Investors have reacted cautiously to Nestlé's recent results, slicing SFr16bn from its market value. However, beneath the surface, the company's turnaround strategy is showing progress. Nestlé has been actively divesting less profitable brands, such as its water business sold to Platinum Equity for SFr2.8bn, and its Blue Bottle Coffee operations. Concurrently, it has acquired the fast-growing German health food brand yfood.

For the first time in a decade, Nestlé's billion-franc brands have stopped losing market share. The company is now growing sales by volume, with a 1.8% increase in the second quarter, contributing to 3.7% organic sales growth. Key growth areas include petcare and coffee, with coffee sales rising nearly 6% last quarter, boosted by increased marketing spend.

Despite leadership changes, Nestlé's progress is reassuring. The article draws a parallel to Procter & Gamble's turnaround, which took four years to show significant results but ultimately led to outperformance. The implication is that Nestlé's large-scale transformation, though slow, is likely to be sustainable.