Nestlé delivered a solid first half of 2026, reporting 3.6% organic growth, driven by real internal growth (RIG) of 1.5% and 2.1% pricing, while free cash flow increased 46.3% to CHF 3.4 billion ($4.17bn) despite foreign exchange headwinds reducing reported sales by 2.5% to CHF 43.1 billion. The company reaffirmed full-year guidance for 3-4% organic growth, expecting RIG to accelerate further and margins to improve in the second half.
Chocolate and confectionery remained resilient despite elevated cocoa costs. Nestlé’s Food & Snacks division – the closest proxy for confectionery – generated 3.7% organic growth in H1 (RIG 1.9%, pricing 1.8%) on sales of CHF 11.9 billion, following 3.2% organic growth in Q2 (RIG 1.8%, pricing 1.5%).
KitKat continued to underpin category performance. In Asia, Oceania and Africa (AOA), confectionery led Food & Snacks growth, with double-digit organic growth in Q2 supported by continued KitKat momentum. In Europe, KitKat delivered positive growth despite broader weakness in Food & Snacks, while in the Americas confectionery growth moderated due to seasonal phasing.
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Higher cocoa and coffee costs continued to pressure profitability, contributing to a 20-basis-point decline in gross margin to 46.4%. Nestlé said pricing, cost savings through its Fuel for Growth programme and stronger RIG helped offset inflationary pressures, while increased marketing investment continued to support flagship brands including KitKat.