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Unilever and Nestlé, some of the world’s largest consumer companies, saw strong sales growth in the first three months of 2025 despite the looming threat of tariffs.
The rivals' growth came from higher demand for some premium products and price hikes to offset soaring cocoa and coffee prices.
Unilever’s underlying sales were up 3% during the first quarter, with its personal care category bringing in the most business. The London-listed company’s so-called power brands, contributing to 75% of the group’s turnover, saw sales jump by 3%.
Unilever is in the middle of a shake-up that’s seen key leadership changes and an overhaul in its business focused on streamlining and gaining market share from rivals. During the pandemic, Unilever began to lose shoppers amid price increases to offset costs.
Earlier this month, the company ousted its CEO Hein Schumacher, and put CFO Fernando Fernandez in charge.
Fernandez has had a single resounding message since taking on the top job: to make big changes at the consumer brand behind Dove soap and Vaseline cream.
Fernandez said the company’s new direction would mean “a ruthless obsession with the consumer” during Thursday's earnings call.
“We have a resilient portfolio, good momentum and, above all, a very clear sense of what we need to do,” the new CEO said.
Nestlé has faced similar struggles. The Swiss company behind KitKat and Nespresso also reacted to surging raw materials costs by jacking up the price tags on its products, which its chair, Paul Bulcke, said Nestlé “went a bit too far with.”
However, as demand for its coffee and confectionery, such as Smarties and Quality Street, boomed in the first quarter, the company reported a 2.8% organic revenue increase, beating analyst estimates of 2.6%.
“We are trying to take as much price as we can to cover our costs while being mindful of the consumer response in a competitive environment,” CEO Laurent Freixe said, Reuters reported. “Some political decisions, economic decisions taken have rather undermined already soft consumer confidence."
Nestlé, too, is undergoing a shift in its business to focus on “billionaire brands,” or its strong-performing suite of brands that can become engines of growth. The Vevey-based company plans to slash $2.8 billion in costs by 2027.
Consumer companies like Unilever and Nestlé constantly jostle over pricing to deliver strong top-line figures without upsetting shoppers. The subject became sensitive in the economic aftermath of the pandemic when cash-strapped consumers alienated big brands amid high inflation in favor of the best deals.