The Swiss food and beverage giant says its sales of Starbucks products reached $3.9bn in 2022, with at-home, ready-to-drink and out-of-home Starbucks channels all achieving revenue growth
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Nestlé sales of Starbucks products increasing 13% to reach CHF 3.6bn ($3.9bn) | Photo credit: Nestlé
Nestlé has reported high single-digit sales growth for coffee across all brands and markets as part of resilient 2022 group revenues, with Starbucks at-home in North America and Nescafé sales in Latin America key performers.
Reporting on the 12 months ended 31 December 2022, the Swiss food and beverage giant saw group revenues rise 8.4% to reach CHF 94.4bn ($102.2bn).
Nestlé said increased sales were driven by an average 8% product price rise, necessitated by ‘unprecedented levels’ of inflation and ‘geopolitical tensions’.
The company said a strong recovery in its out-of-home channel boosted coffee revenues, with sales of Starbucks products increasing 13% to reach CHF 3.6bn ($3.9bn).
It added that Starbucks products had generated incremental sales of CHF 1.5bn ($1.6bn) compared with 2018 when the companies formed the Global Coffee Alliance.
Nestlé Professional and Starbucks out-of-home product sales achieved strong double-digit growth in North America, with Starbucks at-home achieving high single-digit growth across the region, helped by new product launches.
Coffee sales across Latin America also posted broad-based double-digit growth, supported by Nescafé soluble coffee, Nescafé Dolce Gusto and Starbucks products.
Sales growth was more moderate across Europe, with mid-single-digit growth driven by Nescafé soluble coffee and strong sales for Starbucks by Nespresso.
Nestlé reported high single-digit growth for its coffee brands in Greater China and its Asia, Oceania and Africa segment, with the company launching Starbucks ready-to-drink products in seven new markets in the latter region.
Vevey-based Nestlé also cited its acquisition of Seattle's Best Coffee from Starbucks in October 2022 as key to driving future profitable growth in its coffee category. The transaction was completed in January 2023.
Nestlé’s coffee pod division Nespresso achieved 0.5% sales growth to reach CHF 6.4bn ($6.9bn) which the company attributed to the launch and development of its compact Vertuo Pop coffee machine and double-digit growth in North America. Sales across Europe fell across the 12-month period.
“Last year brought many challenges and tough choices for families, communities and businesses. Inflation surged to unprecedented levels, cost of living pressures intensified, and the effects of geopolitical tensions were felt around the world. Organic growth was solid, margins continued to be resilient, and our underlying earnings per share development was strong,” said Mark Schneider, CEO, Nestlé.
Nestlé is forecasting sales growth between 6% and 8% for 2023 and a mid-single-digit increase in revenues across the next three years.