As global beverage makers grapple with declining soda sales around the world, investors have been anticipating whether market leaders Coca-Cola Co. (KO) and PepsiCo Inc. (PEP) could prevail in Q1 despite industry challenges.

While snack and soft drinks company Pepsi managed to secure profits above estimates, driven by rising prices and a boom in demand for healthier options, Coke failed to meet the Street’s forecasts, planning to lay off 20% of its corporate staff and it expands its cost-cutting program.

Healthier Portfolio, Pricing Lift Pepsi Bottom Line

Purchase, N.Y.-based Pepsi posted adjusted earnings of $0.94 per share on revenue of $12.05 billion in Q1, surpassing analysts’ estimates for non-GAAP EPS of $0.91 on $11.98 billion in sales. While Pepsi struggled with declines in all businesses except Asia and the MENA region, cost-cutting efforts and pricing helped lift profits for Frito Lay North America and its North America beverages unit, the firm’s two most important segments. Beverage volumes remained flat In the first quarter, while North American beverage volumes fell 1%.

Pepsi posted organic sales up 2.1% YOY, carried by a boost in demand for its “guilt-free” products, such as unsweetened tea and baked chips, which now make up more than 45% of its net revenue. In full-year 2017, management forecasts EPS to rise 8%. (See also: Analyst: Mondelez Would Be ‘Digestible’ for Pepsi.)

Overseas Slump Pull Coke Below Estimates

In the most recent quarter, Coke reported adjusted earnings of $0.43 on revenues down 11% to $9.12 billion, compared to the Street’s forecasts for earnings of $0.44 per share on $8.89 billion in sales. Coke’s beverage volumes came in flat for the first quarter, while soda volumes fell 1%. Weakness abroad and the impact of a strong U.S. dollar dragged on Coke’s revenues, as over half of its business comes from overseas.

On Tuesday, newly instated Chief Executive Officer (CEO) James Quincey reiterated Coke’s commitment to evolve its growth model to meet consumers’ changing tastes and preferences while it pushes forward its new $800 million cost savings plan. The company has already begun to reduce its products’ sugar content and diversify outside soda, as Coke and its rival Pepsi step up their game in the “premium” water space. Moving forward in full-year 2017, Coca Cola foresees adjusted EPS to decline 2% at the midpoint. (For related reading, see "Coca-Cola vs. Pepsi's Business Models")