When PepsiCo announced its full-year 2018 financials last week, revenue was up but profit was up more: 158% percent more, in fact, over the year prior.
So it might surprise you to learn that Pepsi is acting like a company in crisis, announcing a 4-year restructuring plan designed to save the company billions.
According to a filing with the SEC, Pepsi says the undertaking will cost about $2.5 billion in restructuring costs, 70 percent of which will be severance payouts and other related employee costs. Additionally, the company is assigning about 15 percent of the tab to plant closures.
The company says it wants to become “leaner, more agile and less bureaucratic,” and its CFO Hugh Johnston implied that this would be done by laying off employees that are currently working in positions that could be automated.
But Pepsi isn’t just dipping a toe: CEO Ramon Luguarta said Friday that the company is “relentlessly automating” and also infusing its business models with “new thinking and technologies." The end game to the cost cutting, according to Luguarta, is to dump those savings back into working PepsiCo brands into more and more seconds of our day. He calls them “consumption occasions” and looks forward to finding more and more of them, so PepsiCo can fill your day with snacks and beverages “across dayparts from morning to night.” His words.
So if you unfortunately find yourself out of a job due to the relentless automation, there’s an upside: more time for “consumption occasions”... though decidedly less money.
