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(Reuters) – PepsiCo Inc (O:) beat quarterly revenue and profit estimates on Thursday, as ramped up advertising and new low calorie versions of Gatorade boosted demand for its beverages in North America.
Shares rose 3% to $138 in light premarket trading, as the company said it expects to meet or exceed its fiscal 2019 organic revenue growth target of 4%.
Since taking the helm last October, Chief Executive Officer Ramon Laguarta has charted out an aggressive spending plan to revive demand for out-of-favor sugary sodas and promote new flavors launched to cater to health conscious consumers.
PepsiCo’s advertising and marketing expenditure has jumped 12% so far this year as the company has splurged on new ads for its trademark Pepsi beverages, rounding off with a campaign centering around the National Football League’s 100th anniversary.
Overall beverage sales in North America rose 3.4% in the third quarter to $5.64 billion, also helped by new low sugar and organic versions of the Gatorade sports drink.
Net revenue rose 4.3% to $17.19 billion in the three months ended Sept. 7, beating analysts’ estimates of $16.93 billion, according to IBES data from Refinitiv.
However, net income attributable to the company fell to $2.10 billion, or $1.49 per share, from $2.50 billion, or $1.75 per share, a year earlier.
Excluding one-time items, the company earned $1.56 per share, beating the average estimate of $1.50.
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