Key financial results

  • The company maintained its top line and EPS outlook for the full year 2026.
  • The company reported strong gross profit delivery in the third quarter, driven by volume growth and productivity programs.Strong volume growth. So obviously, operating leverage coming through.
  • Management noted that upside from the third quarter is being reinvested back into the business, specifically into advertising and consumer support.

Business segment results

  • Emerging Markets: Emerging Markets: Consumer confidence remains resilient, with strong volume and top line growth in snacking categories.Snacking continues to perform well across all the major emerging markets.
  • Emerging Markets: Emerging Markets: Distribution expansion continues, with 130,000 outlets added in India year-to-date and over 1 million stores in Brazil.I think we've added about 130,000 outlets in India. Brazil, we're now over 1 million stores.
  • Europe: Europe: The company achieved positive volume mix growth of 1.6 PP, despite a 1% negative impact from unseasonably hot weather.We have a positive volume mix growth of 1.6 PP in Europe was very broad-based.
  • North America: North America: The company delivered solid Q3 results and grew share, despite soft consumer confidence.
  • Latin America: Latin America: Volume performance has flattened and turned slightly positive, with Argentina being the primary driver of volume pressure.

Capital allocation

  • The company announced the acquisition of a majority stake in Undercover Snacks, which will be integrated as a standalone unit within North American ventures.
  • Management confirmed a strategy focused on bolt-on acquisitions in the $0.5 billion to $1 billion range rather than larger deals.Our strategy is bolt-ons, and I mean there's bolt-on and there's bolt-on.
  • Cocoa market: The 2025/2026 cycle is expected to end with a record surplus of 500,000 tonnes.We expect to be ending this year with a surplus of almost 0.5 million tonnes, so 500,000 tonnes, which is a record level of surplus.
  • Cocoa market: While a deficit of 190,000 tonnes is projected for 2026/2027, the current surplus is sufficient to absorb it.Even if that deficit were to eventuate, there is plenty of supply from the surplus this year to absorb that deficit.
  • Industry coverage levels for cocoa are currently at approximately 9 months.You look at the coverage levels of the industry, they're at around 9 months.

Competitive landscape

  • The company is gaining share in North America and noted that competitors are behaving rationally regarding pricing.Most players in our markets are behaving very rationally.
  • Share dynamics are improving in Europe.Our share dynamics are improving.

Macroeconomic environment

  • Consumer confidence in North America remains soft, driven by energy and fuel prices, with a K-shaped economy where growth is concentrated in higher-income households.The K-shaped economy continues where the growth is really coming from the higher income households.
  • Inflationary pressures persist, particularly due to the conflict in the Middle East, which is a concern for consumers in regions like India.There is inflation driven by the conflict in the Middle East.

Growth opportunities and strategies

  • The company is focused on increasing distribution in emerging markets, with significant runway remaining in China, India, and Brazil.The runway that we have in places like China, India, Brazil, it is most likely we still have 25% numeric distribution to go.
  • Management is prioritizing productivity programs and supply chain efficiencies to drive growth.
  • The company is investing in innovation and activation, such as Bisco and Milacron, to drive volume.We have some innovations like Bisco or the Milacron that are landing very well.

Financial guidance and outlook

  • The company reiterated its forecast for strong EPS growth in 2027.We remain confident that we are going to drive strong EPS growth in '27.
  • Management expects volume-led growth to continue into 2027.I think that's going to be on the back of volume-led growth into the year.
  • The company did not provide specific quarterly guidance for Q4, but expects continued volume mix growth.

Supply chain and productivity

  • Productivity programs in procurement and conversion are contributing to gross profit delivery.Very pleased with the productivity program that our supply chain colleagues are delivering through the supply chain, in procurement, in conversion.
  • The company is absorbing costs related to the Middle East conflict within its current outlook.We're continuing to absorb the costs related to the Middle East war. So we're absorbing that within our outlook.

Q3 2026 results

MetricResultChange
Europe volume/mix growth1.6 PPNot stated
India distribution130,000 outletsYear-to-date
Brazil distribution1 million storesNot stated
Latin America chocolate volume/mix (excluding Argentina)4% to 5%Last quarter

How management sounded

Balanced (+35 on our -100 to +100 scale). Management expressed confidence in their volume-led growth strategy and ability to drive strong EPS growth in 2027 despite macroeconomic volatility and inflationary pressures. Management sounded more upbeat than on 20% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.

Read the analyst Q&A summary and guidance and outlook for this call.

What to watch before the next call

  • The closing of the Undercover Snacks acquisition, expected by early 2027.
  • The impact of inflationary pressures on freight and commodities in 2027.
  • The evolution of the cocoa market and whether the projected 190,000 tonne deficit for 2026-2027 materializes.

Earlier calls

  • Q2 2026 (Jul 28, 2026), tone Balanced: Mondelez reported strong growth in emerging markets and sequential improvement in North America, leading the company to raise its full-year top-line guidance to at least 2%. Management remains confident in its strategy despite ongoing cocoa cost volatility and soft consumer sentiment in North America.