Pepsi has cut its full-year profit forecast and said it will keep reducing business costs as it works to reverse weakness in its North American business.

The company said on Thursday that operating conditions in North America had improved compared with the previous quarter. New product launches and price cuts boosted snack sales, while strong sales of functional drinks and zero-sugar beverages offset weakness in traditional soda. Even so, the segment's operating performance still fell short of what Pepsi (NASDAQ: PEP) would like.

Chief Executive Ramon Laguarta said in a written earnings statement on Thursday: "Our North America business performed below expectations and has plenty of room for improvement." Strong sales momentum in overseas international operations helped offset the shortfall in North America.

Third-quarter revenue rose 5.6% year over year to $25.27 billion, above Wall Street's estimate of $24.95 billion, while organic revenue grew 3.1%. Profit also increased. Net income for the quarter ended September 5 was $3.05 billion, up from $2.6 billion a year earlier. Adjusted earnings per share were $2.34, beating analysts' forecast of $2.29.

Laguarta said: "Looking ahead, we will continue to build on the strength of our international business while driving sustainable improvement in North America with urgency."

Laguarta said Pepsi (NASDAQ: PEP) will improve results through new product development and brand building, responding to market trends such as high protein and the removal of artificial colors and flavors. In addition, the company is reviewing more structural cost-cutting measures and plans to implement them in the coming months.

Pepsi (NASDAQ: PEP) lowered its full-year adjusted earnings growth forecast to 1%-2%, from 4%-6% previously, and narrowed its organic revenue outlook to about 3% growth, compared with a prior range of 2%-4%.