Global earnings: Nestle Q1 organic revenue rises 2.8% YoY, surpassing estimated 2.57%
Nestlé has kicked off 2025 with a resilient performance despite macroeconomic and consumer headwinds, reporting organic sales growth of 2.8% year-on-year in the first quarter, ahead of analyst expectations pegged at 2.57%. The company posted a Real Internal Growth (RIG) of 0.7% and pricing growth of 2.1%, signaling continued traction in both volume and value amid inflation and shifting consumer behavior.
CEO Laurent Freixe commented,
'In an environment of heightened macroeconomic and consumer uncertainty, Nestlé delivered organic growth of 2.8%, with broad-based performance across markets and categories and improving share trends, especially in our billionaire brands.' Q1 2025 financial performance: Highlights
Growth was broad-based, with Zone AOA (Asia, Oceania, and Africa) delivering 3.1% organic growth, and Nestlé Waters & Premium Beverages growing by 3.6%. The highest growth rate was seen in the 'Other Businesses' division at 6.4%. Notably, confectionery and coffee categories led organic growth with 8.9% and 5.1%, respectively, powered largely by price hikes to offset input cost pressures. Segment performance snapshot Nestlé Health Science reported 4.2% organic growth but experienced mixed performance across geographies.
Nespresso rose 5.7% organically, showing signs of rebound.
PetCare, despite softness in the U.S. market, grew 1.6% and continued gaining market share in several countries. Strategic and operational update
Nestlé is actively advancing its 'Fuel for Growth' program, targeting CHF 0.7 billion in incremental cost savings by 2025. So far, savings have primarily been achieved through procurement efficiencies.
Key strategic initiatives included: Big bet innovations : Successful roll-outs of Nescafé Espresso Concentrate , pyramid-shaped gourmet cat food, and new Chocobakery products across Latin America and AOA.
Improved business cells : 18 underperforming segments are being actively restructured, showing early signs of turnaround.
Organizational simplification: Especially in Zone Europe, where Nestlé is harmonizing its structure to boost efficiency and innovation pace.
Freixe added,
'We are continuing to make changes throughout the organization to increase alignment and focus, and strengthen our R&D capabilities.' 2025 guidance remains intact
Despite global uncertainties and evolving tariff dynamics, Nestlé has reaffirmed its full-year 2025 guidance: Organic sales growth is expected to improve vs 2024 and accelerate through the year .
UTOP margin is projected at or above 16%, reflecting continued investments in growth.
Nestlé remains cautious but confident in navigating a dynamic environment shaped by tariffs, commodity volatility, and FX pressure, while reinforcing its long-term goal of value-driven growth and market leadership. FAQs
What drove Nestlé's Q1 2025 revenue beat?
Pricing actions in coffee and cocoa, along with a moderate rebound in volume growth and innovation-led product launches.
Which categories posted the strongest growth?
Confectionery (+8.9%) and Coffee (+5.1%), primarily driven by pricing.
What is Nestlé's 2025 margin guidance?
UTOP margin is expected to be at or above 16%, unchanged from prior guidance.
What is the outlook for the rest of the year?
Organic growth is projected to accelerate in the second half, supported by innovation, cost savings, and operational restructuring.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Markets are subject to risk. Please consult a professional financial advisor before making investment decisions. Business Upturn and its authors are not liable for any losses arising from the use of this information.
Aditya Bhagchandani serves as the Senior Editor and Writer at Business Upturn, where he leads coverage across the Business, Finance, Corporate, and Stock Market segments. With a keen eye for detail and a commitment to journalistic integrity, he not only contributes insightful articles but also oversees editorial direction for the reporting team.
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