Nestle to slash 16,000 jobs as new CEO speeds up turnaround after office scandal
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The job cuts, equal to about 6 per cent of the workforce, will be made over the next two years.
PHOTO: AFP
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ZURICH – Nestle plans to cut 16,000 jobs as new chief executive Philipp Navratil seeks to accelerate a turnaround at the Swiss food giant.
The reductions, which would amount to about 6 per cent of the workforce, will be made over the next two years, the maker of Nespresso coffee capsules and KitKat chocolate bars said on Oct 16.
“The world is changing, and Nestle needs to change faster,” Mr Navratil said in a statement.
“This will include making hard but necessary decisions to reduce headcount over the next two years.”
The company also raised its target for cost savings to three billion Swiss francs (S$4.9 billion) by the end of 2027, from a previous goal of 2.5 billion francs.
Nestle tapped company insider Navratil as CEO in September after ousting his predecessor Laurent Freixe a year into his tenure for allegedly hiding a romantic relationship with a subordinate
In the wake of the scandal, chairman Paul Bulcke stepped down earlier than scheduled, replaced by former Inditex CEO Pablo Isla.
The job cuts announcement comes alongside a stronger-than-expected 4.3 per cent rise in third-quarter sales, driven by higher prices and improved real internal growth – a key measure of volumes closely watched by analysts and investors.
“Although still very fragile, we believe this set of results will help Nestle partly restore investors’ trust,” said Mr Jean-Philippe Bertschy, an analyst at Vontobel.
Nestle shares have risen 1.7 per cent in 2025, lagging behind the 8 per cent increase in the Swiss Market Index.
Its management shuffle created turmoil at the top of a company known for its staid corporate culture and left the new leadership duo with the task of presenting a plan to revive volume growth and tackle governance issues.
A Nestle veteran of more than 20 years who most recently ran the Nespresso business, Mr Navratil has indicated that he will maintain Mr Freixe’s strategy of boosting spending on advertising, betting on fewer but bigger product initiatives and getting rid of underperforming units.
On a call with reporters on Oct 16, he identified Nestle’s top priority as further increasing real internal growth and added that the company is evaluating everything in its portfolio.
Any job losses through divestments will not be counted towards the 16,000 planned reductions, Mr Navratil said.
“We welcome Navratil’s ambition to foster a culture that does not accept losing market share and where winning is rewarded, which sounds more assertive than before,” said Mr James Edwardes Jones, an analyst at RBC Capital Markets. BLOOMBERG
