PepsiCo’s Stock Surges on Strong Profit Report

PepsiCo Inc. said Tuesday that its earnings rose an unexpectedly strong 8% in the first quarter, fueled by improvement in domestic soft drinks and its global snack food and restaurant businesses.

Its stock shot up 10%, climbing $3.125 to close at $34.375 a share on the New York Stock Exchange.

PepsiCo, based in Purchase, N.Y., also said it was moving ahead with plans to spin off its major fast-food chains--Pizza Hut, Taco Bell and KFC--into a separate company and to sell several smaller restaurant businesses.

Earnings in the three months ended March 22 rose to $427 million, or 27 cents a share, from $394 million, or 24 cents a share, a year earlier.

The results were 3 cents a share higher than Wall Street analysts expected.

At a Glance:

ITT Corp. said first-quarter earnings exceeded expectations, rising to $19 million, or 16 cents a share, from $17 million, or 15 cents, a year earlier.

Wendy’s International Inc. said first-quarter earnings rose 27% to $24.6 million, or 19 cents a share, from $19.5 million, or 16 cents, in the year-earlier period.

Humana Inc. said its first-quarter earnings fell 26.4% to $39 million, or 24 cents per share, down from $53 million, or 32 cents a share, a year earlier.

Borland International Inc. reported a fiscal fourth-quarter loss of $42.5 million, or $1.15 a share, compared with net income of $7 million, or 18 cents, in the year-earlier period. The company also named Richard LeFaivre, former vice president of Apple Computer Inc.’s advanced technology group, as its chief technology officer.

Estee Lauder Cos. said fiscal third-quarter profit rose a better-than-expected 36% to $38.3 million, or 27 cents a share, from $28.2 million, or 19 cents, a year ago.

Pharmacia & Upjohn Inc. said first-quarter earnings dropped 15.3% to $194 million, or 37 cents a share, from $229 million, or 44 cents, a year ago, before one-time charges.

Bethlehem Steel Corp. said first-quarter earnings jumped to more than $38 million, or 25 cents per share, from $100,000, or a loss of 9 cents, in the year-ago quarter.

Tenneco Inc. said its first-quarter profit rose 27% to $76 million, or 44 cents a share, from $60 million, or 34 cents, in the year-ago quarter.