PepsiCo’s latest packaging data offer a useful snapshot of how one of the world’s largest consumer goods companies is progressing on plastic reduction and circularity.
PepsiCo’s 2025 ESG Performance Metrics and Calculation Methodology, published on August 13, 2026, shows that in 2025, recycled content in primary plastic packaging across the company’s key packaging markets increased from 15% to 18%, while the absolute tonnage of virgin plastic used in primary plastic packaging across those markets declined by 6% year over year. At the same time, however, the share of primary and secondary packaging in key packaging markets classified as reusable, recyclable or compostable “by design” was 94%.
Taken individually, the first two figures point to clear progress. Read together with the third, they reveal something more interesting: measuring packaging circularity is becoming increasingly complex, and no single percentage is enough to explain how far a company has really moved towards a circular model.
For the packaging industry, PepsiCo’s latest disclosure is therefore interesting not only because of the scale of the company involved, but because it illustrates the growing need to distinguish between several metrics that are often grouped under the same sustainability narrative. Reducing virgin material, increasing recycled content, designing packaging for recyclability and ensuring that packaging is actually recycled after use are closely related goals, but they are not the same thing.
Virgin plastic reduction provides one of the clearest signals of progress
Among PepsiCo’s 2025 figures, the 6% year-on-year reduction in absolute virgin plastic tonnage used in primary plastic packaging across key packaging markets is arguably one of the most straightforward indicators to interpret. Unlike relative measures based on production intensity or sales, the figure shows that PepsiCo used less virgin plastic in its in-scope primary packaging portfolio than in the previous year. It does not, however, show on its own that the company’s total plastic packaging volume declined by 6%, because the metric measures virgin plastic rather than total plastic use.
This matters because a transition towards circular packaging cannot rely exclusively on replacing virgin feedstock with recycled material. Reducing the total amount of material required in the first place remains an important part of the equation, particularly for global beverage and food companies operating at very large volumes.
PepsiCo identifies measures such as lightweighting and packaging redesign among the levers it uses to reduce plastic consumption. These measures can lower the amount of resin required per package, although the 2025 methodology does not break down how much of the reported 6% reduction came from lightweighting specifically.
Initiatives of this kind can sometimes receive less attention than new materials or high-profile recyclable formats, yet their impact can be substantial. Removing a few grams from a package may appear marginal at product level, but when multiplied across millions of units it can translate into meaningful reductions in material demand, transport weight and associated resource use.
At the same time, however, lower virgin plastic consumption does not automatically mean that the resulting packaging system is circular. It tells us that less new material is being used, but not necessarily what happens to the packaging once it reaches the end of its useful life.
Recycled content reaches 18%, but the methodology matters
The increase in recycled content from 15% to 18% in PepsiCo’s primary plastic packaging is another positive indicator, particularly because greater demand for recycled feedstock is essential if packaging circularity is to move beyond design commitments and into functioning material loops.
Yet recycled content is also a good example of why headline percentages should be read together with the methodology used to calculate them.
PepsiCo notes that, for certain types of recycling where physical traceability is not feasible, such as chemical recycling processes, recycled content may be accounted for through a mass balance approach. Under mass balance, an accounted quantity of recycled feedstock entering a production system can be allocated to specific outputs through an accounting method rather than by physically tracing the same material into each individual package.
This distinction does not invalidate the role of mass balance, which can be an important tool for scaling the use of alternative feedstocks in existing production infrastructure. It does, however, change the way the resulting figure should be understood.
An 18% recycled-content rate across PepsiCo’s in-scope primary plastic packaging portfolio should therefore not automatically be interpreted as meaning that every plastic package placed on the market physically contains 18% recycled material. Some formats may contain significantly more, others less, while part of the total may be attributed through mass balance accounting.
For packaging professionals, this is an increasingly important distinction because the value of a sustainability metric depends not only on the percentage reported, but also on what that percentage actually represents.
The 94% figure shows the limits of “recyclable by design”
The most revealing figure in PepsiCo’s latest packaging disclosure may actually be the one that appears not to have changed. In 2025, 94% of the company’s primary and secondary packaging in key packaging markets was classified as reusable, recyclable or compostable by design. PepsiCo now also reports the 2024 comparator at 94%, but that figure has been restated from the 93% previously disclosed; the company says the adjustment reflects the availability of improved data.
At first glance, 94% is a high proportion, and reaching the remaining few percentage points can be particularly difficult when a company operates across multiple product categories, materials, markets and waste-management infrastructures. However, the figure also highlights a broader issue that extends well beyond PepsiCo: packaging that is recyclable by design is not necessarily packaging that will actually be recycled.
PepsiCo’s methodology makes this distinction explicit by stating that the metric does not include actual end-of-life outcomes. In practical terms, the indicator assesses whether a package has been designed in a way that is compatible with reuse, recycling or composting according to defined criteria, rather than whether the package is ultimately collected, sorted and transformed into new material after use.
That difference is fundamental.
A package can be technically compatible with an established recycling stream and still fail to be recycled because collection is unavailable in a particular market, consumers dispose of it incorrectly, sorting facilities cannot separate it effectively, contamination reduces its value or there is insufficient demand for the recovered material.
Circularity is therefore not created by design alone. Design is an essential condition, but the system surrounding the package determines whether that potential becomes reality.
Recyclability is becoming a more demanding concept
This distinction is becoming increasingly relevant as the packaging sector moves towards more rigorous definitions of recyclability. For many years, a package could be described as recyclable largely on the basis of the technical properties of its material. Today, regulators, producers and recyclers are paying much closer attention to whether those materials can actually move through collection and recycling systems at scale.
As a result, several different concepts that were once treated as interchangeable are beginning to separate.
A package may be technically recyclable because the material can, under the right conditions, be reprocessed. It may be recyclable by design because its components, labels, adhesives, colours and structure are compatible with a recognised recycling stream. Yet effective recycling requires an additional layer: the existence of real collection, sorting and reprocessing infrastructure capable of recovering that package after use.
This is why recyclability percentages can be useful without providing a complete picture of circular performance. They tell us something about the package itself, but less about the system in which that package operates.
For multinational companies, this becomes even more complicated because one packaging format may have very different end-of-life outcomes depending on the market in which it is sold. A bottle that is routinely collected and recycled in one country may have little chance of entering a recycling stream in another.
Reuse remains the difficult part of the transition
Reuse adds another layer to the discussion. PepsiCo continues to pursue reusable packaging options, but in 2025 it sunset its previous goal of delivering 20% of beverage servings through reusable models by 2030. The company said it would continue its reuse efforts while tracking reusability within its refined reusable, recyclable or compostable packaging goal. The change underlines how structurally demanding reuse can be compared with changes that can be made within existing single-use packaging systems.
This is not unique to PepsiCo. Reuse models often require substantial changes not only to packaging design, but also to logistics, retail infrastructure, consumer behaviour, washing systems, reverse transport and asset management. In many cases, the package itself is the simplest part of the challenge.
The contrast is important because circularity is sometimes discussed as though recycling and reuse were simply two interchangeable routes towards the same outcome. In reality, they involve very different operational models and require different kinds of investment.
For large beverage companies, increasing recycled content and reducing virgin material can often be integrated into existing supply chains more gradually, whereas moving significant volumes into reusable packaging may require a much more structural change in how products are distributed and consumed.
That helps explain why progress across the different circularity metrics can move at very different speeds.
Four metrics can tell four different stories
PepsiCo’s 2025 results illustrate why sustainability performance in packaging increasingly needs to be read through several indicators rather than a single headline target.
A reduction in virgin plastic shows whether a company is lowering its dependence on newly produced material. Recycled content indicates the extent to which secondary material is being brought back into new packaging. Recyclability by design assesses whether the package itself has been engineered to fit within reuse, recycling or composting systems, while actual recycling and reuse tell us whether those systems are functioning once the package leaves the consumer’s hands.
These metrics reinforce one another, but none can substitute for the others.
A company may reduce virgin material substantially while still relying on packaging that faces difficult end-of-life conditions. It may design almost all of its portfolio for recyclability without seeing equivalent collection or recycling rates in practice. It may increase recycled content while continuing to depend largely on single-use formats.
Seen in this context, PepsiCo’s 2025 figures are neither simply a success story nor evidence that progress has stalled. They are more useful than that, because they show how different parts of the circular packaging transition can advance at different speeds.
The next challenge is measuring what happens after the package is sold
As corporate packaging disclosures become more detailed, the industry is gaining access to better information about material use, recycled content and design performance. The next step will be to connect those metrics more closely with what happens after packaging reaches the market.
The increase in recycled content and the reduction in virgin plastic reported by PepsiCo represent tangible progress within the in-scope packaging portfolio, particularly at the scale of a global CPG company. The 94% figure for packaging that is reusable, recyclable or compostable by design, however, is a reminder that designing packaging for circularity is only one part of the challenge.
Ultimately, the most meaningful question may no longer be how much packaging is technically recyclable, but how much of it actually returns to the system as a useful resource.
As the industry becomes more sophisticated in the way it reports sustainability performance, that distinction between circularity in design and circularity in practice is likely to become increasingly difficult to ignore.
