Mondelez's Chocolate Sales Show Strength in FY25: Is It Sustainable?

Mondelez International, Inc.’s MDLZ chocolate business delivered strong growth in full-year 2025, supported by pricing actions and broad-based brand performance across markets. The company saw strength across key brands, including Cadbury Dairy Milk, Milka, Lacta, Cote d’Or, Freia Marabou and Hu, with growth seen in both developed and emerging markets.

Chocolate organic net revenues increased 11.4% in 2025. This growth was driven primarily by pricing and revenue growth management actions taken in response to elevated cocoa costs. At the same time, the category experienced a 7.5 percentage point decline in volume and mix. Management attributed more than 3 percentage points of this decline to deliberate actions such as product downsizing, with the remaining pressure largely linked to elasticity, particularly in Europe.

Europe played a central role in shaping chocolate performance. The region reported organic net revenue growth of 8.6%, supported by strong pricing execution. However, volumes declined, mainly due to consumer response to cocoa-related pricing and revenue growth management actions.

Management indicated that it expects chocolate volumes in Europe to stabilize following the recent pricing cycle. To support this, the company is focusing on price-pack architecture, increased advertising and consumer promotion, and expansion in segments such as pralines, filled chocolates and choco bakery. It is also investing in innovation, including products that require lower cocoa usage. Chocolate products featuring Biscoff have been performing ahead of expectations.

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Cocoa costs remain an important part of the chocolate story. Mondelez said cocoa prices have come down from last year’s peak, and a supply surplus is expected in the 2025 to 2026 cycle. The company has already locked in most of its 2026 cocoa needs, though at prices still above current market levels.

Overall, Mondelez’s 2025 chocolate performance was driven by strong pricing, even as volumes remained under pressure from high cocoa costs and related pricing actions. While the Zacks Rank #3 (Hold) company’s chocolate strength remains intact, the sustainability of that growth will likely depend on how volumes recover as cocoa cost pressures ease.

Shares of MDLZ have risen 6.5% year to date against the industry’s decline of 3.5%.

Better-Ranked Stocks

The Hershey Company HSY engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. It sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Hershey’s current financial-year sales and earnings indicates growth of 4.8% and 30.1%, respectively, from the prior-year reported levels. HSY delivered a trailing four-quarter earnings surprise of 17.2%, on average.

Mama's Creations, Inc. MAMA manufactures and markets fresh deli-prepared foods in the United States. At present, MAMA sports a Zacks Rank #1. Mama's Creations delivered a trailing four-quarter earnings surprise of 133.3%, on average.

The consensus estimate for Mama's Creations’ current fiscal-year sales and earnings implies growth of 39.9% and 44.4%, respectively, from the year-ago figures.

US Foods Holding Corp. USFD engages in the marketing, sale and distribution of fresh, frozen and dry food and non-food products to foodservice customers in the United States. USFD currently carries a Zacks Rank of 2 (Buy). US Foods Holding delivered a trailing four-quarter earnings surprise of 2.2%, on average.

The Zacks Consensus Estimate for US Foods Holding’s current fiscal-year sales and earnings implies growth of 5.4% and 20.9%, respectively, from the year-ago figures.

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