- Mondelez International reported a 6.6% decline in net revenue to $6.4 billion for the third quarter, but saw 1.1% growth in organic revenue, according to the company's earnings report released Wednesday. This was the 12th straight quarter Mondelez reported sales declines.
- Operating income and net revenue dropped significantly, with 91% and 92.5% declines, respectively, due in part to Mondelez's $7 billion gain last year following the divestment of its coffee business to form Jacobs Douwe Egbert.
- The company raised its full-year adjusted per-share earnings outlook to about a 25% increase excluding the impact of foreign currency, above Mondelez's previous call for double-digit-percentage growth in adjusted per-share profit.
Net revenue plunged nearly 30% in Latin America due to currency headwinds and the deconsolidation of the company's Venezuelan business. The net revenue slowdown was less pronounced in North America (-0.2%), Europe (-3.2%) and Eastern Europe, Middle East and Africa (-7.3%). Revenues saw a 2.5% uptick in the Asia Pacific market.
The Asia Pacific market has been a focus for Mondelez in recent years, particularly through the launch of its Milka chocolate brand in China and a partnership with Alibaba Group. Through the joint venture, China's e-commerce leader will host a store for Mondelez to sell its products on Alibaba's Tmall.com platform. Consumers shop online for groceries more commonly in China, a $2.8 billion market, than in the U.S., which offers Mondelez more opportunities for top-line growth outside of Western markets.
While revenues have fallen for Mondelez the past 12 consecutive quarters, the third quarter's 6.6% dip was notably worse than other recent quarters. Net revenues fell 17.7% in the second quarter, 17% in the first quarter and 16.6% in fourth quarter 2015, plus a 13.5% decline for full-year sales last year.
Sales may continue to fall year over year, but those declines may shrink as Mondelez works to improve top-line growth. Returning to positive sales could happen as a result of the company's international initiatives and efforts to expand certain categorical market presence in the U.S., with its failed Hershey takeover now a fading memory.