Nestle jumps 8% after consumer goods giant announces plans to slash 16,000 jobs

Nestle said Thursday it will cut 16,000 jobs as the firm’s new CEO Philipp Navratil looks to accelerate a turnaround at the consumer goods giant.

In a bid to improve operational efficiency, the firm said it will cut 12,000 white-collar jobs and a further 4,000 roles will be reduced over the next two years.

“We are transforming how we work,” Navratil wrote in a LinkedIn post summarizing the company’s earnings report. “We are evolving and will simplify our organization and automate our processes.”

It’s unclear how Nestle plans to incorporate more automation into its corporate offices. Other companies, primarily in the tech sector, have slashed jobs as they turn to artificial intelligence to replace human labor. So far this year, more than 17,000 job losses have been specifically tied to A.I., according to a recent report from Challenger, Gray & Christmas.

Nestle did not immediately respond to a request for comment from CNBC.

Shares of Nestle were last seen trading nearly 9% higher. The stock price jump boosted Europe’s food and beverage sector, which was up more than 3.3% on Thursday morning.

Under its former CEO Laurent Freixe, Nestle had already announced a cost-savings programme worth 2.5 billion Swiss francs ($3.14 billion). This has now been accelerated to 3 billion Swiss francs by the end of 2027. 

The company posted a better-than-expected organic growth rate of 4.3% in the third quarter as it battles an uncertain consumer outlook amid U.S. tariffs and an increase in raw material prices, such as cocoa and coffee beans. 

Notably, Real Internal Growth (RIG) returned to positive territory in the third quarter — up 1.5% — as the maker of Nespresso and KitKat saw growth investments pay off, also helped by easier comparisons.