The operator introduces the participants in the PepsiCo's 2023 Third Quarter Earnings Question-and-Answer Session. The Senior Vice President of Investor Relations, Ravi Pamnani, gives a cautionary statement and mentions that they may make forward-looking statements. He also mentions the use of non-GAAP measures and asks participants to limit themselves to one question. The first question is from Bryan Spillane about volume.

The company is focused on optimizing consumer interaction with their brands and maximizing margin. They have seen sequential volume improvement globally, with units growing faster than volume. In PBNA, they have been more aggressive with volume optimization, making decisions such as pruning unprofitable promotions for take home water. This has resulted in a 2.5 point volume impact.

In the third paragraph of the article, the speaker discusses the importance of a specific variable for their company, but also mentions the need for efficiency in their plants and maximizing consumer interaction with their brands. They mention making trade-offs between volume, net revenue, and margin expansion. The following question asks about the balance between volume and price mix in the future, and the speaker responds by saying that there will likely be higher inflation and pricing in the coming years compared to pre-pandemic levels.

In response to a question about volumes in PBNA, CEO Ramon Laguarta stated that they will continue to optimize the portfolio for a few more quarters, with the goal of maximizing units and transactions and improving margins. He also mentioned that the company has been making decisions around affordability in Latin America, which has impacted volume but improved transactions. The company will continue to make optimizations to absorb inflation and remain a choice for consumers with limited disposable income.

Dara Mohsenian asks about the early guidance for 2024 and the level of visibility and confidence in the decision. Hugh Johnston explains that the early guidance is due to the focus on commodity inflation, cost structure, and commercial plans. The company has been working on driving productivity and reducing costs, which has given them earlier line of sight into their cost outcome for next year. They also have a good relationship with their customers and are ahead of schedule with their commercial plans. Given the availability of information and questions from investors, the company decided to give some indication of what guidance would look like in 2024.

The speaker addresses a question from Peter Grom about the company's performance and outlook. He mentions that the company has a history of meeting or exceeding expectations and expresses confidence in achieving their 2024 goals. He also discusses the current state of the consumer and economy and how they may impact the company's performance.

In the seventh paragraph of the article, the speaker discusses the current trends in consumer behavior and how they are impacting the company's revenue. They mention a shift towards value and a decrease in traditional channels of trade, but also note that they have seen positive results in convenience stores and food service. They anticipate that the consumer will continue to be cautious, but they have plans in place to mitigate any challenges. The speaker also mentions their long-term confidence in their categories and their innovation and commercial plans for the future. The next question comes from Bonnie Herzog, who is prompted to ask her question if she has one.

The speaker was asked about inflation in the PBNA segment and how it compares to the rest of the segments. They were also asked about the outlook for inflation next year and the factors driving it. However, the speaker declined to go into specific details about individual commodities. The next question shifted to the long-term vision for the business, specifically the beverage and food businesses in the US and the impact of their investment in Instacart.

PepsiCo CEO Ramon Laguarta discusses the company's strategic moves in terms of automation and digitalization, stating that their priority is to make the company more precise and intelligence-driven. He also mentions their commercial relationship with Instacart, which is focused on enhancing their DSD system with the help of Instacart shoppers. This has led to a minor investment in Instacart, but there is no long-term strategic intentionality behind it. One analyst asks about the future of the business and how Instacart plays into it.

The speaker cannot provide specific details about the company's growth and performance in 2024 at this time, as it will be discussed in the future. However, they are pleased with the improvement of Gatorade's sales, which has seen an increase in velocity and a decrease in the impact of competing brands like Prime. The company is optimistic about the future of Gatorade, especially with the introduction of new products and their recent move to a DSD platform.

The speaker discusses the potential impact of GLP-1 drugs on Pepsi's business and category. They state that so far, the impact has been negligible and there are still many unanswered questions about the drugs' effectiveness and consumer preferences. However, they believe that the positive trends in urbanization, middle class development, and changing lifestyles will continue to drive the consumption of Pepsi's products.

The speaker discusses the growth of new drugs and its potential impact on the company's portfolio transformation strategy. They mention their efforts to reduce sodium, fat, sugar, and portion sizes in their products, as well as adding new cooking methods to their snacks. They believe these trends will help them pivot their portfolio in the future if needed. They also mention their goal to hold share in their North American Beverage business and how the addition of third-party brands, such as CELSIUS, is part of their energy drink strategy. They have doubled the distribution of CELSIUS in the past year, making their system more efficient.

The speaker discusses the positive impact of CELSIUS on their salesmen and cooler, making it a popular choice in stores and benefiting their overall portfolio. They express gratitude for the investment and hope everyone stays safe and healthy. The presentation has now ended.

This summary was generated with AI and may contain some inaccuracies.