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PepsiCo announced Monday that it will cut prices and shrink its product lineup after pressure from activist investor Elliott Investment Management, which recently took a $4 billion stake in the company.

The food and drink giant said nearly 20% of its products will be removed by early next year so it can focus on items people buy most and give shoppers better value, Yahoo reported.

The company did not say which products will go away or exactly how much prices will drop.

However, PepsiCo explained that money saved from dropping slower-selling items will be used for stronger marketing and more affordable choices on store shelves.

The move comes as Elliott pushed the company to act faster. In a letter to PepsiCo's board, the firm said the company was suffering from slowing growth and weaker profits in its North American business. Elliott argued that PepsiCo needed a clearer strategy to stay competitive.

Marc Steinberg, a partner at Elliott, said in a joint statement with PepsiCo that he believes the new plan will help the company grow.

"We appreciate our collaborative engagement with PepsiCo's management team and the urgency they have demonstrated," he said.

He added that investing in affordability, speeding up new ideas and reducing costs should boost both revenue and profits.

PepsiCo Adds New Simple-Ingredient Snacks

Along with cutting products, PepsiCo plans to roll out more items with simple and functional

ingredients.

This includes new choices like Doritos Protein and the Simply NKD versions of Cheetos and Doritos, which do not use artificial colors or flavors.

The company also recently launched a prebiotic cola as part of its effort to refresh its drink lineup.

According to AP News, PepsiCo said it expects organic revenue to grow between 2% and 4% in 2026.

For the first nine months of this year, organic revenue rose 1.5%. The company's stock remained flat in after-hours trading Monday.

The food and beverage maker also said it will review its supply chain and continue updating its board with leaders who can help drive its long-term growth plans.

Chairman and CEO Ramon Laguarta said he feels good about the steps being taken.

"We feel encouraged about the actions and initiatives we are implementing with urgency to improve both marketplace and financial performance," he said.

In February, the company admitted that shoppers were pulling back as snacks and drinks became more expensive.

By July, PepsiCo expanded lower-cost brands like Chester's and Santitas in an effort to win back budget-minded customers.