Snacks offset soda slump

Soda consumption may be down, but beverage makers are still popping.

The volume of soda sold in the U.S. has been declining for years on concerns that sugary drinks contribute to weight gain as well as a proliferation of alternatives in the beverage aisle. More recently, industry executives have attributed an accelerating decline of diet sodas to concerns over artificial sweeteners like aspartame.

Beverage companies have found other ways to put the fizz back in their business.

PepsiCo reported earlier this month that its adjusted third-quarter profit exceeded market expectations thanks to higher prices, smaller serving sizes and a bigger emphasis on snacks. The owner of the Frito-Lay, Gatorade and Aquafina brands lifted its profit forecast for the year.

CEO Indra Nooyi said that focusing solely on carbonated drinks is “a thing of the past.”

Pepsi’s profit has beaten estimates every quarter this fiscal year, true also for rivals Coca-Cola and Dr Pepper Snapple Group. Both Coca-Cola and Dr Pepper Snapple are expected to report their third-quarter results this week.

While Coca-Cola and Dr. Pepper Snapple may not have the food offerings that Pepsi does to balance out their business, they have also found success with non-soda offerings, smaller sizing and other new products to help adapt to the shifting consumer tastes.