VEVEU, SWITZERLAND — Despite macroeconomic uncertainty in the company’s largest market, Zone Americas, Nestle SA left its 2025 financial guidance unchanged following broad-based growth in the first quarter.

Sales in the period ended March 31 were 22.6 billion Swiss francs ($27.25 billion), up 2.3%. Adjusted for foreign currency swings, sales were up 2.8%, including 2.1% attributed to pricing and 0.7% to real internal growth.

“Growth was broad-based across markets and categories, with improving market share trends across many businesses, particularly our billionaire brands,” said Laurent Freixe, chief executive officer.

Freixe highlighted progress in Nestle’s cost savings program, giving the company resources to put back into the business.

“In the quarter, we invested to strengthen our core business, achieved good consumer traction in the roll-out of our ‘big bet’ innovations such as Nescafe Espresso Concentrate, and saw some encouraging early improvements in our largest underperforming business cells,” he said. “We are continuing to make changes throughout the organization to increase alignment and focus, with steps to harmonize our structure in Zone Europe and enhance our capabilities in R&D.”

In prepared remarks in connection with an April 24 investor call, Freixe emphasized the importance of the cost savings program, adding, “There is no growth without investment, so generating the resources to invest is critical.”

He said the company is poised generate 700 million Swiss francs ($844 million) incremental cost savings in 2025, on top of over 1.2 billion Swiss francs of savings from ongoing efficiency initiatives.

Discussing the operating environment, Freixe described “unprecedented cost inflation,” for coffee and cocoa.

“We have been proactive on pricing, and our team navigated the negotiations with customers well, with limited disruptions,” he said.

Also commenting on cocoa was Anna Manz, chief financial officer.

“(For) coffee and cocoa, it is critical that we price to the fullest extent possible to provide the margin for future investment behind our brands, and our goal is to do that whilst maintaining medium term consumer penetration,” she said. “As we price, we have to consider the customer as well as the consumer."

Asked by an analyst about the elasticity of the coffee and confectionery categories, Manz said consumer demand has held up well, at least so far.

“Coffee particularly has been pretty resilient through previous rounds of price increases and confectionery, too, because it’s an impulse and gifting category, is generally less elastic,” Manz said. “It’s too early to say how these price increases will play out.”

Freixe highlighted investment made in the KitKat and Maggi brands.

“KitKat tablets were rolled out to 12 markets in Europe during Q1, with strong marketing support,” he said. “Early indicators have been positive both with customers and consumers. In Maggi, we have been investing further behind the brand and strengthening our digital platform, which provides access to modern recipes, peer to peer sharing, and a personalized user experience.”

Zone Americas was Nestle’s weakest performing geographic segment in the third quarter, with sales of 8.64 billion Swiss francs ($10.42 billion), unchanged from the year before. Excluding foreign exchange and mergers and acquisitions, organic growth was 1.9% in North Americas, still weaker than growth of Zone Europe (2.4%) or Zone Asia, Oceania, Africa (3.6%)

The company said “macroeconomic uncertainty has made for a challenging environment” in Zone Americas. Given that consumer confidence is “fragile,” Nestle said flat organic growth with positive real internal growth represented “a very solid performance” for North America. “And we grew nicely in Latin America.”

“Growth for the Zone was driven by strong pricing actions in confectionery and coffee,” Manz said. “This was supported by high single-digit growth in our professional business. The main drags on the Zone’s first-quarter delivery were infant nutrition and frozen foods. On the latter, we are making progress in restoring competitiveness. There are recent indications of improving market share developments, although it is too early to call this a sustained trend.”

Offering a breakdown of performance by product category, Manz said coffee and confectionery were drivers, together with pet products and health.

The Group’s first-quarter growth was driven by Powdered and Liquid Beverages, specifically coffee, and by Confectionery, PetCare and Health Science.

Regarding coffee, Manz said sales in the Powdered and Liquid Beverages segment grew thanks to pricing, with mid-single-digit increases, on average.  Holding back Nutrition and Health Science performance was weakness in infant nutrition, specifically “underperformance in Gerber baby food and in NIDO,” she said.

“On prepared dishes and cooking aids, flat organic growth overall was a function of growth in cooking aids, led by Maggi, and offset by frozen food,” Manz said. “Milk products and ice cream organic growth was slightly positive, with growth in ambient culinary offset by coffee creamers. In Confectionery, pricing was double-digit, with LATAM the highest, followed by Europe and AOA. As noted, this had some impact on demand.”

Reaffirming guidance, Nestle said it expects 2025 sales growth to top 2024, strengthening as the year progresses, with underlying operating margins topping 16%.