Nestle cuts 16,000 jobs as part of intensifying cost-cutting campaign

It has been a turbulent year for the company, based Vevey, Switzerland. Last month, Nestle dismissed CEO Laurent Freixe after an investigation into an undisclosed relationship with a direct subordinate.

Freixe had only been on the job for a year. He was replaced by Philipp Navratil, a longtime Nestle executive. Shortly after Freixe was ousted, Chairman Paul Bulcke stepped down early.

Nestle is also fighting external headwinds like other food makers, including rising commodity costs and the negative impact of tariffs. The company said in July that it offset higher coffee and cocoa-related costs with price increases.

Nestle said Thursday that it will eliminate 12,000 white-collar positions in multiple locations. The job cuts are expected to achieve annual savings of 1 billion Swiss francs (USD 1.25 billion) by the end of next year. The company will cut 4,000 jobs as part of ongoing productivity initiatives in its manufacturing and supply chain.

“The world is changing, and Nestle needs to change faster,” Navratil said in a statement. Shares of Nestle rose nearly 8 per cent on the SIX Swiss Exchange.