PepsiCo, the maker of Pepsi soft drinks and Tropicana juices, announced a plan to slash 3,300 jobs today as weak sales in the US hit its earnings.
Shares in the food and drink group fell 7.6% to $57.05 in morning trading, recovering slightly from a 10% plunge, as analysts reacted to the weaker-than-expected figures.
As a housing slump and credit crisis bites in the US, analysts say consumers are cutting spending on non-essential items and shopping in convenience stores - a key driver of Pepsico's business.
The group reported third-quarter net profit of $1.58 billion, down nearly 10% from $1.74 billion a year ago. Sales grew 10.5% to $11.24 billion.
It also trimmed its earnings predictions for the full-year excluding exceptional items to $3.67-3.68 a share from $3.72 previously.
The job cuts will affect 3,300 employees, or 1.8% of the company's work force, and will result in fourth-quarter charges of $550-600m.
