• by Thom Forbes  @tforbes, February 12, 2015

PepsiCo’s earnings were down 24% for the quarter due to currency fluctuations but the news about its 3% bump in sales for Frito-Lay snacks and 1% in beverages was cheery enough to boost its stock 2.5% yesterday. That followed Coca-Cola’s immediate jump of 2% earlier this week “following the release of better-than-expected financial results,” as Barron’s Ben Levisohn put it.

“We have momentum,” PepsiCo CFO Hugh Johnston — “noting the company's growth with retailers in the U.S.” — tells Reuters’ Anjali Athavaley and Yashaswini Swamynathan. “We are absolutely rolling right now.”

Outsiders are a tad less exuberant but encouraged all the same.

“It's not as if PepsiCo or Coca-Cola are suddenly on a financial roll — but they're now at least starting to exceed modest expectations of industry analysts,” USA Today’s Bruce Horovitz points out. “I think we are seeing a stabilization of [PepsiCo’s] business,” S&P Capital IQ analyst Joseph Agnese tells him, driven by the snacks business.  

As for the legendary Soda Wars, they might as well be just that: the stuff of legends.

“It's no longer a matter of who's winning — it's about who's losing the least,” writesTime’s Jack Linshi in introducing three telling charts that “show why no one wins the Coke vs. Pepsi fight.” 

Sales have dropped for both companies for 11 years, “though Coke has better weathered the storm,” Linshi writes. Artificially sweetened sodas are also on the skids. “One corner of the beverage industry that’s actually winning? Energy drinks,” he points out.

“Pepsi’s North American still-drink volume grew 4% during the quarter, while its carbonated soft-drink volume fell 2%,” reportsFinancial Times’ Neil Munshi.

“‘But the consumer doesn’t really want to walk away from bubbles,’ CFO Johnston said, noting the recent launch of Mountain Dew Kickstart, a multi-hundred million-dollar business ‘built almost from nothing,’” Munshi reports.

Mountain Dew Kickstart added two new flavors — Pineapple Orange Mango and Strawberry Kiwi — last month to the beverage line that targets “cross-cultural Millennial males,” as Ben Bouckley reported in Beverage Daily. 

Even as consumers drink less sugary and sugary-substitute carbonated beverages overall, the industry has found a way to re-imagine the path to profitability by repackaging the product. It may be the same old soda, there’s just less of it per unit at a higher relative price. 

“Consumers are paying higher prices for soda, thanks to new types of packages such as 8-ounce cans versus the standard 12-ounce size, a trend that bolstered earnings at both Coke and Pepsi,” reports Jonathan Beer on CBS’ Money Watch.  

“Better pricing in terms of these configurations to smaller package helps you realize more price per ounce,” BMO Capital Markets analyst Amit Sharma points out to Beer. “That same model has been successful in other markets.”

In the event you are wondering, the calls to split up PepsiCo into two companies (or buy Mondelez, which announced its own “mixed results” yesterday) are in abeyance for the nonce.

“Pepsi last month called a truce with activist shareholder Trian Fund Management, agreeing to add former H.J. Heinz Chairman William Johnson, an advisory partner to Trian, to its board,” Chelsey Dulaney reminds us on Dow Jones’ MarketWatch. Trian, which is led by Nelson Peltz, “had been pushing for the company to split up its beverage and snack businesses.”

“Trian has always believed that PepsiCo is a world-class company with a portfolio of iconic brands, and enormous potential,” Peltz said when Johnson’s election to the board was announced. “We support [CEO] Indra [Nooyi]’s commitment to operational excellence, which has resulted in improved performance of the company.”

Slate’s Alison Griswold observes that “the challenges faced by Coke and Pepsi are not unlike those confronting Campbell Soup Co. Late last month, Campbell’s announced a major reorganization that essentially shifted its focus away from soup. Campbell’s winning products these days are its fresher, healthier options ... For Campbell’s to stay Campbell’s, it’s learning that it might have to move away from the core products that once really made it Campbell’s.”