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PepsiCo to cut prices, eliminate products
as part of a deal with an activist investor
[December 09, 2025]
By DEE-ANN DURBIN
PepsiCo
plans to cut prices and eliminate some of its products under a deal with
an activist investor announced Monday.
The Purchase, New York-based company, which makes Cheetos, Tostitos and
other Frito-Lay products as well as beverages, said it will cut nearly
20% of its product offerings by early next year. PepsiCo said it will
use the savings to invest in marketing and improved value for consumers.
It didn't disclose which products or how much it would cut prices. |
Plastic bottles of Pepsi are displayed at a grocery store, Nov. 15,
2023, in New York. (AP Photo/Ted Shaffrey, File) |
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PepsiCo said it also plans to accelerate the introduction of new
offerings with simpler and more functional ingredients,
including Doritos Protein and Simply NKD Cheetos and Doritos,
which contain no artificial flavors or colors. The company also
recently introduced a prebiotic version of its signature cola.
PepsiCo is making the changes after prodding from Elliott
Investment Management, which took a $4 billion stake in the
company in September. In a letter to PepsiCo’s board, Elliott
said the company is being hurt by a lack of strategic clarity,
decelerating growth and eroding profitability in its North
American food and beverage businesses.
In a joint statement with PepsiCo Monday, Elliott Partner Marc
Steinberg said the firm is confident that PepsiCo can create
value for shareholders as it executes on its new plan.
“We appreciate our collaborative engagement with PepsiCo’s
management team and the urgency they have demonstrated,”
Steinberg said. “We believe the plan announced today to invest
in affordability, accelerate innovation and aggressively reduce
costs will drive greater revenue and profit growth.”
Elliott said it plans to continue working closely with the
company.
PepsiCo shares were flat in after-hours trading Monday.
PepsiCo said it expects organic revenue to grow between 2% and
4% in 2026. The company’s organic revenue rose 1.5%. the first
nine months of this year.
PepsiCo also said it plans to review its supply chain and
continue to make changes to its board, with a focus on global
leaders who can help it reach its growth and profitability
goals.
“We feel encouraged about the actions and initiatives we are
implementing with urgency to improve both marketplace and
financial performance,” PepsiCo Chairman and CEO Ramon Laguarta
said in a statement.
PepsiCo said in February that years of double-digit price
increases and changing customer preferences have weakened demand
for its drinks and snacks. In July, the company said it was
trying to combat perceptions that its products are too expensive
by expanding distribution of value brands like Chester’s and
Santitas.
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