Core Viewpoint - European blue-chip companies Unilever and Nestle reported first-quarter sales exceeding market expectations after significantly raising prices to offset soaring commodity costs. Both companies warned that global consumers would bear a substantial portion of these costs due to escalating trade tensions and rising commodity prices [1][2]. Group 1: Company Performance - Unilever and Nestle experienced a rebound in sales after losing market share during the pandemic due to inflation, with both companies indicating that they are raising prices selectively while maintaining a focus on consumer response in a competitive environment [1][2]. - Nestle's CEO noted that consumer confidence is evidently weak globally, not just in the U.S., and that significant price increases have occurred in certain markets, with some reaching double digits [1][2]. - Unilever's sales in emerging markets, which account for nearly 60% of its revenue, showed unexpected weakness, relying more on price increases than volume growth [4][5]. Group 2: Market Challenges - The U.S. retail sector has underperformed since April, with consumer confidence at its lowest since June 2022, driven by uncertainties from trade policies and inflation concerns [3]. - High inflation and interest rates in Latin America have suppressed consumer demand, leading to negative sales growth in countries like Mexico and Argentina for Unilever [4][5]. - Both companies reiterated their outlook for improved sales growth despite the challenges, with Unilever expecting a slight increase in its operating profit margin compared to 2024 levels [5]. Group 3: Consumer Sentiment - Consumer sentiment surveys indicate a significant decline in confidence, with expectations of worsening financial conditions and increased unemployment fears among respondents [3]. - The ongoing pressure on consumers is acknowledged by Unilever's CEO, who mentioned that price increases are a last resort to protect profit margins [5].