01—Abstract
Summary
Summary of the 10-Q filed July 29, 2025. Cited figures are marked; the original filing is the authoritative source.
Mondelez International, Inc. (MDLZ) reported solid revenue growth for the second quarter and the first six months of 2025, driven by price increases and a strategic acquisition.
Net revenues increased by 7.7% to $9.0 billiona in the second quarter and 3.8% to $18.3 billion for the first six months. Organic Net Revenue, a non-GAAP measure excluding acquisitions, divestitures, and currency impacts, also showed healthy growth of 5.6% for the quarter and 4.3% year-to-date. This growth was primarily fueled by higher net pricing across most regions, partially offset by unfavorable volume/mix and increased input costs, particularly for cocoa.
Despite revenue growth, the company experienced a significant decline in net earnings and diluted EPS for the six-month period, largely due to a substantial increase in mark-to-market losses on derivatives, higher input costs, and ERP system implementation costs. The second quarter showed a better trend with increased net earnings and diluted EPS year-over-year, benefiting from a favorable year-over-year change in derivative impacts and acquisition-related items. Investors should note the ongoing challenges from elevated commodity costs, especially cocoa, and the significant investments in the new ERP system, which are expected to impact profitability in the short term, even as the company focuses on long-term value creation.
02—Key points
Key Highlights
- Net revenues increased by 7.7% to $8.98 billion in Q2 2025 and 3.8% to $18.3 billion for the first six months of 2025, compared to the prior year periods.
- Organic Net Revenue, a non-GAAP measure, grew 5.6% in Q2 and 4.3% year-to-date, driven primarily by higher net pricing.
- Diluted EPS attributable to Mondelēz International increased 8.9% to $0.49 in Q2 2025, but decreased significantly by 46.3% to $0.80 for the first six months of 2025 due to various unfavorable items, including mark-to-market derivative impacts and higher input costs.
- Adjusted EPS, a non-GAAP measure, decreased by 12.0% in Q2 2025 and 16.5% year-to-date, reflecting operating declines and higher expenses, partially offset by fewer shares outstanding and acquisition impacts.
- The company completed the acquisition of Evirth (Shanghai) Industrial Co., Ltd. in November 2024, contributing incremental net revenues of $102 million in Q2 2025 and $201 million year-to-date.
- Significant investments are being made in a new global ERP and supply chain systems transformation program, with $1.2 billion funded over four years, expected to impact operating expenses.
- The company announced a 6% increase in its quarterly cash dividend to $0.50 per share, payable in October 2025, signaling confidence in future cash flows.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2025, Mondelez International, Inc. kept $0.07.
- Revenue$8.98B100.0%
- Cost of revenue−$6.05B67.3%
- Gross profit$2.94B32.7%
- Operating costs−$1.76B19.6%
- Operating income$1.17B13.0%
- Interest, other & tax−$531.0M5.9%
- Net income$641.0M7.1%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2025filed July 29, 2025Financial Statements
Q2 FY2025 against Q2 FY2024
| Line item | Q2 FY2025Q2 FY2024 | Change |
|---|---|---|
| Revenue | $8.98B$8.34B | +7.7% |
| Cost of Revenue | $6.05B$5.55B | +9.0% |
| Gross Profit | $2.94B$2.80B | +5.0% |
| SG&A Expenses | $1.73B$1.89B | −8.8% |
| Operating Income | $1.17B$854.00M | +37.2% |
| Interest Expense | $151.00M$130.00M | +16.2% |
| Net Income | $641.00M$601.00M | +6.7% |
| EPS (Basic) | $0.49$0.45 | +8.9% |
| EPS (Diluted) | $0.49$0.45 | +8.9% |
| Shares Outstanding (Basic) | 1.29B1.34B | −3.6% |
| Shares Outstanding (Diluted) | 1.30B1.35B | −3.6% |
05—Questions
Frequently Asked Questions
What drove the revenue growth in the reported periods?
Revenue growth was primarily driven by higher net pricing across most regions, a strategic acquisition (Evirth), and favorable currency translation rate changes. Organic Net Revenue, which excludes these items, also showed growth due to pricing actions.
Why did Net Earnings and Diluted EPS decrease significantly for the first six months of 2025, despite revenue growth?
The decrease in Net Earnings and Diluted EPS for the six-month period was largely due to several factors including an unfavorable year-over-year change in mark-to-market impacts from commodity and foreign currency derivatives, increased input costs (especially cocoa), and costs incurred for the new ERP System Implementation program. A significant non-cash loss from the settlement of a U.S. pension plan also contributed.
What is the company's outlook on commodity costs, particularly cocoa?
The company expects to continue facing significantly higher operating costs, particularly for cocoa, as market prices have increased substantially and are likely to remain elevated. They are using hedging, pricing actions, and cost controls to mitigate these impacts but acknowledge potential risks to profitability if price increases cannot fully offset rising costs.
What are the major investments or initiatives impacting the company's expenses?
The company is investing $1.2 billion in a multi-year ERP and supply chain systems transformation program, with a significant portion expected to impact operating expenses over the next four years. Additionally, higher raw material and labor costs are contributing to increased operational expenses.
06—Continue