PepsiCo's mega brands. Source: Company website.

It was another successful quarter for PepsiCo (PEP -2.91%). The food and beverage giant handily beat analyst expectations on both revenue and earnings per share, and the company raised its earnings guidance for the remainder of the year, in a classic "beat and raise."

To be sure, not everything is going perfectly for PepsiCo. The company is still seeing some strong headwinds weighing on its performance, including the strong U.S. dollar and the threat of slowing economic growth in emerging markets such as China and Brazil.

But PepsiCo's resilient performance in the face of some significant challenges is a testament to its world-class brand and its management leadership. Here's how PepsiCo managed a rousing performance last quarter, in what amounts to a very difficult operating climate.

Snacks business leads the way
Overall, PepsiCo earned $1.32 per share in profit on $15.9 billion of revenue last quarter, year over year. Its GAAP earnings per share and revenue declined 3% and 6%, respectively. However, most of the damage incurred was due to unfavorable currency fluctuations. The rising U.S. dollar makes revenue generated internationally worth less, when those sales are converted back into the domestic currency. Excluding currency effects, PepsiCo's organic revenue would have grown 5%.

The bigger drive of PepsiCo's strong results last quarter was its food and snacks business, led by brands including Quaker and Frito-Lay. PepsiCo has steadily built a very large food business, and its total revenue is now evenly split between food and beverages. This was a very smart strategy, since sales of carbonated beverages are in decline, and the results speak for themselves. PepsiCo generated 23% organic revenue growth last quarter in its Latin America Foods division and 5% growth in Asia, the Middle East, and Africa, due to the combination of higher volumes and higher pricing. These were PepsiCo's top two performing geographic markets.

Cumulatively, emerging market organic revenue jumped 11% last quarter. These strong results are expected to continue, which is why PepsiCo also raised its guidance for the remainder of the year.

But even in soda, PepsiCo is making progress. The company grew revenue in the Americas Beverage division by 1% last quarter, which doesn't sound too impressive, but considering soda has been stuck in a decade-long decline, it actually is.

In fact, soda industry research company Beverage Digest reported that U.S. soda sales fell 1% in 2014, representing the 10th consecutive year of declining sales. The reason PepsiCo finally managed growth could be its decision to remove aspartame from Diet Pepsi after a pronounced consumer backlash against artificial sweeteners. It's a great sign that management is taking notice of changing consumer trends and responding effectively.

Because of the improvement in its flagship soda business, as well as continued strength in snacks, PepsiCo anticipates a very good year. Management now expects 8% growth in constant-currency earnings per share in 2015, up from prior expectations for 7% growth. PepsiCo will accomplish this earnings growth by mid-single-digit organic revenue growth as well as productivity savings. PepsiCo's core gross margin expanded by 115 basis points just last quarter thanks to effective sales management strategies. It expects to deliver $1 billion in cost savings this year and is on track to produce $5 billion in savings by 2019.

This should be more than enough growth to allow PepsiCo to continue rewarding its shareholders with significant cash returns.

Returning cash at an aggressive pace
PepsiCo returns a boatload of cash to its investors each quarter through both share repurchases and dividend payments. Over the first two quarters of the year, PepsiCo returned $4.1 billion to investors. This year, PepsiCo plans to return a total of $8.5 billion-$9 billion to shareholders. Its dividend currently yields 2.9%. The company can do this because it generates a lot of cash. PepsiCo expects to generate $7 billion in free cash flow this year.

PepsiCo is growing, holds some of the strongest brands in the world, and rewards its shareholders with share buybacks and dividends. For these reasons, PepsiCo is a great stock for long-term investors to own.