PepsiCo to Lay Off 100s of Workers Amid Beverage Sales Decline

Struggling Soda Giant Cuts Workforce as Consumer Habits Shift

PepsiCo, the beverage and snack food conglomerate, is laying off hundreds of workers as it grapples with declining sales of its core soda products.

The company confirmed the layoffs in a statement, saying that the move is part of a "cost-cutting initiative" to improve profitability.

Sources close to the matter say the layoffs will affect "hundreds" of employees across the company's North American operations, including both corporate and manufacturing roles.

The layoffs come as PepsiCo faces increasing competition from healthier beverage options, such as sparkling water and plant-based milk, and as consumers become more price-conscious amid rising inflation.

PepsiCo's soda sales have been declining for years, as consumers increasingly opt for healthier alternatives. In 2022, the company's soda sales fell by 3%, according to industry data.

To offset declining soda sales, PepsiCo has been investing in healthier beverage options, such as its LIFEWTR brand of sparkling water and its Naked brand of juice.

The company has also been expanding its portfolio of salty snacks, which have been performing better than its soda products. In 2022, PepsiCo's snack sales grew by 4%.

The layoffs are part of a broader cost-cutting initiative at PepsiCo, which is aiming to save $1 billion by 2023. The company has also been closing plants and reducing its workforce in recent years.

The layoffs are expected to be completed by the end of the year. Severance packages will be offered to affected employees.

PepsiCo declined to comment on the specific number of employees who will be laid off.

The layoffs are the latest sign of the challenges facing the beverage industry. Coca-Cola, PepsiCo's main rival, has also been struggling with declining soda sales in recent years.

Both companies are facing increased competition from healthier beverage options and from smaller, independent brands that are catering to consumers' changing tastes.