Restructuring and Impairment Charges

12 Months Ended

Dec. 30, 2023

Restructuring and Related Activities [Abstract]

Restructuring, Impairment, and Other Activities Disclosure [Text Block]

Restructuring and Impairment Charges

2019 Multi-Year Productivity Plan

We publicly announced a multi-year productivity plan on February 15, 2019 that will leverage new technology and business models to further simplify, harmonize and automate processes; re-engineer our go-to-market and information systems, including deploying the right automation for each market; and simplify our organization and optimize our manufacturing and supply chain footprint. To build on the successful implementation of the 2019 Productivity Plan, in 2022, we expanded and extended the plan through the end of 2028 to take advantage of additional opportunities within the initiatives described above. As a result, we expect to incur pre-tax charges of approximately $3.65 billion, including cash expenditures of approximately $2.9 billion. These pre-tax charges are expected to consist of approximately 55% of severance and other employee-related costs, 10% for asset impairments (all non-cash) resulting from plant closures and related actions and 35% for other costs associated with the implementation of our initiatives.

The total plan pre-tax charges are expected to be incurred by division approximately as follows:

	FLNA		QFNA		PBNA		LatAm		Europe		AMESA		APAC		Corporate
Expected pre-tax charges	15	%	1	%	25	%	10	%	25	%	5	%	4	%	15	%

A summary of our 2019 Productivity Plan charges is as follows:

	2023		2022		2021
Cost of sales	$	13	$	33	$	29
Selling, general and administrative expenses	433		347		208
Other pension and retiree medical benefits (income)/expense (a)	(1)		31		10
Total restructuring and impairment charges	$	445	$	411	$	247
After-tax amount	$	349	$	334	$	206
Impact on net income attributable to PepsiCo per common share	$	(0.25)	$	(0.24)	$	(0.15)

	2023		2022		2021		Plan to Date through 12/30/2023
FLNA	$	42	$	46	$	28	$	252
QFNA	—		7		—		19
PBNA	41		68		20		267
LatAm	29		32		37		200
Europe	223		109		81		566
AMESA	15		12		15		97
APAC	8		16		7		85
Corporate	88		90		49		317
	446		380		237		1,803
Other pension and retiree medical benefits (income)/expense (a)	(1)		31		10		97
Total	$	445	$	411	$	247	$	1,900

(a)Income amount represents adjustments for changes in estimates of previously recorded amounts.

	Plan to Date through 12/30/2023
Severance and other employee costs	$	1,050
Asset impairments	192
Other costs	658
Total	$	1,900

Severance and other employee costs primarily include severance and other termination benefits, as well as voluntary separation arrangements. Other costs primarily include costs associated with the implementation of our initiatives, including consulting and other professional fees, as well as contract termination costs.

A summary of our 2019 Productivity Plan is as follows:

	Severance and Other Employee Costs		Asset Impairments		Other Costs		Total
Liability as of December 26, 2020	$	122	$	—	$	5	$	127
2021 restructuring charges	120		32		95		247
Cash payments (a)	(163)		—		(93)		(256)
Non-cash charges and translation	(15)		(32)		—		(47)
Liability as of December 25, 2021	64		—		7		71
2022 restructuring charges	243		33		135		411
Cash payments (a)	(90)		—		(134)		(224)
Non-cash charges and translation	(29)		(33)		—		(62)
Liability as of December 31, 2022	188		—		8		196
2023 restructuring charges	243		2		200		445
Cash payments (a)	(242)		—		(192)		(434)
Non-cash charges and translation	(1)		(2)		(7)		(10)
Liability as of December 30, 2023	$	188	$	—	$	9	$	197

(a)Excludes cash expenditures of $1 million in 2023, $1 million in 2022 and $2 million in 2021, reported in the cash flow statement in pension and retiree medical plan contributions.

The majority of the restructuring accrual at December 30, 2023 is expected to be paid by the end of 2024.

Other Productivity Initiatives

There were no material charges related to other productivity and efficiency initiatives outside the scope of the 2019 Productivity Plan.

We regularly evaluate different productivity initiatives beyond the productivity plan and other initiatives described above.

For information on additional impairment charges, see Notes 1, 4 and 9 for impairment and other charges taken related to the Russia-Ukraine conflict, brand portfolio impairment charges and other impairment charges.