PURCHASE, N.Y. (AP) -- PepsiCo Inc.'s earnings report on Thursday told two familiar story lines: One was of a U.S. company relying more heavily on customers in emerging markets, as U.S. customers remain shy about spending. The other was of a company raising prices on those same customers, and blaming the higher costs for ingredients.
In one of the starkest examples of the discrepancy, PepsiCo said that revenue for Asia, the Middle East and Africa grew 17 percent, and revenue for Latin American food grew 18 percent. Meanwhile, revenue for Frito-Lay snacks in North America grew just 3 percent, and revenue for Quaker oatmeal products in North America was flat.
CEO Indra Nooyi said in a statement the company is "satisfied with the performance of our portfolio overall," but that "the consumer in developed markets continues to be stressed."
The other story in Pepsi's earnings report was also familiar: a company raising prices on customers and saying it has no choice because it is paying more for raw ingredients. Pepsi said it will raise prices by October as previously announced. Costs for aluminum and gas have fallen since highs this spring, but they're still up compared to a year ago.
The maker of Mountain Dew and Diet Pepsi and Lay's potato chips said its net income rose to $1.9 billion, or $1.17 a share, in the three months ended June 11, up from $1.6 billion, or 98 cents a share, a year ago.
Its earnings excluding one-time items matched the consensus forecast of $1.21 by analysts surveyed by FactSet.
Revenue rose 14 percent to $16.8 billion from $14.8 billion a year ago. That beat analysts' estimates of $16.4 billion.
PepsiCo said it expects per-share earnings to grow in the high single digits in 2011, reflecting uncertainty about how much its customers will spend and how much costs will rise.
PepsiCo shares fell $1.24, or 1.8 percent, to $67.25 in premarket trading.