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NESTLE (4707.MY)  surged 3.07% to RM79.26 during mid-afternoon trading on Thursday, climbing RM2.36 from its previous close, after delivering a tasty second-quarter earnings report. The stock opened at RM77.20 and reached an intraday high of RM79.60, with 52,800 shares changing hands. Investor appetite grew after Nestlé announced a  19% spike in Profit After Tax (PAT) to RM112.1 million  for the quarter ended June 30, 2025, driven by a  9.5% boost in turnover to RM1.67 billion . The food giant attributed the strong results to  robust local demand, steady export sales , and ongoing efforts in  cost control and efficiency improvements . For the first half of 2025, Nestlé recorded RM3.44 billion in turnover — a 4% year-on-year increase — while  Profit Before Tax (PBT)  and  PAT  came in at  RM361.6 million  and  RM273.5 million , respectively. The company credited its festive campaigns and new product launches for acceleratin...

Key Takeaway: Nestle aims to revive sluggish sales growth by increasing advertising and marketing efforts , even as it lowers its profitability target. Nestle SA, under new CEO Laurent Freixe, has adjusted its profitability goals and announced a strategic overhaul of its water business to address stagnating sales. Key Updates: Profit Margin Target Adjusted Nestle now targets a trading operating margin of 17% , down from the previous 17.5% to 18.5% goal set by former CEO Mark Schneider. Sales are expected to grow 4% or more in the medium term , compared to Schneider's mid-single-digit prediction for 2025. Water Business Restructure Starting Jan 1, 2025 , Nestle’s water brands, including Maison Perrier and Acqua Panna , will operate as a standalone entity led by Muriel Lienau. This division represents less than 4% of Nestle's revenue and has faced challenges like contamination issues and supply constraints . Nestle will explore potential partnerships for this segment. Incre...

  Nestle’s KitKat has signed a global sponsorship deal with Formula 1 from late 2025 to 2028, marking a major shift in Nestle’s marketing approach. Under the guidance of new CEO Laurent Freixe , this sponsorship aims to broaden KitKat’s appeal among shoppers under 30 and increase global visibility. The deal will feature KitKat advertising at F1 racetracks , Formula 1 branding on chocolate wrappers, and hundreds of race ticket giveaways . This move signifies Nestle’s first global marketing initiative, departing from its traditional country-specific campaigns. KitKat’s global marketing budget has risen by 20% this year, reflecting Freixe’s commitment to reinvest in core brands. The brand is valued at over 2 billion Swiss francs (US$2.29 billion) , making it one of Nestle’s largest revenue drivers. Nestle's CEO, Freixe, sees this as a strategic accelerator for growth. This comes after Freixe replaced former CEO Mark Schneider , whose cost-cutting on marketing during the pandemic l...

Nestlé SA has lowered its sales and profit expectations for the year as the Swiss food giant struggles to regain market share after higher prices led consumers to shy away from branded products. The company now expects organic sales to rise by around 2% in 2024, down from its previous forecast of at least 3%, marking the lowest annual growth rate since at least 2000. Shares of Nestlé fell by as much as 2.3% in early Swiss trading, contributing to a year-to-date decline of about 16% . The company’s newly appointed CEO, Laurent Freixe , who took over from Mark Schneider in September, has introduced several organizational changes, including a streamlined executive board and fewer geographical zones to improve decision-making. However, analysts at Bernstein expressed concern, noting that it is unclear how these changes will boost market share or performance. Nestlé's sales in North America contracted by 0.3% in the first nine months of the year, while Latin America was impa...

Mark Schneider, the recently ousted CEO of Nestle, had successfully steered the company through the COVID-19 pandemic, improved margins during a challenging supply chain crisis, and executed a major reorganization of the company. However, despite these achievements, Schneider lost the board's confidence, leading to his departure. Key Issues Leading to Schneider's Ouster: Sluggish Sales Growth : The primary concern that led to Schneider's removal was weak sales growth. Despite his successes, the board became increasingly worried about the company's ability to sustain growth, especially as Nestle's performance lagged behind some of its competitors. Schneider's tenure saw patchy sales growth, and the momentum Nestle gained during the pandemic waned, particularly as the company alienated consumers with high prices in 2023. Slowing Innovation : Another significant issue was the slowdown in product development. New and revamped products were taking longer to be introd...

Shares in Nestlé (Malaysia) Bhd fell to RM118.90, their lowest since April, following weaker-than-expected quarterly results. The company's first-half net profit of RM289 million accounted for only 37% of the consensus full-year forecast, leading analysts to downgrade the stock. Key Points: Stock Performance: Shares dropped by 2.5%, trading at RM119, with a market cap of nearly RM28 billion. Analyst Recommendations: At least two research houses downgraded the stock to “sell.” The consensus 12-month target price is RM120.87. Earnings Forecast: Analysts have revised their earnings forecasts downwards. Nestlé is now expected to make a net profit of RM777 million for 2024. Challenges: Nestlé faces challenges from volatile commodity prices, a weakening currency, and the ongoing Israel-Gaza conflict. The company has raised prices on at least 20 products to protect margins. ESG Reporting: The article also highlighted the importance of transparent ESG reporting amidst challenges in st...

Retain HOLD call with a higher target price (TP) of RM85.73 Highlights We attended Nestle’s 1Q17 briefing and came away feeling neutral on the company’s prospects going forward. Nestle anticipates half of revenue growth in FY17 will be driven by new product launches, in particular, the launch of new varieties of KitKat chocolates. We share management’s optimism on its new KitKat products, given: (1) its lion share in Malaysia’s chocolate product market which market share has grown from 14.4% in 2013 to 16.8% in 2016 (and overtook Cadbury as Malaysia’s most popular chocolate); (2) Majority of Malaysian consumers (two-third, according to a Nielsen report) prefer new and innovative products from brands that are familiar to them. Additionally, we believe that the launch of the Kit Kat confectionary store in Mid Valley in late-2016 (where consumers can customize KitKat chocolate bars with up to 10,000 combinations) will serve as its marketing base (apart from allowing N...