Mondelez International, the parent company of Cadbury, signaled a cautious outlook for the year ahead as consumers respond to price increases by cutting back and moving toward lower-priced retail channels. The Chicago-based snacks group saw its shares fall about 4% after the bell on Tuesday.
Management said consumer spending patterns are tightening, particularly in the United States, where shoppers are trading down. Those dynamics have pressured volumes following several rounds of price increases intended to offset a surge in the cost of cocoa.
Cocoa prices jumped 160% in 2024 and have since fallen amid a global surplus. However, Mondelez noted it has already secured cocoa for 2026 at prices that exceed current market levels, limiting the company’s ability to reduce retail prices in the near term.
Chief Executive Dirk Van de Put described U.S. consumer confidence as "remains weak," saying that while some higher-income consumers are shifting toward "better-for-you" snack options - particularly those higher in protein - other shoppers are trading down. He added that conditions in Europe remain fragile, although chocolate volumes there are expected to stabilize after last year’s wave of price increases.
For 2026 the company expects organic net revenue growth between flat and 2% - a pace below analysts’ forecasts of a 3.84% increase. Adjusted profit is forecast to rise in the flat to 5% range, versus an expected 8.3% increase, according to data compiled by LSEG.
Commenting on the disconnect between pricing and volumes, Michael Gunther, VP of Research and Market Intelligence at ConsumerEdge, said: "Volumes for Mondelez decelerated sequentially as pricing accelerated - demonstrative of both a strained consumer and the need to offset input cost inflation, especially cocoa."
On the company’s fourth-quarter performance, volumes fell by 4.8 percentage points while pricing rose by 9 points. Higher pricing contributed to a 9.3% increase in revenue to $10.50 billion, topping analysts’ estimates of $10.31 billion. Adjusted earnings were 72 cents per share, beating expectations by 2 cents.
Mondelez said it is implementing price adjustments in selected markets and expects those measures to help restore volumes. The company’s comments came alongside news that rival PepsiCo, which also reported stronger-than-expected quarterly results on Tuesday, plans to reduce prices on core snack brands such as Lay’s and Doritos by up to 15% amid consumer pushback.
Context and market reaction
The combination of higher input costs locked in through forward purchases and consumers migrating to lower-priced channels is central to Mondelez’s cautious guidance. While the firm delivered top-line and earnings beats for the quarter, management’s outlook signals a muted recovery in volumes and constrained revenue growth relative to market forecasts.