Are Nestlé's Job Cuts Under New CEO a Strategic Pivot?

Nestlé’s new Chief Executive Officer, Philipp Navratil announced plans to cut 16,000 jobs over the next two years as part of a strategic initiative to boost growth and improve performance.

The move came after Philipp took the helm in September 2025 following a period of leadership change at the food and beverage multinational. Nestlé is sharpening its focus on an approach to performance that doesn't accept losing market share to rivals.

According to the company, the job cuts will include 12,000 white-collar professionals and 4,000 other employees, forming part of “ongoing productivity initiatives in manufacturing and supply chain”.

Nestlé says these redundancies could generate savings of around CHF1bn (US$1.25bn). The restructuring follows a report of improved sales figures in the first nine months of 2025 - on 16 October 2025 the company reported a 3.3% increase in organic growth which was supported by a 0.6 rise in real internal growth (RIG) and 2.8% pricing.

Leadership upheaval and cultural change

The workforce restructuring follows a turbulent year for Nestlé’s leadership. The company dismissed former CEO Laurent Freixe in September after an investigation into “an undisclosed romantic relationship with a direct subordinate that breached Nestlé’s Code of Business Conduct”.

Paul Bulcke, the Chairman at the time, called it a “necessary decision,” affirming, “Nestlé’s values and governance are strong foundations of our company".

The Board moved quickly to appoint Philipp as the new CEO. This was followed by Bulcke announcing he would step down as Chairman earlier than planned, with Pablo Isla taking over the role on 1 October 2025.

Upon his appointment, Philipp signalled his intention of “fostering a culture that embraces a performance mindset” as “the world is changing, and Nestlé needs to change faster.”

These leadership changes and the focus on a new performance-led culture could suggest a major strategic pivot for Nestlé's human capital management.

Restructuring to improve performance

The planned redundancies are part of a wider strategy to improve agility and speed up decision-making. Earlier in the year, Nestlé made structural changes to its executive board.

Laurent said at the time: “A leaner Executive Board structure and close collaboration of the leadership team at the headquarters will increase simplicity, speed up decision making and strengthen the momentum behind global initiatives.”

The large-scale job cuts could be seen as an extension of this principle to the wider workforce.

The focus on performance comes as Nestlé reports stronger growth in Q3 of 4.3% achieved by stronger volume recovery and pricing actions.

Discussing this, Philipp explained: “Achieving RIG-led growth is our number one priority. We have been stepping up investment to achieve this, and the results are starting to come through. Now we must do more and move faster to speed up our growth momentum.”

The strategy appears to use the stability of recent growth as a platform for deeper organisational change.

Strategic resource allocation

Looking forward, the new leadership at Nestlé intends to be more selective in its allocation of resources and capital.

“As Nestlé moves forward, we will be rigorous in our approach to resource allocation, prioritising the opportunities and businesses with the highest potential returns,” Philipp said.

“We will be bold in investing at scale and fostering innovation to deliver stronger growth and value creation.”

This rigorous approach extends to Nestlé's cost base. The initial CHF1bn in savings from the job cuts is part of a larger objective to increase the total savings target to CHF3bn (US$3.75bn) by the end of 2027.

In his new role, Philipp has emphasised a commitment to speed and fresh ideas, telling employees “Together we are moving fast, open to fresh ideas on how we deliver the future of tasty, healthy, affordable food.”

He stated the layoffs will be handled with “respect and transparency” a key consideration for maintaining morale and brand perception during such a notable transition.