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- Nestle to cut 16,000 jobs as part of cost savings initiative (foxbusiness.com)
Nestle Announces Significant Workforce Reduction Amidst Cost-Cutting Push
Nestle, the world’s leading packaged-food company, is set to reduce its global workforce by 16,000 employees over the next two years as part of an aggressive cost-cutting strategy under its new CEO, Philipp Navratil. The announcement, made on Thursday, outlines a revised and ambitious goal to achieve 3 billion Swiss francs in cost savings by the end of 2027, surpassing previous targets.
Navratil, who is only one month into his tenure, emphasized a rigorous approach to resource allocation, stating, “As Nestle moves forward, we will be rigorous in our approach to resource allocation, prioritizing the opportunities and businesses with the highest potential returns.” He further highlighted the need for accelerated growth, indicating that Nestle plans to be “bolder in investing at scale” and to leverage innovation to stimulate growth and enhance value.
The CEO articulated a commitment to a performance-driven culture. “We are fostering a culture that embraces a performance mindset, that does not accept losing market share, and where winning is rewarded,” Navratil said, asserting that these actions, including the workforce reduction, are crucial to “secure Nestle’s future as a leader in our industry” and deliver shareholder value.
Navratil’s appointment followed a turbulent period for Nestle. His predecessor, Laurent Freixe, was ousted less than a year after taking the helm due to an inappropriate workplace relationship with a subordinate, which violated Nestle’s code of business conduct.
Freixe departed without an exit package. This incident was not the first leadership change prompted by performance or conduct issues; prior CEO Ulf Mark Schneider voluntarily stepped down due to underperformance concerns.
Nestle experienced a challenging first half of fiscal 2025, recording 2.9% organic growth largely driven by pricing increases rather than increased sales volumes. Real internal growth (RIG), which measures volume and product mix, saw a modest 0.2% increase, reflecting soft consumer demand and volume pressures. However, the company’s performance improved in the third quarter, delivering 4.3% organic sales growth.
Chairman Paul Bulcke praised Navratil’s “impressive track record of achieving results in challenging environments” upon his appointment, signaling confidence in the new CEO’s ability to steer the company toward sustained growth and profitability.
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- Nestle to cut 16,000 jobs as part of cost savings initiative (foxbusiness.com)