VEVEY, SWITZERLAND — Nestlé’s PetCare segment is witnessing a slowdown, largely driven by market softness, according to the company’s 2025 first quarter financial performance. Despite this, the company continues to gain share in various markets, with solid momentum for its science-based premium brands Purina ProPlan, Purina ONE and Felix.

Net sales for the segment were reported at CHF 4.7 billion ($5.67 billion USD), an increase from CHF 4.6 billion ($5.55 billion USD) in the first quarter of 2024. Organic growth was reported at 1.6%, down from 4.3% year-over-year. Real internal growth (RIG) was 1.5% and pricing was -0.9%.  

Swiss franc (CHF) to USD currency conversions are based on April 25 conversion rates.

“On PetCare, category growth has come down from a year ago, but is now stabilizing,” shared Anna Manz, chief financial officer of Nestlé. “First quarter organic growth of 1.6% was similar to the growth we saw in the second half of last year. RIG continues to be positive across all regions, led by cat food and therapeutics. Negative pricing reflects input costs and a return to a more normal promotional environment.”

In Zone Americas, first quarter sales were reported at CHF 8.6 billion ($10.37 billion USD), stagnant year-over-year. Organic growth was 1.9%, RIG was 0.1% and pricing was 1.7%. PetCare achieved market share gains in this zone, achieving low single-digit growth with sold performance for scienced-based premium offerings, which was partially offset by weak growth from dog brands and pet snacks.

In Zone Asia, Oceania and Africa (AOA), first quarter net sales were reported at CHF 5.5 billion ($6.63 billion USD), a 3.6% increase from CHF 5.3 billion ($6.39 billion USD) in 2024. Organic growth was 3.1%, RIG was 0.7% and pricing was 2.4%. According to Nestlé, growth in this zone was most notable in emerging markets for PetCare. The segment experienced mid-single-digit growth, with strong double-digit growth in emerging markets, which were offset by category softness in developing markets. In this zone, Nestlé plans to accelerate its PetCare business in South Korea by integrating it into the company group following the exiting of a joint-venture structure.

In Zone Europe, first quarter net sales were reported at CHF 4.4 billion ($5.30 billion USD), a 2.5% increase from CHF 4.2 billion ($5.07 billion USD) in 2024, led by PetCare. Organic growth was 2.4%, RIG was -0.6% and pricing was 3%. PetCare experienced low single-digit growth, primarily led by Purina ProPlan and Purina ONE. 

“We generated broad-based growth across markets and categories, with improving market share trends across most country-category combinations,” Manz shared. “A priority during the quarter was our annual price negotiations. And as we have said, we navigated these with relatively limited disruption. We now need to see the impact of price increases on consumer demand in Coffee and Confectionery, which we are watching carefully. Beyond these categories, the zone’s growth continues to be supported by solid RIG-led growth in PetCare.”

Overall, PetCare’s growth reflects some market softness, especially in the United States, the company revealed, but with market share gains continuing. Despite the negative pricing and minimal RIG, Nestlé remains confident in the segment. 

“The key point there is the slightly negative pricing, which is largely justified by a mild commodity environment. So, there is no need for pricing to protect the margins on the one hand,” explained Laurent Freixe, chief executive officer of Nestlé, during the company’s first quarter call on April 24. “Second, we got more capacity coming on stream, and more to come, as we are still constrained in a few areas, especially wet pet food. 

“I would qualify the RIG as solid; it’s ahead of the rest of the group,” he added. “We have a broad-based positive RIG, more, of course, in emerging markets than in developed markets, but the category is strong. We took massive volumes. When you think of a growth of 2% on massive volumes, this is very, very significant. We’ve got everything it takes to support the growth. We got the brands, we’ve got the R&D capabilities, we’ve got innovation, and we got the resources being deployed, and on top of that, the capacity is also available. So, we are very, very confident.”

Overall, first quarter net sales for Nestlé were reported at CHF 22.6 billion ($27.25 billion USD), a 2.3% increase from CHF 22.1 billion ($26.65 billion USD) a year ago. Organic growth was 2.8%, RIG was 0.7% and pricing was 2.1%. The company continues to make progress on its strategy to accelerate category growth and enhanced market share, investing in its various brands and launching new products, like GOURMET REVELATIONS Fine Cuts in Gelée in Europe and Fancy Feast Gems in the United States. 

“In an environment of heightened macroeconomic and consumer uncertainty, Nestlé delivered organic sales growth of 2.8%, with RIG of 0.7% and pricing of 2.1%,” Freixe said. “Growth was broad-based across markets and categories, with improving market share trends across many businesses, particularly our billionaire brands.”

Looking into its operations, the company plans to further simply its organization to support more effective execution. The company is on track to deliver CHF 700 million ($844.09 million USD) of cost savings in 2025, primarily driven by realization of procurement savings. 

“We have made further progress in delivering our strategy. Our ‘Fuel for Growth’ cost savings program is on track, providing the resources to help accelerate performance,” Freixe detailed. “In the quarter, we invested to strengthen our core business, achieved good consumer traction in the roll-out of our ‘big bet’ innovations such as Nescafé Espresso Concentrate, and saw some encouraging early improvements in our largest underperforming business cells. We are continuing to make changes throughout the organization to increase alignment and focus, with steps to harmonize our structure in Zone Europe and enhance our capabilities in R&D.”

The company’s 2025 guidance remains unchanged. Organic sales growth is expected to improve compared to 2024 and Underlying Trading Operating Profit is expected to be around 16% as the company continues to invest in growth.

“Performance in the first quarter was in line with our expectations, and our 2025 guidance remains unchanged,” Freixe shared. “This is based on our assessment of the direct impact of current tariffs and our ability to adapt. The indirect impacts — on consumers and customers, as well as currencies and commodity prices — remain unclear at this stage. Overall, the situation continues to be dynamic, with heightened risks and uncertainty. Our 277,000 committed colleagues are focused on successfully executing our strategy: driving efficiencies and investing for growth to accelerate our categories and improve market share.”

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