What's going on?

PepsiCo reported better-than-expected earnings on Tuesday, as the US food and drinks giant starts to cater to slightly more� expensive tastes.

What does this mean?

Supply shortages have been pushing up costs for companies across the board, but Pepsi�s in a stronger position than most: it sells products that customers tend to buy no matter what, which means it can bump up prices without sacrificing sales. And that�s exactly what happened last quarter: Pepsi�s profit fell 3% compared to the same time last year, sure, but its organic revenue � that is, excluding the effects of acquisitions and currency swings � grew 9%. Emboldened, the company said it�s planning to raise prices even more in an effort to close that profit gap, and its raised its revenue outlook for the rest of the year too.

Why should I care?

For markets: Green is the new brown.
Pepsi�s stock is only up 4% this year versus the US stock market�s 16%, but the company has a plan to fix that: it�s been trying to endear itself to an increasingly eco-conscious customer and investor base (tweet this). That became clear last month, when it said it�d be releasing a new range of healthy snacks and drinks in collaboration with Beyond Meat by 2022. It then doubled down on those new sustainable stylings, announcing that it would be committing to a new program � �Pep+� � that includes a raft of ambitious sustainability targets.

Zooming out: Beer�s lost its taste.
It�s not just Pepsi that�s looking to change with the times: AB InBev � the world�s biggest brewer � said on Monday that it�s thinking of selling off some of the German beer brands it�s owned for decades. It apparently wants to focus more on wines and spirits, which stands to reason: more than 60% of growth in the alcohol industry is being driven by products other than beer.