Why is Nestle cutting 16,000 jobs globally over the next two years?
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Synopsis
Nestle, the Swiss food and beverage giant, has announced a drastic decision to cut 16,000 jobs worldwide in an effort to adapt to changing market conditions. This move, led by new CEO Philipp Navratil, aims to streamline operations and boost financial stability amid challenging economic pressures.
Key Takeaways
- Nestle plans to cut 16,000 jobs globally.
- 12,000 of these cuts will affect white-collar positions.
- The company aims to save one billion Swiss francs through these layoffs.
- Nestle's total savings target is now three billion Swiss francs by 2027.
- The company is undergoing significant restructuring amid economic challenges.
New Delhi, Oct 16 (NationPress) Nestle, the renowned Swiss food and beverage corporation famous for its brands such as Nespresso, Kit Kat, Perrier, and Purina, declared on Thursday its intention to eliminate 16,000 jobs globally over the upcoming two years.
This decision is aimed at accelerating the company’s transformation under the leadership of new CEO Philipp Navratil, who assumed his role in early September.
"The world is evolving, and Nestle must evolve more rapidly," stated Navratil in an official announcement.
He emphasized that the job reductions are part of "difficult yet indispensable decisions to cut down on workforce" and optimize operations in response to shifting market dynamics.
Among the 16,000 positions being eliminated, 12,000 are white-collar jobs. Nestle anticipates that this workforce reduction will generate savings of one billion Swiss francs, which is twice the initially projected savings.
These layoffs are in addition to 4,000 job cuts already underway in production and supply chain sectors.
The company has revised its total savings target to three billion Swiss francs by the conclusion of 2027, an increase from its previous goal of 2.5 billion.
This announcement coincided with the disclosure of Nestle’s financial results for the first nine months, revealing a 1.9 percent decline in sales, totaling 65.9 billion Swiss francs (approximately $83 billion).
Organic sales increased by 3.3 percent during this period, largely attributed to a 2.8 percent rise in prices.
The Indian division, Nestle India, also reported a significant 17 percent year-on-year (YoY) drop in its consolidated net profit for Q2 FY26.
The FMCG company reported a profit of Rs 743 crore in Q2, as noted in its exchange filing.
Analysts believe these results reflect both economic challenges and ongoing restructuring efforts.
Navratil steps into his role during a tumultuous period for Nestle. The former CEO was dismissed in September due to an office relationship, and the company chairman resigned earlier than anticipated.
Nestle is also grappling with a bottled water scandal in France that surfaced in 2024, intensifying the pressure on the new leadership to stabilize the company and restore investor confidence.
Point of View
It is essential to acknowledge that Nestle is navigating a complex landscape of economic pressures and internal restructuring. The job cuts reflect a strategic response to market demands, but they also pose significant challenges for the workforce and company culture. It is crucial for the leadership to balance cost-cutting measures with maintaining morale and trust among employees as they move forward.
NationPress
16/10/2025
Frequently Asked Questions
What is the reason behind Nestle's job cuts?
Nestle is cutting 16,000 jobs globally to accelerate its transformation and streamline operations in response to changing market conditions.
How many of the jobs being cut are white-collar positions?
Out of the 16,000 positions being eliminated, 12,000 are white-collar jobs.
What financial savings does Nestle expect from these layoffs?
Nestle expects these job cuts to save one billion Swiss francs, which is double the initial savings target.
What challenges is Nestle facing currently?
Nestle is facing economic pressures, internal restructuring, and a bottled water scandal in France that adds to the challenges for the new leadership.
What was the financial performance of Nestle in recent months?
Nestle reported a 1.9 percent drop in sales to 65.9 billion Swiss francs, but organic sales grew by 3.3 percent due to price increases.
