PepsiCo cutting product lineup by 20% after deal with activist investor

"PepsiCo Inc. reached an agreement with activist investor Elliott Investment Management that includes a 20% reduction in its U.S. product lineup and a sharper focus on affordability, while the soda and snacks company also plans layoffs as part of cost reduction efforts. The moves represent an early agreement with Elliott as the maker of Mountain Dew and Doritos seeks to recapture growth and win back investors. Elliott built up a roughly $4 billion stake earlier this year and clamored for changes, citing an overly complex portfolio of brands and a declining share of the beverage business."

"Marc Steinberg, a partner at Elliott, said the plan "will drive greater revenue and profit growth," according to PepsiCo's statement. Elliott will continue to engage with PepsiCo, he added. The company also offered an updated outlook for next year, projecting organic revenue growth of 2% to 4% in fiscal 2026, versus an average analyst estimate of nearly 2.7%. Organic growth, a key measure for investors, excludes items such as acquisitions and currency volatility."

"Separately, PepsiCo instructed employees in a number of North American offices, including its headquarters in Purchase, New York, as well as Chicago and Plano, Texas, to work remotely this week. Companies in recent years have frequently requested staff to work from home ahead of layoff announcements. "We will be making structural changes to our business that will affect some roles in the company," Jennifer Wells, chief people officer in North America, said in a message to workers."

PepsiCo agreed with activist investor Elliott to reduce its U.S. product lineup by about 20%, emphasize affordability, and pursue cost reductions including layoffs. Elliott accumulated roughly a $4 billion stake and urged changes, citing a complex brand portfolio and a declining beverage share. PepsiCo set an updated fiscal 2026 organic revenue growth outlook of 2%–4%, compared with analysts' near-2.7% estimate. The company asked employees at several North American offices to work remotely ahead of the structural changes. The company stated that the planned changes will affect some roles across the organization.

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