PepsiCo Cuts 1,000 Jobs as GLP-1 Drugs Squeeze Snack Sales

PepsiCo is eliminating 1,000 jobs in North America as slipping sales squeeze the company behind Doritos, Lay's, Gatorade and Pepsi. The cuts target its weakest region. International sales remain relatively strong, but North America has declined for a long stretch, and the layoffs are the answer.

What do the numbers show?

The company's most recent earnings report, for the third quarter of this year, showed North American beverage sales down 2 percent and the food business stagnant. According to Reuters, PepsiCo's North American beverage volume has declined every quarter since Q1 2025. That is not one bad quarter. That is a pattern.

CEO Ramon Laguarta did not dress it up. "Obviously, we're not satisfied with the performance," he told investors on a recent earnings call. PepsiCo also lowered its earnings-per-share forecast for the year. The earnings report foreshadowed changes to shrink the cost base, and the layoffs are those changes made real.

Why are GLP-1 drugs part of the story?

One pressure point stands out. Research from consulting firm McKinsey found that people who go on GLP-1 weight-loss drugs spend 11.5 percent less on chips and similar savory snacks, and almost 7 percent less on soft drinks. Those two categories anchor PepsiCo's business model.

The user base keeps growing. Gallup puts the share of Americans taking these drugs at 11 percent and rising. Every new prescription chips away at demand for the products that built the company's empire.

Investment strategist Stephanie Link, speaking to Reuters last month, said PepsiCo's problems predate the drug trend. "They have not identified a focused path to recovery," Link said. "They were simply too late, and now they have the threat of GLP-1s."

How is Coca-Cola pulling ahead?

The contrast with its rival is stark. Business Insider Africa reported that several large chains, including KFC and Costco, have recently switched from Pepsi to Coke. Regal Cinemas is rumored to be planning the same switch. On the consumer side, Coca-Cola's subbrands — Fairlife, Minute Maid and Topo Chico — may hold more appeal for a health-conscious customer base.

The stock market has already priced the divergence. The layoffs gave PepsiCo's share price a slight boost, lifting it by less than 1 percent over the past twelve months after a year-over-year decline. Over the same period, Coca-Cola stock rose 37 percent. That is the gap a stalled recovery leaves behind.

What does the competition look like now?

PepsiCo is fighting on two fronts at once. Marketing consultant Katherine O'Hara, in an interview with Reuters, described the shift plainly. "PepsiCo now finds itself competing harder for every dollar," O'Hara said. "Increasingly that competition is about relevance as much as price."

Relevance is the harder fight. Price cuts can move a quarter's numbers. Relevance means convincing consumers who are eating less, drinking less and taking appetite-suppressing drugs that a portfolio built on chips and cola still fits their lives.

The 1,000 job cuts buy time and margin. They do not answer the structural question: whether a company whose empire rests on savory snacks and soft drinks can grow when 11 percent of its home market uses drugs that cut demand for exactly those products. Until PepsiCo shows a focused path — the one thing Link says it lacks — investors will keep comparing its chart to Coca-Cola's.