Lindt & Sprüngli’s sales volumes faced challenges due to the company’s highest pricing to date last year, with expectations of additional pressure in 2026.
On March 10, the Swiss premium chocolate maker announced an organic growth rate of 12.4% for the previous year, its fastest growth since the 13.3% rate recorded in 2021. However, this increase was largely driven by a 19% rise in pricing rather than volume sales.
Volume and mix dropped by 6.6%, and the forecast for fiscal 2026 indicates a “slightly” negative trend as Lindt & Sprüngli prepares for mid-single-digit price hikes, including a double-digit rise during the upcoming Easter season.
CEO Adalbert Lechner mentioned that any increase in volume will likely occur during the latter half of the year but will remain “flat to positive” after initially experiencing another negative trend in the first six months.
Lechner stated, “We were forced to increase prices by more than 40% in the last four years, and for three years we did not see any impact on volumes. Last year was the first year where we saw a slight negative volume/mix effect of minus 6.6%. For us, it’s the clear priority – how to get back to volume growth as soon as possible.”
Lindt & Sprüngli’s pricing strategy has overshadowed its volume-driven revenue growth. From 2021 to 2025, the company observed an average volume/mix growth of 2.1% while pricing surged by 8%. This contrasts sharply with the period from 2006 to 2019, during which average volume/mix growth was 4% alongside a mere 2.5% increase in pricing.
The company has encountered tough negotiations with retailers, highlighted by Lechner’s comments on negotiations with Migros in Switzerland. “This did quite cost us some of the growth rates that we had intended,” he noted. Challenges also arose in France and North America, where prolonged negotiation periods delayed price acceptance, potentially dampening growth rates.
The ongoing conflict in the Middle East adds to existing pressures, notably on cocoa and cocoa butter costs. Although cocoa prices have declined from record highs in 2024, CFO Martin Hug pointed out they remain about 50% higher than three years ago, with potential corrections expected.
“The big question is now, of course, where will the market go from here?” Hug mused. He emphasized that various challenges, including diseases affecting cocoa production, pose ongoing structural concerns. He also highlighted, “What I should also say is, when I look now into the future with the Iran crisis, et cetera, you have cost pressure from other areas as well, not just cocoa.”
Consumer sentiment across Europe and North America was already weak last year, and a drop in tourism, particularly from Asian visitors traveling through the Middle East, could further impact Lindt & Sprüngli. Possible pain points might arise from the company’s retail stores and global travel retail sector, especially with rising energy and transportation costs likely straining consumers in these regions.
Given this uncertainty, Lindt & Sprüngli is projecting a slowdown in organic growth to approximately 4-6% for 2026. Nevertheless, the company anticipates an improvement in the EBIT margin, forecasting a gain of 20-40 basis points from last year’s 16.4% (16.2% in 2024).
For context, last year’s sales reached SFr5.92 billion ($7.62 billion), with a net profit increase of 8.1% to SFr726.7 million. Lechner remains hopeful that volume-led revenue growth will return by 2027. However, as of 12:33 GMT today, shares had dipped by over 11% to SFr10,750.
In summary, the current landscape presents challenges in the food and beverage industry, particularly around pricing strategies and consumer trends. Lindt & Sprüngli’s ability to navigate these complexities will be crucial for its future growth, as the food and drink business continues to adapt to evolving market conditions. For more insights on food and drink consumer trends, consider subscribing to industry newsletters to stay informed.