Food and beverage giant Nestle has announced a significant workforce reduction, cutting 16,000 jobs over the next two years. This move is part of a cost-saving initiative led by the new CEO, Philipp Navratil, who aims to prioritize products with the highest potential returns.
Nestle’s Strategic Shift and Job Cuts
Navratil emphasized the need for Nestle to adapt quickly in a changing global market. He expressed that the company must adopt a more aggressive performance mindset to maintain its market share against growing competition. These layoffs will save the company approximately 1 billion Swiss francs (£940 million) annually.
Details of the Job Reductions
- 12,000 white-collar jobs to be eliminated.
- 4,000 additional roles across various sectors will also be cut.
Nestle’s decision comes shortly after reporting improved sales figures for the first nine months of 2025, notably in popular categories such as coffee and sweets. Following the job cuts announcement, Nestle’s share price increased by 7.5%.
Leadership Changes and Corporate Culture
Philipp Navratil succeeded Laurent Freixe, who was dismissed in September due to a scandal involving a romantic relationship with an employee. Following this turmoil, Paul Bulcke, the outgoing chairman, also expedited his departure amid investor concerns regarding the company’s stability.
Responses from Analysts
Equity analyst Diana Radu commented on the changes, suggesting that Navratil’s actions signal a desire for greater transparency in Nestle’s cost-saving strategies. Radu noted that these job cuts could help reset expectations and rebuild investor confidence through quantifiable actions.
Previous Controversies
This restructuring comes on the heels of last year’s investigation revealing high sugar levels in Nestle baby food products marketed in low- and middle-income countries. These products, according to research by a Swiss NGO and the International Baby Food Action Network, contained significantly more sugar compared to their counterparts sold in wealthier regions.
Overall, as Nestle embarks on this critical transformation, it aims to ensure its longevity in an increasingly competitive landscape.
