After 12 years – and a recent spate of run-ins with activist investors – Pepsi CEO Indra Nooyi will step down from leading the food and beverage firm. She will be succeeded in the role by Pepsi President Ramon Laguarta as of October 3. Nooyi will remain as chairman until early 2019.
“Growing up in India, I never imagined I’d have the opportunity to lead such an extraordinary company,” Nooyi said in a statement. “PepsiCo today is in a strong position for continued growth with its brightest days still ahead.”
Since Nooyi took the helm, Pepsi has seen its stock rise 75 percent cumulatively, less than the SNP, which picked up 112 percent overall. They also trailed their rivals at Coke, which added 108 percent during the same time period. Net revenue climbed from $35 billion in 2006, to $63.5 billion last year.
Nooyi has also experienced difficulty with activist investor Nelson Peltz, who was looking for Pepsi to split its beverage and snacking businesses. After a two-year struggle, Peltz backed off in 2016 and exited the firm. Nooyi was a strong advocate of keeping the brands together, which she believed gave the firm better leverage over retailers.
Nooyi’s departure marks the second female leader to depart a large food and beverage firm, following Campbell Soup’s Denise Morrison.
She is also the latest in a growing list of departures of chief executives across the food and beverage industry, which is facing a myriad of challenges in the digital age.
International markets have proven strong for Pepsi, as slowing U.S. growth has pushed the firm to look for opportunities in foreign markets. Pepsi this quarter reported 7 percent organic revenue growth in Europe Sub-Saharan Africa and 6 percent growth in Asia, the Middle East and North Africa.
With Nooyi’s departure, the rest of PepsiCo’s senior leadership team will remain unchanged, according to the firm.