Mondelez Stock Drops on Weak 2024 Outlook

Key Financial Results

Mondelez International reported fourth-quarter net revenue of $10.50 billion, exceeding analysts' average estimate of $10.31 billion. Despite this, the company's shares fell approximately 4% in after-hours trading following the release.

Challenging Consumer Landscape

The company issued a cautious forecast for the upcoming year, projecting annual revenue and profit below Wall Street expectations. This outlook is attributed to weakening consumer demand as shoppers switch to cheaper alternatives in response to multiple price increases. The price hikes were implemented to counter rising cocoa costs.

Market Reaction and Future Projections

Mondelez expects its 2026 organic net revenue growth to be between flat and 2 percent, compared to the average analyst estimate of a 3.84 percent rise. The forecast for annual adjusted profit growth is similarly conservative, projected between flat and 5 percent, well below the estimated 8.3 percent.

Summary

While the fourth-quarter revenue beat was a positive point, the significantly weaker-than-expected forecast for future growth has concerned investors. The company faces a difficult environment of cost inflation and shifting consumer spending habits, signaling potential challenges ahead.

FAQ

Q: Why did Mondelez stock drop despite beating revenue estimates?
A: The stock dropped because its forecast for 2024 revenue and profit was significantly below what analysts had predicted, signaling future challenges.

Q: What was Mondelez's reported revenue for the fourth quarter?
A: The company reported net revenue of $10.50 billion, surpassing the estimated $10.31 billion.

Source: Investing.com