Chocolate Market Challenges Shape Barry Callebaut Group’s Nine-Month Sales Performance
Barry Callebaut Group has reported mixed but improving performance for the first nine months of fiscal year 2025/26, with sales volumes impacted by challenging chocolate market conditions, supply disruptions, and changing cocoa price dynamics. However, the company saw renewed momentum in the third quarter, supported by stronger demand in Global Cocoa, improved customer service levels in North America, and continued expansion across key emerging markets.
For the nine-month period ending May 31, 2026, Barry Callebaut recorded sales volumes of 1,557,239 tonnes, representing a decline of 2.8% compared with the previous year. Despite the overall decline, volume growth returned to positive territory in the third quarter, increasing by 5.7%. The improvement reflected stronger demand in the Global Cocoa business following a correction in cocoa market conditions earlier in the year, ongoing growth in the Asia Pacific, Middle East and Africa (AMEA) region, and progress in restoring operational reliability in North America.
Global Chocolate Performance Impacted by Market Challenges
The company’s Global Chocolate business experienced a 2.3% decline in sales volume during the first nine months. This performance occurred against the backdrop of a broader decline in the global chocolate confectionery market, which contracted by 5.6% during the same period and by 4.4% in the third quarter, according to Nielsen data.
Within Global Chocolate, the Food Manufacturers segment reported a 2.3% decrease in volumes. Performance was affected by weaker market demand and supply disruptions in North America during the first half of the fiscal year. However, the segment returned to growth in the third quarter as customer service levels improved and order momentum strengthened.
The Gourmet business recorded a 2.8% volume decline over the nine-month period. Lower cocoa bean prices created a highly competitive environment, putting pressure on pricing dynamics and customer purchasing patterns. Despite these challenges, Barry Callebaut continued focusing on strengthening customer relationships and supporting long-term growth opportunities.
Regional Performance Shows Strong Growth in Emerging Markets
Regional performance varied significantly across markets, with AMEA emerging as the strongest contributor to volume growth. The region delivered a 10.3% increase in sales volume, supported by market share gains in China, continued expansion in India, and new customer wins in Australia.
Growth in AMEA was partially offset by challenging market conditions in Japan and South Korea, where consumer demand remained under pressure. Nevertheless, the region continued to demonstrate resilience and strategic importance for Barry Callebaut’s global growth ambitions.
Central and Eastern Europe (CEE) recorded a slight volume decline of 0.7%. Growth among regional and local Food Manufacturers helped offset weaker performance from large global customers operating in a more difficult market environment.
Latin America experienced a modest volume decline of 1.2%, mainly due to timing-related effects during the third quarter. Western Europe saw volumes decrease by 2.5% as market pressures continued to affect demand, although performance improved during the third quarter with volumes returning to slightly positive growth.
North America remained the most challenging region, with volumes declining 7.6% over the nine-month period. The decline was primarily linked to network supply disruptions and difficult market conditions during the first half. However, the business showed signs of recovery in the third quarter, supported by improved service levels, stronger customer engagement, and increasing contract activity.
Global Cocoa Benefits from Market Recovery
Barry Callebaut’s Global Cocoa business recorded a 4.9% decrease in sales volume for the first nine months. However, the segment delivered strong recovery momentum in the third quarter, with volumes increasing by 18%.
The improvement reflected increased demand following the correction in cocoa markets earlier in the year, along with a lower comparison base from the previous period. Cocoa powder demand remained particularly strong, especially in Latin America and Asia, where some customers increased inventory levels through restocking activities.
The company also benefited from specific cocoa butter opportunities during the third quarter, contributing positively to overall Global Cocoa performance.
Revenue Decline Reflects Lower Cocoa Pricing
Barry Callebaut generated sales revenue of CHF 9,557.1 million during the first nine months, representing a decline of 9.5% in local currencies and 12.7% in Swiss francs. The decline was primarily driven by lower sales volumes and negative pricing effects linked to cocoa bean market movements.
In the third quarter alone, revenue decreased by 21.0% in local currencies and 23.4% in Swiss francs, mainly due to significantly lower cocoa bean prices compared with the previous period.
Focus for Growth Strategy Strengthens Business Foundations
In June, Barry Callebaut introduced its “Focus for Growth” action plan aimed at strengthening operational fundamentals and reinforcing its position as a leading value-added, end-to-end chocolate and cocoa solutions provider.
As part of this strategy, the company is enhancing regional empowerment while maintaining global functional coordination. Selected capabilities and teams will move closer to regional operations to improve speed, agility, and customer responsiveness.
The company also announced organizational changes effective September 1, 2026. The Middle East & North Africa (MENA) and South East & West Africa (SEWA) country clusters will transition from AMEA to CEE, reflecting geographic connections, customer requirements, and supply chain relationships.
From fiscal year 2026/27, CEE will become CEMEA (Central & Eastern Europe, Middle East & Africa), while AMEA will transition to APAC (Asia Pacific).
Debt Reduction Through Bond Buyback Initiative
Barry Callebaut also completed a bond buyback tender in June involving its outstanding senior guaranteed euro-denominated notes issued by Barry Callebaut Services NV. The final accepted amount totaled EUR 849 million.
The transaction supports the company’s financial strategy by reducing gross debt, strengthening credit metrics, lowering financing costs, and advancing its deleveraging objectives. The company expects to recognize an upfront cost of approximately CHF 15 million during fiscal year 2025/26 as a result of the transaction.
Source Link:https://www.barry-callebaut.com/
