News Summary: PepsiCo's profit hit by China deal

AP News
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Posted: Jul 25, 2012 12:10 PM

THE BOTTOM LINE: PepsiCo Inc. said its net income fell by 21 percent in the second quarter, as a deal to expand in China and a stronger dollar ate into results.

THE BIG PICTURE: The Purchase, N.Y.-based company said its organic revenue, which strips out the impact of foreign exchange rates and the refranchising of its Mexico and China businesses, rose 5 percent in the quarter.

THE BACKGROUND: PepsiCo is significantly increasing its marketing spending this year in hopes of strengthening its brands. The company is betting that will make them more resilient to competitors and price hikes.