By Aimee Look


Lindt & Spruengli's shares slumped after the company lowered its guidance for 2026, citing a bleak consumer mood exacerbated by conflict in the Middle East.

The Swiss chocolatier's cut to growth expectations for the year comes after it booked lackluster sales over the key Christmas period. A continued gloomy mood among consumers and suppressed appetite for the company's wares is a central concern for Lindt as uncertainty rises, Chief Executive Officer Adalbert Lechner said.

Lindt now expects organic sales growth this year of 4%-6%, down from previous annual targets of 6% to 8% growth. Last year, Lindt's sales rose 12% to 5.92 billion Swiss francs ($7.62 billion), it said in an earnings update Tuesday.

War in the Middle East will likely further dampen sentiment and strain sales as energy prices spike and international travel faces a squeeze, Lechner said.

The reduction in travel will hit tourism sales, particularly for flights from Asia that would normally stop over at Middle Eastern hubs, Lechner added.

Shares fell 7.8% in afternoon European trading to 112,800 francs.

Lindt's cut to its own guidance reflects not only the current geopolitical turmoil but more general uncertainty around the company's ability to get some momentum into its sales volumes, Vontobel analyst Jean-Philippe Bertschy wrote in a note to clients.

"This will likely fuel the bears' doubts about Lindt's ability to reignite volumes," Bertschy said.

The company has also faced pressure from higher cocoa prices. Lindt's recipes, heavy in cocoa and cocoa butter, mean that its variable costs are sensitive to fluctuations in the volatile commodity. Unprecedentedly high prices of cocoa, particularly at the start of 2025, hit Lindt's costs, it said.

Now, as the price of cocoa comes down, Lindt doesn't expect an immediate lowering in prices for the company since the effect lags, Chief Financial Officer Martin Hug said. Other input costs are rising and could jump further as energy prices spike, Hug said.

Despite cost pressures, Lindt's operating margin rose to 16.4% last year, it said, compared with 16.2% the year prior.


Write to Aimee Look at aimee.look@wsj.com


(END) Dow Jones Newswires

03-10-26 0810ET