Excessive dependence on carbonated drinks

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PepsiCo is involved in numerous lawsuits
PepsiCo and one of its biggest rivals, Coca-Cola, are embroiled in many legal battles. While this is expected of big brands like Pepsi, lawsuits can be damaging to a company’s reputation, especially in the eyes of consumers and the company’s investors.

For example, in 2020, a California environmental group sued both Pepsi and Coca-Cola for causing plastic pollution and misleading consumers about the sustainability of their plastic products (specifically, recyclability).

Another lawsuit against PepsiCo involved claims that the company's Naked Juice products were falsely labeled as architect data "all natural" when they actually contained synthetic ingredients. PepsiCo ultimately settled the lawsuit for $9 million in 2013. Such cases damaged PepsiCo's image and credibility, creating tension between the company, its customers, and its investors.

Although PepsiCo has a wide range of beverages and food products, the company often relies on its carbonated beverages as its main source of revenue. According to one report, PepsiCo derives approximately 30% of its revenue from North American beverage sales. This percentage represents the highest revenue segment, closely followed by Frito-Lay sales. However, this is one of the company's major weaknesses, as trends indicate that the demand for carbonated soft drinks has slowly declined over the years as consumers have opted for healthier beverages.