- PepsiCo is selling bigger packs of chips to win over inflation-weary shoppers.
- The company's snack revenue fell 1% during the third quarter, it said Tuesday.
- It's the latest sign that shoppers are getting some relief after years of rising food prices.
There's finally some good news for snackers reaching for a bag of chips at the grocery store.
PepsiCo is adding more chips in packs without raising prices, company executives said during an earnings call on Tuesday.
Bags of Tostitos, Ruffles, and Doritos now contain 20% more chips, CEO Ramon Laguarta said on the call. PepsiCo is also adding two or three extra bags of chips to variety packs, which typically contain around a dozen small bags of chips, he said.
The company is betting that those deals will help attract shoppers back to its brands after years of snackflation. Spiraling food prices over the past few years have led many food companies to raise prices and even sell smaller packages of food for the same price — a phenomenon called "shrinkflation." Inflation has slowed down this year, but many Americans are still spending historically high percentages of their budgets on food.
Shrinkflation doesn't look like it's been working out so well for PepsiCo lately, though. Third-quarter revenue at Frito-Lay North America, the company division that makes Doritos, Lay's, Ruffles, and other snacks, fell 1%, it said.
But the new chip move "will be all additional value that I think will have a positive impact on the business in the coming months," the CEO said, especially as Americans hold watch parties for some of fall's biggest sports.
"It's the football season," Laguarta said. "There's a lot of gatherings, and those brands belong very well in those gatherings."
Executives at PepsiCo, one of the world's largest snack and beverage makers, had indicated in July that relief from higher snack prices was on the way.
Even so, food prices have gained attention in Congress. On Monday, Sen. Elizabeth Warren and Rep. Madeleine Dean, both Democrats, wrote to Laguarta and the CEOs of Coca-Cola and General Mills. In the letters, Warren and Dean question the CEOs about their companies' profits as a result of raising prices and cutting product sizes.
Vice President Kamala Harris has said that her administration would seek a federal ban on price gouging for groceries if she is elected president.