PepsiCo is lowering prices for brands including Doritos and Cheetos by up to 15% in a bid to reignite growth and win back inflation-wary consumers who have cut back on spending.
Executives at the beverage and snacking giant said the company tested out deeper price reductions during the second half of 2025 and found these initiatives improved purchase frequency with shoppers. PepsiCo is now rolling out broader price cuts across the U.S. this week that offer “greater affordability” on certain pack sizes for brands such as Lay’s, Tostitos, Doritos and Cheetos.
“We’ve spent the past year listening closely to consumers, and they’ve told us they’re feeling the strain,” Rachel Ferdinando, CEO of PepsiCo Foods U.S., said in a release. “Lowering prices is one step — an important one — in our commitment to deliver for consumers and strengthen our brands for the future.”
Stephen Schmitt, PepsiCo’s chief financial officer, characterized the price cuts as the company “playing offense,” and that the CPG giant was “excited about the initiatives and the benefits that will come both in volume and sales growth.” The company also was optimistic that the reductions would boost the “competitiveness” of its snacks business.
PepsiCo is the latest large food company to cut back prices in a bid to fuel growth. Cheerios and Nature Valley bar maker General Mills said in December it cut prices on nearly two-thirds of its grocery products in North America, resulting in an uptick in product volume.
Food companies have been increasing prices for several years in a bid to offset rising costs, optimistic that loyal consumers would follow.
But shoppers, many of whom are dealing with higher prices across the board for everyday necessities, are "tapped out," Brian Choi, a managing partner and CEO of The Food Institute, said in a recent interview. High prices have proven especially straining for low- and middle-income consumers.
Most food companies have reported that volumes have dropped as people purchase less or switch to cheaper private-label options. During its 2025 fiscal year, volume in PepsiCo’s food division dropped 2%, the company said Tuesday.
Price cuts come in the wake of mounting pressure from an activist investor, which has pushed PepsiCo to slash expenses and take other bold steps to save money and improve margins. Last year, PepsiCo announced it closed snacking plants in Florida, New York and California and planned to reduce the number of products it sells by nearly 20%.
The savings generated from the cost-cutting moves will help fund the price reductions, the company said.
However, PepsiCo is not only depending on price drops to spur demand. The New York-based company has a substantial innovation pipeline that reimagines many of its core brands to meet demands from consumers around health and wellness.
PepsiCo has announced versions of Cheetos and Doritos without artificial dyes, used olive or avocado oil in some products and touted the launch of snack options with trendy ingredients, such as protein-enhanced Doritos. Its beverage business also has responded with the debut of Pepsi with prebiotics.
