Nestlé volume growth rebounds to 3% on increased marketing spend

Nestlé’s Real Internal Growth, which excludes price increases and currency effects, rose to nearly 3% in the third quarter, the best value since 2021 and double the rate from a year ago. This marks a reversal after four years of stagnant volume sales and a mid-2025 shrinkage. Price increases contributed only about one percentage point to total growth. The company increased marketing spend to nearly one-tenth of its over 100 billion dollar revenue and improved product quality, such as reformulating Milo, which is now growing double-digit after being a concern two years ago. A cost-saving program will cut 16,000 jobs, primarily in administration, freeing up nearly 4 billion dollars by 2027. Emerging markets, representing 40% of revenue, grew three times faster than developed markets, with India up 20% driven by Maggi and KitKat. In the US, frozen pizzas and Hot Pockets are recovering, countering fears that weight-loss drugs like Osempik would reduce demand. Nestlé is exiting Russia, where Putin placed its subsidiaries under forced administration, removing the business (3% of operating profit) from its accounts. The stock trades at a 260 billion dollar market cap and 18x P/E, below the 10-year average of 21x.