Nestle(US:NSRGY) 3 6 Ke·2025-09-22 00:13Core Viewpoint - Nestlé has experienced an unusual turnover in its leadership, changing three chairpersons in just over a year, raising concerns about the company's future direction and stability [2][3]. Group 1: Leadership Changes - Paul Bulcke, who served for 46 years, has stepped down as chairman, with Pablo Isla taking over on October 1 [2][3]. - The rapid succession of leadership changes, including the dismissal of former CEO Laurent Freixe, has surprised the market and led to worries about the company's strategic direction [3][4]. Group 2: Financial Performance - Nestlé's sales in the Greater China region fell by 6.4% year-on-year to 2.47 billion Swiss francs in the first half of 2025, while global sales decreased by 1.8% to 44.228 billion Swiss francs [4]. - The company's net profit also declined by 10.3% to 5.065 billion Swiss francs during the same period [4]. Group 3: Strategic Shifts - Nestlé is shifting its focus from a channel-driven distribution model to a consumer-driven approach, aiming to enhance growth through direct consumer engagement [5]. - The company is undergoing a fundamental transformation in its operational model, which may cause short-term performance challenges but is expected to strengthen its business in the medium term [5]. Group 4: Management Restructuring - Nestlé has appointed Kais Marzouki as the new chairman and CEO for Greater China, who has a long history with the company and is expected to lead a management team overhaul [7]. - The company is also restructuring its management team across various divisions, indicating a significant internal shift to address market challenges [7]. Group 5: Product Issues and Market Challenges - Nestlé's premium water brands, including Perrier and Acqua Panna, have faced scandals related to consumer fraud and quality issues, impacting brand reputation [8][9]. - The overall market for packaged water in China is contracting, with high-end water sales declining by 16% year-on-year, exacerbated by intensified price competition [8][9]. Group 6: Future Outlook - The new leadership under Pablo Isla is tasked with redefining Nestlé's positioning as a modern food company centered on consumer needs, amidst a challenging economic environment [12]. - The effectiveness of previous strategies, such as the "Back to Basics" initiative and the "4D" strategy for China, remains uncertain with the leadership transition [11][12].