MDLZBy Calypso Research7 min read

Mendelez (MDLZ) Q4 2025 Earnings Analysis

Cocoa-nuts About 10.5B but Stock Takes a Dip

Key Takeaways

Mendelez (MDLZ) reported Q4 2025 earnings with revenue of $10.5B, representing a +9.3% year-over-year change. The stock moved -0.1% on earnings day.

The bull case: Cocoa normalization, resilient emerging-market demand, and stepped-up brand investment drive a volume-led recovery and significant chocolate margin and EPS expansion from 2027 onward.

The bear case: Persistent US consumer weakness, potential competitive price cuts amid cocoa volatility, and structurally higher A&C spending could cap margin recovery and leave 2026–2027 earnings below bullish expectations.

Financial Highlights

  • Revenue: $10.5B (+9.3% YoY)
  • Gross Profit: $3.0B (28.2% margin, -10.5% YoY)
  • Operating Income: $979M (9.3% margin, -7.4% YoY)
  • Net Income: $665M
  • TTM Revenue: $38.5B

Stock Performance

  • Earnings Day Move: -0.1%
  • Year-to-Date: +12.5%
  • 1-Year Return: -7.6%
  • vs. S&P 500 (since earnings): +4.4%
  • vs. Nasdaq (since earnings): +7.2%

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What Management Said

Here are the key debates and direct quotes from Mendelez's Q4 2025 earnings call:

Cocoa Price Collapse, Chocolate Strategy, and 2026–2027 Profit Recovery

Sentiment: Positive

"However, as you probably have seen in the last two weeks, suddenly the cocoa price has declined more than anybody would have expected... And this could maybe give us some unexpected competitive reactions. And so we want to build in some flexibility in our guidance because we don't quite know how that is going to play out in the market in 2026." — Dirk Van de Put
"If cocoa ranges at around 3,000, our goal is to get into 2027 with a much improved situation. And to really be able to get back to the old profit pool. And if we have to make some selective price investments, we will make them." — Luca Zaramella

2026 Guidance Prudence, Volume Trajectory, and Regional Growth Mix

Sentiment: Mixed

"On 2026, the guiding principle of the guidance was to be prudent. Particularly as we see some short-term pressure points like in The US... and in Europe, we have planned for a chocolate category that is stable... but we also planned for some disruption due to the usual customer negotiation process that takes place in the first part of the year." — Luca Zaramella
"We clearly expect AMEA overall... we see EMEA as being a big source of volume growth for us... Latin America... it's going to be quite a good year for us. North America... we are not exactly counting on volume growth in North America." — Dirk Van de Put

North America Consumer Weakness, Pricing vs Promotions, and Channel Strategy

Sentiment: Mixed

"The consumer confidence is near historic low... they are fed up with the price increases... what we are seeing is that the average shopping basket of the consumer in The US... has not increased for the last two, three years... and as a consequence, snacking is being affected." — Dirk Van de Put
"We did a lot less promotion and pricing. As a consequence, our price realization went up. And I would say, overall, our P&L improved in North America. But we lost some market share because our volume performance wasn't the same... we don't necessarily think that we need to decrease our prices to the magnitude that I heard from another company." — Dirk Van de Put

Advertising & Brand Investment Step-Up and Multi-Year Margin Algorithm

Sentiment: Mixed

"If you look over a couple of years, between 2024 and 2026, we will more than recover what we have to pull back in 2025 into the overall line... all in all, the investment in A and C over two years, I think it's going to be substantial... It's up quite meaningfully." — Luca Zaramella
"For 2027, we expect that we will do another step up in investments. We believe that we have to continue to invest in our brands... we are aiming for a strong EPS growth in 2027, but at the same time, we want to keep on investing in our brand. So we are not planning to flow everything to the bottom line." — Dirk Van de Put

Emerging Markets, Latin America/Argentina, and Volume vs PPA Dynamics

Sentiment: Positive

"The emerging markets will continue growing and hopefully they will do even better than what is embedded quite frankly, in the guidance... The idea for 2026 is, again, to grow this market pretty much at the same level, but there will be a little bit less contribution from pricing and more contribution from volume mix." — Luca Zaramella
"When you strip out Argentina and you look around, Brazil got a little bit impacted by elasticity in chocolate... But Brazil is one of the best performing markets that we have top and bottom line... If you look at Mexico, there was a big comeback... It is Argentina masking a little bit the performance of the region." — Luca Zaramella

Bull Case

Cocoa normalization, resilient emerging-market demand, and stepped-up brand investment drive a volume-led recovery and significant chocolate margin and EPS expansion from 2027 onward.

Bear Case

Persistent US consumer weakness, potential competitive price cuts amid cocoa volatility, and structurally higher A&C spending could cap margin recovery and leave 2026–2027 earnings below bullish expectations.

Looking Ahead

Investors will be closely watching Mendelez's next quarterly report for continued execution, particularly around cocoa Price Collapse, Chocolate Strategy, and 2026–2027 Profit Recovery. With operating margins at 9.3%, margin trends will remain a focal point. The muted stock reaction on earnings day suggests the market is taking a wait-and-see approach, and the next earnings report will be a key catalyst for the stock.

Frequently Asked Questions

What was Mendelez's revenue in Q4 2025?

Mendelez reported Q4 2025 revenue of $10.5B, representing a +9.3% year-over-year change.

Did Mendelez beat earnings expectations in Q4 2025?

The stock moved -0.1% on earnings day, suggesting the results were roughly in line with market expectations. The current bull case centers on: Cocoa normalization, resilient emerging-market demand, and stepped-up brand investment drive a volume-led recovery and significant chocolate margin and EPS expansion from 2027 onward.

What is the bull case for MDLZ stock?

The bull case for MDLZ centers on: Cocoa normalization, resilient emerging-market demand, and stepped-up brand investment drive a volume-led recovery and significant chocolate margin and EPS expansion from 2027 onward.

What is the bear case for MDLZ stock?

The bear case for MDLZ centers on: Persistent US consumer weakness, potential competitive price cuts amid cocoa volatility, and structurally higher A&C spending could cap margin recovery and leave 2026–2027 earnings below bullish expectations.

How has MDLZ stock performed since its Q4 2025 earnings?

MDLZ moved -0.1% on the day of its Q4 2025 earnings report, outperforming the S&P 500 by +4.4% since earnings. Year-to-date, the stock has returned +12.5%.

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