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VEVEY, Switzerland - Nestlé SA (OTC:NSRGF) reported 2.9% organic sales growth for the first half of 2025, with real internal growth (RIG) of 0.2% and pricing of 2.7%, according to the company’s half-year results released Thursday.
The Swiss food and beverage giant’s total reported sales decreased by 1.8% to CHF 44.2 billion, impacted by a negative 4.7% effect from foreign exchange due to the strengthening Swiss franc.
Underlying trading operating profit (UTOP) was CHF 7.3 billion, down 7.1% from the prior year, with the UTOP margin decreasing 90 basis points to 16.5%. Net profit fell 10.3% to CHF 5.1 billion, while basic earnings per share decreased 9.0% to CHF 1.97.
CEO Laurent Freixe stated that the company is executing its strategy to accelerate performance and transform for the future, with actions "already delivering results, with broad-based growth and a robust profit performance in the first half."
Nestlé has increased its marketing investments, with advertising and marketing expenses reaching 8.6% of sales compared to 8.1% in the same period last year. The company reported that its six global innovation "big bets" achieved combined sales of over CHF 200 million in the first half.
By category, confectionery and coffee were the largest organic growth contributors, driven by pricing of 10.6% and 6.0% respectively, as the company addressed input cost inflation in these categories.
Nestlé maintained its 2025 guidance despite acknowledging increased macroeconomic risks and uncertainties. The company expects organic sales growth to improve compared to 2024 and strengthen over the year, with UTOP margin expected to be at or above 16.0%.
The company also announced it is taking steps to strengthen its business in Greater China and is focusing its Vitamins, Minerals and Supplements business on premium brands, launching a strategic review of its mainstream and value brands.
Free cash flow was CHF 2.3 billion, down from CHF 4.0 billion in the same period last year, with the decrease primarily due to lower EBITDA and negative working capital movements.
The information was released in Nestlé’s half-year results press release.
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