Q3 2025 Nestle SA Earnings Call

October 16, 2025

David Hancock: Good morning and welcome to Nestlé's nine-month sales call. I'm David Hancock, Head of Investor Relations, and I'm joined today by Mark Schneider, our CEO, and by Anna Manz, CFO. As you know, this is Mark's first earnings announcement as CEO. To keep the call focused, we filmed a short interview with Mark, where you can hear more about his background and experiences. The video will be posted on our website at the end of this call, and I encourage you to take a look. Now, moving to the call, please take a moment to review the usual disclaimer. A quick overview of the agenda: Mark will share his key messages on strategic priorities and how he sees the business. Anna will take us through the nine-month results in detail, and we will then open up for Q&A. With that, I hand over to Mark.

Good morning and welcome to Nestlé's 9-month sales call.

I'm David Hancock, Head of Investor Relations, and I'm joined today by Philip Navratil, our new CEO, and by Anuman, SFO.

As you know, this is Phillips' first earnings announcement as CEO.

David Hancock: The video will be posted on our website at the end of this call, and I encourage you to take a look. Now, moving to the call. Please take a moment to review the usual disclaimer. Quick overview of the agenda. Philipp will share his key messages on strategic priorities and how he sees the business. Anna will take us through the nine-month results in detail, and we will then open up for Q&A. With that, I hand over to Philipp.

To keep the call focused, we filmed a short interview with Phillip where you can hear more about his background and experiences.

The video will be posted on our website at the end of this call, and I encourage you to take a look.

Moving to the call.

Please take a moment to review the usual disclaimer.

So quick overview of the agenda.

Philip will share his key messages on strategic priorities and how he sees the business.

Anna will take us through the 9-month results in detail.

And we will then open up for Q&A.

Philip: Thanks, David. Good morning all, and thank you for joining our nine-month results presentation. Over the last few months, our organization has gone through a lot of changes. Despite all of that, we have delivered a good Q3. I want to thank our people for staying focused on the business and embracing the transformation journey ahead of us. It is a privilege to lead this great company. We have strong foundations to build on. Let's be clear, we have a lot of work to do. I am very focused on how we move faster with our transformation to accelerate our growth momentum. The action we are now taking will secure Nestlé's future as a leader in our industry. We have been making good financial progress with a strong Q3. Our investments in growth are starting to show results.

Philipp Navratil: Thanks, David. Good morning, all, and thank you for joining our nine-month results presentation. Over the last few months, our organization has gone through a lot of changes. Despite all of that, we have delivered a good Q3. I want to thank our people for staying focused on the business and embracing the transformation journey ahead of us. It is a privilege to lead this great company. We have strong foundations to build on. Let's be clear, we have a lot of work to do. I am very focused on how we move faster with our transformation to accelerate our growth momentum. The action we are now taking will secure Nestlé's future as a leader in our industry. We have been making good financial progress with a strong Q3. Our investments in growth are starting to show results.

And with that, I hand over to Phillip.

Thanks, David. Good morning all, and thank you for joining our 9-month results presentation.

Over the last few months, our organization has gone through a lot of changes.

Despite all of that, we have delivered a good Q3.

I want to thank our people for staying focused on the business and embracing the transformation journey ahead of us.

It is a privilege to lead this great company. We have strong foundations to build on.

But let's be clear. We have a lot of work to do.

I am very focused on how we move faster with our transformation to accelerate our growth momentum.

And the action we are now taking will secure Nestlé's future as a leader in our industry.

Philip: We are determined to deliver on our commitments, and I'm confirming our full-year 2025 guidance. We are moving in the right direction. Now we need to move faster. As CEO, I want to share with you my four big priorities. Driving RIG-like growth is the most important. We will be bolder in investing at scale and driving innovation. Second, we must have a winning portfolio. I'll be looking at everything in a rational way. Where we aren't performing, I will act and act with urgency. Third, it is critical that we build a culture that delivers and rewards performance. Last, we are accelerating our business transformation and our cost-savings plans to build a stronger company. Doing all of this will deliver improved performance and shareholder value. Driving RIG-like growth is the number one priority for us. We have seen stepping up growth investments, and we are seeing positive results.

Philipp Navratil: We are determined to deliver on our commitments, and I'm confirming our full year 2025 guidance. We are moving in the right direction. Now we need to move faster. As CEO, I want to share with you my four big priorities. Driving RIG-led growth is the most important. We will be bolder in investing at scale and driving innovation. Second, we must have a winning portfolio. I'll be looking at everything in a rational way. Where we aren't performing, I will act and act with urgency. Third, it is critical that we build a culture that delivers and rewards performance. Last, we are accelerating our business transformation and our cost savings plans to build a stronger company. Doing all of this will deliver improved performance and shareholder value. Driving RIG-led growth is the number one priority for us.

We have been making good financial progress with a strong Q3. Our investments in growth are starting to show results.

We are determined to deliver on our commitments, and I'm confirming our full year 2025 guidance.

We are moving in the right direction. Now, we need to move faster.

SEO. I want to share with you my four big priorities.

Driving revenue growth is the most important. We will be bolder in investing at scale and driving innovation.

Second, we must have a winning portfolio.

Philipp Navratil: Where we aren't performing, I will act and act with urgency. Third, it is critical that we build a culture that delivers and rewards performance. Last, we are accelerating our business transformation and our cost savings plans to build a stronger company. Doing all of this will deliver improved performance and shareholder value. Driving RIG-led growth is the number one priority for us.

I’ll be looking at everything in a rational way.

Where we aren't performing, I will act and act with urgency.

Third, it is critical that we build a culture that delivers and rewards performance. Last

We are accelerating our business transformation and our cost savings plans to build a stronger company.

Doing all of this will deliver improved performance and shareholder value.

Philipp Navratil: We have seen stepping up growth investments, and we are seeing positive results. Our organic growth year to date is 3.3%, up from 2% this time last year. That's an acceleration of 130 basis points. Out of that, 60 basis points has come from an acceleration in the areas we have prioritized for growth investments, and 40 basis points has come from improved growth in our 18 key underperforming sales. These two areas are driving the majority of growth acceleration. Our increased investment in priority opportunities doubled the growth of these businesses from 7% to 14%. In our key underperformers, the growth rate improved from -2.5 to flat. Excluding the sales that are in Greater China, the underperformers grew 1.5%. What we're doing is working.

Driving riglet growth is the number one priority for us.

We have seen stepping up growth investments.

Philip: Our organic growth year to date is 3.3%, up from 2% this time last year. That's an acceleration of 130 basis points. Out of that, 60 basis points have come from an acceleration in the areas we have prioritized for growth investments. 40 basis points have come from improved growth in our 18 key underperforming cells. These two areas are driving the majority of growth acceleration. Our increased investment in priority opportunities doubled the growth of these businesses from 7% to 14%. Our key underperformers, the growth rate improved from minus 2.5% to flat. Excluding the cells that are in Greater China, the underperformers grew 1.5%. What we are doing is working. What I'm not happy about is that these priority growth opportunities are only 10% of our sales. Flat growth in our underperformers is nowhere near good enough.

And we are seeing positive results.

Our organic growth year-to-date is 3.3%, up from 2% this time last year.

That's an acceleration of 130 basis points.

Out of that.

60 basis points have come from an acceleration in the areas we have prioritized for growth investments, and 40 basis points have come from improved growth in our 18 key underperforming sales.

These two areas are driving the majority of growth acceleration.

Our increased investment in priority opportunities doubled the growth of these businesses from 7% to 14%.

And our key performers showed that the growth rate improved from minus 2.5% to flat. Excluding the sales in Greater China, the underperformers grew by 1.5%.

Philipp Navratil: What I'm not happy about is that these priority growth opportunities are only 10% of our sales, and flat growth in our underperformers is nowhere near good enough. Now we need to go bigger and bolder, investing at scale behind the highest return opportunities. This means being rigorous about which opportunities have the best returns, and then significantly increasing the resources we give them. During this year, we have increased investment in a number of areas to accelerate our growth. These are largely right, and they are working well, as I just showed. They are a bit of a mix of products, platforms, and brands, and they are not big enough. To drive growth at scale, we must go beyond individual innovations and do this in a structured way.

So, what we are doing is working.

What I'm not happy about is that these priority growth opportunities are only 10% of our sales, and flat growth in our underperformers is nowhere near good enough.

Philip: We need to go bigger and bolder, investing at scale behind the highest return opportunities. This means being rigorous about which opportunities have the best returns, and then significantly increasing the resources we give them. During this year, we have increased investment in a number of areas to accelerate our growth. These are largely right, and they are working well, as I just showed. They are a bit of a mix of products, platforms, and brands, and they are not big enough. To drive growth at scale, we must go beyond individual innovations and do this in a structured way. Start with the big strategic consumer platforms, build multi-year innovation pipelines for these platforms, and execute flawlessly with high-quality marketing through our billionaire global brands. Take the example of Nescafé Espresso Concentrate, one of our six big bets. The strategic consumer platform here is cold coffee, an incredible growth opportunity.

So now we need to go bigger and bolder, investing at scale behind the highest return opportunities. This means being rigorous about which opportunities have the best returns and then significantly increasing the resources. We gave them.

During this year, we have increased investment in the number of areas to accelerate our growth.

These are largely rights, and they are working well, as I just showed.

But they are a bit of a mix of products, platforms, and brands, and they are not big enough.

Philipp Navratil: Start with the big strategic consumer platforms, build multi-year innovation pipelines for these platforms, and execute flawlessly with high-quality marketing through our billionaire global brands. Take the example of Nescafé Espresso Concentrates, one of our 6 big bets. The strategic consumer platform here is cold coffee, an incredible growth opportunity. We build a strong multi-year innovation pipeline for that. I know this well because we did some of it while I was running the coffee business. The espresso concentrate actually came out of that pipeline. We're bringing it to the market globally under the Nescafé brand, the world's number 1 coffee brand. We now need to take it to our other 2 leading coffee brands. We need this structured, scaled approach across all of our categories. To be successful with that, we need to step up our marketing capabilities across the organization. We're not strong enough, and that needs to change.

To drive growth at scale, we must go beyond individual innovations and do this in a structured way.

Start with the big strategic consumer platforms. Build multi-year innovation pipelines for these platforms and execute flawlessly with high-quality marketing to our billionaire global brands.

take the example of Nescafe, espresso concentrates

Philip: We built a strong multi-year innovation pipeline for that. I know this well because we did some of it while I was running the coffee business. The Espresso Concentrate actually came out of that pipeline. We're bringing it to the market globally under the Nescafé brand, the world's number one coffee brand. We now need to take it to our other two leading coffee brands. We need this structured, scaled approach across all of our categories. To be successful with that, we need to step up our marketing capabilities across the organization. We are not strong enough, and that needs to change. At Nestlé, I really think that our portfolio is a huge competitive advantage. There are very significant benefits to scale. For example, negotiating with customers, innovation capability, brand trust, and access to talent. We only get the scale benefits if we are winning in the individual businesses.

The strategic consumer platform here is cold coffee, an incredible growth opportunity. We built a strong multi-year innovation pipeline for that. I know this well because I was involved in some of it while I was running the coffee business.

Philipp Navratil: We're bringing it to the market globally under the Nescafé brand, the world's number 1 coffee brand. We now need to take it to our other 2 leading coffee brands. We need this structured, scaled approach across all of our categories. To be successful with that, we need to step up our marketing capabilities across the organization. We're not strong enough, and that needs to change.

The espresso concentrate actually came out of that pipeline.

We're bringing it to the market globally under the NCAA brand, the world's number one coffee brand.

We now need to take it to our other two leading coffee brands.

We need this structure, scaled approach, all of our architectures.

To be successful with that, we need to step up our marketing capabilities across the organization.

We're not strong enough, and that needs to change.

Philipp Navratil: At Nestlé, I really think that our portfolio is a huge competitive advantage. There are very significant benefits to scale. For example, negotiating with customers, innovation capability, brand trust, and access to talent. We only get the scale benefits if we are winning in the individual businesses. I will consistently review every part of our portfolio with an open mind, unconstrained by preconceived ideas. I look at assessing business on four key questions: Is this a growth category? Is the returns profile attractive? Are we positioned to win? And are we actually winning? Across most of the portfolio, the answer to these questions is yes, although we are not yet winning as much as we need to. If our assessment concludes that one or the other business does not meet the criteria I described, we will act, whether that means fixing, partnering, or selling.

At Nestlé, I really think that our portfolio is a huge competitive advantage.

There are very significant benefits to scale. For example, negotiating with customers, innovation capability, brand trust, and access to talent.

Philip: I will consistently review every part of our portfolio with an open mind, unconstrained by preconceived ideas. I look at assessing business on four key questions. Is this a growth category? Is the returns profile attractive? Are we positioned to win? Are we actually winning? Across most of the portfolio, the answer to these questions is yes, although we are not yet winning as much as we need to. If our assessment concludes that one or the other business does not meet the criteria I described, we will act, whether that means fixing, partnering, or selling. Just to confirm, we're continuing with the strategic evaluation of Waters and mainstream VMS. Delivering on our strategy requires a relentless focus on execution and a culture that drives high performance. Nestlé's culture has many strengths, and there are areas where we must evolve.

But we only get the scale benefits if we are winning in the individual businesses.

I will consistently review every part of our portfolio with an open mind, unconstrained by preconceived ideas.

I look at assessing business on four key questions.

Is this a growth category?

Is the returns profile attractive.

Are we positioned to win? And are we actually winning?

Across most of the portfolio, the answer to these questions is yes.

Although we are not yet winning as much as we need to.

Philipp Navratil: Just to confirm, we're continuing with the strategic evaluation of Waters and mainstream VMS. Delivering on our strategy requires a relentless focus on execution and a culture that drives high performance. Nestlé's culture has many strengths, and there are areas where we must evolve. Accepting that we lose market share is no longer an option. This mindset has to change. Until this year, we did not have a common set of KPIs worldwide. This has changed, and we now have forward-looking indicators focusing on innovation and execution. This is a big step forward. Now we need to use them consistently across the group. Most importantly, compensation will be driven by performance. This ensures rewards reflect achievement. Personal objectives will be much more rigorous, measurable, and consistent across the group. These steps will help us build a culture that recognizes and rewards excellence across the organization.

But if our assessment concludes that one or the other business does not meet the criteria I described, we will act. That means fixing, partnering, or selling.

Just to confirm, we are continuing with the strategic evaluation of waters and mainstream VMS.

Delivering on our strategy requires a relentless focus on execution and a culture that drives high performance.

Philip: Accepting that we lose market share is no longer an option. This mindset has to change. Until this year, we did not have a common set of KPIs worldwide. This has changed, and we now have forward-looking indicators focusing on innovation and execution. This is a big step forward. Now we need to use them consistently across the group. Most importantly, compensation will be driven by performance. This ensures rewards reflect achievement. Personal objectives will be much more rigorous, measurable, and consistent across the group. These steps will help us build a culture that recognizes and rewards excellence across the organization. The fourth focus area for me is our business transformation. How we work better, smarter, and faster, and with a lower cost base. Getting this right is fundamental to creating value in our business. Our scale and breadth bring advantages, which I touched on earlier.

Leslie's culture has many strengths, and there are areas where we must evolve.

Accepting that we lose market share is no longer an option. This mindset has to change.

Philipp Navratil: This has changed, and we now have forward-looking indicators focusing on innovation and execution. This is a big step forward. Now we need to use them consistently across the group. Most importantly, compensation will be driven by performance. This ensures rewards reflect achievement. Personal objectives will be much more rigorous, measurable, and consistent across the group. These steps will help us build a culture that recognizes and rewards excellence across the organization.

Until this year, we did not have a common set of KPIs worldwide. This has changed, and we now have forward-looking indicators focusing on innovation and execution. This is a big step forward.

Now, we need to use them consistently.

Across the group.

Most importantly, compensation will be driven by performance.

This ensures rewards reflect achievement.

And personal objectives will be much more rigorous, measurable, and consistent across the group.

These steps will help us build a culture that recognizes and rewards excellence across the organization.

Philipp Navratil: The fourth focus area for me is our business transformation. How we work better, smarter, and faster, and with a lower cost base. Getting this right is fundamental to creating value in our business. Our scale and breadth bring advantages, which I touched on earlier, but they also can bring complexity, and this creates inefficiencies. I have started to look at this, and we will spend more time on it over the coming months. It is clear that we can get more agile in how we work with simpler structures and roles. We have made great progress in the last year in mapping our processes across the organization, so we don't look at them in silos. This gives us the basis to simplify, digitalize, and automate our processes and get full value out of our shared services. This will give us a better, more agile business.

The fourth focus area for me is our business transformation.

How we work: better, smarter, and faster, and with a lower cost base.

Getting this right is fundamental to creating value in our business. Our scale and breadth bring advantages.

Philip: They also can bring complexity, and this creates inefficiencies. I have started to look at this, and we will spend more time on it over the coming month. It is clear that we can get more agile in how we work with simpler structures and roles. We have made great progress in the last year in mapping our processes across the organization so we don't look at them in silos. This gives us the basis to simplify, digitalize, and automate our processes and get full value out of our shared services. This will give us a better, more agile business. We will take hard but necessary decisions to reduce headcount. Historically, we have avoided being fully transparent about these changes, and I want to be transparent. We plan a reduction of 12,000 white-collar professionals across functions and geographies over the next coming two years.

Which are touched on earlier.

But they also can bring complexity, and this creates inefficiencies.

Philipp Navratil: It is clear that we can get more agile in how we work with simpler structures and roles. We have made great progress in the last year in mapping our processes across the organization, so we don't look at them in silos. This gives us the basis to simplify, digitalize, and automate our processes and get full value out of our shared services. This will give us a better, more agile business.

I have started to look at this, and we will spend more time on it over the coming months.

It is clear that we can get more agile in how we work with simple structures and roles.

We have made great progress in the last year in mapping our processes across the organization, so we don't look at them in silos.

This gives us the basis to simplify, digitalize, and automate our processes and get full value out of our shared services. This will give us a better, more agile business.

Philipp Navratil: We will take hard but necessary decisions to reduce headcount. Historically, we have avoided being fully transparent about these changes, and I want to be transparent. We plan a reduction of 12,000 white-collar professionals across functions and geographies over the next coming 2 years. In addition, we plan a further 4,000 headcount reduction as part of our ongoing productivity initiatives in manufacturing and supply chain. This will drive cost savings, and we have increased our Fuel for Growth savings target by CHF 500 million by the end of 2027. In conclusion, my 4 priorities: RIG-led growth, winning portfolio, performance culture, and transformation and efficiency. I will drive all of this with urgency to accelerate our growth performance and deliver improved shareholder value. I will now hand over to Anna, who will take you through the detailed financial results for the period.

We will take hard but necessary decisions to reduce headcount.

Historically, we have avoided being fully transparent about these changes, and I want to be transparent.

Philip: In addition, we plan a further 4,000 headcount reduction as part of our ongoing productivity initiatives in manufacturing and supply chain. This will drive cost savings, and we have increased our fuel for growth savings target by CHF 500 million by the end of 2027. In conclusion, my four priorities: RIG-like growth, winning portfolio, performance culture, and transformation and efficiency. I will drive all of this with urgency to accelerate our growth performance and deliver improved shareholder value. I will now hand over to Anna, who will take you through the detailed financial results for the period.

We plan a reduction of 12,000 white-collar professionals across functions and geographies over the next two years.

In addition.

Philipp Navratil: This will drive cost savings, and we have increased our Fuel for Growth savings target by CHF 500 million by the end of 2027. In conclusion, my 4 priorities: RIG-led growth, winning portfolio, performance culture, and transformation and efficiency. I will drive all of this with urgency to accelerate our growth performance and deliver improved shareholder value. I will now hand over to Anna, who will take you through the detailed financial results for the period.

We plan a further reduction of 4,000 headcount as part of our ongoing productivity initiatives in manufacturing and supply chain.

This will drive cost savings.

500 million Swiss francs by the end of 2027.

To inclusion my 4 priority.

Rate lead growth.

Winning portfolio performance, culture, transformation, and efficiency.

I will drive all of this with urgency to accelerate our growth performance and deliver improved shareholder value.

I will now hand over to Anna.

Anna Manz: Thanks, Philipp. Good morning. Moving to our nine-month sales, we delivered 3.3% organic sales growth with RIG of 0.6% and pricing of 2.8%. Sales were negatively impacted by FX movements with the strengthening of the Swiss franc. For the group, organic growth strengthened in Q3 to 4.3% with a good recovery in RIG. Within this is a few different dynamics. Firstly, it's helpful to pull out China and Nestlé Health Science on the right-hand side of the slide. That's because the issues and corrective actions in these businesses are different, and we've talked about them in detail last quarter. Looking at the middle chart, you see what's going on within the other 88% of the business.

Anna Manz: Thanks, Philip. Good morning. Moving to our nine-month sales, we delivered 3.3% organic sales growth with RIG of 0.6% and pricing of 2.8%. Sales were negatively impacted by FX movements with the strengthening of the Swiss franc. For the group, organic growth strengthened in the third quarter to 4.3% with a good recovery in RIG. Within this is a few different dynamics. Firstly, it's helpful to pull out China and Nestlé Health Science on the right-hand side of the slide. That's because the issues and corrective actions in these businesses are different. We've talked about them in detail last quarter. Looking at the middle chart, you see what's going on within the other 88% of the business. The last four quarters, up until Q3, organic growth has accelerated as we've taken pricing given input cost inflation in coffee and confectionery.

Who will take you through the details of the financial results for the period?

Thanks Phillip.

For the first nine months, we delivered 3.3% organic sales growth, with a volume increase of 0.6% and pricing of 2.8%.

Sales were negatively impacted by FX movements, particularly due to the strengthening of the Swiss franc.

For the group, organic growth strengthened in the third quarter to 4.3%, with a good recovery in rig.

And within this, there are a few different dynamics.

Firstly, it's helpful to pull out China unless they say "Health Science" on the right-hand side of the slide. This is because the issues and corrective actions in these businesses are different, and we've talked about them in detail last quarter.

Anna Manz: The last four quarters up until Q3, organic growth has accelerated as we've taken pricing given input cost inflation in coffee and confectionery. Despite increased pricing, we were able to hold RIG broadly flat, and that's because we're delivering a growing impact from both our investments in priority growth opportunities and improvements in our 18 underperforming sales, as Philipp took you through a few minutes ago. After four quarters of stable RIG, Q3 saw a marked improvement, and that's due to three factors. Firstly, the benefit of actions which I just talked about continuing. Secondly, we benefited from an easier comp in Q3, both in terms of RIG and OG. This will get harder again in Q4, especially for OG. Finally, we've taken some selective actions to manage a small number of areas where our pricing has moved out of reach of the consumer.

Looking at the middle chart, do you see what's going on within the other 88% of the business?

Anna Manz: Despite increased pricing, we were able to hold RIG broadly flat. That's because we're delivering a growing impact from both our investments in priority growth opportunities and improvements in our 18 underperforming cells, as Philip took you through a few minutes ago. After four quarters of stable RIG, Q3 saw a marked improvement. That's due to three factors. Firstly, the benefit of actions which I just talked about continuing. Secondly, we benefited from an easier comp in Q3, both in terms of RIG and OG. This will get harder again in Q4, especially for OG. Finally, we've taken some selective actions to manage a small number of areas where our pricing had moved out of reach of the consumer. At the beginning of the year, I said we would be front-footed about pricing to protect our structural profitability, but that we would be nimble and adjust to our consumers' reactions.

The last four quarters, up until Q3, organic growth has accelerated as we've taken pricing given input cost inflation in coffee and confectionery.

Despite increased pricing, we were able to hold rig broadly flat.

Anna Manz: After four quarters of stable RIG, Q3 saw a marked improvement, and that's due to three factors. Firstly, the benefit of actions which I just talked about continuing. Secondly, we benefited from an easier comp in Q3, both in terms of RIG and OG. This will get harder again in Q4, especially for OG. Finally, we've taken some selective actions to manage a small number of areas where our pricing has moved out of reach of the consumer.

And that's because we're delivering a growing impact from both our investments in priority growth opportunities and improvements in our 18 under sales, as Philip took you through a few minutes ago.

After four quarters of stable rig, Q3 saw a marked improvement, and that's due to three factors.

Firstly, the benefit of actions which I just talked about continuing.

Secondly, we benefited from an easier comp in Q3, both in terms of rig and OG. This will get harder again in Q4.

For OG.

Anna Manz: At the beginning of the year, I said we would be front-footed about pricing to protect our structural profitability, but that we would be nimble and adjust to our consumers' reactions. That's exactly what we're doing, optimizing price where it's gone too far. It's working. We're getting pricing whilst improving RIG and market share. An example is the introduction of the promo packs in a confectionery product in Brazil. Stepping back, as you heard from Philipp, there's a lot for us to do to accelerate performance. In Q3 overall, we see that things are moving in the right direction. Now let's get into a bit more detail on the segments, and here I'm going to focus on Q3. In Zone AMS, growth has been accelerating, helped by softer comps in Q3.

And finally, we've taken some selective actions to manage a small number of areas where our pricing has moved out of reach of the consumer.

Anna Manz: That's exactly what we're doing, optimizing price where it's gone too far. It's working. We're getting pricing whilst improving RIG and market share. An example is the introduction of the Promo Packs in a confectionery product in Brazil. Stepping back, as you heard from Philip, there's a lot for us to do to accelerate performance. In Q3 overall, we see that things are moving in the right direction. Now let's get into a bit more detail on the segments. Here I'm going to focus on the third quarter. In Zone AMS, growth has been accelerating, helped by softer comps in Q3. The acceleration was driven by LatAm, while North America held its momentum as we gained market share across most categories. By category, coffee and confectionery drove the growth.

At the beginning of the year, I said we would be front-footed about pricing to protect our structural profitability, but that we would be nimble and adjust to our consumers' reactions.

And that's exactly what we're doing: optimizing price, where it's gone too far.

And it's working. We're getting pricing, while improving rig and market share.

An example is the introduction of the promo packs in a confectionery product in Brazil.

So, stepping back, as you heard from Phillips, there's a lot for us to do to accelerate performance. But in Q3 overall, we see that things are moving in the right direction.

Now, let's get into a bit more detail on the segments.

And here I'm going to focus on the third quarter.

Anna Manz: The acceleration was driven by LATAM, while North America held its momentum as we gained market share across most categories. By category, coffee and confectionery drove the growth. This was led by pricing, supported by good RIG in coffee and an improving RIG trend in confectionery as we acted to manage price elasticities. Growth in pet reflected ongoing category softness, was stable from Q2 to Q3. In food, we continue to improve our market share trends in US frozen. Turning to AOA. In Greater China, the organic growth decline in Q3 was similar to that in Q2, as we reduce trade inventory levels and shift our focus to generating consumer pull. In the rest of AOA, growth was broad-based and there was good sequential improvement, particularly across the larger markets in Asia.

In Zone, AMS growth has been accelerating, helped by softer comps in Q3.

The acceleration was driven by LatAm, while North America held its momentum, as we gained market share across most categories.

Anna Manz: This was led by pricing but supported by good RIG in coffee and an improving RIG trend in confectionery as we acted to manage price elasticities. Growth in pet reflected ongoing category softness but was stable from Q2 to Q3. In food, we continue to improve our market share trends in U.S. frozen. Turning to AOA, in Greater China, the organic growth decline in Q3 was similar to that in Q2 as we reduced trade inventory levels and shifted our focus to generating consumer pull. In the rest of AOA, growth was broad-based, and there was good sequential improvement, particularly across the larger markets in Asia. RIG was strong across markets and categories, and we gained market share across much of the business. In Europe, we saw a nice improvement with RIG of 2% in Q3, helped by a softer comp.

By category, coffee and confection drove the growth.

This was led by pricing but supported by good rigging coffee and an improving rig, trending confectionery as we acted to manage price elasticities.

Growth in pets reflected ongoing category softness but was stable from Q2 to Q3.

And in food, we continue to improve our market share trends in the U.S. Frozen.

Turning to AOA.

In Greater China, the organic growth decline in Q3 was similar to that in Q2 as we reduce trade inventory levels and shift our focus to generating consumer pull.

Anna Manz: RIG was strong across markets and categories. We gained market share across much of the business. In Europe, we saw a nice improvement with RIG of 2% in Q3 helped by a softer comp. The biggest drivers were coffee and confectionery. Again, this was a combination of pricing and targeted actions on elasticities. The other important growth driver is pet care, where RIG was strong, driven by good market momentum and strong performance of our innovations. Growth was solid across most geographic markets. Turning to the globally managed businesses. Again focusing on Q3. In Nestlé Health Science, we're still lapping tougher comps. We saw good performance in premium VMS, improvement in Nature's Bounty, and innovation driving strong growth in organics. Nespresso continues to perform well with another quarter of solid growth in both price and RIG.

In the rest of AOA, growth is broad-based, and there was good sequential improvement, particularly across the larger markets in Asia.

Rig was strong across markets and categories, and we gained market share across much of the business.

Anna Manz: The biggest drivers were coffee and confectionery, and this was a combination of pricing and targeted actions on elasticities. The other important growth driver is pet care, where RIG was strong, driven by good market momentum and strong performance of our innovations. Growth is solid across most geographic markets. Turning to the globally managed businesses and focusing on the third quarter. In Nestlé Health Science, we're still lapping tougher comps, but we saw good performance in premium VMS, improvement in Nature's Bounty, and innovation driving strong growth in organic. Nespresso continues to perform well with another quarter of solid growth in both price and RIG. Q3 benefited from a particularly successful limited edition summer campaign. In Nestlé Waters and premium beverages, we continue to see solid growth in waters, but the category softened towards the end of the summer due to cooler weather in Europe.

In Europe, we saw a nice improvement with a rig of 2% in Q3, helped by a softer comp.

The biggest drivers with coffee and confectionery were a combination of pricing and targeted actions on elasticities.

The other important growth driver is Pet Care, where growth was strong, driven by good market momentum and the strong performance of our innovations.

Greater solidity across most geographic markets.

Globally, managed businesses, and again, focusing on the third quarter.

Unless they Health Science, we're still lapping tougher comps, but we saw good performance in premium VMS. Improvement in Nature's Bounty and innovation driving strong growth in our game.

Anna Manz: Q3 benefited from a particularly successful limited edition summer campaign. In Nestlé Waters and Premium Beverages, we continue to see solid growth in waters, but the category softened towards the end of the summer due to cooler weather in Europe. In premium beverages, our investments are driving double-digit growth. Turning to our categories. Powders and liquid beverages, which is mainly coffee, continued to grow strongly, driven by pricing and with RIG of over 2% in the quarter. The pet care category is currently sluggish but stable, and overall, we're holding or gaining share. We remain positive about the medium-term growth outlook, and we're focused on accelerating category growth through innovation and investment in fast-growing areas such as therapeutic diets and supplements. I've already covered Nestlé Health Science and in nutrition, performance continues to be impacted by Gerber in the US. This is one of our more stubborn underperformers.

Nespresso continues to perform well, with another quarter of solid growth in both price and RIG.

Q3 benefited from a particularly successful limited edition summer campaign.

Anna Manz: In premium beverages, our investments are driving double-digit growth. Turning to our categories, powders and liquid beverages, which is mainly coffee, continue to grow strongly, driven by pricing and with RIG of over 2% in the quarter. The pet care category is currently sluggish but stable, and overall we're holding or gaining share. We remain positive about the medium-term growth outlook, and we're focused on accelerating category growth through innovation and investment in fast-growing areas such as therapeutic diets and supplements. I've already covered Nestlé Health Science. In nutrition, performance continues to be impacted by Gerber in the U.S. This is one of our more stubborn underperformers. We're taking the right actions across brand, innovation, and cost. Given U.S. retailers have annual shelf reset cycles, we won't see results improving for another few quarters yet.

In Q3 2025, waters and premium beverages continue to show solid growth in waters. However, the category softened towards the end of summer due to cooler weather in Europe.

In premium beverages, our investments are driving double-digit growth.

Turning to our categories.

Anna Manz: The pet care category is currently sluggish but stable, and overall, we're holding or gaining share. We remain positive about the medium-term growth outlook, and we're focused on accelerating category growth through innovation and investment in fast-growing areas such as therapeutic diets and supplements. I've already covered Nestlé Health Science and in nutrition, performance continues to be impacted by Gerber in the US. This is one of our more stubborn underperformers.

How does liquid beverages, which is mainly coffee, continue to grow strongly, driven by pricing and with a rig of over 2% in the quarter?

The Pet Care category is currently sluggish but stable, and overall, we're holding or gaining share.

We remain positive about the medium-term growth outlook, and we're focused on accelerating category growth through innovation and investment in fast-growing areas, such as therapeutic diets and supplements.

I've already covered Nestlé Health and, in nutrition, performance continues to be impacted by Gerber in the U.S.

Anna Manz: We're taking the right actions across brand, innovation, and cost. Given US retailers have annual shelf reset cycles, we won't see results improving for another few quarters yet. Prepared dishes and cooking aids was predominantly driven by frozen, where we're taking share despite ongoing category softness. In the rest of the category, incremental investment in Maggi is driving strong results. Milk products and ice cream growth was positive, with price-led growth in ambient dairy and strong RIG in coffee creamers. In confectionery, growth remains strong. We're starting to lap the price increases that began last year, and RIG is on an improving trend. Our Fuel for Growth program is on track to deliver CHF 700 million of savings for 2025. As you know, the largest portion of savings in the program come from procurement, where we're making good progress.

Anna Manz: Prepared dishes and cooking aids was predominantly driven by frozen, where we're taking share despite ongoing category softness. In the rest of the category, incremental investment in Maggi is driving strong results. Milk products and ice cream growth was positive, with price-led growth in ambient dairy and strong RIG in coffee creamers. In confectionery, growth remains strong, and we're starting to lap the price increases that began last year, and RIG is on an improving trend. Our fuel for growth program is on track to deliver CHF 700 million of savings for 2025. As you know, the largest portion of savings in the program come from procurement, where we're making good progress. Philip just talked about his focus on operational efficiencies. The business transformation he's described will lead to a planned reduction in our white-collar headcount of 12,000.

This is one of our more stubborn underperformers. We're taking the right actions across brand innovation and cost, but given our retailers have annual shelf reset cycles, we won't see results improving for another few quarters yet.

Prepare dishes and cooking. AIDs were predominantly driven by Frozen, where we're taking shared despite ongoing categories of softness.

Anna Manz: Milk products and ice cream growth was positive, with price-led growth in ambient dairy and strong RIG in coffee creamers. In confectionery, growth remains strong. We're starting to lap the price increases that began last year, and RIG is on an improving trend. Our Fuel for Growth program is on track to deliver CHF 700 million of savings for 2025. As you know, the largest portion of savings in the program come from procurement, where we're making good progress.

In the rest of the category, incremental investment in Maggie is driving strong results.

Milk products and ice cream showed positive growth, driven by price-led increases in ambient dairy, as well as strong performance in coffee creamers.

And in confectionery, growth remains strong. We are starting to lap the price increases that began last year, and rig is on an improving trend.

Our Fuel for Growth program is on track to deliver $700 million in savings for 2025.

Anna Manz: Philipp just talked about his focus on operational efficiencies. The business transformation he's described will lead to a planned reduction in our white collar headcount of 12,000. This will deliver CHF 1 billion of annual savings, which is CHF 500 million more than our original plan, and takes our Fuel for Growth savings target to CHF 3 billion by the end of 2027. These additional savings will be reinvested, more fuel for driving growth. For the headcount reductions, there will be a restructuring cost of about 2x the annual savings, so expect it to be around CHF 2 billion. In short, we're increasing efficiency and reducing complexity as we accelerate business transformation. Turning finally to guidance. We're maintaining our full year guidance despite increased headwinds at the beginning of the year.

As you know, the largest portion of savings in the program comes from procurement, where we're making good progress.

Good. It's just talked about his focus on operational efficiencies.

Anna Manz: This will deliver CHF 1 billion of annual savings, which is CHF 500 million more than our original plan, and takes our fuel for growth savings target to CHF 3 billion by the end of 2027. These additional savings will be reinvested, more fuel for driving growth. For the headcount reductions, there will be a restructuring cost of about two times the annual savings, expected to be around CHF 2 billion. In short, we're increasing efficiency and reducing complexity as we accelerate business transformation. Turning finally to guidance, we're maintaining our full-year guidance despite increased headwinds since the beginning of the year. Our organic sales growth is expected to improve compared to the 2.2% in 2024. We're well on track after the first nine months. As we look to the rest of the year, we continue to have good growth momentum.

The business transformation he's described will lead to a planned reduction in our white collar headcount of 12,000.

This will deliver $1 billion of annual savings, which is $500 million more than our original plan and takes our fuel-for-growth savings target to $3 billion by the end of 2027.

These additional savings will be reinvested as more fuel for driving growth.

But the headcount reductions there will incur a restructuring cost of about 2 times the annual savings, which are expected to be around 2 billion Swiss Francs.

In short, we're increasing efficiency and reducing complexity as we accelerate business transformation.

Turning finally, to guidance.

Anna Manz: Our organic sales growth is expected to improve compared to 2.2% in 2024. We're well on track after the first nine months. As we look to the rest of the year, we continue to have good growth momentum, but do keep in mind that we have a tougher comp in Q4 than we had in Q3. The UTOP margin is still expected to be at or above 16% as we invest for growth. This assumes tariffs currently in place today, including the higher tariffs in Switzerland that came in after the half year. The guidance also reflects today's FX rates. While we're continuing to execute with focus, macroeconomic and consumer uncertainty remains. As we navigate these headwinds, I want to be clear that we won't compromise on investing for the medium term.

We're maintaining our full-year guidance despite increased headwinds at the beginning of the year.

Our organic sales growth is expected to improve compared to the 2.2% in 2024, and we're well on track after the first nine months.

Anna Manz: Do keep in mind that we have a tougher comp in Q4 than we had in Q3. The UTOP margin is still expected to be at or above 16% as we invest for growth. This assumes tariffs currently in place today, including the higher tariffs in Switzerland that came in after the half year. The guidance also reflects today's FX rates. While we're continuing to execute with focus, macroeconomic and consumer uncertainty remains. As we navigate these headwinds, I want to be clear that we won't compromise on investing for the medium term. Lastly, let me comment on cash flow and dividend. Generating free cash flow is a key focus for us, and we expect to deliver at least CHF 8 billion of free cash flow this year. We're committed to our long-standing dividend practice.

As we look to the rest of the year, we continue to have good growth momentum. However, do keep in mind that we have a tougher comp in Q4 than we had in Q3.

The Utah margin is still expected to be at or above 16% as we invest for growth.

And this assumes tariffs currently in place today, including the higher tariffs in Switzerland that came in after the half year.

The guidance also reflects today's FX rates.

While we're continuing to execute with focus, macroeconomic and consumer uncertainty remains.

Anna Manz: Lastly, let me comment on cash flow and dividend. Generating free cash flow is a key focus for us, and we expect to deliver at least CHF 8 billion of free cash flow this year. We're committed to our long-standing dividend practice, and this means we have to grow our free cash flow in Swiss francs faster on an ongoing basis. To pull together everything you've heard from Philipp and I this morning, we delivered a good performance in Q3, and we are on track to hit our guidance for the full year. Our results demonstrate we're making progress, but as Philipp said, there's much more to do, and we need to accelerate. We're clear on our priorities. We will drive RIG through investing boldly. We'll transform the organization and accelerate efficiencies, and we will improve cash flow.

And as we navigate these headwinds, I want to be clear that we won't compromise on investing for the medium term.

And lastly, let me comment on cash flow and dividend.

Generating free cash flow is a key focus for us, and we expect to deliver at least $8 billion of free cash flow this year.

Anna Manz: This means we have to grow our free cash flow in Swiss francs faster on an ongoing basis. To pull together everything you've heard from Anna and I this morning, we delivered a good performance in Q3, and we are on track to hit our guidance for the full year. Our results demonstrate we're making progress. As Anna said, there's much more to do, and we need to accelerate. We're clear on our priorities. We will drive RIG through investing boldly. We'll transform the organization and accelerate efficiencies, and we will improve cash flow. In short, we'll move faster and act with urgency to deliver improved shareholder value. With that, I'll hand it over to David for Q&A.

We're committed to our long-standing dividend practice, and this means we have to grow our free cash flow in Swiss Francs faster on an ongoing basis.

To pull together everything you’ve heard from Philip and me this morning.

Anna Manz: Our results demonstrate we're making progress, but as Philipp said, there's much more to do, and we need to accelerate. We're clear on our priorities. We will drive RIG through investing boldly. We'll transform the organization and accelerate efficiencies, and we will improve cash flow. In short, we'll move faster and act with urgency to deliver improved shareholder value. With that, I'll hand it over to David for Q&A.

Yeah.

Our results demonstrate we're making progress. But as Philip said, there's much more to do, and we need to accelerate.

Anna Manz: In short, we'll move faster and act with urgency to deliver improved shareholder value. With that, I'll hand it over to David for Q&A.

We're clear on our priorities. We will drive growth through investing boldly, transform the organization and accelerate efficiencies, and improve cash flow.

In short, we'll move faster and act with urgency to deliver improved shareholder value.

And with that, I'll hand it over to David for Q&A.

David Hancock: Thanks, Anna. We'll now begin the Q&A session. As usual, please limit yourself to two questions to allow everyone a chance to ask their questions. The first question we have comes from Guillaume Delmas from UBS. Please go ahead, Guillaume.

Thanks, Anna. So, we'll now begin the Q&A session as usual. Please limit yourself to 2 questions to allow everyone a chance to ask their questions.

Guillaume Delmas: Thank you very much, David. Good morning, Philipp and Anna. First question on margin. Philipp, you mentioned in your four priorities, you didn't touch explicitly on future margin development. Just wondering if you remain committed to some margin improvements in 2026 and a return to 17% plus over the medium term, or, I mean, as you flagged, the additional half a billion in savings will be reinvested. Are you signaling that RIG is the number one, two, and three priority, that the cost of doing business in packaged food is rapidly increasing, and therefore margin should be more viewed as the should say, by-product of above industry average RIG rather than a clearly defined numerical target? My second question is on the leadership at Nestlé.

[Analyst 1]: Thank you very much, David, and good morning, Philip and Anna. First question on margin. Philip, you mentioned in your four priorities, you didn't touch explicitly on future margin development. Just wondering if you remain committed to some margin improvements in 2026 and a return to 17% plus over the medium term, or, as you flagged, the additional $0.5 billion in savings will be reinvested. Are you signaling that RIG is the number one, two, and three priority, that the cost of doing business in packaged food is rapidly increasing, and therefore, margin should be more viewed as the, I should say, byproduct of above industry average RIG rather than a clearly defined numerical target? My second question is on the leadership at Nestlé because, again, this morning, you're flagging the need for accelerating Nestlé's transformation with a particular clear focus on evolving and strengthening the group's culture.

The first question we have comes from Guom Delmare from UBS. Please go ahead, GM.

Thank you very much David. And, um, good morning, uh, Philip and Anna. Um, first question on margin. Um, silly you, you you mentioned, uh, in your for priority is uh you didn't touch explicitly on future margin development. So just wondering if you remain committed to some margin improvements in 2026 and a return to 17% plus over the medium term.

Or I mean, as you flagged, the additional half a billion in savings will be reinvested. Are you signaling that Rig is the number 1, 2, and 3 priority, and that the cost of doing business in packaged food is rapidly increasing?

And therefore margin should be more viewed as the uh should say byproduct of above industry, average rig rather than a clearly defined numerical, uh, Target.

Guillaume Delmas: Again, this morning you're flagging the need for accelerating Nestlé's transformation with a particular clear focus on evolving and strengthening the group's culture. My question is, do you think you have the right leaders in place across functions, regions, or categories to successfully drive this ambitious change agenda? Here, I guess what I'm getting to is curious to hear your view on this and despite the fact it's only been a few weeks, how you're planning on assessing the key leaders of the firm and whether we should expect some personnel changes over the coming months. Thank you very much.

Um, and then my second question is on the leadership that, uh, at Nestlé, because.

[Analyst 1]: My question is, do you think you have the right leaders in place across functions, regions, or categories to successfully drive this ambitious change agenda? I guess what I'm getting to is curious to hear your view on this, and despite the fact it's only been a few weeks, how you're planning on assessing the key leaders of the firm and whether we should expect some personnel changes over the coming months. Thank you very much.

Again, this morning, you're flagging the need for accelerating Nestlé's transformation, with a particular focus on evolving and strengthening the group's culture.

But, but my question is, do you think?

You have the right leaders in.

Place across functions, regions, or categories to successfully drive this ambitious change agenda. And here, I guess what I'm getting to is, I'm curious to hear your view on this, and despite the fact it's only been a few weeks, how are you planning on assessing the key leaders of the firm? Should we expect some personnel changes over the coming months? Thank you very much.

Anna Manz: Thank you very much for the 2 questions. To the first one on margin, I'm absolutely committed to the guidance of getting back to 17 and above. What keeps me positive here is that we are generating the Fuel for Growth to invest behind our growth platforms and to generate the growth to do this. I remain committed to that. In terms of the leadership, which is a good question. What we said we want to accelerate the transformation of the company, we want to become a company that works faster, that is more agile, that is bolder in its decision-making. I do think we have the right leaders in place.

Philipp Navratil: Thank you very much for the 2 questions. To the first one on margin, I'm absolutely committed to the guidance of getting back to 17 and above. What keeps me positive here is that we are generating the Fuel for Growth to invest behind our growth platforms and to generate the growth to do this. I remain committed to that. In terms of the leadership, which is a good question. What we said we want to accelerate the transformation of the company, we want to become a company that works faster, that is more agile, that is bolder in its decision-making. I do think we have the right leaders in place. I also have said that we want to drive a performance culture within the company, and the performance culture means that we are all

Philip: Thank you very much for the two questions. To the first one on margin, I'm absolutely committed to the guidance of getting back to 17% and above. What keeps me positive here is that we are generating the fuel to invest behind our growth platforms and to generate the growth to do this. I remain committed to that. In terms of the leadership, which is a good question, what we said is we want to accelerate the transformation of the company. We want to become a company that works faster, that is more agile, that is bolder in its decision-making. I do think we have the right leaders in place, but I also have said that we want to drive a performance culture within the company, and the performance culture means that we are all being measured on the same KPIs, and we will drive this through the company.

Thank you very much for, for the 2 question to the first 1 on, on, on margin. Um, so I'm absolutely committed to to the guidance of getting, uh, back to, uh, 17 and above

Um what what what um keeps me positive here is that uh, we are, we are, we are generating the fuel to invest behind, uh, our, our growth platforms and to generate, uh, the growth to to, to do this. So I I remain committed to that.

Anna Manz: I also have said that we want to drive a performance culture within the company, and the performance culture means that we are all

Philipp Navratil: Being measured on the same, Key Performance Indicators. We will drive this through the company. It will be quite easy to assess who is performing and who is not performing. A part of the performance culture is obviously making sure that the ones that perform are the ones we keep in the company, and the ones that don't, they don't. This is what the performance culture means. I think today we have the right leaders in the company, but we will be ruthless in assessing our talent, our people, and we will be driving performance throughout our organization as we have indicated.

Philip: It will be quite easy to assess who is performing and who is not performing. Part of the performance culture is obviously making sure that the ones that perform are the ones we keep in the company and that the ones that don't, they don't. This is what the performance culture means. I think today we have the right leaders in the company, but we will be ruthless in assessing our talent, our people, and we will be driving performance throughout our organization, as we have indicated.

Um, in terms of the leadership which is, which is a good question. So what we said, we want to accelerate the transformation of the company. So we want to, um, become a company that that works faster that is more agile. Um, that is, uh, Bolder in its decision making and, um, I do think we have the right leaders in place, um, but I also have said that we want to drive a performance culture within the company. And the performance culture means that we are all being measured on the same uh, key performance indicators and um and we will, we will drive this through the company. And so it will it will be quite easy to assess who is performing and who is not performing it. And um, and part of the performance culture is obviously making sure that the ones that perform are the ones who keep in the company and that the ones that don't, uh, they don't. And, and, and so, um, this is what, what the performance culture means. And so, I think today we have the right leaders in the company.

But we will be ruthless in assessing our talent, our people, and we will be driving performance throughout our organization, as we have indicated.

Warren Ackerman: Thank you very much.

Guillaume Delmas: Thank you very much.

David Hancock: Thank you very much. Thank you very much. Thanks, Guillaume. The next question comes from Warren Ackerman from Barclays. Go ahead, Warren.

David Hancock: Thanks again. The next question comes from Warren Ackerman from Barclays. Go ahead, Warren.

Thank you very much. Thank you very much.

Warren Ackerman: Yeah. Hi, Philipp, Anna, David. It's Warren here at Barclays. Two from me as well. First one is Philipp, in your prepared remarks, you said that marketing spend is gonna be a really big focus for you. I appreciate it's early days, but when you step back, what are your observations on the quality and quantity of the marketing spend? Is 8.5% or 9% the right level, and how do you feel about the returns that you're getting on marketing spend? That's the first one. The second one is, can you talk a bit more about the underperformers? Obviously, quite a big inflection in them. They are improving. I think you said flat overall for the Q4, but flat is not good enough for underperformers. What is good enough? Maybe can you explain what targeted actions you've taken?

[Analyst 2]: Yeah, hi, Philip, Anna, David, so Warren here at Barclays. Two from me as well. The first one is, Philip, in your prepared remarks, you said that marketing spend is going to be a really big focus for you. I appreciate it's early days, but when you step back, what are your observations on the quality and quantity of the marketing spend? Is 8.5% or 9% the right level? How do you feel about the returns that you're getting on marketing spend? That's the first one. The second one is, can you talk a bit more about the underperformers? Obviously, quite a big inflection in them. They are improving. I think you said flat overall for the quarter, but flat is not good enough for underperformers. What is good enough? Maybe can you explain what targeted actions you've taken?

Thanks again. The next question comes from Warren Aqumin from Barclays. Go ahead, Warren.

Warren Ackerman: Obviously, quite a big inflection in them. They are improving. I think you said flat overall for the Q4, but flat is not good enough for underperformers. What is good enough? Maybe can you explain what targeted actions you've taken? It sounds like there's a few places, a few spots where you're rolling back pricing because they, you know, pricing got out of sync. Can you maybe elaborate on what you're doing, which areas, and has that been part of the reason why these underperformers are improving? Thank you.

Warren Ackerman: It sounds like there's a few places, a few spots where you're rolling back pricing because they, you know, pricing got out of sync. Can you maybe elaborate on what you're doing, which areas, and has that been part of the reason why these underperformers are improving? Thank you.

[Analyst 2]: It sounds like there's a few places, a few spots where you're rolling back pricing because pricing got out of sync. Can you maybe elaborate on what you're doing, which areas, and is that being part of the reason why these underperformers are improving? Thank you.

In them, they are improving. I think you said flat overall for the quarter, but flat is not good enough for underperformers. What is good enough? And maybe can you explain what targeted actions you've taken? It sounds like there are a few places, a few spots where you're rolling back pricing because pricing got out of sync. Can you elaborate on what you're doing, which areas, and if that is part of the reason why these underperformers are improving? Thank you.

Philipp Navratil: Thank you. Thank you, Warren. Look, in terms of marketing spend, what we have said is that we want to invest more behind the biggest opportunity to drive sustained growth. That is the prioritization we're gonna do in really committing to invest more. When I say investing more, it's not only marketing spend per se. When I see a growth opportunity, I think we have to think about investing behind those more broadly as well. Think about it, obviously marketing, also about investing in taste and quality, formats, packaging. You've mentioned investing in pricing is one part we can invest in if the pricing was too much.

Philip: Thank you. Thank you, Warren. In terms of marketing spend, what we have said is that we want to invest more behind the biggest opportunity to drive sustained growth. That is the prioritization we're going to do in really committing to invest more. When I say investing more, it's not only marketing spend per se. When I see a growth opportunity, I think we have to think about investing behind those more broadly as well. Think about it, obviously marketing, but then also about investing in taste and quality, formats, packaging. You mentioned investing in pricing as one part we can invest in if the pricing was too much. Price and pack architecture is another one. Think about investment in distribution and capabilities, or digital capabilities when it comes to marketing. The investment I see is broader, but we are committed to investing more behind those areas.

Philipp Navratil: Price and pack architecture is another one, or think about investment in distribution and capabilities, or digital capabilities when it comes to marketing. The investment I see is broader, but we are committed to investing more behind those areas. That's important because I believe we have the right brands that can take this investment and generate growth. I'll pass to Anna Manz quickly just on the specifics of the numbers that you asked, Warren Ackerman, so to give her point of view on that one.

Thank you. Thank you Warren. Um, look on, in terms of marketing spend. Um, what we have said is that, we want to, uh, invest more behind the biggest opportunity to drive sustained, uh, sustained growth and, um, that that that is the periodization we're going to do in in, in really, really, um, committing to invest more. But when I, when I say investing more, it's not only marketing spend per se. When I, when I, when I see a growth opportunity, I think we have to think about investing behind those more broadly as well, so think about it. Um, obviously marketing. But then also about, um, investing in in taste and quality. Um, formats packaging. Um, we we you you you, you, you, you mentioned investing in in pricing, is 1 part. We can invest in, if the pricing was too much price and pack architecture, is another 1 or think about investment in, in distribution and, and capabilities, uh, or digital, uh, capabilities, when it comes to marketing. So,

Philip: That's important because I believe we have the right brands that can take this investment and generate growth. I'll pass to Anna quickly just on the specifics of the numbers that you asked, Warren, to give her point of view on that one.

Anna Manz: Thanks, Philipp. Yeah. Just a couple of comments. I mean, based on what Philipp's just said, I think one of the things we will look at going forward is whether marketing as a percentage of sales is the right individual metric, but that's something we will come back to over time. In terms of how you think about year-over-year, we're not guiding specifically for 2026 at this point, but you should expect marketing to be up on 2025 and 2026.

Anna Manz: Thanks, Philip. Yeah, just a couple of comments. I mean, based on what Philip's just said, I think one of the things we will look at going forward is whether marketing as a % of sales is the right individual metric, but that's something we will come back to over time. In terms of how you think about year on year, we're not guiding specifically for 2026 at this point, but you should expect marketing to be up on 2025 and 2026.

Philipp Navratil: Thanks, Anna. On your question on underperformers, where I'm unhappy with, you know, going back to flat growth, obviously what we want these underperformers to do is to generate more growth than they do today. There are various levers that we're pulling to make this happen. It's not only pricing or any one lever. These are real, sometimes complicated marketing plans where we need to get everything right. Some of it, we need to invest into having a better tasting product out there. Some of it is pure marketing capability. Some of it we have not the right price and pack architecture in place or the brand is too weak to be performing.

Philip: Thanks, Anna. On your question on underperformers where I'm unhappy with, you know, going back to flat growth, obviously what we want these underperformers to do is to generate more growth than they do today. There are various levers that we're pulling to make this happen. It's not only pricing or any one lever. These are real, sometimes complicated marketing plans where we need to get everything right. Some of it, we need to invest into having a better-tasting product out there. Some of it is pure marketing capability. Some of it, we have not the right price and pack architecture in place, or the brand is too weak to be performing. There are many levers, and there's a lot of work going into these 18 underperformers. We have seen what we're doing is working, but it's not good enough and it's not fast enough.

The investment I see is broader, um, but we are we are committed to investing more behind those areas and, um, and that's, that's important because I believe we have the right brands that can take this, uh, this investment and, and and generate growth. And I'll pass to Anna quickly just on on the specifics of of the numbers that you ask Warren. So to give to give uh her point of view on that 1. Thanks. Yeah. So just a couple of comments. I mean based on what Phillips just said, I think 1 of the things we will look at going forward is where the marketing is a percentage of sales, is the right individual metric, but that's something we will come back to over time. In terms of how you think about year on year. Uh, we're not guiding specifically for 2026 at this point, but you should expect marketing to be up on 2025 in 2026.

Philipp Navratil: There's many levers and there's a lot of work going into these 18 underperformers that we have seen what we're doing is working, but it's not good enough and it's not fast enough. You mentioned, you know, some marketing capabilities, what will we change? I think we just need to become the best marketers in the industry. We have not been there in the past, and we're not there yet.

Thanks, Anna and on on your question, on other performers where I'm unhappy with, um, you know, going blind back to Flat growth. Um, obviously what we want, uh, these other performers to do is to, to, um, generate, uh, more growth and then they do today and there are various, um, levers that we're pulling to make this happen. It's not only pricing or any any 1 lever. So these, These are, these are real sometimes complicated marketing plans where we need to get everything, right? Some of it. Uh, we need to invest into having a better tasting product out there. Some of it is pure marketing capabilities. Some of it, we have not the right price and pack architecture in place or the brand is is is is too weak um, to be performing.

Philip: You mentioned some marketing capabilities, what will we change? I think we just need to become the best marketers in the industry. We have not been there in the past, and we're not there yet. It's all about really re-reading these underlying consumer trends correctly, being the best in driving these insights into winning meaningful innovation, and then driving that into the market with a strong marketing plan that is an overall marketing plan, but also we need to step up our capabilities in how we communicate, digital capabilities, etc. We have some good examples there, but it's not there across the board. You can expect an update on that specifically by the full year, what we're doing. Back to Anna on that point specifically.

Philipp Navratil: It's all about reading, re-reading these underlying consumer trends correctly, being the best in driving these insights into winning meaningful innovation, and then driving that into the market with a strong marketing plan that is an overall marketing plan, but also we need to step up our capabilities in how we communicate digital capabilities, et cetera. We have some good examples there, but it's not, it's not there across the board. You can expect an update on that specifically by the full year, what we're doing. Back to Anna on that point specifically.

So, there's there's many levers, and, and, and there's a lot of work going into these 18 underperformers that. Uh, we have seen what we doing is working, but it's not good enough and it's not fast enough. And, um, you you mentioned, you know, some marketing capabilities. What will we change? And I think we just need to become the best marketers in in the industry and um, we have we have not been there in the past and we're not there yet. Um, and it's all about, um, really re reading these, um, underlying, um, consumer Trends, um, correctly being the best in driving these insights into uh, winning meaningful Innovation and then driving that into the market with, um, a strong marketing plan that is an overall marketing plan, but also we need to step up our capabilities in um, how we communicate

Digital capabilities Etc. And and we have some good examples there but it's not it's not uh, it's not there across across the board and and you can expect an update on on that specifically, um, by by the full year, what we're doing

Anna Manz: Just a specific point on the areas where we've adjusted you know, pricing to just manage elasticities in the shorter term. That wasn't actually really around the 18 underperformers as such. Just as a piece of context for you, Warren, the improvement we've been making in our underperforming sales has been really consistent quarter-over-quarter. It's not a Q3 thing. It's been the actions that we've been taking over this last year. It's been a very consistent change.

Anna Manz: Just a specific point on the areas where we've adjusted elasticity, you know, pricing to just manage elasticities in the shorter term. That wasn't actually really around the 18 underperformers as such. Just as a piece of context for you, Warren, the improvement we've been making in our underperforming cells has been really consistent quarter on quarter. It's not a Q3 thing. It's been the actions that we've been taking over this last year. It's been a very consistent change.

And back to Anna on on, on that point specifically just a specific point on the, um, areas where we've adjusted elasticity, you know, pricing to just manage elasticities in the shorter term. That wasn't actually really around the 1800 performance as such, um, the just as a piece of context for you are and the Improvement. We've been making and our underperforming sales has been

It's been a really consistent quarter-on-quarter performance. It's not just a Q3 thing; it's been the actions that we've been taking over this last year. So it's been a very consistent change.

Philip: Okay, thank you.

Philipp Navratil: Okay, thank you.

David Hancock: Thank you. Thanks, Warren. The next question comes from Olivier Nicolai at Goldman Sachs. Go ahead, Olivier.

Warren Ackerman: Thank you.

David Hancock: Thank you. Thanks, Warren. The next question comes from Olivier Nicolai at Goldman Sachs. Go ahead, Olivier.

David Hancock: Thanks, Warren. The next question comes from Olivier Nicolai at Goldman Sachs. Go ahead, Olivier.

Yeah, thank you. Thank you. Thanks, Warren.

Olivier Nicolai: Hi, good morning, Philippe, Anna, and David. Congratulations on your results. 2 questions on my side. First on Nespresso, could you quantify the phasing effect you mentioned in Q3? Then more specifically on the US, how much room for growth do you see for Vertuo? Then secondly, for Anna, perhaps, considering your guidance on free cash flow of at least CHF 8 billion, I believe you're also going to receive a dividend from L'Oréal. How should we think about Nespresso net debt EBITDA in full year 2025? Will you be able to be below 3x net debt EBITDA this year? Why would you expect to go back to all the 2.5x, assuming obviously, the Swiss franc staying roughly where it is? Thank you.

Olivier Nicolaï: Hi, good morning, Philippe, Anna, and David. Congratulations on your results. 2 questions on my side. First on Nespresso, could you quantify the phasing effect you mentioned in Q3? Then more specifically on the US, how much room for growth do you see for Vertuo? Then secondly, for Anna, perhaps, considering your guidance on free cash flow of at least CHF 8 billion, I believe you're also going to receive a dividend from L'Oréal. How should we think about Nespresso net debt EBITDA in full year 2025? Will you be able to be below 3x net debt EBITDA this year? Why would you expect to go back to all the 2.5x, assuming obviously, the Swiss franc staying roughly where it is? Thank you.

[Analyst 3]: Hi, good morning, Anna, and David. Congratulations on your results. Two questions on my side. First, on Nespresso, could you quantify the phasing effect you mentioned in Q3? More specifically on the U.S., how much room for growth do you see for Virtuo? Secondly, for Anna, perhaps, considering your guidance on free cash flow of at least CHF 8 billion, and I believe you're also going to receive a dividend from Forneri, how should we think about Nestlé Net Debt to EBITDA in full year 2025? Will you be able to be below three times Net Debt to EBITDA this year? When would you expect to go back towards two and a half times, assuming obviously a Swiss franc staying roughly where it is? Thank you.

The next question comes from Olivier Nikolai at Goldman Sachs. Go ahead, Olivier.

So uh, could you quantify the phasing effect? You mentioned Q3 and then more specifically on the US how much room for growth? Do you see for for virtual and then secondly, for for Anna? Perhaps, uh, considering your guidance on free cash flow of at least 8 billion and I believe you also going to receive a dividend from, for, how should we think about nesting net debt to be die? In through the 25? Will you be able to be, uh, below 3 times? Um, that will be that this year and why would you expect to go back to all the 2 and a half times? Assuming, obviously a Swiss franc? Staying roughly, why? It is. Thank you.

Philipp Navratil: I can take the Nespresso one, as I know this one well. The Q3 was really a strong quarter. It was driven by a strong marketing campaign, a strong innovation also that we had over the summer, which led to this growth. As you point out rightly, most of the growth still comes out of the US, on the back of our winning Vertuo system over there. I believe there is ample avenues of growth still there. If you look at it from a penetration point of view, portion systems is the way the US drinks coffee, and we are under penetrate still with the Nespresso system compared to our competitors.

Philip: I can take the Nespresso ones and know this one well. The third quarter was a really strong quarter. It was driven by a strong marketing campaign and strong innovation also that we had over the summer, which led to this growth. As you point out rightly, most of the growth still comes out of the U.S., on the back of our winning Virtuo system over there. I believe there is ample avenues of growth still there. If you look at it from a penetration point of view, portion systems is the way the U.S. drinks coffee, and we are underpenetrated still with the Nespresso system compared to our competitors. What we're really doing is driving penetration-led growth, and it's working. The Virtuo system, I think, has still ample ways of growing there also because we are playing with two winning brands there.

Philipp Navratil: There is what we're really doing is driving penetration-led growth, and it's working. The Vertuo system, I think, has still ample ways of growing there also because we are playing with two winning brands there on... We're playing on that system with Nespresso and with Starbucks. This is working really well. We have also tuned up, as I said before, our marketing capabilities there. You have seen the collaboration with The Weeknd, et cetera. We're tapping into a younger consumer base as well, which is working, which is working too. Very positive on Nespresso going forward. Over to you, Anna, on free cash flow.

I can I can take 10 special ones and and all this 1. Well um, so the third quarter was was really was a really strong quarter. Um, it was it was driven by a strong marketing campaign. A strong Innovation also that we had over the summer, um, which led to this uh, which led to this growth. And as a point out rightly, um, most of the growth still comes out of the US, um, on the back of our winning virtual system over there. Um, I believe there is uh, there is ample, um, Avenues of of gross still there. There is, uh, if you look at it from a penetration point of view, um, portion systems is the way, um, the US drinks coffee and and we are underpin. The trade still with an espresso system compared to our competitors. So, there's there's, um, what we're really doing is driving penetration.

Philip: We're playing on that system with Nespresso and with Starbucks. This is working really well. We have also tuned up, as I said before, our marketing capabilities there. You have seen the collaboration with The Weeknd, etc. We're tapping into a younger consumer base as well, which is working too. Very positive on Nespresso going forward. Over to you, Anna, on free cash flow.

Let growth, uh, and and it's working. And so, the virtual system I think has has still, um, ample ways of growing there also, because we are playing with, um, 2 winning Brands there on, we, we're playing on that system with Nespresso and, and with Starbucks and, uh, this is, uh, this is working really well. And we have also tuned up, as I said before our marketing capabilities. There you have seen the collaboration with The Weeknd Etc. So, we we're tapping into a younger consumer base, as well, uh, which is working, uh, which is working too. So, so very positive on

On on Nespresso, going forward.

Anna Manz: Sure. The 8 billion CHF of free cash flow guidance does not include the Furnari dividend, which doesn't impact free cash flow, although it does impact net debt. To quantify the Furnari dividend for you, just so you've got it's EUR 2.1 billion, and that benefits net debt. In terms of how we think about consistently bringing down our leverage, and we're very focused on that, you know, the number one way to do it is RIG-led growth, because as we drive growth and improve our margin, we increase our EBITDA and our cash flow. You know, that is our single biggest focus. Related to that, we're very focused on all of those other elements that impact cash flow, so specifically working capital and CapEx to consistently bring those down.

Anna Manz: Sure. The $8 billion of free cash flow guidance does not include the Forneri dividend, which doesn't impact free cash flow, although it does impact net debt. To quantify the Forneri dividend for you, just so you've got it, it's €2.1 billion, and that benefits net debt. In terms of how we think about consistently bringing down our leverage, and we're very focused on that, the number one way to do it is RIG-led growth because as we drive growth and improve our margin, we increase our EBITDA and our cash flow. That is our single biggest focus. Related to that, we're very focused on all of those other elements that impact cash flows, specifically working capital and CapEx to consistently bring those down. Of course, if we move into a partnership model with Waters and things like that, those will all help net debt over time.

And, um, over to you and on free cash flow. Sure. So, um,

The 8 billion of free cash flow. Guidance does not include the feri dividend which doesn't impact free cash flow although it does impact net debt um and to quantify the feri dividend for you, just so you've got it, it's 2.1 billion euros and that that benefits, net debt. In terms of how we think about, uh, consistently bringing down our leverage and we're very focused on that. Um,

Anna Manz: You know, that is our single biggest focus. Related to that, we're very focused on all of those other elements that impact cash flow, so specifically working capital and CapEx to consistently bring those down. Of course, you know, if we move into a partnership model with Waters and things like that, those will all help net debt over time.

Anna Manz: Of course, you know, if we move into a partnership model with Waters and things like that, those will all help net debt over time.

The, you know, the number one way to do it is riglet growth because as we drive growth and improve our margin, we increase our EBITDA, um, and our cash flow. And so, you know, that is our single biggest focus. And related to that, we're very focused on all of those other elements that impact cash flow. So specifically working capital and CAPEX to consistently bring.

Those down, and of course, you know, if we, um, uh, move into a partnership model with Waters and things like that, those will all help net debt over time.

Olivier Nicolai: Thank you very much.

Olivier Nicolaï: Thank you very much.

[Analyst 3]: Thank you very much.

Thank you very much.

David Hancock: Thank you. The next question comes from Celine Pannuti at J.P. Morgan. Celine, your line is open.

David Hancock: Thank you. The next question comes from Celine Panuti at JPMorgan. Celine, your line is open.

Thank you. The next question comes from Selene Pony at JP Morgan. Your line is open.

Celine Pannuti: Thank you. Good morning, everyone. Philippe, maybe if I start with a question. You mentioned many times in your prepared remark, that you are focusing on faster transformation with a sense of urgency. Can you give some example of what you are planning to do, like, I mean, what exactly it means, that faster transformation. You also mentioned in some of the prior questions the need for reinvestment, not just in A&P, but across the different capabilities, and marketing is one of those. Are you still committed? I think that was a commitment that was made during the roadshow this summer to increase margin in 2026, given those investment needed. My second question is maybe more back to like Q3 performance.

[Analyst 4]: Thank you. Good morning, everyone. Philip, maybe if I start with a question. You mentioned many times in your prepared remark that you are focusing on faster transformation with a sense of urgency. Can you give some example of what you are planning to do? Like, I mean, what exactly it means, that faster transformation? You also mentioned in some of the prior questions the need for reinvestment, not just in A&P but across the different capabilities. The marketing is one of those. Are you still committed? I think that was a commitment that was made during the roadshow this summer, to increase margin in 2026, given those investments needed. My second question is maybe more back to Q3 performance. AOA was, see a strong step up in RIG, 3.6%, and I looked it was the last time you did that was 2021.

Celine Pannuti: AoA was see a strong step up in RIG, 3.6, and I looked, it was the last time you did that was 2021. While I understand it was broad-based, can you explain what happened from, you know, like, a run rate that was much slower to such a step up in RIG, and is the kind of like 2 to 3, I mean, 3% RIG in that region at a sustainable level? Thank you.

Thank you. Uh, good morning everyone. Um, Philip maybe if I start with a question, you mentioned many times in your uh prepared remark um that you are focusing on faster transformation with a sense of urgency. Uh, can you give some um example of what you are planning to do? Like, I mean, what exactly it means that faster transformation and you also mentioned in some of the prior questions. The need for reinvestment, not just in A&P but, uh, across the different, uh, uh, capabilities. And marketing is 1 of those, uh, are you still committed? Uh, I think that was a commitment that was made during the road to this summer. Uh, to increase margin, uh, in 2026. Uh, given those investment needed. Uh, my, uh, second question is, maybe more back to, um, uh, like Q3 performance. Um, AOA was see a strong Step Up in rig, uh, 3.6. And I looked it was

[Analyst 4]: While I understand it was broad-based, can you explain what happened from, you know, like, a run rate that was much slower to such a step up in RIG? Is the kind of like two to three, I mean, three-ish percent RIG in that region a sustainable level? Thank you.

The last time you did, that was 2021. So, uh, while I understand it was broad-based, um, can you explain what happened from, you know, like uh, a run rate that was um much slower to such a step up in rig and is the kind of like 2 to 3, I mean 3, each percent rig in that region sustainable level? Thank you.

Philipp Navratil: Thank you. Thank you very much, Celine. Look, on the business transformation and on the sense of urgency, is really about how we want to work. You know, Nestlé has not been the most efficient company in the past. What we want to do today, and hence, also the announcement we have done today on headcount, is really become an agile company. A company that takes decisions fast, a company that drives impact, and a company that leverages its scale as well, when it comes to how we work. What we have said we want to do is to become more digitalized, become more automated, become more fast in decision-making, and also leverage our above the market capabilities in our shared service centers.

Philip: Thank you. Thank you very much, Celine. Look, on the business transformation and on the sense of urgency, it's really about how we want to work. You know, Nestlé has not been the most efficient company in the past. What we want to do today, and hence also the announcement we have done today on headcount, is really become an agile company, a company that takes decisions fast, a company that drives impact, and a company that leverages its scale as well when it comes to how we work. What we have said we want to do is to become more digitalized, become more automated, become faster in decision-making, and also leverage our above-the-market capabilities in our shared service centers. That is a way to drive speed and also consistency across all markets.

Um, it's really about how we want to work. And, um, you know, Nestlé has not been the most efficient company in the past, and what we want to do.

Philipp Navratil: That is, that is a way to drive speed and also consistency across across all markets. In the past, this has been more of an optional view if markets want to tap into those, into those areas, but we want to make this how we work. We want to really scale those shared services and drive world-class services throughout our markets. When we talk business transformation, think about it on how we want to become a faster, more nimble company. That is driving growth. It's all about growth. In terms of your question on reinvestment and capabilities, we are committed. As I said before, we are committed to go back to 17% plus of a margin in the medium term.

Philip: In the past, this has been more of an optional view if markets want to tap into those areas, but we want to make this how we work. We want to really scale those shared services and drive world-class services throughout our markets. When you, when we talk business transformation, think about it on how we want to become a faster, more nimble company that is driving growth. It's all about growth. In terms of your question on reinvestment and capabilities, we are committed, as I said before, we are committed to go back to 17+% of our margin in the medium term. That means going there step by step. While we invest in those capabilities, the best way to get to that margin improving is through driving, again, back to RIG-led growth.

Today in hands are also the announcement. We have done. Um, today on, on headcount, is really become an agile company. A company that takes decisions fast a company, that drives impact and and a company that leverages its scale as well. Um, when it comes, uh, to how we work. So what, what we have said, we want to do is to become more digitalized, become more automated, uh, become more fast in decision making and also leverage our, um, above the market, um, capabilities in, uh, our shared service centers that is, uh, that is a way to drive, uh, speed, and also consistency across, uh, across all markets. And in the past, this has been more of an optional, um, view if markets want to tap into those into those areas. But we want to make this, um, how we work. And so we want to really scale those shared services and and and drive world class Services throughout our markets. So when when we talk business transformation, think about it, uh, on how we want to become a, a faster more nimble.

Company, um, that is that is driving growth. It's all about. It's all about growth.

Philipp Navratil: That means going there step by step. While we invest in those capabilities, the best way to get to that margin improving is through driving, again back to RIG-led growth. The margin improvement comes through RIG-led growth, investing behind those growth opportunities that we think deliver the best returns. Specifically on your question on AOA, and the RIG step-up, I'll pass it over to Anna.

And in terms of your, your question on, um, reinvestment and capabilities, um, we are committed. As I said before, we are committed, um, to go back to 17 plus, um, percent of, uh, of our margin in the medium term, and that mean, that means going there step by step. Um, and um,

Philip: The margin improvement comes through RIG-led growth, investing behind those growth opportunities that we think deliver the best returns. Specifically on your question on AOA and the RIG step up, I'll pass it over to Anna.

While we invest in those capabilities, the best, the best way to get to that margin improvement is through driving, again, back to rigid growth. So, the margin improvement comes through rigid growth, investing behind those growth opportunities that we think deliver the best returns.

Anna Manz: Sure. Hi, Celine. On AOA, maybe just to sort of firstly talk about China and then outside of China. I think, you know, we've talked about China a lot in the last Q results. Quarter-over-quarter performance in China was similar. We'll continue to see China weigh on our growth for another Q or so, then we'll sort of see that demand generation come through and that will see further acceleration in AOA. Outside of China, we've got some really good momentum, and that's because of the investments that we've been making in those high-priority investment areas. It's because of the work that we've been doing on consistently improving share loss sales, and it's because of, you know, some tactical elasticity adjustments we've made.

Anna Manz: Sure. Hi, Celine. On AOA, maybe just to firstly talk about China and then outside of China. I think, you know, we've talked about China a lot in the last quarter results. Quarter on quarter, performance in China was similar. We'll continue to see China weigh on our growth for another quarter or so. Then we'll see that demand generation come through, and that we'll see further acceleration in AOA. Outside of China, we've got some really good momentum. That's because of the investments that we've been making in those high-priority investment areas. It's because of the work that we've been doing on consistently improving, shared ourselves. It's because of some tactical elasticity adjustments we've made. We're really seeing that show up across strong performance across Malaysia, Indonesia, India, Pakistan. I would say across the region, in most businesses, we're growing share, so good momentum.

And specifically on uh, on your question on, on AOA. Um, and the Rick step up. I'll, I'll pass it over to Anna.

Sure. Hi Seline. Um so on AOA, maybe just to sort of firstly, talk about China and then outside of China uh I think you know, we've talked about um China a lot in in the in the last quarter results.

Quarter on quarter performance, in China was similar, we'll continue to see China weigh on our growth for another another quarter or so. Uh, and then we'll sort of see that demand generation come through and and that will see further acceleration in AOA outside of China. We've got some really good momentum and that's because of the Investments that we've been making, uh, in those high priority investment areas is because of the work that we've been doing on consistently, improving, uh, share ourselves. And it's because,

Anna Manz: We're really seeing that show up across, you know, strong performance across Malaysia, Indonesia, India, Pakistan. I would say across the region, in most businesses, we're growing share, so good momentum. Now, as you think about what that means going forward, the fundamentals of what we're doing, don't change. In any given quarter, you've got to look at the comps and, you know, as I look forward to Q4, you've got to be thoughtful about Chinese New Year timing because that impacts a number of markets in the region. Chinese New Year is a little bit later next year.

Anna Manz: As you think about what that means going forward, the fundamentals of what we're doing don't change. In any given quarter, you've got to look at the comps. As I look forward to Q4, you've got to be thoughtful about Chinese New Year timing because that impacts a number of markets in the region. Chinese New Year is a little bit later next year.

Of course, you know, some tactical elasticity adjustments we've made. But we're really seeing that show up across, you know, strong performance across Malaysia, Indonesia, India, Pakistan, and I would say across the region in most businesses. We're growing share, so good momentum. Now, as you think about what that means going forward, the fundamentals of what we're doing. Um,

Don't change. But in any given quarter, you've got to look at the comps. As I look forward to Q4, you've got to be thoughtful about Chinese New Year timing because that impacts a number of markets in the region. Um, and China, this New Year is a little bit later next year.

David Hancock: Thank you. Our next question comes from Tom Sykes at Deutsche Bank. Go ahead, Tom.

Thank you.

Tom Sykes: Yeah, thanks, David. Morning, everybody. You've obviously generated 1.5% RIG in this quarter. There's, you know, flagging the comps in Q4. When you look at the macro environment and where the business is now, do you think that 1.5% RIG is sort of the minimum that or the level that should be expected, or is what you're outlining something that progressively gets you there consistently? When will the US get to that sort of level? 'Cause you should have got a benefit from creamers, obviously, in this quarter. Just on the free cash flow, you've outlined getting over CHF 8 billion. I mean, is there any sort of way you could size the ambition in free cash flow? i.e.

[Analyst 5]: Yeah, thanks, David. Morning, everybody. You've obviously generated 1.5% RIG in this quarter. There's flagging the comps in Q4. When you look at the macro environment and where the business is now, do you think that 1.5% RIG is sort of the minimum that, or the level that should be expected, or is what you're outlining something that progressively gets you there consistently? When will the US get to that sort of level, please, because you should have got a benefit from Creamers, obviously, in this quarter? Just on the free cash flow, you've outlined getting over $8 billion. Is there any sort of way you could size the ambition in free cash flow, i.e., would it be greater, the improvement in free cash flow, than, say, the restructuring costs so you can deliver, excluding further disposals, please.

Our next question comes from Tom Sykes at Deutsche Bank. Go ahead, Tom.

Yeah, thanks, David. Good morning, everybody. Um,

You've obviously generated 1.5% rigging in this quarter. There's, you know, flagging the comps in Q4. But when you look at the macro environment and where the business is now,

Tom Sykes: 'Cause you should have got a benefit from creamers, obviously, in this quarter. Just on the free cash flow, you've outlined getting over CHF 8 billion. I mean, is there any sort of way you could size the ambition in free cash flow? i.e. Would it be greater the improvement in free cash flow than, say, the restructuring costs so you can de-lever, excluding, further disposals, please?

Do you think that 1 and a half percent rig is, is sort of the minimum that or the level that should be expected or is what you're outlining something that progressively gets you there consistently. And and when will the US get to that sort of level? Please. Because you should have got a benefit from creamers obviously in in this quarter.

Tom Sykes: Would it be greater the improvement in free cash flow than, say, the restructuring costs so you can de-lever, excluding, further disposals, please?

And then, um, just on the free cash flow, uh, you've outlined getting over $8 billion. I mean, is there any sort of way you could size the ambition in free cash flow, i.e., would it be greater than the improvement in free cash flow than, say, the restructuring costs? So you can de-lever.

Uh, excluding, um, further disposals, please.

Philip: Yeah, you want to take those?

Philipp Navratil: Yeah. You want to take those?

Anna Manz: Yeah, sure. So maybe first to just talk about RIG. Maybe I'll start with the medium term. Our medium-term guidance is to be growing over 4%. That's because of the strength that we see in our medium-term categories. In that world, when we get there, we need to be delivering sustainable, strong RIG-led growth. We need to be delivering at least, you know, 2% RIG growth to sustain that kind of momentum. What you're hearing us do is put the actions in place to consistently improve our RIG performance. Now, maybe just to unpick a little bit Q3, because there is strength in Q3, but maybe how to think about Q4 in that context. We are on our journey to accelerate towards a consistent 2%.

Anna Manz: Yeah, sure. Maybe, first to just talk about RIG. I'll start with the medium term. Our medium-term guidance is to be growing over 4%, and that's because of the strength that we see in our medium-term categories. In that world, when we get there, we need to be delivering sustainable, strong RIG-led growth. We need to be delivering at least, you know, 2% RIG growth to sustain that kind of momentum. What you're hearing us do is put the actions in place to consistently improve our RIG performance. Maybe just to unpick a little bit Q3 because there is strength in Q3, but maybe how to think about Q4 in that context, as we are on our journey to accelerate towards a consistent 2%. Really good Q3. There is a lot that is going, on an underlying basis, well with the business.

Yeah, you want to, you want to take on it? Yeah, sure. So so, so maybe um, first to just, uh,

Talk about rigs. So

Be growing.

Anna Manz: Really good Q3. There is a lot that is going on an underlying basis well with the business, and that's the work we're doing to improve our share loss sales, the work we're doing in those selective investment areas, and the momentum that we've got there. Also, you know, the work we've done to look at some of those short-term elasticities and make sure that we're in the right place. That all continues. As we look forward to Q4, there's a couple of technical factors which will impact us. There is a tougher comp and Chinese New Year, which impacts a number of Asian markets, is a little bit later. That's the shape of it.

Anna Manz: That's the work we're doing to improve our share of ourselves, the work we're doing in those selective investment areas, and the momentum that we've got there. Also, you know, the work we've done to look at some of those short-term elasticities and make sure that we're in the right place. That all continues. As we look forward to Q4, there's a couple of technical factors which will impact us. There is a tougher comp, and Chinese New Year, which impacts a number of Asian markets, is a little bit later. That's the shape of it. I guess the other thing I would have in mind as you think about it is also, I have to see how the consumer plays out over the holiday period in the current sort of macroeconomic environment. If I think about Q4, U.S., because I think that was your other question, U.S.

Um, over 4%, uh, and that's because of the, the strength that we see in our medium-term categories, in that world. Uh, when we get there, we need to be delivering sustainable strong regular growth, we need to be delivering, at least, you know, 2% rig growth to sustain that kind of momentum. So what you're hearing us do is, uh, put the actions in place to consistently improve our, our rig performance now, maybe just to unpick, uh, a little bit Q3 because there is there is strength in Q3, but maybe how to think about Q4 in that context, as we are on our journey to accelerate towards a consistent 2%. So really good. Q3 there is a lot that is going um, on an underlying basis. Well, with the business and that's the the work we're doing to improve our share ourselves, the work we're doing in those selective investment areas and the momentum that we've got there and also, you know, the the work we've done to

Look at, um, some of those short-term elasticities and make sure that we're in the right place.

Anna Manz: I guess the other thing I would have in mind as you think about it, is also we'll have to see how the consumer plays out over the holiday period but in the current sort of macroeconomic environment. If I think about Q4, US, 'cause I think that was your other question. US RIG growth has been a little bit lower in Q3 and has been at the lower end for a little bit. Just to sort of give you a little bit the shape of that, two categories are weak and are holding us back there, frozen food and pet.

Um, so that all continues. But as we look forward to Q4, there are a couple of technical factors which will impact us. So, there was a tougher comp and Chinese New Year, which impacts a number of Asian markets as it is a little bit later. So, that's the shape of it. And I guess the other thing I would have in mind as you think about it is also we'll have to.

See how the consumer plays out over the holiday period in the current sort of macroeconomic environment.

Now, if I think about Q4, uh,

Anna Manz: RIG growth has been a little bit lower in Q3 and has been at the lower end for a little bit. Just to sort of give you a little bit of the shape of that, two categories are weak and are holding us back there: frozen food and pet. Although our share performance in both of those categories is strong, and actually, we've got good share performance across the U.S. The big accelerator going forward, particularly, will be pet coming back and frozen stabilizing a little bit. In the quarter, just as a piece of context, we took price in Starbucks, and that slowed coffee a little bit, just as we've taken that price, but I fully expect that to come back.

Us, because I think that was your other, uh, question.

U.S. rig growth has been a little bit lower in Q3 and has been at the lower end for a little bit. And just to sort of give you a little bit of the shape of that.

Anna Manz: Although our share performance in both of those categories is strong, actually we've got good share performance across the US. The big accelerator going forward particularly will be pet coming back and frozen stabilizing a little bit. In the quarter, just as a piece of context, we took price in Starbucks and that slowed coffee a little bit just as we've taken that price, I fully expect that to come back. As you think about the US, as momentum in coffee comes back in, as we see more innovation and capacity come into the pet category that allows us to innovate, that's what's going to drive the acceleration there over the medium term. In terms of free cash flow.

Two categories are weak and are holding us back: frozen food and pet. Although our share performance in both of those categories is strong, we’ve actually got good share performance across the U.S. So the big accelerator going forward, particularly, will be pet coming back and frozen stabilizing a little bit in the quarter. Just as a piece of context, we took price.

Anna Manz: As you think about the US, as momentum in coffee comes back and as we see more innovation and capacity come into the pet category that allows us to innovate, that's what's going to drive the RIG acceleration there over the medium term. In terms of free cash flow, $8 billion, we have said that we would expect free cash flow to improve from $8 billion in 2026. That stands, $8 billion or more, and that stands irrespective of, there will be a cash cost associated with the restructuring. For your models, you'll have had some restructuring cost in there. Of course, as we've announced a bigger restructuring, there's a billion more restructuring costs that will be cash over the next couple of years, probably than what you had before.

Uh, in Starbucks, that slowed coffee a little bit just as we've taken that price, but I fully expect that to come back. So, as you think about the U.S., as momentum in coffee comes back, and as we see more innovation and capacity come into the pet category that allows us to innovate, that's what's going to drive the rig cons acceleration there over the medium term.

Anna Manz: CHF 8 billion, we have said that we would expect free cash flow to improve from CHF 8 billion in 2026, and that stands CHF 8 billion or more, and that stands irrespective of there will be a cash cost associated with the restructuring. You know, for your models, you'd have had some restructuring costs in there. Of course, as we've announced a bigger restructuring, there's CHF 1 billion more restructuring costs that will be cash over the next couple of years probably than what you had before. I expect cash flow to improve irrespective of that in 2026 because of the actions that we are taking to accelerate the business and also manage all the levers of cash flow, specifically working capital and CapEx, and we'll be continuing to do that.

And then in terms of free cash flow. Um, so.

Anna Manz: I expect cash flow to improve irrespective of that in 2026 because of the actions that we are taking to accelerate the business and also manage all the levers of cash flow, specifically working capital and CapEx. We'll be continuing to do that.

8 billion we have said that we would uh expect free cash flow to improve from 8 billion in 2026 and and that that stands 8 billion or more, um, and that stands, uh, irrespective of uh, there will be a cash cost associated with the roof structuring and, you know, for your models, you'll have had some restructuring cost in there. But of course, uh, as we've announced a bigger restructuring, this a billion more restructuring costs that that will be cash over the next couple of years probably than what you had before.

um,

I expect cash flow to improve in 2026, irrespective of that. This is due to the actions that we are taking to accelerate the business and also manage all the levers of cash flow, specifically working capital and capex. We'll be continuing to do that.

Jon Cox: Thank you.

Tom Sykes: Thank you.

[Analyst 5]: Thank you.

David Hancock: Thanks, Tom. The next question is from Jon Cox from Kepler Cheuvreux. Go ahead, John.

David Hancock: Thanks, Tom. The next question is from John Cox from Kepler Cheuvreux. Go ahead, John.

Thank you.

[Analyst 1]: Yeah, good morning, guys. Thank you very much for taking the questions. Yeah, congratulations on the print. I think the commentary, Philip, has been broadly welcomed by the market. Philip, maybe the first one for you. What about accelerating the winners? I was actually quite surprised to see it's only 10% of the portfolio. You mentioned this step up from 7% to 14% as you put resources behind that. How can you actually broaden that part of the portfolio? I know a lot of focus is on sorting out the ones that are underperforming, but just wondering what your thoughts are on that, how you know how to expand it. Is it tapping into, you know, what opportunities? There's a lot of things going on in the world, GLP1s, and, you know, a lot of different things out there. What your thoughts are on that?

Jon Cox: Yeah. Good morning, guys. Thank you very much for taking the questions. Yeah, congratulations on the print. I think the commentary, Philipp, has been broadly welcomed by the market. Philipp, maybe the first one for you. What about accelerating the winners? I was actually quite surprised to see it's only 10% of the portfolio. You mentioned this step up from 7% to 14% as you put resources behind that. How can you actually broaden that part of the portfolio? I know a lot of focus is on sorting out the ones that were under before. Just wondering how, what your thoughts are on that, how, you know, how to expand it. Is it tapping into, you know, what opportunities?

Thanks, Tom. The next question is from John Cox from Kepler. Shero, go ahead, John.

Yeah. Good morning guys. Thank you very much for taking the questions and, uh, yeah. Congratulations on, the, on the print. And I think the commentary Phillip is, has been broadly. Welcome to buy the market. Philip maybe the first 1 for you. Um, what about accelerating the winners? Uh, I was actually quite surprised to see. It's only 10% of the portfolio.

You mentioned this step up from 7% to 14% as you put resources behind that. How can you actually broaden that part of the portfolio? I know a lot of focus is on sorting out the...

Jon Cox: There's a lot of things going on in the world, GLP-1s and, you know, a lot of different things out there, what your thoughts are on that. As a bit of an add to that, I'm just wondering if you could give us a rough idea of how the volume mix equation was in that 1.5% in the quarter. Maybe a question for Anna, just back on the free cash flow. You know, you've mentioned some levers. I wonder if you could just give us a bit more examples on that because free cash flow has never been great, you know, on a very long-term basis. The growth of free cash flow has not been great at Nestlé.

[Analyst 1]: As a bit of an add to that, I'm just wondering if you could give us a rough idea of how the volume mix equation was in that 1.5% in the quarter. Maybe a question for Anna, just back on the free cash flow, uh. You've

Operator: You've mentioned some levers. I wonder if you could just give us a bit more examples on that because free cash flow has never been great. On a very long-term basis, the growth of free cash flow has not been great at Nestlé. You know what your thoughts are around CapEx to sales, which always seems to be much higher at Nestlé compared to peers, trade network and capital to sales, you know what you can do there. I'm just wondering, do you think aspirationally you can come back to some of the bigger numbers we've seen over the years? I think you were close to $12 billion, for example, back in 2019. Is this the sort of direction where you think you can go with free cash flow over the next few years? Any sort of granularity on that would be appreciated. Thank you.

Jon Cox: You know, what your thoughts are around, you know, CapEx to sales, which always seems to be much higher at Nestlé compared to peers, trade networking capital to sales, you know, what you can do there. I'm just wondering, do you think aspirationally you can come back to, you know, some of the bigger numbers we've seen over the years? I think you were close to CHF 12 billion, for example, back in 2019. You know, is this the sort of directionally where you think you can go with free cash flow over the next few years? Any sort of granularity on that would be appreciated. Thank you.

Um uh you know, you've mentioned some levers. I want to just give us a bit more examples on that because free cash flow has never been great. Um you know on a very long-term basis, the growth of free cash flow has not been great at Nestle. You know what your thoughts are around? You know, capex to sales which you always seems to be much higher at Nestle compared to peers um trade networking, Capital to sales, you know what you can what you can do there and I'm just wondering do you think aspirationally you can come back to you know some of the bigger numbers we've seen over the years I think you were close to 12 billion. For example, back in uh 2019 you know is this the sort of directionally where you think you can go with free cash flow over the next few years? Any any sort of granularity on? That would be appreciated. Thank you.

Philipp Navratil: Thanks, John. I'll start with the your acceleration question. As you pointed out, when you look at our big bets and priorities that we have stated in the past, and we invested behind those, I said I was not happy with that. I'm happy with the fact that they are growing. What we're doing is actually working. I'm really happy about that. I'm unhappy with the size of those priorities, how much they add up. As I pointed out, it's only 10% of sales. How I'm thinking about it, and I'll come back to you with more thoughts generally about this at full year.

Philip: Thanks, John. I'll start with your acceleration question. As you pointed out, when you look at our big bets and priorities that we have stated in the past and we invested behind those, I said I was not happy with the fact I'm happy with the fact that they are growing. What we're doing is actually working. I'm really happy about that. I'm unhappy with the size of those priorities, how much they add up. As you pointed out, it's only 10% of sales. How I'm thinking about it, and I'll come back to you with more thoughts generally about this at Full Year, but how I think about it is winning consumer platforms. I can give you two that we're already working on, and I think they're showing really good results. One is, for example, Cold Coffee.

Philipp Navratil: How I think about it is winning consumer platforms. I can give you two that we're already working on, and I think they're showing really good results. One is, for example, cold coffee. Cold coffee is a huge consumer platform, and we have started to tap into that one in different ways. We have launched those Nescafé concentrates that you have seen. That is one way to tap into that, and that's one example. It's actually one of the big bets. As it is just one product, it's too small to be big enough to be a consumer platform. I think about it as cold coffee. Cold coffee includes those concentrates.

Thanks for that. I'll start with um, the the your acceleration, uh, question and and as I pointed out when, when you look at, um, our um, big bets and and and um, priorities that we have stated in in, in the past and we invested behind those. Um, I I said I was not happy with that. Um, the fact I'm happy with the fact that they're growing. So what we're doing is actually working, I I really happy about that but I'm unhappy with the size of of of uh doors doors priorities. How much they add up. But as a, as a pointed out, it's only 10% off sales. And, um, how about how I'm thinking about it and I'll come, I'll come back, uh, to you with, with more thoughts. Generally about about this at full year, but how I think,

Philip: Cold Coffee is a huge consumer platform, and we have started to tap into that one in different ways. We have launched those Nescafé concentrates that you have seen. That is one way to tap into that, and that's one example, and it's actually one of the big bets. As it is just one product, it's too small to be big enough to be a consumer platform. I think about it as Cold Coffee. Cold Coffee includes those concentrates, but also includes ready-to-drink coffee, for example, which is a growth category for us, and also includes cold recipes that you can prepare through Nescafé Dolce Gusto or through Nespresso, for example. Think about it as big platforms that we will invest more broadly behind. We have the right brands to play on it. On that Cold Coffee platform example still, we have three fantastic brands to play on.

About it is, um, is, uh, winning consumer platforms. So, I can give you a tool that we are already working on, and I think they're showing really good results. So, one is, for example, cold coffee.

Philipp Navratil: It also includes ready-to-drink coffee, for example, which is a growth category for us, and also includes recipes, cold recipes that you can prepare through Nescafé Dolce Gusto or through Nespresso, for example. Think about it as big platforms that we will invest more broadly behind it. Then we have the right brands to play on it. On that cold coffee platform example still, we have three fantastic brands to play on. We have Nescafé, we have Starbucks, and we have Nespresso. We should be really being able to have a big impact.

Philip: We have Nescafé, we have Starbucks, and we have Nespresso. We should be really being able to have a big impact. The other example I have there is we call it modern cooking, and we have had a very good example where we tapped really early into a consumer trend, which is the growing penetration of air fryers at homes all over the world. We have launched specifically on the Maggi, but also other brands, mixes that can be used to prepare delicious dishes with air fryers. We were fast in doing this. We had the right brand. We rolled it out, the right execution. Modern cooking can be taken to other ways of cooking, and we're looking at that. We're looking at that as well.

Philipp Navratil: The other example I have there is, we call it modern cooking. We have had a very good example, where we tapped really early into a consumer trend, which is, the growing penetration of air fryers at homes all over the world. We have launched specifically on the Maggi, but also other brands, mixes that can be used to prepare delicious dishes with air fryers. We were fast in doing this. We had the right brand, we rolled it out, the right execution. Modern cooking can be taken to other ways of cooking, we're looking at that as well.

Cold coffee is a is a huge consumer platform and we are started to tap in into that 1, um, in in different ways. So we have launched those, um, those Nescafe concentrates, uh, that that you have seen that is 1 way to tap into that, and that's 1 example. And is actually 1 of the big bets, but as as it is, just 1 product, it's too small to be big enough to be a consumer platform. So I think about it as cold coffee, cold coffee includes, uh, those concentrates but also includes ready to drink coffee, for example, which is, which is a growth category for us and also includes recipes cold recipes that you can. You can uh, prepare through Nescafe at also or through an espresso for example. So the so think about it, as big platforms that we will invest more, broadly behind it and then we have the right Brands to play on it. So on, on that call Coffee platform, example still we have 3, fantastic Brands to play on. So we have NES Cafe, we have Starbucks and we have Nespresso. So we we we should we should be really being able to to have a big impact

The other example, I, I have there is, uh, we we call it modern cooking and we have had a very good example, uh, where we tapped really early into a consumer Trend, which is, uh, the growing penetration of air fryers at at, at homes, all over the world. And we have launched, um,

Philip: Think about those platforms as being really larger consumer-driven platforms, and we're looking at those very thoroughly, and we'll come back with more details on more of those at Full Year, around Full Year. The second question was more, I'll give those to you, Anna, on the volume mix equation in the RIG and your follow-up on free cash flow, John. Thank you.

Philipp Navratil: Think about those platforms as being really larger consumer driven platforms, and we're looking at those very thoroughly, and we'll come back with more details on more of those in at full year, around full year. The second question was more... Well, I'll give those to you and on the volume mix equation in the RIG and your follow-up on free cash flow, Jon. Thank you.

A specifically on the Maggi but also other brands um mixes that can uh be used to prepare delicious. Uh dishes with air fryers and we were fast in doing this. We had the right brand, we rolled it out the right execution. But in modern, cooking can then can be taken to other ways of of cooking. And we're looking at that, we're looking at that as well. So, think about those platforms as being, um, really larger consumer-driven platforms and, and we're looking at those, um, very thoroughly and and will come back with more um, details on more of those uh in uh, at full year around full year.

Anna Manz: Sure. I think the volume mix question was referring to the share loss sales. I would say we're seeing both volume and mix. It depends on the sell and the actions that we needed to take. For example, I'll give you an example. In frozen, and for example in frozen pizza, it was about getting our brands back into the consumer's repertoire. There you saw volume-led share improvements before you saw the value-led one. You know, good volume. We've seen good volume shift there. Whereas something like confectionery in the Latin American market, for example, it's been a more about mix because it's been about the right mix of choco bakery in some places, to make sure that our products were tasting delicious, but at an affordable price point in a world of commodity increases.

Anna Manz: Sure. I think the volume mix question was referring to the share loss sales. I would say we're seeing both volume and mix, and it depends on the sale and the actions that we needed to take. For example, in frozen, and for example, in frozen pizza, it was about getting our brand back into the consumer's repertoire. There you saw volume-led share improvements before you saw the value-led ones. We've seen good volume shift there. Whereas something like confectionery in the Latin American market, for example, it's been more about mix because it's been about the right mix of choco bakery in some places to make sure that our products were tasting delicious but at an affordable price point in a world of commodity increases. It's a mix of both, and it's a thoughtful mix of both depending on the problem that we needed to solve for the consumer.

Then the second question was more. Well, I'll I'll give those to you and on the on the volume mix equation in in the rig and um, and the free your follow up on free cash. Flow, John. Thank you.

Sure. So I think the volume makes question was referring to the share loss sales. Um, and I would say we're seeing both volume and mix, and it depends on the cell and the actions that we needed to take. So, for example, I'll give you an example in Frozen. And, for example, in frozen pizza, it was about getting our brand back into the consumer's repertoire. And so, there you saw volume Le share improvements before you saw the value LED ones.

So you know, we've seen good volume shift there. Whereas something like, um,

Anna Manz: It's a mix of both, and it's a thoughtful mix of both, depending on the problem that we needed to solve for the consumer. In terms of free cash flow, you're right, we've never been great at it, and that is a wonderful opportunity, and we need to get better. And it's also something that takes a little bit of time to get better because working capital is touched by many people across the organization, and we need to improve it at every one of those touchpoints. To give you some sort of sense of that, let's just, you know, start with working capital. There, you know, what sorts of things are we doing and why will it deliver sustained changes?

Anna Manz: In terms of free cash flow, you're right, we've never been great at it, and that is a wonderful opportunity, and we need to get better. It's also something that takes a little bit of time to get better because working capital is touched by many people across the organization, and we need to improve it at every one of those touch points. To give you some sort of sense of that, let's just start with working capital. There, what sorts of things are we doing and why will it deliver sustained changes? Historically, we've given targets on inventory that sort of reflected existing inventory levels and maybe a small improvement rather than looking at what's the optimum inventory level for the factory footprint that we have.

Uh, confectionery in in the Latin American market. For example, it's been a more about mix because it's been about the right mix of choco Bakery and some places, um, to make sure that our products were tasting delicious, but at an affordable price point in a world of commodity increases. So, it's a mix of both and it's a thoughtful mix of both depending on the problem that that we needed to solve for the consumer.

A little bit of time to get better because working capital is touched by many people across the organization, and we need to improve it at every one of those touch points. So, to give you some sort of sense of that, um,

So, so, so let's just, you know,

Start with working capital there. Um,

Anna Manz: Well, historically, we've given targets on inventory that sort of reflected existing inventory levels and maybe a small improvement, rather than looking at what's the optimum inventory level for the factory footprint that we have. That meant that as we've added factories, we haven't always optimized how we're moving product around the network to really make sure that we're optimizing, you know, the cash that is there. We're working through all of those things. Actually, if you go back to what Philipp said, it is around having the right KPIs at the right level in the organization to drive these shifts. That's why I'm comfortable that there is an opportunity for sustained improvement. CapEx to sales is another interesting one.

Anna Manz: That meant that as we've added factories, we haven't always optimized how we're moving product around the network to really make sure that we're optimizing the cash that is there. We're working through all of those things. Actually, if you go back to what Philip said, it is around having the right KPIs at the right level in the organization to drive these shifts. That's why I'm comfortable that there is an opportunity for sustained improvement. CapEx to sales is another interesting one. Yes, we are higher than the competitive set, and some of that is the nature of our categories and the fact that we manufacture more locally, and we need to do a better job of right-sizing our investments and making sure that we're getting the returns on them.

Anna Manz: Yes, we are higher than the competitive set, and some of that is the nature of our categories and the fact that we manufacture more locally, and we need to do a better job of right-sizing our investments and making sure that we're getting the returns on them. That is something that, again, there's a lot of work going into and will give us a sustained improvement in CapEx as a percentage of sales over time. Those are sort of sustainable improvements that we can and will deliver over a couple of periods. The biggest driver of free cash flow and what will see us elevate our free cash flow levels to the levels that we should be at over the medium term is driving RIG and improving margin.

You know, what? Sorts of things are we doing, and why will it deliver sustained changes? Well, historically, we've given Targets on on inventory that sort of reflected existing inventory levels and maybe a small Improvement rather than looking at what's the optimum inventory level for the factory footprint that we have. And that meant that as we've added factories, we haven't always, uh, optimized how we're moving product around the network to really make sure that we're optimizing. You know, the, the, the cash that is is, is there. So we're working through all of those things. And, and actually, if you go back to what, um, Philip said it is around having the right kpis at the right level, in the organization to drive these shifts. And that's why I'm comfortable that there is an opportunity for sustained Improvement. Capex to sales is another another. Um, interesting 1. Yes we are higher than the competitive set and some of that is the nature of our categories. And the fact that we manufacture more locally

Anna Manz: That is something that, again, there's a lot of work going into and will give us a sustained improvement in CapEx as a % of sales over time. Those are sort of sustainable improvements that we can and will deliver over a couple of periods. The biggest driver of free cash flow and what will see us elevate our free cash flow levels to the levels that we should be at over the medium term is driving RIG and improving margin. As you drive volume and improve margins, you drive EBITDA and improve your cash conversion. On top of that, you see a healthy acceleration. I know I'm stating the obvious, but that is the single biggest driver. There is no reason why we shouldn't get back to some much stronger medium-term cash flow generation.

And we need to do a better job of, uh, right-sizing our investments and making sure that we're getting the returns on them.

Anna Manz: As you drive volume and improve margins, you drive EBITDA, improving your cash conversion on top of that, you see a healthy acceleration. I know I'm stating the obvious, but that is the single biggest driver. There's no reason why we shouldn't get back to some much stronger medium-term cash flow generation. I say that carefully because in the shorter term, there is a restructuring cash that we just need to work through over the next couple of years. That is to drive a more nimble, sustainably better organization.

Anna Manz: I say that carefully because in the shorter term, there is a restructuring cash that we just need to work through over the next couple of years. That is to drive a more nimble, sustainably better organization.

Um and that is something that again, there's a lot of work going into and will give us a sustained Improvement in capex as a percentage of sales over time. So so those are sort of sustainable improvements that we can and will deliver um over a couple of periods. The the biggest driver of free free cash flow and what we'll see. Us Elevate, our free cash flow levels to the levels that we should be at, uh, over the medium term is, is driving rig, it's driving rig, and improving margin. And as you drive volume and improve margins, you drive e, bit down and, and providing your improving, your cash conversion on top of that. You see a healthy acceleration. I, I know I'm stating the obvious but that is the single biggest driver. And so there's no reason why we shouldn't get back to some much stronger medium-term. Cash flow generation. I say that carefully because in the shorter term, there is the restructuring cache. Uh, that we just need to work through over the next couple of years, but that is to drive.

A more nimble, sustainably better organization.

Philipp Navratil: Thank you.

Jon Cox: Thank you.

Operator: Thanks, John. The next question comes from Sarah Simon at Morgan Stanley. Sarah, your line should be open. We will have to come back to Sarah, so we will take the next question from Patrick Schwendimann at ZKB. Go ahead, Patrick.

David Hancock: Thanks, Jon. The next question comes from Sarah Simon at Morgan Stanley. Sarah, your line should be open. We will have to come back to Sarah, so we will take the next question from Patrik Schwendimann at ZKB. Go ahead, Patrik.

Thanks, John. The next question comes from Sarah Simon at Morgan Stanley. Terry, your line should be open.

We will have to, uh, come back to Sarah. So we will take the next question.

Patrik Schwendimann: Thank you, David. Patrik Schwendimann, ZKB. Welcome, Philipp. Hi, Anna. We have seen an overall broad-based improvement in RIG and organic growth. The prominent exception was pet care. What needs to be done that pet care will be back on a mid-single-digit organic growth path? That's my first question. Secondly, in infant nutrition, we have seen an improvement, but RIG was still down in Q3. I know the environment is not easy, but what needs to be done to get the infant nutrition business back to growth despite lower birth rates? Is it still attractive category for Nestlé in the future? Thank you.

David Hancock: Thank you very much, Patrick Schwendimon at ZKB. You're welcome, Philip. Hi, Anna. We have seen an overall growth-based improvement in RIG and organic growth. The prominent exception was PetCare. What needs to be done that PetCare will be back on a mid-single-digit organic growth path? That's my first question. Secondly, in infant nutrition, we have seen an improvement, but RIG was still down in quarter three. I know the environment is not easy, but what needs to be done to get the infant nutrition business back to growth despite lower birth rates? Is it still an attractive category for Nestlé in the future? Thank you.

From Patrick, spending at ZKB. Go ahead, Patrick.

Thank you, David. Welcome, Philly. Piana, you've seen an overall broad-based improvement in Rick and organic growth. The prominent exception was Pet Care. What needs to be done at Pet Care to get back on a mid-single-digit organic growth path? That's my first question. Secondly, in Incidents, we have seen the improvement, but the trick was still down in Q3. I know the environment is not easy, but what needs to be done to get the Nutrition business back to growth? Despite lower birth rates, is it still an attractive category for Nestlé in the future? Thank you.

Philip: Yeah, thank you. Thank you, Patrick. I'll give some more midterm statements, and I'll give those at the end. At the end, to Anna. On pet generally, we think the fundamentals of the category are really strong. We see that the number of pets are increasing. Pets are more and more treated like members of the family, and also we see caloric coverage increasing. That is definitely a place that we see growth going further. On your question on infant nutrition, Anna will be able to give a bit more numbers or more color to both of those.

Philipp Navratil: Yeah. Thank you. Thank you, Patrik. I'll give some more midterm statements, and I'll give those then at the end to Anna. On pet generally, I think the fundamentals of the category are really strong. We see that, you know, the number of pets are increasing. Pets are more and more treated like members of the family. Also we see caloric coverage increasing. That is definitely the place that we see growth going further.

Philipp Navratil: On, your question on infant nutrition, and then Anna will be able to give a bit more numbers or more color to both of those. I know that not the birth rate is going back, but we believe, this is a very attractive category for us still because this is where, if you think about it, this is where Nestlé was born and we have plenty of opportunities to grow the category further, and we have plenty of opportunities also to recover market share in markets where we have not been performing as we should. We're looking forward to drive growth on both of those categories going forward. Anna will be able to give you a bit more color to both of those.

Philip: I think I know that the birth rate is going back, but we believe this is a very attractive category for us still because this is where, if you think about it, this is where Nestlé was born, and we have plenty of opportunities to grow the category further, and we have plenty of opportunities also to recover market share in markets where we have not been performing as we should. We're looking forward to drive growth on both of those categories going forward. Anna, I will be able to give you a bit more color to both of those.

Yeah, thank you. Thank you, Patrick. I'll I'll give some some um some more midterm statements and I'll I'll give I'll give those then uh, at the end and at the end to Anna. So on, on, on pet generally, I I, we think the fundamentals of the category are are are really strong. Um, so we see that, you know, the number of pets are increasing, pets are more and more treated like members of of the family. And and also we see caloric coverage increasing. Um, so that that is, that is definitely a place uh, that uh, that we see grows going further and then on on uh, your question on infant nutrition. And then Anna will will be able to give a bit more more numbers or more color to both of those.

I think I I know that now the birth rate is going is going back, but we we believe uh, this is a very attractive category for us. Still

Anna Manz: Sure. Maybe let me start with pet. Actually, maybe let me just talk about pet in Europe for a moment, because pet in Europe is delivering mid-single digit growth. That sort of helps ground us, I think, in the potential of the category. Then we should talk about the U.S. and maybe why it isn't. In Europe, we are there, that's because there is good category momentum, particularly in cats. Across the board, we're seeing more cats being adopted, category growth is skewed there. In Europe, we're very much a cat skewed market, we are benefiting from the category momentum, actually we're driving the category momentum, which is where we should be, because we are innovating well into that category, the innovations are performing strongly.

Anna Manz: Sure. Maybe let me start with pet. Actually, let me just talk about pet in Europe for a moment because pet in Europe is delivering mid-single-digit growth. That sort of helps ground us, I think, in the potential of the category. We should talk about the U.S. and maybe why it isn't. In Europe, we are there, and that's because there is good category momentum, particularly in cats. Across the board, we're seeing more cats being adopted, and category growth is skewed there. In Europe, we're very much a cat-skewed market. We are benefiting from the category momentum, and actually, we're driving the category momentum, which is where we should be because we are innovating well into that category, and the innovations are performing strongly.

I will be able to give you a bit more Colour to both of those sure. So, so, maybe let me, let me start with pet and actually maybe let me just talk about pet in Europe for a moment. Because pet in Europe is delivering mid single digit growth and and that sort of helps ground us. I think in, in the potential of the category and then we should talk about the US and maybe why it is. And so in Europe, we are there, uh, and that's because there is good category of momentum, particularly in cats. So across the board, we're seeing more cats, being adopted, um, uh, and category growth is skewed. Their

And in Europe, we're very much a cat-skewed market. So we are

Anna Manz: That is an example of how pet should be working where we are using innovation to deliver on the consumer desire to feed their pets really lovely premium offerings. The U.S., we're not seeing that level of growth. The category momentum is much slower. Again, it's better in cat and much weaker in dog. We're seeing more cats being adopted, but dogs are flattish to a slight decline in the shorter term. In the U.S., we're lapping a period where there was no promo, and that has also had a sort of deflationary impact on growth a little bit. I think the opportunity in the U.S. to see category acceleration and our acceleration comes back to more driving innovation harder in that cat area where we're seeing good growth. As you know, here, we're capacity constrained on wet cat.

Anna Manz: That is an example of how pet should be working, where we are using innovation to deliver on the consumer desire to feed their pets, you know, really lovely premium offerings. The US, we're not seeing that level of growth. The category momentum is much slower. Again, it's better in cat, and much weaker in dog. We're seeing more cats being adopted, but dogs are flattish to a slight decline in the shorter term. Again, in the US, we're lapping a period where there was no promo, that has also had a sort of deflationary impact on growth a little bit. I think the opportunity in the US to see category acceleration and our acceleration comes back to more driving innovation harder in that cat area where we're seeing good growth.

Benefiting from the category of momentum, and actually, we're driving the category momentum, which is where we should be because we are innovating well into that category and the innovations are performing strongly. So that is an example of how pets should be working, where we are using innovation to deliver on the consumer desire to feed their pets, you know, really lovely premium offerings.

So, in the U.S., we're not seeing that level of growth. The category momentum is much slower. Again, it's better in cats and much weaker in dogs. We're seeing more cats being adopted, but dogs are flattish to a slight decline in the shorter term.

Anna Manz: As you know, here, we're capacity constrained on wet cat. We've got more capacity coming on in Q3, which will help us and help us to deliver against that opportunity. We've got then further capacity coming on stream towards the end of Q4. In a market that is led by innovation and premiumization, that is really important 'cause it's very hard to innovate without capacity to put through the plant. That's pet. A shorter term comment on nutrition. I think we're seeing an improvement in momentum in AoA in LatAm. You know, there's an acceleration there. I think what's holding back our performance on infant nutrition at the moment is our performance in Gerber. We've talked a bit about that.

Anna Manz: We've got more capacity coming on in Q3, which will help us and help us to deliver against that opportunity. We've got further capacity coming on stream towards the end of Q4. In a market that is led by innovation and premiumization, that is really important because it's very hard to innovate without capacity to put through the plant. That's pet. A shorter-term comment on nutrition. I think we're seeing an improvement in momentum in AOA and LATAM. There's an acceleration there. I think what's holding back our performance on infant nutrition at the moment is our performance in Gerber. We've talked a bit about that. We're taking actions to improve Gerber's performance in the U.S., and that is both around brand, innovation, distribution, and cost.

And again in the US we're lapping a period where there was no promo and so that has also had a sort of deflationary impact on growth a little bit. I think the the opportunity in the US to see category acceleration and our acceleration comes back to more uh driving Innovation harder in that cat area where we're seeing good growth. Uh and as you know here we're capacity constrained on wet cat. Um, we've got more capacity coming on in Q3 which will help us and help us to deliver against that opportunity. And we've got them further capacity coming on stream towards the end of of Q4 and in a market that is led by Innovation and premiumization. That, that is really important because it's very hard to innovate with that with that capacity, uh, to put through the plant. So that's pet. Um, a shorter term comment on nutrition. I think we're seeing an improvement in momentum in AOA and last time. So, you know, there's there's

There's an acceleration there, I think. What's holding back our performance on infant nutrition at the moment is our performance in Gerber.

Anna Manz: We're taking actions to improve Gerber's performance in the US, that is both around brand innovation, distribution, and cost. We won't see the benefits of those actions come through until into next year because, as you know, in the US, retailers have an annual cycle around shelf resets. We won't be able to win our distribution back until into next year. It's going to be a drag for a little bit in the shorter term.

Anna Manz: We won't see the benefits of those actions come through until into next year because, as you know, in the U.S., retailers have an annual cycle around shelf resets. We won't be able to win our distribution back until into next year. It's going to be a drag for a little bit in the shorter term.

And we've talked a bit about that. We're taking actions to improve Gerber's performance in the U.S. And that is both around brand innovation, distribution, and cost.

Philipp Navratil: Thanks, Philipp and Anna.

David Hancock: Thanks, David and Anna.

Uh, but we won't see the benefits of those actions come through until into next year because, as you know, in the US, retailers have an annual cycle around shelf resets. So we won't be able to win our distribution back until into next year. It's going to be a drag for a little bit in the shorter term.

Thanks Philip.

Operator: Thanks, Patrick. We'll take our next question from David Hayes from Jefferies. Go ahead, David.

David Hancock: Thanks, Patrick. We'll take our next question from David Hayes from Jefferies. Go ahead, David.

Thanks Patrick.

David Hayes: Thank you, David. Morning, all. Congratulations, Philipp, on the new role. Just related to that, I wonder if you could just give us a bit of a sense from your perspective what the process was for you to get the role, and I guess specifically what you feel was your key pitch to the board in terms of you getting that role. Then in that context, just almost playing back some of the answers you've given so far this morning, it sounds like your team's reviewed and/or is comfortable with the medium-term guidance. That's not likely to change come February, but it sounds like maybe your team under your leadership is now still looking at reviewing some of the business units.

We'll take our next question from David Hayes from Jefferies. Go ahead, David.

Philip: Thank you, David. Morning all. Congratulations, Philip, on the new role. Just related to that, I wonder if you could just give us a bit of a sense from your perspective what the process was for you to get the role, and I guess specifically what you feel was your key pitch to the board in terms of you getting that role. In that context, just almost playing back some of the answers you've given so far this morning, it sounds like your team's reviewed and/or is comfortable with the medium-term guidance. That's not likely to change come February, but it sounds like maybe your team under your leadership is now still looking at reviewing some of the business units. Is that a reasonable summary about where you are in terms of you looking to sort of take the leadership on from here?

David Hayes: Is that a reasonable summary about where you are in terms of you looking to sort of take the leadership on from here? I guess the second question, just so again, can always come back to what you've talked about. A lot of moving parts on the RIG for the Q4 you talked about on comps, et cetera, Chinese New Year. Can you give us a sense in terms of the scale of slowdown on sequentially that you'd still be positive RIG would be expected when you net all those elements off? Thank you.

Philip: I guess the second question, just to again can always come back to what you've talked about. A lot of moving parts on the RIG for the fourth quarter you've talked about on comps, etc., Chinese New Year. Can you give us a sense in terms of the scale of slowdown on sequentially that you'd still be positive RIG would be expected when you net all those elements off? Thank you.

Thank you. David morning all, uh, congratulations Philip on the new role. Um, just released that I wonder if you could, just give us a bit of a sense from your perspective. What the process was for you to to get the role and I guess specifically what you feel was your key pitch to the board in terms of you, you getting that role. Um and then in that context, just what was playing back? Some of the answers you've given so far this morning. It sounds like your team's reviewed and always comfortable with the medium-term guidance. That's not likely to change. Come February but but it sounds like maybe your team under your leadership is now still looking at reviewing? Some of the business units is that a reasonable summary about where you are in terms of you? Um, looking to sort of, take, take take the leadership on from from here. Um, and I guess the second question, just to again, can always come back to what you've talked about. A lot of moving Parts on the rig for the fourth quarter. You talked about on comps Etc. Chinese New Year, can you give us a sense in terms of the scale of slowdown on sequentially that you'd still be positive rig?

Uh, it would be expected, uh, when you net all those elements off. Thank you.

Philipp Navratil: Thanks. Thank you very much, David. Look, on the process how I got the role, obviously this process was run by the board. There is a thorough succession planning and I was obviously on the list. What my context was, and I think what I pitched and what I was advocating for is that I would be able... I mean, I'm still have over 24 years in the group, so I cannot say I'm not a Nestlé veteran. I'm able to look at things with a, you know, with a fresh look, unconstrained by preconceived ideas. This is also when I talked about the portfolio, this is how I look at things.

Philip: Thanks. Thank you very much, David. On the process how I got the role, obviously, this process was run by the board, and there is a thorough succession planning. I was obviously on the list, but what my context was, and I think what I pitched and what I was advocating for is that I would be able, I mean, I still have almost 24 years in the group, so I cannot say I'm not a Nestlé veteran, but I'm able to look at things with a fresh look, unconstrained by preconceived ideas. This is also when I talked about the portfolio, this is how I look at things. I'm not really taken aback by what we would have as dogmas and not taking decisions because we don't take decisions. What I am standing for, and what you can expect from me is really transparency. You can expect accountability.

Thanks, thanks, very much, David. Um, look on on the process. How I I got the role, obviously, this process was, uh, was run by the board. And, um, there is, uh, there is a sorrow succession planning and, um, uh, I, I was obviously on the list but what what, um, what my

Philipp Navratil: I'm not, I'm not really, you know, taken aback by what we, what we would have as dogmas and not taking decisions because we don't take decisions. What I am standing for, and you can really what you can expect from me is really, you know, transparency. You can expect accountability. This is what I also said, many times, and you can also expect that I will drive and culk a sense of urgency throughout the organization. I think as a company, we have to move faster.

But I I'm able to look at things uh, with a, you know, with a fresh look unconstrained by by preconceived ideas. And this is also when I talked about the portfolio, this is how I I look at things. So I I'm not, I'm not really um,

Philip: This is what I also said many times. You can also expect that I will drive and inculcate a sense of urgency throughout the organization. I think as a company, we have to move faster. We have fantastic fundamentals to build on: great scale, great company, great people, great brands. We just need to move faster, and we need to start winning out there. That is also why I was quite clear in saying that we don't want a culture where losing market share is okay. It's not acceptable, and we need to win everywhere we play. We need to win. You can expect also some competitiveness to be brought back to the organization and love for our brands because at the end of the day, that's what we sell. We sell great brands, and they're made of great products that we sell out there. Expect more of that.

Philipp Navratil: We have a fantastic, you know, fundamentals to build on great scale, great company, great people, great brands. We just need to move faster and we need to start winning out there. That is also why I was quite clear in saying that we don't want a culture where we're losing market share is okay. It's not acceptable, and we need to win everywhere we play. We need to win. You can expect also some competitiveness to be brought back to the organization and love for our brands because at the end of the day that's what we sell. We sell great brands and they're made of great products that we sell out there.

Philipp Navratil: You can expect also some competitiveness to be brought back to the organization and love for our brands because at the end of the day that's what we sell. We sell great brands and they're made of great products that we sell out there. Expect more of that. In terms of your question about RIG, I guess that was for Q4 RIG. I'll give that to Anna to give a bit more color on that, David. Thank you very much.

You know, taking a back by, by what we, what we would have as as dogmas. And and, and and, and not taking decisions because uh, because we don't take decisions. So what I am standing for and and and you can really what you can expect from me is really uh, you know transparency you can expect accountability. This is what I also said, um, many times. And, uh, you can, you can also expect that, uh, I will, I will drive inn in, culk a sense of urgency throughout the organization, and I think, as a company we have, we have to, we have to move faster. We have, we have a fantastic, you know, fundamentals to to, to, uh, build on great scale. Great company. Great people, great Brands, but we just need to move faster, and we need to start winning out there. And that is also why I was quite clear in saying that we, we, we don't want a culture where we're losing market, share is okay. It it's not acceptable and we need to win everywhere. We play. We need uh, we need to win so you can you can expect also some some

Philipp Navratil: Expect more of that. In terms of your question about RIG, I guess that was for Q4 RIG. I'll give that to Anna to give a bit more color on that, David. Thank you very much.

Philip: In terms of your question about RIG, I guess that was for Q4 RIG. I'll give that to Anna to give a bit more color on that, David. Thank you very much.

Anna Manz: Sure. Good question, David. We absolutely expect all of the actions that we are taking to continue to improve our underlying RIG momentum. You know, it's important that you hear that. There are some technical factors. Comps, Chinese New Year. Are we going to have positive RIG in Q4? Absolutely. Now I'm not guiding on RIG, but we're absolutely. You know, there's a big difference between 0 RIG and 1.5. We're not guiding on RIG, but it absolutely will be positive. You know, there are some. It was just a slightly higher comp technical base for Q4.

Anna Manz: Sure. Good question, David. We absolutely expect all of the actions that we are taking to continue to improve our underlying RIG momentum. You know it's important that you hear that. There are some technical factors, comps, Chinese New Year. Are we going to have positive RIG in Q4? Absolutely. Now, I'm not guiding on RIG, but we're absolutely, you know, there's a big difference between zero RIG and 1.5. We're not guiding on RIG, but it absolutely will be positive. You know there is just a slightly higher comp technical base for Q4.

Competitiveness to to be brought back to uh to the organization and and uh and and love for Our Brands because at the end of the day, that's what we sell we sell, we sell uh, great Brands and and and they're made of of, of great products that we sell out there. So expect more more of that. Um, and in terms of um your question about uh Rick, I guess that was was for Q4 rig. Um, I'll I'll give, I'll I'll give that to Anna to give a bit more color on on on that. David, thank you very much. Sure. So, so good question, David. Um,

We absolutely expect all of the actions that we are taking to continue to improve our underlying rig momentum. It's important that you hear that. There are some technical factors, such as comps and the Chinese New Year. Are we going to have positive rig in Q4? Absolutely. Now I'm not guiding on rig, but we are absolutely.

Philipp Navratil: Thanks.

David Hayes: Thanks.

Philip: Thanks, David.

Well, you know, there's a big difference between negative zero rig and 1.5 so we're not guiding on rig, but it absolutely will be positive. Uh, and, you know, there are some, it was just a slightly higher technical base for um, Q4

David Hancock: Thanks, David. I'm afraid we're at time, so we have to conclude there. Thanks for the questions and the interest. I'll pass over to Philipp for his concluding remarks.

Operator: Thanks, David. I'm afraid we're at time, so we have to conclude there. Thanks for the questions and the interest. I'll pass over to Philip for his concluding remarks.

Thank you.

Philip: Yeah, thank you. Thank you, David. Thank you all for attending the call. I'd like to conclude with a final message. As I said, and I will repeat it many times, you can expect for me to focus on those four key priorities we have been calling out. The first and most important one is RIG-led growth, a winning portfolio, a performance culture throughout the whole company, and transformation and efficiency. I will drive that with urgency, accountability, and transparency to accelerate our performance and to deliver improved shareholder value. I really thank you for your interest, your questions, and I'm looking forward as I go onto the road to meeting many of you in the coming days and months. Thank you very much.

Philipp Navratil: Yeah. Thank you. Thank you, David. Thanks all for attending the call. I'd like to conclude with a final message. As I said, I will repeat it many times, for... You can expect from me to focus on those 4 key priorities we have been calling out. The first and most important one is RIG-led growth, a winning portfolio, a performance culture throughout the whole company, and transformation and efficiency. I will drive that with urgency, accountability, and transparency to accelerate our performance and to deliver improved shareholder value. I really thank you for your interest, your questions, and I'm looking forward as I go on, onto the road to meeting many of you in the coming days and months. Thank you very much.

Thanks, David. I'm afraid we're out of time, so we have to conclude that. Thanks for the questions and the interest. I'll pass it over to Phillip for his concluding remarks. Yeah, thank you. Thank you, David, and thanks to all for attending the call. I'd like to conclude with a final message. As I said, and I will repeat it many times, you can expect from us to focus on those four key priorities we have been calling out. The first and most important one is resilient growth.

Um, a winning portfolio, a performance culture throughout the whole company, and transformation and efficiency. I will drive that with urgency.

Accountability and transparency to accelerate our performance and to deliver improved shareholder value. And I really thank you for uh, your interests, your questions. And uh, I'm looking forward as I go on onto the road to meeting many of you uh, in the coming days. Uh, and month. Thank you very much.

Q3 2025 Nestle SA Earnings Call

Request a DemoDemo

NSR

Nestle

Earnings