PepsiCo Inc. has announced plans to reduce its workforce in North America by approximately 1,000 employees. This significant downsizing pertains to roles within its food and beverage divisions and is aimed at streamlining operations in order to address the ongoing sluggish sales the company has been experiencing in the domestic market.
In a letter addressed to employees on Monday, Ram Krishnan, the CEO of PepsiCo’s North America division, indicated that the layoffs are expected to occur next week as part of an effort to simplify the company’s operations.
He stated, “We have a clear goal for PepsiCo North America: to create a stronger and more adaptable business for the future, achieving industry-leading growth.”
Krishnan emphasized the necessity of such changes, mentioning that to reach their objectives, the company will need to streamline its operational processes, enhance team collaboration, and strengthen critical capabilities.
“Our aim is to act faster, execute better, and invest in opportunities that will drive our growth,” he added.
PepsiCo has faced a series of challenges in its North American operations. Most notably, last month, the fast-food giant KFC announced it would terminate its nearly 40-year partnership with PepsiCo, switching to Coca-Cola beverages in its U.S. locations starting next January. While KFC will continue to offer Pepsi products in its international outlets, the loss of business from KFC’s 3,718 American locations poses a critical setback for PepsiCo.
Moreover, in October, PepsiCo lowered its earnings forecast for the year, citing difficulties in their domestic market. The company reported a 2% decline in volumes within its North American beverage division during the third quarter, while its food segment remained stagnant in terms of sales.
Despite these challenges, shares of PepsiCo rose nearly 1% during late trading on Monday afternoon.
According to a document submitted by PepsiCo to regulatory agencies, as of December 27, 2025, the company employs approximately 306,000 individuals worldwide, with around 125,000 of those based in the United States.
As the company navigates through these turbulent times, the emphasis on operational efficiency, team connectivity, and strategic investments will be crucial for PepsiCo’s future success and recovery in the competitive landscape of the food and beverage industry. As the restructuring commences, it will be essential for the company to maintain morale and support among its remaining workforce while aiming for a more robust position in the market.