NEW YORK: Mondelez International Inc shares slumped in after-hours trading after the snack food company said “unprecedented cocoa cost inflation” would drive down earnings this year.
The company expects adjusted earnings per share in 2025 to decline by approximately 10%. The stock fell 5% in after-hours trading.
Cocoa prices remain substantially elevated from prior years, more than doubling since the end of 2023. Chief executive officer Dirk Van de Put said the company was focused on navigating cocoa cost inflation in 2025.
Sales in the company’s financial fourth quarter ended Dec 31 rose 3.1% to US$9.6bil, the maker of Oreo biscuits, Triscuit crackers and Milka chocolate bars said in a statement on Tuesday. Adjusted earnings per share fell 16% to US$0.65.
While Mondelez’s revenues were up compared to 2023, volumes for the year were down, as budget conscious shoppers pulled back on a wide range of purchases at the supermarket.
While some food makers have used promotions to reel customers in, Mondelez has raised prices because of its reliance on cocoa.
The company said that it expects cocoa prices to eventually come down from their current highs, but they will remain higher than they have historically.
It is currently raising prices and may have to do more increases in the second half of the year and in 2026, Van de Put told investors.
Still, consumers maintain their appetite for chocolate – the company had double digit Christmas net revenue in the category.
Chief financial officer Luca Zaramella said that the company would grow earnings per share in 2026 no matter what happens to cocoa prices. — Bloomberg
