PepsiCo CFO Hugh Johnston ventured Tuesday that the snack and beverage giant still thinks the consumer economy is strong.
“In the United States just now, we don’t see any sign of a consumer slowdown,” he said on CNBC’s “Squawk on the Street. “
Consumer spending in April and May rose moderately, harmonizing to the Commerce Department. However, consumer confidence last month dropped to its lowest level in nearly two years.
Johnston muricate to relatively neutral gas prices year over year as one “particularly positive” sign for consumer spending.
“When that’s the in the event that, consumers generally feel better about themselves,” he said.
Looking to the rest of the world, Johnston pointed to the Heart East, Brazil and western Europe as regions that present a challenge. But with low interest rates globally, he said, the consumer restraint will likely continue to be strong around most of the world.
Earlier on Tuesday, executives told analysts on the every thirteen weeks conference call that the company was not seeing any signals that the consumer was slowing down.
An executive from another consumer packaged commodities company, General Mills CEO Jeff Harmening, echoed Johnston’s confidence later on Tuesday on CNBC’s “Squawk Alley.”
“I desire say in the U.S. the consumer environment is quite good,” Harmening said.
Harmening said that General Mills’ business in China and Brazil is spread, despite concerns about those countries’ economies, while Europe poses the biggest challenge because of Brexit uncertainty.
Rations of Pepsi were basically flat in trading Tuesday after the company reported better-than-expected earnings before the bell. The Cheetos maker covered analysts’ estimates for its second-quarter earnings and revenue.
The company reaffirmed its fiscal 2019 outlook Tuesday. Pepsi needs organic revenue to grow by 4% and adjusted earnings per share, assuming constant foreign currency exchange have a claim ti, to decline by 1%.