Mondelēz reports strong second quarter despite softness in U.S. demand

Mondelēz International reported organic net revenue growth of 5.6% despite continued U.S. declines due to consumer concerns about inflation and retailer inventory destocking. Price increases accounted for part of that growth, particularly in international markets. The company has raised prices in part to offset rising ingredient costs for items such as cocoa.

In North America, the volume, or total number of products sold, declined by 2.4 percentage points compared to the same period last year. At the same time, overall volume/mix declined 1.5 percentage points despite international regions gaining share. Value-seeking consumers are shifting to lower price points, bulk buying and multipacks amid lingering concerns about a broader economic slowdown, the company noted in prepared remarks. The company says it is focused on its lower-priced portfolio, expanding in multipacks, and growing share in under-represented channels such as convenience, club and value.

In evaluating snacking growth opportunities, Mondelēz acknowledged U.S. consumers’ changing “functional and emotional needs” influencing interest in new formats and flavors.