Nestlé has announced it will cut 16,000 jobs and increase its savings plan to 3 billion francs by 2027. New CEO seeks to restore investor confidence and stabilize the business.
Nestlé to cut 16,000 jobs and raise savings plan to 3 billion francs
Swiss food giant Nestlé has announced it will cut 16,000 jobs as part of a program to improve efficiency and restore investor confidence. This represents almost 6% of the company’s total workforce.
New CEO Philippe Navratil said the company is increasing its cost-saving plan from 2.5 billion to 3 billion Swiss francs ($3.77 billion) by the end of 2027.
“The world is changing — and Nestlé needs to change even faster,” Navratil said.
Management Turbulence and Personnel Changes
Nestlé is going through an unprecedented period of leadership changes. Navratil took over after Laurent Frakes was fired in September for misconduct.
Two weeks later, chairman Paul Bulke also resigned early, making way for Pablo Isley, the former CEO of Inditex.
Of the 16,000 job cuts, 12,000 will be in office staff, with the remaining 4,000 in production and logistics.
Return to growth: an “internal restart” strategy
The company that makes KitKat, Nespresso and Maggi is seeking to return to sales growth after months of stagnation, rising debt and falling profitability.
Despite the difficult situation, Nestlé’s quarterly report beat expectations, with internal growth of 1.5% against a forecast of 0.3%.
Navratil stressed that the main priority is “growth based on real demand” and the creation of a “winning culture” where efficiency will be rewarded.
Tariffs, China and new challenges
The increased US tariffs on Swiss goods to 39%, which came into effect in August, have become an additional challenge for Nestlé, even though most of its products for the American market are produced locally.
In China, the company has faced problems with a decline in demand.
“We were too focused on distribution, not on creating consumer demand. Now we are correcting this imbalance,” explained CFO Anna Manz.
Forecast stable, but emphasis changes
Nestlé left its 2025 forecast unchanged: organic sales growth should improve compared to 2024, and the operating margin is expected to be at least 16%, with a medium-term target of 17%.
The bulk of the savings will fall in 2026-2027, but the company plans to save 700 million francs next year.
Analysts at Bernstein called the decision to cut costs “fuel for Nestlé’s restart,” noting that Navratil’s decisive steps could restore market confidence in a company that has been a symbol of stability in the global food industry for decades.
Related: Italy fights new US pasta tariffs that could double prices
