The soft drink and snack maker forecast earnings per share would rise 6% in 2020, less than Wall Street had expected and predicted slower organic revenue growth than last year.
PepsiCo shares were last down 0.7% after dipping as much as nearly 2% in early trade, but its finance chief described the earnings target as a "good, balanced number."
"It gives us the room and the ability to continue to invest back in the business," Chief Financial Officer told Reuters.
Analysts said the cautious forecasts should come as no surprise.
"PepsiCo typically starts the year with conservative guidance, setting up for modest beats and raises," Evercore ISI analyst Robert Ottenstein said.
Chief Executive Ramon Laguarta has been largely focusing on new launches, which include healthy snacks and beverages, and higher investments in marketing to drive sales.
Sugary drinks and salty snacks have been shunned for long on health concerns, but smaller soda servings and greater choice of healthy on-the-go snacks have rejuvenated that demand.
"We've seen the consumer continue to go back to our classics... Doritos and Cheetos and Tostitos," Laguarta told analysts.
Rival Coca-Cola Co also beat forecasts on growing demand for its trademark soda.
PepsiCo said its North American beverage unit grew the fastest in four years in 2019, reflecting strong demand for its trademark Pepsi soda and Pepsi Zero Sugar. Sales in the unit rose 4% in the fourth quarter.
Snacks sales, under its Frito-Lay North America segment, gained 3%, powered by Lays, Doritos and premium brands such as Bare and Off the Eaten Path. Organic revenue, which strips out currency and acquisition effects, grew 4.3%.
Johnston said the coronavirus outbreak would have little impact on its business in China, which accounts for less than 2% of the group's worldwide sales and added that five of PepsiCo's six plants in China were already open.
For 2020, PepsiCo forecast core earnings of $5.88 per share, below $5.95 expected by analysts, according to IBES data from Refinitiv. It sees organic revenue up 4% this year after a 4.5% rise in 2019.
Net revenue rose 5.7% to $20.64 billion in the fourth quarter, beating the estimate of $20.27 billion. It earned $1.45 per share on an adjusted basis, a cent above market forecasts.
By Nivedita Balu
