely moved from the last quarter. And over the past year the stock lagged the market.
Record sales, but the growth rate is cooling
PepsiCo sells drinks and snacks, and in the third quarter of 2026 it sold more of both. Against the quarter just before, revenue rose 4.5%. On the chart it is the biggest quarter so far. Year-over-year A comparison with the same quarter one year earlier, which cancels out normal seasonal ups and downs., revenue grew 5.6%. That is the number a news app puts in its headline, and it looks fine.
Data table
| period | revenue | yoy |
|---|---|---|
| 2023Q1 | $17.8bn | — |
| 2023Q2 | $22.3bn | — |
| 2023Q3 | $23.5bn | 6.7% |
| 2024Q1 | $18.2bn | 2.3% |
| 2024Q2 | $22.5bn | 0.8% |
| 2024Q3 | $23.3bn | -0.6% |
| 2025Q1 | $17.9bn | -1.8% |
| 2025Q2 | $22.7bn | 1.0% |
| 2025Q3 | $23.9bn | 2.7% |
| 2026Q1 | $19.4bn | 8.5% |
| 2026Q2 | $24.2bn | 6.4% |
| 2026Q3 | $25.3bn | 5.6% |
Now the small print. In the quarter before, revenue grew 6.4% year-over-year. So the growth rate is smaller this time, even though the sales total is bigger. Pull the camera back and the pace is calmer still: over the three years to 2026 Q3, revenue grew 2.5% a year on average. A record quarter and a slower engine can sit in the same report.
Glossary
- Revenue
- The money a company takes in from selling its products, before any costs are paid.
- Year-over-year
- A comparison with the same quarter one year earlier, which cancels out normal seasonal ups and downs.
Profit per dollar of sales hardly budged this quarter
Operating margin Operating profit divided by revenue. It shows the share of each sales dollar left after day-to-day running costs. tells you how many cents of each sales dollar are left after the costs of making and selling the product. In 2026 Q3 PepsiCo's operating margin was 16.9%. Against the same quarter a year earlier, operating margin is up 1.9 pp Short for percentage point. It is the plain gap between two percentages, so moving from one margin level to another is measured in pp.. Gross margin Revenue minus the direct cost of making the goods, divided by revenue., measured higher up the income statement, is up 0.8 pp over the same year.
Data table
| order | category | amount | kind |
|---|---|---|---|
| 0 | 2026Q2 operating margin | 16.6% | total |
| 1 | Gross margin change | 0.2% | delta |
| 2 | Opex ratio change | 0.0% | delta |
| 3 | 2026Q3 operating margin | 16.9% | total |
Against the quarter just before, the picture is flat: operating margin moved 0.2 pp from 2026 Q2 to 2026 Q3. My reading is that the large year-over-year jump owes most of its size to a weak comparison base, because last year's quarter carried big write-downs of intangible assets. So the quarter-on-quarter number is the duller but cleaner one to follow.
Glossary
- Operating margin
- Operating profit divided by revenue. It shows the share of each sales dollar left after day-to-day running costs.
- Gross margin
- Revenue minus the direct cost of making the goods, divided by revenue.
- pp
- Short for percentage point. It is the plain gap between two percentages, so moving from one margin level to another is measured in pp.
Over the past year, the stock trailed the market
Step away from the quarter and look at a whole year. A holder of PepsiCo over the year to 23 October 2026 ended at -6.8%. The deepest fall from a high point along the way was -25.2%. That window covers 252 trading days.
Over that same year, how did the whole US market do?
Actual14.4%
The market returned 14.4% over the same year. The surprise is the size of the gap: a famous household name can sell more soda and chips than ever while the broad market climbed and its own holders ended the year lower.
Show answer
14.4% The market returned 14.4% over the same year. The surprise is the size of the gap: a famous household name can sell more soda and chips than ever while the broad market climbed and its own holders ended the year lower.
Three housekeeping notes on those numbers. These figures use prices adjusted for splits and dividends, so dividends are counted in. The amount used for this kind of comparison is an illustration, not a recommendation. And last year's path is no guide to what comes later. What you can watch from here is simple: whether the growth line keeps drifting down, and whether margin holds its ground against the quarter before.
Risks
- Last year's quarter carried large write-downs, so the year-over-year profit jump flatters the comparison.
- The peer basket is small and mixes drinks with household goods, so the comparison means less.
- Currency translation swings move reported growth and can distort the year-over-year picture.
Sources
- SEC EDGAR XBRL companyfacts, PEPSICO INC — data as of 2026-09-05; fetched 2026-10-25 15:59 UTC