Nestlé's first‑quarter sales slipped after a recall of infant formula feared to carry cereulide. The Swiss food group said nutrition sales fell 3.9% year‑on‑year, a hit that weighed on overall growth. The recall affected more than 65 countries and rattled the brand’s reputation amid tightening regulatory scrutiny and rising consumer caution for the entire year.

While nutrition sales fell, coffee business lifted the group, posting a 9.3% rise that helped cushion the dip. Overall group sales grew 3.5%, signalling the new management team’s turnaround is gaining traction. CEO Philipp Navratil and chair Pablo Isla are streamlining reporting to boost efficiency across global operations and product lines to achieve sustained growth.

The infant formula recall imposed a 0.9% drag on group sales growth, half from returns and stock shortages, the rest from weakened demand. China bore the brunt, with sales falling 10.6% as excess inventory was cleared. Distributors claim Nestlé owes them hundreds of thousands of renminbi for unsold goods to settle the outstanding claims today.

Danone, which also recalled formula sourced from the same Chinese supplier, reported a 4.3% drop in its specialized nutrition division across Europe, the Middle East and Africa. Supply‑chain constraints, especially in the Middle East, have slowed stock replenishment, while Europe has largely returned to normal. The recalls underscore the fragility of global food supply chains.