Consumers are buying fewer snacks as they pay more at the gas pump.

PepsiCo Chief Executive Ramon Laguarta said the Iran war had a meaningful impact on business during the latest quarter, resulting in a slowdown in the conversion of traffic to purchases.

"Will it change in the coming months? It all depends on the price of gas," he said on a call with analysts Thursday.

Still, the food-and-beverage company said revenue climbed 6.4% to $24.18 billion in the fiscal second quarter, topping Wall Street forecasts. On an organic basis, revenue was up 2.4%.

Growth stemmed primarily from PepsiCo's international business, where sales accelerated across developing and emerging markets. The increase helped offset continued weakness across its North American business.

Shares fell 4.8%, to $135.67, shortly after Thursday's opening bell. The stock is down 5.5% year to date.

PepsiCo has spent much of the past year attempting to win back cost-conscious shoppers, cutting prices on some of its chips and snacks, as well as restaging several of its largest brands to lean into current trends such as protein and the removal of artificial colors and flavors.

Other companies have resorted to price cuts recently, seeking to help consumers with affordability after years of inflation. Walmart earlier this week said it would cut prices on thousands of items, ranging from beef and produce to household products and toys.

PepsiCo's turnaround efforts have started to bear some fruit, Laguarta said. But some operational missteps and a widespread moderation across the U.S. food-and-beverage category have hindered growth.

"There's a lot of things we feel good about the business," he said. "And there's a few things that we're going to be very focused on in the second half to accelerate the business."

PepsiCo will continue to cut prices and evolve its portfolio throughout the back half of the year, Laguarta said. The company previously said it would focus such efforts on brands including Gatorade sports drinks, Tostitos tortilla chips and Quaker-branded foods. The company added that it will also look to grow its away-from-home sales by expanding into new locations.

These efforts will be supported by ongoing productivity initiatives, as PepsiCo continues work to simplify its business as well as invest in automation and digitization, Laguarta said.

Looking ahead, Chief Financial Officer Steve Schmitt said PepsiCo expects its international business to remain strong and for its North America business to gradually improve, albeit at a more moderate pace than initially forecast.

Higher commodity costs will likely weigh on the business, though tariff refunds should help to offset the pressure, Schmitt added.

For the year, PepsiCo continues to expect adjusted earnings to increase between 4% and 6%. It also backed its outlook for organic revenue to climb between 2% and 4%.

For its 12 weeks ended June 13, PepsiCo posted a profit of $2.98 billion, or $2.18 a share, compared with a profit of $1.26 billion, or 92 cents a share, in last year's comparable quarter.

Stripping out one-time items, earnings came in at $2.20 a share. Analysts surveyed by FactSet had expected adjusted earnings of $2.19 a share.

Write to Connor Hart at connor.hart@wsj.com

(END) Dow Jones Newswires

July 09, 2026 10:16 ET (14:16 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.