Nestlé pops as new boss unveils 16,000 job cuts and a bigger cost-cutting push

With input from CNBC, FOX Business, CNN, Reuters, and the New York Times.

Nestlé shares surged — up roughly 8–9% in early trading — after brand-new CEO Philipp Navratil swung a heavy axe: about 16,000 jobs will go over the next two years as the food giant tries to speed a turnaround. The rally lifted Europe’s food and beverage names broadly, with the sector up more than 3% in morning deals.

Navratil’s plan leans hard into “operational efficiency.” About 12,000 white-collar roles will be eliminated and another 4,000 positions in manufacturing and the supply chain will be trimmed, with the company saying the effort is about simplifying the organization and automating processes rather than simply swapping people for AI. In total, the cuts represent roughly 6% of Nestlé’s 277,000-strong workforce.

Alongside the shake-up, Nestlé raised its savings goal to 3 billion Swiss francs by the end of 2027, up from a previously announced 2.5 billion. The timing follows a bruising stretch for the Vevey-based group: shares are still well below their 2021 peak, China remains a drag, and US tariffs are a headwind even with most American sales produced locally. Management turmoil hasn’t helped — former CEO Laurent Freixe was ousted in September over an undisclosed relationship with a subordinate, and Chairman Paul Bulcke stepped down early, handing the reins to chairman-elect Pablo Isla.

The numbers gave bulls something to cheer. Third-quarter organic growth came in at 4.3% and real internal growth — Nestlé’s volume and mix gauge — rebounded 1.5% after a weak second quarter, helped by pricing in coffee and confectionery and easier comparisons. Greater China still weighed on results, but the company said new leadership is in place and executing a fix. Guidance for 2025 stays intact, with management promising sharper capital allocation and faster execution as it prioritizes businesses with the highest returns.

“The world is changing, and Nestlé needs to change faster,” Navratil said, framing the headcount reduction as a “hard but necessary” step to regain momentum and rebuild investor trust.

For now, the market likes the message.