8-K

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    Form 8-K

                                 CURRENT REPORT

                       Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934


                     September 30, 1996 (September 26, 1996)
                     --------------------------------------
                Date of Report (Date of earliest event reported)


                                  PepsiCo, Inc.
                    ----------------------------------------
             (Exact name of registrant as specified in its charter)

                                 North Carolina
                        ---------------------------------
                 (State or other jurisdiction of incorporation)


             1-1183                                     13-1584302
      (Commission File Number)                (IRS Employer Identification No.)



                700 Anderson Hill Road, Purchase, New York 10577
                   -------------------------------------------
                    (Address of Principal Executive Offices)

       Registrant's telephone number, including area code: (914) 253-2000





Item 5.            Other Events.

         The information contained in Exhibit 20 hereto is incorporated herein
by reference.

Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.

        (c)    Exhibits.

               20   Press Release dated September 26, 1996 from PepsiCo, Inc.



                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

Date:   September 30, 1996                        PepsiCo, Inc.




                                            By:   /s/ LAWRENCE F. DICKIE
                                                  ---------------------------
                                                      Lawrence F. Dickie
                                                      Vice President,
                                                      Associate General Counsel
                                                      and Assistant Secretary

EX-20

EXHIBIT 20

(PURCHASE,  NY, September 26, 1996)--PepsiCo,  Inc., today announced a series of
long-term   strategic   actions  to  strengthen  its   competitiveness   in  the
marketplace,   improve  the   consistency  of  its  financial   performance  and
significantly improve shareholder returns.

Several of the actions will have a one-time negative impact on earnings,  though
they will not affect PepsiCo's plans to generate about $1.8 billion in cash this
year.

Roger Enrico, PepsiCo's Chief Executive Officer, said: "PepsiCo is re-committing
to a long-term  mid-teens compound growth rate for earnings per share.  Clearly,
we have  lately  fallen  short of that goal.  I believe we can best  correct the
situation by focusing more squarely on our core  businesses of Taco Bell,  Pizza
Hut and KFC restaurants,  Frito-Lay snacks and Pepsi-Cola beverage products. Now
is the time to re-evaluate all other businesses in our portfolio,  as well as to
streamline our operations, especially international beverages."

International Soft Drinks

Pepsi-Cola  Company  will  immediately   undertake  a  major   restructuring  of
international  operations  to reduce  annual  operating  costs by more than $100
million.  Additionally,  its  strategy  will shift to assure  priority  focus on
building our business in those  markets in which we are already  strong,  and on
long-term  development  of the business in the most promising  emerging  markets
where we believe the competitive  strategic playing field is essentially  level.
The restructuring will result in a one-time charge of approximately $125 million
($.07 per share) in the fourth quarter.

In addition,  PepsiCo will take the necessary steps to reduce to a prudent level
its  exposure  to BAESA,  the  Pepsi-Cola  bottler for  several  Latin  American
countries,  including Argentina and Brazil. It will also write down the carrying
value  of  certain   international   beverage  assets  including  some  non-core
businesses, primarily packaging ventures, which are being held for disposal. The
charges arising from these write-downs will be approximately  $400 million ($.24
per share).  The third quarter will reflect $360 million of the total charge and
the balance will be taken in the fourth quarter.

"Clearly we've had problems in our international  beverage business," said Roger
Enrico.  "But I believe  we're moving to fix them quickly and get ourselves on a
sound strategic  footing.  Our domestic beverage  business  continues to have an
excellent year on all measures  whether volume,  market share,  profit growth or
cash flow."






Restaurants

PepsiCo will  immediately  conduct a review to  determine  whether to retain its
casual dining  business.  Although we believe these are  attractive  and growing
concepts,  the question is whether they fit strategically  within our portfolio.
Hot 'n Now, our small hamburger  concept,  will be sold as soon as is practical.
Additionally,   PepsiCo   will   expand  its   successful   program  of  selling
company-owned  Pizza Hut and Taco Bell  restaurants to franchisees,  and include
KFC in the program beginning in 1997.

"Having  more  of  our   restaurants   run  by  franchisees   benefits  us  both
operationally and financially," said Mr. Enrico.  "Our refranchising  effort has
worked well thus far, and was a major  contributor to the $600 million cash flow
turnaround  in  our  restaurant  business  in  1995.  Going  forward,  I see  us
generating about $800 million per year in cash for quite some time."
Snack Foods

PepsiCo has made important progress in building the long-term market strength of
its global snack food  business.  An accelerated  effort to increase  volume and
market share  following the recent exit of a U.S.  competitor  has proven highly
successful,  with  Frito-Lay  achieving  its  highest  market  share in history.
However,  short-term  costs associated with this effort have carried over to the
third quarter and profitability, while good, will be less than we'd like.

"The  world-wide  progress  we've  achieved this year at Frito-Lay  reflects the
remarkable  vitality and enormous potential of a truly great business," said Mr.
Enrico. "Having successfully improved our volume and share in the United States,
we're now well  positioned to leverage our  efficiencies  to  strengthen  profit
margins,  beginning in the fourth quarter.  Adding to this the excellent results
we're  seeing in our U.K.,  Canadian  and  Mexican  businesses,  I see full year
profit  performance  in the  mid-teens as we'd  planned at the  beginning of the
year."

Financial Impact

The charges  associated  with PepsiCo's  strategic  actions will affect reported
earnings in the third and fourth quarters of 1996. The ongoing  strategic review
of our  non-core  businesses  could also result in one-time  charges or gains in
future years.





Reported earnings

In the third quarter,  which ended  September 7, earnings per share are expected
to be approximately  thirty cents below third quarter 1995 earnings.  The causes
of the decline are:

     charges which are associated with the  international  beverage  business as
discussed above (approximately $360 million pretax or $.21 per share),

     PepsiCo's  share of the losses and charges  announced by BAESA on August 8,
1996 (approximately $55 million after-tax or $.03 cents per share),

     a drop in the international  beverage operating profits (approximately $135
million pretax or about $.07 per share) and

     declines in operating profits at Pizza Hut in the United States. These will
more than offset solid gains at Pepsi-Cola, Frito-Lay, KFC and the international
snacks and restaurant businesses.

Cash Flow

For the full year,  PepsiCo's robust cash generation  remains on track given the
non-cash nature of most of the unusual items.  Operating cash flow after capital
spending is expected to be about $1.8 billion. More than 40% of that is expected
to come from the restaurant  business.  So far this year, about $1.25 billion in
cash has been used to repurchase nearly 41 million shares of PepsiCo stock.

"With cash  generation  continuing  strong and  expected to grow at double digit
rates over the next  several  years,  we expect to pick up the pace of our stock
buyback to about $2 billion a year," said Mr. Enrico. "Given the great prospects
of this  corporation  and our  confidence  in the  strategies we have to deliver
consistent results, I can't think of a better place to invest our cash."

Safe Harbor Language

This  announcement  contains  forward-looking  statements  that estimate  future
savings  in  International   Beverages,   cash  to  be  provided  by  restaurant
operations,  the full-year  profit  performance of our Snack Food Business,  and
future  operating cash flow growth.  These  forward-looking  statements  reflect
management's  expectations and are based upon currently available data; however,
actual  results  are  subject to future  events and  uncertainties  which  could
materially  impact actual  performance.  The key  uncertainty  regarding  future
savings in International  Beverages is our ability to execute the  restructuring
as planned.  Cash from restaurant  operations will be significantly  impacted by
the operating  performance of our four large quick service restaurant businesses
as  well  as  the  availability  of  potential  buyers  to  participate  in  the
refranchising  program.  Critical to full-year  profit  performance of our Snack
Food  business  are  maintenance  of sales  momentum  and a reduction of certain
selling costs. Finally, future operating cash flow growth depends on key factors
such as strong net sales growth, some expansion of current net margins, the pace
of capital spending and the continuation of the current refranchising program.