Swiss food conglomerate Nestlé is entering a major restructuring phase under its new CEO Philipp Navratil, who plans to eliminate 16,000 jobs globally in a sweeping cost-cutting effort. The move comes alongside a higher savings target of 3 billion Swiss francs by 2027 — up from the previously announced 2.5 billion.
“The world is changing, and Nestlé must change faster,” Navratil said during Thursday’s quarterly earnings presentation.
The new strategy marks one of the most significant shake-ups at Nestlé in recent years, reflecting growing pressure from investors and analysts for sharper execution and renewed growth momentum.
What’s behind the cuts
The restructuring aims to make Nestlé leaner and more agile amid rising input costs, volatile currencies and intensifying competition from global peers like Danone and Unilever.
According to company data, Nestlé employs around 277,000 people worldwide. Approximately 12,000 of the planned job cuts will affect office and administrative staff, while the remaining 4,000 will involve production and logistics functions.
Navratil framed the move as “a difficult but necessary decision” to align the company’s structure with its long-term growth priorities.
Financial performance: growth but at a slower pace
For the first nine months of 2025, Nestlé reported sales of 65.9 billion CHF, with organic growth of 3.3 percent — slightly above analysts’ expectations of 3.2 percent. In the first half of the year, organic growth stood at 2.9 percent.
Despite headwinds, the company reaffirmed its 2025 guidance, expecting full-year organic sales growth to exceed last year’s 2.2 percent and maintaining an adjusted operating profit margin of at least 16 percent.
Leadership turbulence adds urgency
Navratil took over in September 2025 after the sudden dismissal of his predecessor, Laurent Freixe, who was removed over an undisclosed relationship with a direct report. The leadership reshuffle didn’t stop there: long-time chairman Paul Bulcke soon stepped down, replaced by Pablo Isla, the former Inditex chief.
These rapid leadership changes have intensified the need for a clear strategic reset, as Nestlé seeks to restore investor confidence and accelerate operational performance.
Investor reaction and future outlook
Markets initially responded positively to the restructuring plan, viewing it as a necessary correction to regain competitiveness. Analysts, however, warn that the scale of the layoffs poses risks to morale and continuity within the organization.
Navratil insists the focus will now shift to volume-driven growth and targeted investments in innovation and high-margin categories such as nutrition, coffee and pet care. “We need to do more, act faster and reignite our growth dynamic,” he said.
While the company remains profitable and financially sound, its recent stock performance has lagged behind rivals, underscoring the importance of a credible transformation strategy.
The bigger picture
Nestlé’s overhaul reflects a broader trend in the consumer goods sector, where multinationals are trimming costs and consolidating operations to navigate inflation, weak consumer demand and supply disruptions. For Nestlé — whose portfolio includes Nespresso, Maggi, KitKat, Purina and Vittel — the challenge is to modernize without losing the stability that once defined its global reputation.
As the restructuring unfolds, employees and investors alike will be watching whether Navratil’s cost discipline can deliver the agility and growth Nestlé now urgently needs.
