Bank of America, Pepsico beat expectations

NEW YORK (AP) — Bank of America (BAC) said Wednesday that it narrowly turned a profit from July through September, good enough to beat Wall Street expectations.

The bank earned $340 million in the most recent quarter, which works out to a fraction of a penny per share. Financial analysts expected an 11-cent loss, according to a poll by data provider FactSet.

Last month, Bank of America announced it would settle a legal dispute with shareholders who said the bank misled them about its purchase of Merrill Lynch, announced in 2008.

Profits were also hurt by a controversial accounting rule that cuts into banks' net income when the value of their corporate debt rises.

Without those charges, Bank of America revenue was essentially flat at $22.5 billion, beating the expected $21.9 billion.

Bank of America stock was up in premarket trading.

PepsiCo(PEP) says its net income dipped 5% in the third quarter, as the food and beverage maker continued to pour more money into marketing to bolster its flagship brands.

The company, which makes Tropicana juice, Frito-Lay snacks and Quaker Oats, stood by its guidance for the year, however, and profit came in above Wall Street expectations.

Global sales volume for snacks rose 6%, while sales volume for beverages rose 3%.

As part of a turnaround push that began this year, PepsiCo is working to raise the stature of its key brands, such as its namesake cola and Gatorade sports drink. The company is betting that this will help cultivate customer loyalty and make the products more resilient to competition and price hikes.

When excluding the impact of unfavorable currency exchange rates and other structural changes, the company said revenue rose 5% in the quarter. The increase reflected a 1% jump in sales volume and 4% bump in pricing.

The company's core operating profit declined 8%, reflecting higher costs for ingredients, increased advertising and marketing and higher pension expenses.

For the period ended Sept. 8, PepsiCo says it earned $1.9 billion, or $1.21 per share. That's compared with $2 billion, or $1.25 per share, a year ago. Earnings from core operations were $1.20 per share, better than the $1.16 per share analysts expected.

Total revenue fell 5% to $16.65 billion, partly because of unfavorable currency exchange rates and the refranchising of its business in China and Mexico. That means that revenue in those countries is now recorded by PepsiCo's local partners.

Analysts expected revenue of $16.96 billion.