Pepsi Fizzles

Overall, revenues rose 11 percent on a mere 2 percent of volume growth, showing that the company has been able to pass along price increases.

But none of that was enough to counter sagging soft-drink sales.

To compete globally with Coca-Cola, Pepsi has no choice but to invest big in worldwide growth, but that growth is coming at a cost. As it pursues initiatives such as a $500 million marketing effort in India and acquisitions in Russia and elsewhere, Pepsi is seeing its core product fall in its core market.

But even where the company is strongest, the company faces big challenges. Sales of bottled water have started sinking lately, thanks in part to environmental concerns. And a resurgent dollar could put a crimp on overseas sales.