Pepsico Cuts Growth Forecast Amid Tariffs and Slowed Consumer Spending

Consumers, worried about the economy, are pulling back on their spending, and that anxiety is translating into lower sales and profits for some of the country’s largest consumer-oriented companies.

On Thursday, PepsiCo cut its full-year guidance outlook, citing a reduction in consumer spending as well as the impact the company is feeling from increased global tariffs.

“Relative to where we were three months ago, we probably aren’t feeling as good about the consumer now,” Jamie Caulfield, the chief financial officer of PepsiCo, told Wall Street analysts and investors on an earnings call Thursday morning.

The company, which manufactures Pepsi and Gatorade drinks as well as popular snacks like Doritos and Cheetos, cut its profit forecast for the full year to flat from its earlier guidance that expected earnings growth to be in the mid-single digits. It reported a decline of 1.8 percent in revenue, to $17.9 billion, for the quarter that ended March 22, and a drop of 10 percent in net income, to $1.8 billion, from a year earlier.

PepsiCo’s stock fell more than 4 percent, to $136, by early afternoon.

Comments made on PepsiCo’s earnings call echoed what executives at other consumer companies have said in recent days about how apprehension in the global economy is key to less consumer spending. The pullback has started to weigh on some companies’ revenues and dampen their outlook for the coming months, especially as they try to calculate the costs they’ll incur from the Trump administration’s new or increased tariffs on imported goods.

At Chipotle, same-store sales fell for the first time since 2020 in the most recent quarter, the chain reported this week. Uncertainty about the path forward for the U.S. economy started to affect spending in February, the company said, shortly after President Trump’s inauguration — a trend that continued into April.