PepsiCo announced on Monday that it is acquiring prebiotic soda brand Poppi for $1.95 billion. This strategic move strengthens its presence in the growing “healthier soda” market, as the company faces declining demand for its traditional soft drinks and snacks.
Following the announcement, PepsiCo’s stock rose 1.5% in early trading.
Consumers, particularly younger generations, are shifting toward functional beverages that support health and wellness. In response, competitors like Coca-Cola have expanded their product lines, launching prebiotic sodas such as “Simply Pop” under its Simply brand. Other industry players, including Celsius Holdings and Keurig Dr Pepper, have also entered the space by acquiring smaller wellness-focused beverage brands.
With this acquisition, PepsiCo is positioning itself more firmly in the health-conscious segment of the carbonated drinks industry. The company has faced sluggish demand due to multiple price increases affecting its traditional sodas and Lay’s snacks. The Poppi deal allows PepsiCo to tap into the fast-growing prebiotic soda market, which has seen increasing consumer interest in gut health-friendly beverages.
What Makes Poppi Stand Out?
Poppi’s prebiotic sodas combine apple cider vinegar, fruit juice, and prebiotics, offering a low-calorie alternative with no more than five grams of sugar per serving. According to PepsiCo, Poppi has experienced rapid growth, with retail sales soaring 122% year-over-year in the 12 weeks leading up to February 22. The brand now holds approximately 1% of the total U.S. carbonated soft drink market, according to BNP Paribas.
Poppi was originally founded as “Mother” by Stephen and Allison Ellsworth and later rebranded in 2020. The couple gained early recognition when they pitched their product on Shark Tank in 2018, securing investment from Rohan Oza, co-founder of CAVU Consumer Partners.
PepsiCo stated that the transaction includes $300 million in anticipated cash tax benefits, bringing the net purchase price down to $1.65 billion. Additional terms of the deal were not disclosed.
By acquiring Poppi, PepsiCo is strengthening its foothold in the health-focused beverage market, ensuring it stays competitive as consumer preferences shift away from traditional sodas toward functional and wellness-driven drinks.
