How Nestlé’s 16,000-Job Cut Plan Could Affect Efficiency and Investors (SWX:NESN)

• Earlier in October 2025, Nestlé S.A.'s new CEO announced plans to cut 16,000 jobs, around 6% of its global workforce, primarily targeting white-collar positions over the next two years following a strong quarterly sales report.
• This significant restructuring move comes as the company maintains its full-year sales guidance and capitalizes on improved organic growth momentum despite ongoing market headwinds.
• We’ll explore how Nestlé’s workforce reduction plan could influence its investment narrative and prospects for enhanced operational efficiency.

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Nestlé Investment Narrative Recap

To hold Nestlé shares, you need to have confidence in its ability to maintain steady organic growth and recapture margin momentum, despite persistent cost and currency pressures. The recent workforce reduction, announced after a strong quarterly sales result, may support future operational efficiency, but it does not fundamentally alter the biggest near-term catalyst, margin stabilization through cost actions and portfolio focus. At the same time, the most pressing risk continues to be input cost inflation and FX volatility, which could erode profitability if not managed effectively.

This restructuring closely follows Nestlé’s latest quarterly announcement, where the company reported 4.3% organic growth but flagged ongoing headwinds from a stronger Swiss franc and elevated input costs. The commitment to full-year sales guidance signals management’s focus on defending top-line momentum, yet cost discipline and productivity initiatives are increasingly critical to underpin earnings resilience against external pressures.

In contrast, the speed and scale of these changes may bring new challenges that investors should be aware of if...

Read the full narrative on Nestlé (it's free!)

Nestlé's outlook anticipates CHF96.0 billion in revenue and CHF12.0 billion in earnings by 2028. This is based on a forecasted annual revenue growth rate of 1.8% and an earnings increase of CHF1.7 billion from the current CHF10.3 billion.

Uncover how Nestlé's forecasts yield a CHF87.16 fair value, a 11% upside to its current price.

Exploring Other Perspectives

Seventeen members of the Simply Wall St Community estimate Nestlé’s fair value anywhere from CHF65.45 to CHF143.16 per share. While some see deep value, ongoing concerns over margin pressure from input costs and currency trends remain front of mind for many, underscoring significant differences in outlook and highlighting the importance of reviewing multiple viewpoints.

Explore 17 other fair value estimates on Nestlé - why the stock might be worth 17% less than the current price!

Build Your Own Nestlé Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Nestlé research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Nestlé research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Nestlé's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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