Nestlé annual results reveal significant market tests, yet confectionery offers bright spark

Against a backdrop of market volatility, Nestlé’s has posted its latest annual results, with sales down 2%, to CHF 89.4 billion for 2025, in what its CEO Philipp Navratil acknowledged as a ‘difficult external environment,’ reports Neill Barston.

Notably, the company’s net profit was also down by a total of 17% across the group, to a figure of just over CHF 9billion, reflecting complex trading conditions in which key ingredients including cocoa were trading a notably higher prices last year, as well as operating increases in other areas of its supply chain logistics costs, including navigating US tariffs.

However, market analysts noted that its organic growth of 3.5% (against 2.2% the prior year) showed some encouraging signs for 2026, though regulatory uncertainties remain. 

In terms of category performance, confectionery was hailed as one of the largest areas of positive development for the firm, recording high single digit positive upturns.  This had been achieved through smart pricing action to fully address input cost increases where possible.

During 2025, the Swiss-headquartered company adjusted its product pricing by 2.5%, with the business commenting that its food and snacks, including its chocolate production had made progress. The business has embarked on a period of brand rationalisation, with plans to sell-off its remaining interests in the Froneri ice cream business reportedly at an advanced stage.

Significantly, the company confirmed that under the leadership of its recently arrived CEO, it is set to further simplify its organisational structure, with a programme of  enhanced local accountability.

It has also put in place cost saving steps with  20% of targeted CHF 1 billion annual savings in white-collar operational efficiencies already achieved, ahead of plan, according to the company.

Philipp Navratil, Nestlé CEO commented: “I am encouraged by our performance during 2025, which reflects the targeted actions we have taken in a difficult external environment. Real internal growth (RIG) was positive across all Zones and global businesses. We increased our investment in marketing, delivered a UTOP margin of 16.1% and generated CHF 9.2 billion in free cash flow. Improving organic growth, RIG and market share trends in the second half show that our actions are working.

“We are accelerating our strategy. We are focusing our portfolio on four businesses, led by our strongest brands, with prioritized resources and a simplified organization. We are upgrading our marketing and innovation and increasing investment behind high-potential growth platforms, which now have an expanded scope and represent 30% of sales. We are stepping up our efficiencies and strengthening our financial position. This is underpinned by a performance culture that rewards excellence and results,” adding that there was more to be done, but he believed its more focused strategy would lead to sustained improvements this year.