Price hikes can help estimate Beat analysts at Unilever and Nestlé, but tariffs could push consumers to limit
Unilever and Nestlé, some of the world’s largest consumer companies, saw significant sales growth in the first three months of 2025 despite the looming threat of tariffs.
The growth of the rival came from high demand for several premium products and price hikes, offsetting the prices of cocoa and coffee.
Unilever’s underlying sales increased 3% in the first quarter, with the personal care category bringing the most business. The so-called power brands of the London listed company contributed to 75% of the group’s revenue, with sales rising by 3%.
Unilever is in the midst of reforms that have seen key leadership changes and business overhauls focused on streamlining and gaining market share from rivals. During the pandemic, Unilever began losing shoppers as prices rose and offset costs.
Earlier this month, the company ousted CEO Hein Schumacher and took charge of CFO Fernando Fernandez.
Fernandez has had a single overwhelming message ever since taking on top job to make major changes with the consumer brands behind Dove Soap and Vaseline Cream.
Fernandez said the company’s new direction would mean “a ruthless obsession with consumers” in its revenue call on Thursday.
“We have a resilient portfolio, good momentum and, above all, a very clear sense of what we need to do,” the new CEO said.
Nestlé faces a similar struggle. The Swiss company behind KitKat and Nespresso also responded to a surge in the costs of raw materials by jacking the price of their products.I went a little too far. ”
However, as demand for coffee and confectionery such as Smarties and high-quality streets boomed in the first quarter, the company reported an organic revenue increase of 2.8%, surpassing analyst estimates by 2.6%.
“We are trying to take as many prices as possible to cover costs, keeping in mind the response of consumers in a competitive environment,” CEO Laurent Freixe said. Reuters reported. “Some political decisions, economic decisions made, have undermined the trust of already soft consumers.”
Nestlé is also experiencing “business changes.”Billionaire brandA powerful performance brand suite that can become an engine of growth, or a powerful performance. VeveyBasedCompany plans to cut costs by $2.8 billion by 2027.
Consumer companies like Unilever and Nestlé are constantly happy to pricing to provide a powerful top-line figure without upsetting shoppers. The subject has become Sensitive In the economic aftermath of the pandemic when cash-strap consumers alienated big brands amid high inflation in favor of the best deal.
Talks about tariffs in the US threaten to regain some of these pressures. Experts are worried On the medium-term impact of additional taxation on wider consumer sentiment. This is set against the backdrop of eye-catching cocoa and coffee prices. This is a key ingredient in some of Unilever and Nestlé’s top products.
Given their products are sold all over the world, Unilever and Nestlé have a vast manufacturing presence throughout the region. For example, Nestle Approximately 90% Of the domestic US products, it protects against the worst effects of tariffs.
However, companies also count the US as the largest market in most product categories, ordering financial health demand from the country.
How consumers respond to global order changes will determine the demand for consumer goods that both companies make. Unilever pointed to a “declining consumer sentiment,” but Nestlé said political and economic decisions would undermine “already soft consumer trust.”
On Wednesday, British consumer company Reckitt Benckiser warned that cleaning detor’s cleaning fluids and strepsils would also shake consumer trust. These challenges could determine the demand in the competitive market for consumer goods through 2025.
“The big picture on tariffs is still unfolding, but our analysis suggests that at this stage we will have a limited direct impact on our business,” Fernandez said.
Meanwhile, Nestlé CFO Anna Manz warned that tariffs could damage some of its business, including bottled water and Nespresso capsules. The Swiss giant said it will cut prices by 1% in the US to maintain its appeal with American shoppers.
The size and scale of Nestle and Unilever provide ample cushioning, but you need to monitor private labels that offer the same product at a lower price.
“The number of retailers that have developed the capabilities of multinational companies is growing significantly,” says Aftab Hussain, managing director and senior partner of BCG’s consumer and retail team. I told Reuters. “You’re actually getting innovations from private brand retailers that are ahead of (larger) brands.”
This story was originally introduced Fortune.com