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Navratil is in the midst of slashing 16,000 jobs, or about 6% of the global workforce, reorganising the business around four core divisions, and managing the baby formula recall.<\/p>\n
(Feb 19): Nestl\u00e9 SA\u2019s new chief executive officer shrugged off the biggest infant formula recall in the Swiss foodmaker\u2019s history with an upbeat outlook for the year and the planned sale of its remaining ice cream brands.<\/p>\n
CEO Philipp Navratil said the turnaround at the company \u2014 whose performance has lagged for years \u2014 is on track as he forecast sales and profit growth and revealed plans to reorganise the 160-year-old group. Nestl\u00e9 shares rose the most in four months.<\/p>\n
\u201cOur actions are starting to pay off and the growth trends are improving,\u201d Navratil told analysts on a call. \u201cWe have a clear strategy with priorities.\u201d<\/p>\n
The maker of Nespresso coffee and Purina cat chow on Thursday forecast organic revenue growth of 3% to 4% in 2026. That compares with the 3.2% estimate of analysts in a Bloomberg survey. Real internal growth \u2014 a closely watched measure of volumes \u2014 will accelerate in 2026, the company said.<\/p>\n
Navratil has endured a torrid start since taking over the top job in September following the ouster of his predecessor over an undisclosed office romance. He is in the midst of slashing 16,000 jobs, or about 6% of the global workforce, reorganising the business around four core divisions, and managing the baby formula recall.<\/p>\n
Nestl\u00e9 said it\u2019s ahead on its cost-cutting plan and has already achieved around 20% of the targeted savings.<\/p>\n
A key part of Navratil\u2019s strategy also involves carving out or disposing of brands and businesses no longer seen as core. Navratil confirmed that Nestl\u00e9 is in advanced negotiations to sell its remaining ice cream business, which includes brands like D\u2019Onofrio, Real Dairy, Parlour and Lafrutta, to its Froneri joint venture with PAI Partners, confirming a story by Bloomberg. The ownership structure of the joint venture itself will stay as it is, he said.<\/p>\n
The potential disposal will help further streamline Nestl\u00e9\u2019s portfolio, continuing a years-long retreat from slower-growth and capital-intensive businesses as management doubles down on coffee and pet care.<\/p>\n
Shares of Nestl\u00e9 rose as much as 4.5% in early trading. The stock, which has trailed that of rival Unilever Plc in recent months, is up about 2.1% since the start of the year.<\/p>\n
Navratil said the company has worked quickly to handle the largest product recall in its history after contaminated ingredients forced it to pull baby formula in more than 60 countries.<\/p>\n
\u201cWe lost no time and decided to recall immediately. We were surprised that others took longer to act,\u201d Navratil said on a media call on Thursday. \u201cA recall is never something you want to do\u00a0\u2014 but if you have to, you need to do it fast.\u201d<\/p>\n
Other producers like Danone SA and Lactalis Group have been affected by the same supply chain issue, first identified by Nestl\u00e9.<\/p>\n
The estimated cost of customer returns and inventory write-offs related to the baby formula recall amounted to 75 million Swiss francs (US$97 million or $122.9 million) in 2025, chief financial officer Anna Manz said on a call with analysts. Upcoming results will reflect a one-off hit from sales returns and stock shortages, while any additional financial impact remains uncertain, she added.<\/p>\n
Navratil and chairman Pablo Isla \u2014 both in place less than six months\u00a0\u2014 are under pressure from investors keen for a turnaround. Navratil is the third CEO of the Vevey-based company in the past two years, an unheard of level of turnover in the senior ranks at Nestl\u00e9. Since taking over Nestl\u00e9 has updated management incentives, targets and compensation structures to \u201cdrive a performance culture,\u201d Navratil said Thursday.<\/p>\n
Isla is also the first outsider in the role as chairman and announced a board shake-up on Wednesday as he works to steady Nestl\u00e9 after last year\u2019s governance crisis. The company nominated former Swiss National Bank chief Thomas Jordan and Procter & Gamble executive Fatima Francisco to strengthen oversight and sharpen decision-making.<\/p>\n
Uploaded by Magessan Varatharaja<\/p>\n
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