Nestle is set to cut 16,000 jobs as part of a sweeping restructuring plan under its new CEO, Philipp Navratil, who aims to revive the company's fortunes amid slowing sales and ongoing scandals. The layoffs, which represent about 6% of Nestle's global workforce, will mostly impact white-collar employees, with 12,000 of the cuts coming from office roles and another 4,000 from manufacturing and supply-chain jobs, the Wall Street Journal reports. The announcement comes just weeks after Navratil took the helm, following the dismissal of Laurent Freixe due to a code-of-conduct violation involving a relationship with a subordinate.
Navratil, a 24-year Nestle veteran and former head of Nespresso, wasted little time signaling a new direction at the Swiss food giant. He told staff and investors that the company must move faster to adapt to changing consumer preferences and tougher market conditions, with price hikes and tariffs dampening demand for processed foods. "The world is changing, and Nestle needs to change faster," Navratil said in a statement, per CNN. "This will include making hard but necessary decisions to reduce headcount." The Journal reports that the CEO said the company would be "ruthless" in assessing employee performance.
Investors appeared to welcome the shake-up—Nestle shares, which have been sliding for years, jumped 8% on the news, in what could be their biggest daily gain since 2008. The job cuts come as other major consumer-goods companies, including Procter & Gamble and Estée Lauder, have also moved to trim their workforces in response to sluggish sales. Nestlé, seen as a bellwether for global consumer trends, has struggled with slowing growth and shifting shopper habits as more people opt for store brands amid high inflation.
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Navratil said head-count reductions have already started and will pick up speed over the next two years. He also hinted at possible exits from underperforming brands, with a review of Nestle's water and vitamin businesses underway.
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