Unilever Q3 2025 slides: Volume growth accelerates as Ice Cream demerger advances

Introduction & Market Context

Unilever PLC (LSE:ULVR) presented its Q3 2025 trading statement on October 23, 2025, highlighting modest growth amid challenging currency headwinds. The consumer goods giant reported underlying sales growth of 3.9%, supported by a 1.5% increase in volume and a 2.4% rise in pricing. Despite the positive underlying performance, reported turnover declined by 3.5% to €14.7 billion, primarily due to a significant negative currency impact of 6.1%.

The company continues to make progress on its strategic priorities, including building a stronger portfolio in Beauty, Wellbeing & Personal Care, shifting toward premium segments and digital commerce, and delivering growth in anchor markets like the US and India. Meanwhile, the planned Ice Cream demerger remains on track for completion in 2025.

Quarterly Performance Highlights

Unilever’s Q3 2025 results showed encouraging signs of volume acceleration, particularly when excluding the Ice Cream business. Underlying volume growth excluding Ice Cream reached 1.7%, with underlying sales growth of 4.0%.

As shown in the following chart of quarterly volume growth trends:

Power Brands continue to be a key growth driver for Unilever, outperforming the overall portfolio with underlying sales growth of 4.4%. When excluding Ice Cream, Power Brands delivered volume growth of 2.2% and a two-year compound annual growth rate (CAGR) of 3.2%.

The following chart illustrates the strong performance of Power Brands:

"We are crystal clear on what we need to do and where we want to invest," stated CEO Fernando Fernandez during the presentation, emphasizing the company’s strategic focus on its core brands and growth markets.

Regional Performance Analysis

Unilever’s regional performance revealed stark contrasts across its global operations. North America and Asia Pacific Africa delivered robust growth, while Europe showed modest gains and Latin America faced significant challenges.

The regional breakdown is illustrated in the following map:

North America, representing 22% of group turnover, delivered impressive results with underlying sales growth of 5.5% and volume growth of 5.4%. This marks the fifth consecutive quarter of strong volume-led growth in the region, reflecting what the company described as a "multi-year portfolio transformation." Premium innovations in Personal Care and Wellbeing categories were highlighted as key contributors to this performance.

Asia Pacific Africa, Unilever’s largest region at 42% of group turnover, posted strong underlying sales growth of 6.8% with volume growth of 3.5%. Indonesia showed particularly strong performance, while China delivered low-single-digit growth. In India, the implementation of GST reform was noted as a factor affecting market dynamics.

In contrast, Latin America faced significant headwinds, with underlying sales declining by 2.5% and volume falling by 7.3%. The company attributed these challenges to a slowing market in Brazil and an unstable macroeconomic environment in Argentina.

The following slide provides further details on developed markets’ outperformance:

Business Group Performance

Among Unilever’s business segments, Beauty & Wellbeing emerged as the strongest performer with underlying sales growth of 5.1% and volume growth of 2.3%. The segment benefited from double-digit growth in several brands including Dove Hair, Vaseline, Hourglass, K18, Liquid IV, and Nutrafol.

As shown in the following performance chart for Beauty & Wellbeing:

Home Care delivered solid results with underlying sales growth of 3.1% and volume growth of 2.5%. The company highlighted strong performance from Persil Wonder Wash, which is expected to reach 30 markets by year-end. Domestos and Cif achieved double-digit growth supported by science-led innovations.

Foods posted underlying sales growth of 3.4% with volume growth of 1.3%, while Ice Cream reported underlying sales growth of 3.7% with flat volumes. Cornetto led the Ice Cream portfolio with high-single-digit growth, while Ben & Jerry’s grew at mid-single digits.

CFO Srinivas Phatak emphasized the importance of product mix in driving growth, noting, "Mix is actually becoming a component which gives about 25 to 30 basis points on a regular basis for us."

Ice Cream Demerger Update

Unilever provided an update on its Ice Cream demerger, which remains on track despite some timeline adjustments due to the impact of the US government shutdown on SEC processes. The company published its Shareholder Circular on October 2, 2025, and received approval for the Share Consolidation on October 21, 2025.

The demerger plan includes a 5:1 share ratio, meaning shareholders will receive one share in The Magnum Ice Cream Company for every five Unilever shares owned. The company also confirmed it expects to pay a Q4 dividend in full.

The following slide outlines the demerger timetable:

Forward-Looking Statements

Unilever maintained its full-year 2025 guidance, projecting underlying sales growth within the range of 3-5%, both including and excluding Ice Cream. The company expects second-half growth to exceed first-half performance, with an underlying operating margin of at least 18.5% for H2 (or at least 19.5% excluding Ice Cream).

The following waterfall chart illustrates how underlying sales growth is offset by disposals and currency effects:

Other financial guidance for 2025 includes capital expenditure above 3% of turnover, restructuring costs around 1.2% of turnover, and net finance costs less than 3% on average net debt. The underlying effective tax rate is expected to be around 26%, with leverage of approximately 2x net debt to underlying EBITDA.

Currency headwinds remain a significant challenge, with a full-year impact expected to be around -6% on turnover and approximately -30 basis points on underlying operating margin.

Despite these challenges, Unilever remains focused on its strategic priorities, including portfolio transformation, premium segment expansion, and digital commerce growth. The company’s ability to deliver volume growth in most regions, particularly in North America and Asia Pacific Africa, provides some optimism amid the currency and regional challenges it faces.

Full presentation:

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