Nestlé is preparing to eliminate roughly 16,000 jobs over the next two years as part of a sweeping cost-reduction effort under its newly appointed chief executive, Philipp Navratil.

The company announced Thursday that it is raising its cost-savings goal to 3 billion Swiss francs by the end of 2027, an increase over its earlier target. Navratil, who took over just a month ago, said the restructuring is meant to sharpen Nestlé’s profitability and speed up growth after a sluggish year.

He emphasized that the company will be more disciplined about where it deploys capital, putting priority on areas with stronger returns and higher strategic potential.

“We’re taking a harder look at how resources are allocated and backing the parts of the business with the strongest upside,” Navratil said in the statement.

He also described a push to scale up investments and lean into innovation to reignite momentum. Nestlé, whose brands range from KitKat to Nescafé, is aiming to “move faster” and “be bolder” in how it fuels growth and value creation.

Navratil said he wants the organization to fully adopt a performance-driven mentality—one that rejects losing market share and rewards strong results. He framed the restructuring, including the workforce reduction, as necessary to ensure Nestlé maintains its position as a global leader while delivering returns for shareholders.

The leadership handoff follows a turbulent period for the Swiss food giant. Navratil replaces Laurent Freixe, who was removed in September after an internal probe found he had an inappropriate relationship with a direct report, an action that violated the company’s code of conduct. Freixe, who had previously been seen as influential in shaping the company’s strategic direction, is departing without a severance package.

Freixe himself had taken over less than a year earlier following the exit of CEO Ulf Mark Schneider, who stepped down amid concerns about underperformance.

Nestlé’s results in the first half of fiscal 2025 highlighted the need for change. Organic sales growth came in at 2.9%, largely due to price increases rather than stronger demand. Real internal growth—a metric focused on volume and product mix rose just 0.2%, pointing to weaker consumer spending and pressure on volumes.

Chairman Paul Bulcke has expressed confidence in Navratil’s ability to reset the company’s trajectory, noting his history of delivering in difficult operating environments. Navratil now faces the challenge of stabilizing performance while reshaping the business for long-term growth.