PEPNEUTRAL

PEP Gross Margin Analysis

54.2%

Updated 825h ago·SEC filings & market data

Key Takeaway

PepsiCo’s gross margin of 54.2% means that for every dollar of revenue, the company keeps $0.542 after covering the direct costs of producing its drinks and snacks.

Sector Performance

60th percentile

PEP

54.2%

Sector Median

46.6%

Sector Avg

47.6%

Prior Period

55.2%(Apr 2026)

↓ Declining

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Deep Analysis

PepsiCo’s gross margin of 54.2% means that for every dollar of revenue, the company keeps $0.542 after covering the direct costs of producing its drinks and snacks.

This margin is above the sector median of 44.6%, placing PepsiCo in the 63rd percentile among its peers—suggesting it earns a higher-than-average markup on its products. There is no trend data available: the year-over-year change, quarter-over-quarter change, and historical eight-quarter pattern are all reported as “N/A,” so no direction can be inferred. The combination of a high current margin with an unknown trend means you cannot assess whether this advantage is strengthening or weakening, adding uncertainty to the risk profile. This metric on its own does not clearly support or contradict the overall NEUTRAL verdict—the strong level is a positive, but the lack of trend information prevents a more definitive stance.

Frequently Asked Questions

What does the Gross Margin tell investors about PEP?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

Who are PEP's closest peers by Gross Margin?

The closest peers by Gross Margin include: LVS (46.9%), ORLY (51.4%), MPWR (55.2%), NEM (56.0%), REI (56.0%).

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Learn More About Gross Margin

Gross Margin vs Net Margin: Why the Gap Between Them Tells You Everything

Gross margin vs net margin: learn what the spread between them reveals about operating leverage, cost structure, and early warning signs in any stock.

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.