Nestle to sell ice cream unit, Q4 sales growth beats estimates
Nestlé Shares rose 3% on Thursday after Nescafé and KitKat reported organic sales growth in the fourth quarter that beat analyst estimates.
The closely watched organic growth rate was 4%, beating FactSet’s consensus of 3.55%. Nestle said it is targeting organic sales growth of 3% to 4% for 2026 and an improvement in its underlying business operating profit margin of 16.1% in 2025.
The Vevey, Switzerland-based company also announced plans to sell its remaining ice cream business to the owner of Haagen-Dazs. Froneri, a joint venture between PAI and Nestle.
Separately, Nestle said it began the formal process to exit its water business early in the first quarter and expects the business, which houses brands such as Henniez and Perrier, to be deconsolidated by 2027.
Under the new leadership duo of CEO Philipp Navratil and Chairman Pablo Isla, a former Inditex executive, the company is focusing on modernizing the sprawling consumer giant after years of operational and share price underperformance.
“We are accelerating our strategy. We are focusing our portfolio on four businesses led by our strongest brands, with prioritized resources and a simplified organization,” Navratil said in a statement. he said.
A baby food recall that also shocked the competition Danone and Lactalis, which is privately owned in France, has been an obstacle to restoring confidence in the business.
Nestle said on Thursday that its organic growth forecast includes a 20 basis point negative impact from the recall, marking CHF1.7 billion in restructuring items mainly due to the recall.
