Mondelez (NASDAQ:MDLZ) Posts Q1 Sales In Line With Estimates

Yahoo

29-04-2025

Packaged snacks company Mondelez (NASDAQ:MDLZ) met Wall Street's revenue expectations in Q1 CY2025, but sales were flat year on year at $9.31 billion. Its non-GAAP profit of $0.74 per share was 12.2% above analysts' consensus estimates.
Is now the time to buy Mondelez? Find out in our full research report.
Revenue: $9.31 billion vs analyst estimates of $9.31 billion (flat year on year, in line)
Adjusted EPS: $0.74 vs analyst estimates of $0.66 (12.2% beat)
Adjusted EBITDA: $1.00 billion vs analyst estimates of $1.54 billion (10.8% margin, 34.7% miss)
Operating Margin: 7.3%, down from 29.4% in the same quarter last year
Free Cash Flow Margin: 8.8%, down from 11% in the same quarter last year
Organic Revenue rose 3.1% year on year (4.2% in the same quarter last year)
Sales Volumes fell 3.5% year on year (-2.1% in the same quarter last year)
Market Capitalization: $84.34 billion
'We delivered solid Q1 2025 results in line with our expectations, driven by strong execution of our growth strategy while navigating unprecedented cocoa cost inflation,' said Dirk Van de Put, Chair and Chief Executive Officer.
Founded as Nabisco in 1903, Mondelez (NASDAQ:MDLZ) is a packaged snacks powerhouse best known for its Oreo, Cadbury, Toblerone, Ritz, and Trident brands.
A company's long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
With $36.46 billion in revenue over the past 12 months, Mondelez is one of the most widely recognized consumer staples companies. Its influence over consumers gives it negotiating leverage with distributors, enabling it to pick and choose where it sells its products (a luxury many don't have).
As you can see below, Mondelez's sales grew at a decent 7.7% compounded annual growth rate over the last three years despite selling a similar number of units each year. We'll explore what this means in the "Volume Growth" section.
This quarter, Mondelez's $9.31 billion of revenue was flat year on year and in line with Wall Street's estimates.
Looking ahead, sell-side analysts expect revenue to grow 4.8% over the next 12 months, a slight deceleration versus the last three years. This projection is underwhelming and indicates its products will see some demand headwinds.
Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.
Revenue growth can be broken down into changes in price and volume (the number of units sold). While both are important, volume is the lifeblood of a successful staples business as there's a ceiling to what consumers will pay for everyday goods; they can always trade down to non-branded products if the branded versions are too expensive.
To analyze whether Mondelez generated its growth from changes in price or volume, we can compare its volume growth to its organic revenue growth, which excludes non-fundamental impacts on company financials like mergers and currency fluctuations.
Over the last two years, Mondelez's quarterly sales volumes have, on average, stayed about the same. This stability is normal as the quantity demanded for consumer staples products typically doesn't see much volatility. The company's flat volumes also indicate its average organic revenue growth of 7.7% was generated from price increases.
In Mondelez's Q1 2025, sales volumes dropped 3.5% year on year. This result was a reversal from its historical levels.
It was encouraging to see Mondelez beat analysts' EPS expectations this quarter on in-line revenue. The stock traded up 1.3% to $66.46 immediately after reporting.
So should you invest in Mondelez right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free.