Summary of Mondelez International Q3 2025 Earnings Call

1Key Financial Results and Metrics

Organic Net Revenue Growth: 4% year-to-date, with guidance for Q4 indicating growth above this rate.

Volume Decline: U.S. volume down 4% in Q3, reflecting a slowdown in the biscuit category and consumer spending pressures.

Price Elasticity: European chocolate elasticity noted at 0.7-0.8, higher than historical norms, indicating sensitivity to pricing changes.

Emerging Markets: Volume down 4.7%, significantly impacted by Argentina's economic situation and pricing strategies in India.

2Strategic Updates and Business Highlights

European Market: Strong performance in biscuits, cakes, and pastries, with share growth. Adjustments in pricing strategies are being implemented to address competitive pressures and retailer margin increases.

U.S. Strategy: Focus on value and pricing optimization, particularly in the club and e-commerce channels. Emphasis on multipack offerings and better-for-you products, which are performing well.

Supply Chain Program: A new multi-year initiative aimed at improving cost efficiency and logistics, expected to yield benefits starting in 2027.

Product Innovations: Continued investment in seasonal products and new flavors to enhance consumer engagement.

3Forward Guidance and Outlook

2025 Guidance: Adjusted downward due to unexpected tariffs, destocking in the U.S., and a heatwave in Europe affecting volumes.

2026 Outlook: Targeting high single-digit EPS growth, with expectations for improved cocoa pricing and volume recovery in both U.S. and European markets. Confidence in emerging markets continuing to grow.

Q4 Expectations: Anticipated volume increase in Europe driven by holiday activations, while U.S. market expected to remain challenging.

4Bad News, Challenges, or Points of Concern

Consumer Sentiment: Ongoing concerns regarding consumer confidence in the U.S. market, with a focus on essential purchases limiting discretionary spending on snacks.

Competitive Pressures: Competitors in Europe not matching price increases, leading to market share challenges in certain segments.

Volume Declines: Significant declines in U.S. biscuit sales and pressures in emerging markets, particularly in Argentina and China.

Pricing Strategy Risks: The need to balance pricing increases with consumer acceptance, especially after substantial hikes in cocoa prices.

5Notable Q&A Insights

Elasticity Discussion: Dirk Van de Put emphasized the need for careful pricing adjustments in Europe, particularly for chocolate products, to avoid exceeding consumer acceptance thresholds.

U.S. Market Strategy: The company is adapting its promotional strategies in North America, focusing on value offerings while protecting profit margins.

Emerging Markets: Despite challenges, there is optimism for recovery in key markets like India and Brazil, with expectations for gradual improvement in consumer confidence.

Investment Plans: Luca Zaramella confirmed that planned investments for 2026 are locked in, with a focus on maintaining brand support and market presence. Overall, Mondelez International is navigating a challenging environment with strategic adjustments aimed at stabilizing performance and positioning for future growth.