PepsiCo’s efforts to revive its North American snacks business have lost momentum as rising living costs, weight-loss drugs and healthier eating habits reshape how Americans consume brands including Lay’s, Doritos and Cheetos.

Sales across PepsiCo Foods North America fell two per cent during the second quarter, while volumes remained flat despite the group cutting prices by as much as 15 per cent on some of its best-known products.

The performance marked a setback after the division returned to growth during the opening quarter, when volumes improved by around two per cent. Food volumes have now declined in four of the company’s past six quarters.

PepsiCo has invested heavily in making its core ranges more affordable, but the latest figures suggest lower prices alone may not be enough to persuade consumers to buy more crisps and snacks.

American shoppers are becoming more selective as household budgets remain under pressure and demand shifts towards products offering more protein, fibre, less sugar and smaller portions.

The growing use of GLP-1 weight-loss drugs is also changing buying habits. Around 21 per cent of US households were using the medication by May, up from nine per cent in January 2025, according to an analysis of Numerator data by PwC. Users were found to be buying fewer sweet treats and cutting back on salty snacks.

The change presents a significant challenge for PepsiCo, whose food portfolio includes Frito-Lay brands such as Ruffles, Tostitos and PopCorners and accounts for around 58 per cent of its annual revenue.

Its North American drinks business is also under pressure, with volumes falling four per cent during the quarter. By comparison, rival Coca-Cola reported four per cent volume growth in the region in its previous results.

PepsiCo said trading across the US food and drink market had slowed as consumers tightened their budgets in response to inflationary pressure. The group now expects the improvement in its North American business to be more gradual than previously anticipated.

The food and beverage giant is responding by expanding into more health-conscious and “permissible” snacking occasions. Recent launches include Doritos Protein, PopCorners Protein, SunChips Fiber and products made without artificial colours or flavours.

It is also placing greater emphasis on portion-controlled multipacks, which generate more than $3.5bn in annual sales, and brands such as Baked, Simply, SunChips, Siete and Quaker Rice Cakes. PepsiCo said those ranges delivered strong volume and revenue growth during the quarter.

Despite the weakness in North America, PepsiCo’s wider business continued to grow. Group revenue rose 6.4 per cent in the second quarter, with global convenient food volumes up three per cent and international organic revenue rising seven per cent.

The pressure on its home market is nevertheless likely to intensify scrutiny from activist investor Elliott Investment Management, which disclosed a stake worth around $4bn last year and has urged PepsiCo to strengthen its drinks business and consider selling non-core food assets.

PepsiCo now faces the challenge of adapting a portfolio built around habitual snacking to consumers who are thinking more carefully about price, ingredients and how often they eat between meals.