Indra Nooyi, the first woman to serve as PepsiCo’s chief executive officer and a one-time adviser to President Trump, is giving up control of the soft drink maker after 12 years.
Nooyi, a native of India who stepped into PepsiCo’s top job in October 2006, agreed 10 years later to join the Strategic and Policy Forum that advised Trump on buoying U.S. economic growth and creating jobs after his unexpected victory against Democrat Hillary Clinton in the 2016 presidential election.
The group dissolved less than a year later, as Trump grappled with fallout from his slowness in condemning violence by white nationalists at a Charlottesville, Va., rally in which a protester was killed. Nooyi, 62, condemned the attack but was criticized by advocacy groups when she didn’t publicly part ways with the administration as did some of her peers.
Heartbroken by the violence in #Charlottesville. Hate and intolerance are a betrayal of what we stand for as Americans.
— Indra Nooyi (@IndraNooyi) August 13, 2017
Nooyi’s last day as CEO will be Oct. 3, though she will remain chairman until early 2019 to ensure a smooth transition. Overall, her tenure marked a period of growth for Purchase, N.Y.-based Pepsi, whose revenue nearly doubled to $63 billion despite the drag from the 2008 financial crisis. Its stock price has surged 80 percent to $117.38 under Nooyi, who will be succeeded by 54-year-old Ramon Laguarta, the firm’s president.
“Leading PepsiCo has truly been the honor of my lifetime, and I’m incredibly proud of all we have done over the past 12 years,” Nooyi said. “Growing up in India, I never imagined I’d have the opportunity to lead such an extraordinary company.”
Under her leadership, Pepsi increased its focus on healthier foods, grouped into its “Good for You” and “Better for You” divisions. Together, the businesses accounted for about 50 percent of last year’s sales, up from just 38 percent when Nooyi took over in 2006.
“Indra was a pioneer, paving the way for a new generation of business leaders who seek to ‘do well by doing good,’ Ian Cook, presiding director of Pepsi’s board, said in a statement. “She has delivered strong and consistent financial performance, managing with an eye toward not only the short run, but the long run as well.”
In the three months through June, Pepsi garnered profit of $1.82 billion, or $1.61 a share, topping the $1.52 average estimate from analysts surveyed by FactSet.
While the company had fielded questions from investors about its executive-succession plan as Nooyi’s tenure lengthened, her successor is unlikely to make major strategy chances in the near future, said Judy Hong, an analyst with Goldman Sachs.
Laguarta’s initial focuses will likely include adapting to changing consumer tastes such as an interest in new and healthier foods and drinks, analysts said, and improving growth in the $21 billion North American beverage business, which has struggled relative to peers.
Nooyi had long emphasized the benefits of running North American snacks and beverages — from Pepsi, SoBe and Naked drinks to Tostitos chips — under a single division through the company’s “Power of One” strategy, JPMorgan Chase analyst Andrea Teixeira said in a report.
“While we would not expect any change in tone from Pepsi in the near future, we do think investors may believe that a separation of the businesses is possible,” Teixeira said.
