Mondelez International, Inc. (MDLZ) Q2 2026 Earnings Report, Transcript and Summary

Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press 0, and a member of our team will be happy to help you. If you need assistance at any time, please press 0, and a member of our team will be happy to help you. Thank you for your continued patience. Your meeting will begin shortly. If you need assistance at any time, please press 0, and a member of our team will be happy to help you. Please standby. Your meeting is about to begin. Afternoon, and welcome to the Mondelez International Second Quarter 26 Earnings Question and Answer Session. Your lines have been placed on listen only. Until it is your turn to ask a question. In order to ask a question, please press the star key followed by the number 1 on your touch tone phone at any time. To remove yourself from the queue, press star 2. On today's call are Dirk Van de Put, chairman and CEO Luca Zaramella, COO, Amit Banati, CFO, and Shep Dunlap, SVP of Investor Relations. Earlier this afternoon, the company posted a press release and prepared remarks. Both of which are available on its website. During this call, the company will make forward looking statements about performance. These statements are based on how the company sees things today, Actual results may differ materially due to risks and uncertainties. Please refer to the cautionary statements and risk factors contained in the company's 10 ks 10 Q, and 8-K filings for more details on forward looking statements. As the company discusses results today, unless noted as reported, it will be referencing non GAAP financial measures. Which adjust for certain items included in the company's GAAP results. In addition, the company provides year over year growth on a constant currency basis unless otherwise noted. You can find the comparable GAAP measures, and GAAP to non GAAP reconciliations within the company's earnings release and at the back of the slide presentation. We will now move to our first question. Our first question comes from Andrew Lazar of Barclays. Your line is open. Please go ahead.

Great. Thanks so much, and welcome, Amit. Maybe to start off, Dirk, emerging markets, again, remarkably strong. For the second quarter in a row this year. A trend we have seen from some other multinationals recently as well. Was hoping you could talk briefly maybe about some of the key highlights that give you confidence in the second half outlook. in those markets.

Yep. Thank you, Andrew. I would say at this moment, what is really driving the strong top line that we have which was 4.4%, and then also strong volume in Q2. And we feel that there is a very solid backdrop as it relates to snacking, which continues to perform well across the major emerging markets. Consumer confidence in the emerging markets, I would say, overall is stable and pretty good. India is very strong. Mexico, Brazil, consumer is solid. And then in China, it is softer, but we feel overall that things will gradually improve. Value growth is holding up very well. Particularly in biscuits and chocolates. And if you think about what is sort of driving this for sure, the expansion of our distribution We added another 100 thousand stores in India. Brazil is now at 1 million stores. China keeps on building out its distribution in Southeast Asia, we are expanding. The categories are still very underpenetrated, so we still have a long runway of more consumers consuming more every day. We have now multi years of sustained reinvestment I think the mixture between global brands and local jewels is working well for us in this market. So we hit all the different price tiers. And then we have a very good buildup in our channels and our GM. So I think it is a very structural situation. Not cyclical. And I think that we will continue to see some strong growth in emerging markets for us.

Great. Thanks for that and then a follow-up. Was hoping you could double click a little bit on the improvement you are seeing in North America. Really with an eye towards sort of the sustainability of performance in this region in the back half of the year. Thanks so much.

Yeah. Yeah. Well, I would say that consumer confidence in North America has rebounded from lows, but it remains very subdued. There is still inflation. there is energy prices. That continue to put pressure. We see this k shaped growth where you have consumers on 1 hand going to value formats and channels where prices are lower. But at the same time, better for you and premium options are doing well. Purchasing powers is up, but consumers remain very concerned about affordability economic outlook, and job security. So we did well. We had, I would say, strong net revenue growth. We had a positive volume mix. Both are positive, and we are accelerating sequentially versus Q1. And we think that will continue in the second half We gained share in all our categories in North America. Our ventures portfolio did well. Perfect Snacks, States, You, have very strong growth in the value channel, high single digits. We have mid single digit growth in away from home. We are gaining share in crackers, particularly Ritz is doing well. And so we and we have a good bottom line. I would say the reason why that is happening is first of all, we have a very disciplined promotional execution. Second, we have now innovation that is really working for us. I am thinking about Ritz Drizzled or Sour Patch Kids chews. Oreo is starting to do well. Like I said, Ritz with its innovations is doing well. Zbar is growing. Give-and-Go had a good Q2 also. I think another reason why we have these results is that these growth channels are really working for us. We have good price pack architecture. With the single serve, multipacks, variety packs, the club packs. And we grew our reinvestment on ANC double digit. So I believe this is sustainable, all these reasons. Why? Because we will continue to reinvest and in fact, we will accelerate that in the second half. We have a very good possibility to keep on growing in the value channels We have the innovation pipeline that will continue And I think that at this stage, the pricing is solid, and the promotional execution that we have is working well for us. So we are expecting a very strong second half in North Great.

Thanks so much.

Thank you. We will move on to Scott Marks, with Jefferies. Your line is open. Please go ahead.

Hey. Good afternoon. Thanks very much for taking our questions. Wanted to start off with Amit first. Welcome. I know it is your first call with the team here. Given that you are coming into the business with a fresh set of eyes, wondering if you could just share maybe some initial observations now that you are almost a month in about this business.

Thanks, Scott. Holidays? But my initial observations reinforce my thesis on Mondelez. I you know, it is only a few weeks into the role. But the strength of the portfolio the strength of the team clearly stand out. You know, we have a truly iconic brand portfolio, and I am really encouraged by the strong innovation pipeline. And I think as Doug mentioned, you know, the momentum that we are seeing behind the innovation around the world. We also have a very advantaged emerging markets platform with plenty of runway for growth. it is also been great to see the level of commitment to reinvesting back into the business. To drive sustained performance and you know, you saw that in this quarter, and we are going to continue to drive that in the rest of the year as well. I do believe we have compelling growth opportunities. You know, when I look at the penetration and distribution opportunity in emerging markets, you know, the new occasions that our brands can access through innovation, the channels that we under index in, And, we saw that in the quarter, you know, the growth in the value channels in the US. So some compelling growth opportunities. We also see I also see opportunities on the productivity side. Whether it is in the supply chain, or in AI enabled efficiency across the P&L. And that is going to create the fuel for us to continue to reinvest behind growth. So it is been a busy few weeks. I have already been through a board meeting, operating reviews, and into my first earnings. Obviously, some things are new for me. But some things are familiar. I mean, I have been in CPG now. For over 3 decades and in snacking and food categories for over 2 decades. So the categories, the brands, you know, the underlying dynamics, are very familiar. And I am really looking forward in the coming weeks and months to diving deeper into the business, getting to know the teams, and getting into the market.

Appreciate the thoughts there. And then maybe just as we think about the outlook for the remainder of the year, obviously, took up the top line guide but held EPS. Wondering if you can help us understand any puts and takes as it relates to phasing for the back half of the year on the top line, inflation, brand reinvestment, anything else you might you might flag for us, as we think about the rest of the year? Thanks.

Yeah. So we do feel good about the top line, and I think, you know, you have seen us take the top line to at least +2%. You know, emerging markets, strong volume led growth, we expect that to continue. North America Improving execution. And, again, despite a soft consumer, we expect to continue to grow both share and top line. In North America. And then in Europe, we are seeing signs of improvement as the volume trajectory improves and as we start lapping some of the pricing from last year. I would say the shape of the top line growth would be balanced between the 2 quarters. So, you know, we would expect to see similar levels of growth across both across the rest of the year, across the quarters. From an EPS standpoint, we are maintaining our outlook. I think, you know, we have been consistent that we will invest any upside back and reinvest back into the areas where we are seeing momentum Also emerging markets, some of the innovation like Biscoff driving distribution. And, you know, we do have an incremental cost. The Middle East conflict. Which we have managed. And which we are digesting. So that included in the outlook as well. And then I think from a phasing standpoint, Q3 and Q4, you know, it will be a little bit more Q4 back-weighted on the below the line. On the earnings. But it really be driven by some phasing on cocoa. We would still see some phasing in on cocoa in Q3. Which will reverse out in Q4. And then we are lapping up a couple of interest and tax items in quarter 3. So it will be back weighted in quarter 4, but that is largely mechanical.

Understood. Thanks very much. Pass it on.

Thank you. We will move on now to Peter Galbo with Bank of America. Your line is open.

Hey. Good afternoon. Thanks for the questions. Amit, nice to nice to speak with you again.

Dirk, I was hoping to click in on Europe. Your prepared remarks, talk about signs of progress there. And specifically, I think, mentioned volumes kind of turning positive come the second half. Just maybe you could kind of put that in context for us in terms of the timing. In particular, just given the heat wave that is kind of continued so far through Q3, how you see that volume improvement in Europe particularly evolving in the second half? Yes. We have 3 today, so I am going to put Luca to work a little bit too then let him answer the European question.

Hi, Peter. Thank you for your question. As we said, the, European chocolate business is on a positive volume mix trajectory. And that is really what you are going to see in the second part of the year. Volumes are, and we see that continuing through the second half. Particularly as we start lapping prior year pricing. You might have seen a little bit of a negative price in Q2, in Europe. That is the result of pricing adjustments that we made already in the second part of last year to adjust some specific price gaps. But really nothing to worry about. Share particularly has been moving in the right direction in the last several months, both in volume and value. And the importantly, past the heat wave, I think you are going to see more execution and more activation, particularly around Biscoff And, we have another brand that is Milka cross-line that is doing very, very well. So we feel confident about the improved trajectory in Europe. The second part of the year. We are also leaning into new channels and for pursuing incremental growth. And then, clearly, we are investing much more A&C. So Q2 is a little bit below where we would have expected it to be, quite frankly, but it is mostly because we kept Tray stock in control given the heat wave that came and impacted particularly, chocolate consumption. So, I feel optimistic about the second part of the year in Europe. I think you are going to see a much better top line. Are happy with the share numbers. And, importantly, you are going to see a rebound in profitability as well. And that really sets the stage for continued growth, top and bottom in 2027.

Great. No. Thanks for that, Luca. And maybe as a follow-up, Luca, just your perspective with Cocoa at these levels. Obviously, there is been a lot of movement in the kind of futures market over the past few months. Just how you are viewing the environment from a pricing discipline perspective amongst the players, maybe any color on coverage into next year? And then just how you are thinking about Super El Nino, at this point, as it relates to Cocoa? Thanks very much.

Yes. I think, look, on cocoa, despite the most recent run ups in cocoa prices, the market fundamentally is in a very different place, versus what drove the crisis, I would say, in 2024. So predominantly, I would say the current reaction in the market price of cocoa is due to 3 elements. It is the pod count that is a little bit below the average. Quite frankly, that is driven by what happened to the meat crop that was exceptionally good. There is a short squeeze, so specs covering their positions, and that drove again, support to the price and clearly El Nino. Though from a fundamental standpoint, I think we all need to realize that the surplus in between demand and supply in cocoa is at historical high. I think for this year, we are going to have at least half a million metric tons of, surplus, and that is the equivalent of 10% of the total demand for cocoa. So not inconsequential. The industry coverage is at 10 months, so very different place compared to, what happened in 2024 when, the industry was covered just 7 months. And then, as I said, I think, the early pod counts suggest that this is not going to be a great crop. But there is still opportunity for the crop to develop and catch up with the historical norms. Finally, the specs are now short only in inverted commas less than 200 thousand metric tons. And so the market is already pricing some downside risk. So I would say, structurally, the market is, is in a very different position. To your question about, 2027, look, I do not want to make this necessarily how well or how bad are we covered into 2027. The reality is that as we mentioned a few times, 2027 earnings are expected to be strong. And quite frankly, earnings are insulated from, commodity volatility for us at least. We are, using multiple levers into 2027, We still believe, this company can deliver positive volume mix and differentiated volume mix compared to many others. As we said many times, we are full steam into delivering productivities, particularly in supply chain, in places like, Europe and, and The US. We have interesting programs in terms of AI efficiencies that will drive overhead down. And that even our portfolio strategy to become a less cocoa-reliant company, and so pushing portfolio solutions that are less cocoa intense I think, continues to make strides. So even acknowledging the, uncertainty around cocoa in 2027, pod counts, and El Nino, etcetera. I think, the structural positioning in cocoa is much better than 2024. And our 2027 earnings. is around executional levers that I just mentioned. So I feel quite good about 2027. And, look. As we exit the year with momentum, we are going to see continuation into 2027 of top and bottom.

Great. Thanks very much. Thank you, Peter.

Thank you. We will now move on to Peter Galbo with UBS. Your line is open.

Great. Thank you, everyone. I was hoping to get some perspective on gross margins, just wanted to do some kind of a trajectory. The 34% in Q2, it was a bit better than, I think, we and others have modeled So just curious if you could unpack how that came in relative to your expectations And then you mentioned cocoa phasing impacting the back half earnings guidance. Can you maybe just frame how to think about gross margin in the back half relative to 34%? Thanks.

Yeah. The line was quiet, but I got the gist of your question, which I think is around gross margin. Look. I think we moved away from guiding to gross margin percentage. We were very happy with +3% in gross profit dollar terms. That, we saw in Q2. You are gonna see an acceleration of the gross profit dollar number Particularly in Q3, but also in Q4. The EBIT in absolute dollar terms is going to be up in both Q3 and Q4, more in Q4, quite frankly, for a series of reasons. But we feel very good about, you know, the guidance we gave you for, EPS for the full year recognizing that there are a couple of, items below the line in Q3 that, are gonna cause a little bit of a hiatus between EBIT and EPS, but really nothing structural, nothing to worry about. Top line is coming. Volume mix is coming. Gross profit dollar is coming. And so despite the material investments we are going to have in A&C, you are going to see EBIT growth in both Q3 and Q4. EPS, as I said, is a little bit pressured in Q3. So we are happy with, the gross profit dollar. The of the gross profit dollar is us holding prices in chocolate, given also the fact that the environment is fairly rational across the board, it is the result of volume mix leverage It is the result of, the, incredible amount of work our supply chain, both procurement and manufacturing, are doing in terms of productivities. And as I said, hopefully, we are gonna see a combination of these throughout 2027. Great.

Thank you. Hopefully, this is a little bit better. And then just a clarification A little better? Okay. Great. Alright. Well, sorry about that, guys. Just 1 more clarification. I think in reference to I think it was Andrew's question, you talked about positive volume mix in North America. And how it improved sequentially versus Q1 and that you expect that to continue. So just I just want to clarify, should we expect volume mix to accelerate relative to the 1.2% that you delivered in 2Q in the back half of the year?

I stay disciplined in not guiding through many variables. What I said is that we are happy with the volume mix momentum we see in emerging markets that we see in North America, Europe, I think, was pressured, but you are going to see a sequential improvement now I would not guide you necessarily to volume mix for the second part of the year, but, it will be positive. I think in terms of top line, what we said at least 2%, reflect positive volume mix and modest contribution from pricing.

Great. Thank you so much. I will pass it on.

Thank you. We will move on now to Michael Lavery, with Piper Sandler. Your line is now open. Please go ahead.

Thank you. Good afternoon, and welcome, Amit. Just wanted to touch on I just wanted to follow up on a comment from the prepared remarks just talking about expecting strong 2027 EPS growth. Any key levers you are watching for how that unfolds or maybe any way you could maybe elaborate on how you define strong or put that in a little bit more context?

Look. I think it is, really pretty much premature to give you more color than what we said consistently, I would say, in the last 3 earnings calls in terms of 2027. I said in answer to a previous question that again, earnings are expected to be strong. And insulated somewhat from, commodity volatility. You are going to see into 2027, volume mix, positive, continuous momentum in emerging markets. I think you are going to see a European situation that has stabilized. North America continuing, particularly around, us going after incremental opportunities both in terms of channels, alternate channels, innovation, and strength of our brand. I think Dirk mentioned a few times in 1 of the past calls that we are going to have a full relaunch for Oreo, and that, I believe, is gonna make us flash into North America in volume mix. You are going to see accelerated productivity and cost savings We mentioned a few times the supply chain program. In, in The US, but there are cost opportunities that are meaningful in Europe too. And then from, an overhead standpoint, we are accelerating overhead saving. and driving efficiencies, particularly through AI. So when you put all these things together, we feel quite confident in telling you today that, earnings for 2027 is going to be strong.

No. that is great color. Very helpful. And just on innovation, could you elaborate there a little bit more and maybe point to some of what is really working or key focus areas. And maybe specifically, would love if you could elaborate on Biscoff in particular and how that is playing out.

I know there is some different layers to that. Yes. So 1 of the things we are doing is reduce our innovation portfolio going for bigger and fewer bets, And make sure that those are based on platforms that we can prove. Of course, the sort of the breakthrough innovation we have to combine that still with renovation, flavors, PPA, seasonal, and so on. And so this year, we are seeing particularly good traction some on some of those innovations. Particularly in, for instance, in health and wellness and functional our snack bar, portfolio driven by the protein trend protein trends, of course, is doing well. Gluten free is working well for us. Zero sugar also. We see good traction in cakes and pastries with Give and Go and Evirth in China. Then we have particularly Ritz, as I mentioned, as an example, as it relates in into salty. And then in premium and indulgent, we have Toblerone Pralines, We have the Cadbury and more range that we are launching around the world. And in the US, Hu is doing well. So very good in well-being. Cakes and pastries, premium, and indulgent chocolate As it relates to Biscoff there is 3 layers to the BISCOF collaboration. The first 1 is that we are launching in our chocolate range a special Biscoff range, Basically, it is tablets in the first place filled with different forms of Biscoff, could be sprinkles of Biscoff or the Biscoff cream or even a full Biscoff cookie. We then bring that into other formats, like, for instance, the Cadbury egg, and we go around the world. We just launched in Scandinavia, for instance, where this new range took 7% market share just in the first month that we launched it. In Australia, that chocolate range added 3% growth to the chocolate category on a year basis. So very, very strong reaction to this. And we step it up. it is not like we launch once. We continue bringing new innovations every 6 months or so under this BISCOF range. And we think we have a runway for a number of years to keep on doing that. The second part is that we are starting to represent with license BISCOF in certain markets around the world. We launched in India with great success. In fact, we built 1 line and we sold out that line from the first month. So we are hurrying up the building of the 2nd line, and we see Biscoff really becoming an important biscuit brand in India. We are preparing a launch in Brazil where we are going to launch in the beginning of next year. And so on. So it is largely gonna be in emerging markets, but the idea is that we keep on adding emerging markets where we build up the Biscoff presence as a biscuit And then the third part of this collaboration is basically that we have developed a range of ice cream products for Biscoff which we are also representing for them. We are starting to explore a 4th leg. We have not done anything yet. But we are thinking about our other product categories. What can we do with Biscoff? To give you an idea, starting to think in the 7 days range, croissants with Biscoff filling. We are thinking about a launch of an Oreo with a Biscoff cream inside and things like that. So there is another leg that we are developing. So if you look at that, this will take a magnitude that is gonna be in the several hundred million dollars, and I personally believe if you look at it on also on their side, because they are starting to do a number of innovations on their side. Think about the Biscoff which has a layer of Cadbury or layer of milk on top. But that is gonna be sold by Lotus Bakery. You add that all up, I think this is a collaboration that in the coming years will be worth $500 million to about $1 billion.

Great color. Very helpful. Thank you. Thanks.

Thank you. We will move on now to David Palmer of Evercore ISI. Your line is now open.

Thanks. I am just hearing all this talk about different growth stuff, innovation, your double digit investment in A&C. Just wondering maybe, sort of a big picture as you are thinking about this. You know, a and c has been higher in the past. I am, you know, I wonder as we are skating through years, would you see A&C reaching past peak levels in the percent of sales. And then and certainly with that ability to spend, you are going to want to do that well. I am wondering, you know, how are you spending that A&C if you, you know, seeing how, you know, sometimes when you take things on and take things off, you are beginning to see what works and what does not, plus you have mentioned a lot of innovation. So I am wondering how your priorities in terms of A&C are shifting as you are going through that ramp. And I will have a quick follow-up.

Yeah. Look. I think, again, we think in dollar terms in the company, and I can assure you that even despite the, cuts that we made last year that were, for the most part, in the nonworking media If you look consistently over the last few years, A&C is, you know, the line on the p and l that is really growing the most. So we have consistently invested We are investing in our brands. And we have the strong belief that, reinvesting in our brands is really the best thing. I would also say that the quality of how we spend has improved, dramatically. We give clear guidelines in terms of, what we expect the A&C investments to be by main, bucket. So we expect communication We expect, a certain amount of, digital We expect a certain amount of activation at point of sales through material that drives consumption and quality of execution and consumption of our brands and category consumption. And so we have tightened up the screws quite a bit in terms of guidelines. I think there is now an important frontier, which is what AI can do, particularly to, creative media. And I think there are going to be important, steps in terms of how efficiently we are going to spend. Now I would be lying if I would say A&C and the amount of money we spend is, consistent high across the board. We know there are situations where, quality of media can improve. And particularly targeting specific cohorts and going after incremental opportunities. And so tailoring, communication to consumer cohorts is really something that, we are trying to do more and more. And so expect better, spending going forward, higher spending, but also expect better execution on, how we spend the A&C. But having said that, I think we should be happy with the amount of work the marketing teams have done around the world to ensure that we spend and we spend well to support our brands.

Yep. And just a quick follow-up on that. You have talked about some innovation. You mentioned some Biscoff innovation before. Is there any way to roll up the scale of innovation this year, percent of sales that you anticipate from new ideas? And then to what degree is that, are you spending money advertising on some of your increases allocated to that? And then if you had to isolate gains, typically, in a given year, it might be 2 points of distribution gains just is typical amount of revenue lift from distribution. Like, how would you characterize distribution as a lift And then I will pass it on.

Go ahead.

No, no, you go ahead. Yes. I think it is going a little bit too deep if we have to sort of separate out how much we are doing in innovation. But in a typical thinking about innovation, I think you are performing well as a company, and we are at that level even slightly below with that 10% of your net revenue is from innovations that were launched in the last 3 years. And we are there, slightly above So that is typically what we are aiming at. We would like to see that go up going forward. To potentially more like 15% But that is sort of the benchmark that we have in mind. The way things are going this year, I feel that the bars that innovation represents in our net revenue will continue to go up. The second part of the question was about distribution. it is difficult to put an exact number on our global gains, how much that represents in our revenue net revenue gains. But in a market like India or China, whatever our net revenue growth is, usually, 50% is an increase in same store sales and 50% of that net revenue growth is extra stores that we open. We continue at the same rhythm. As I mentioned before, we are now in a million stores in Brazil. We have added 100 thousand stores in India. We see a runway in most emerging markets to continue to do that. And at the same time, even in developed markets, I was explaining in North America, the value chain away from home, convenience, still are channels where we can, where we can gain significant distribution. And so that runway of distribution that we have almost in every market around the world is 1 of the reasons that we believe we can we can perform quite well in top line growth.

Thank you. Thank you. And we will move on to our final question today from Chris Carey with Wells Fargo Securities. Your line is open.

Hi. Good evening. Good afternoon. Good evening, everybody. I wanted to follow-up on this, line of thinking actually around distribution with a focus on North America. Last quarter, you talked about growing under indexed channels, namely in The U. S. This quarter. You are flagging high single digit growth in value channels and away from home is up mid single digits. But can you expand on I do not know, the history, if you will, of what brought us to this point that, you know, such a scaled company still has such opportunity from a distribution standpoint in a market as seemingly developed and mature as North America What are you doing specifically to accelerate your distribution in these channels? When do you think that inflection point in distribution came? Is it specifically this year versus perhaps consumers? Just seeking value And then just, you know, maybe you have touched on it a bit, but just the concept of durability of expanding distribution Again, all of this is specific to the North America business. I would just appreciate your additional context there.

Yeah. I would say that historically, these channels have not been a priority in the sense that usually the growth that we could get in the food channel, for instance, was already quite substantial. And as a company, from a history perspective, are the channels where we were always big in. I would say the value channel, yes, in theory, the value channel in the past was a channel that we did not focus that much on because of margins. But now we see the consumer is really migrating there. So we are developing special pack and working on the margin structure in those channels. And so we feel that we can push much harder I believe that still is going to be quite a runway for us. Convenience has always been a bit of an opportunity for us. It might seem very logical, but in convenience, you need to have the right product range. And while Oreo and our biscuit range are, of course, very successful, They are a little bit more of a home consumption and consumers walking into a convenience store tend to go more for a drink or a coffee or a cake and pastry. and it is not that obvious. Now with recently with the things such as Cliff, and some of the other bars that we have, we believe that there is an opportunity We have also historically covered that channel through brokers. We have started to do more directly in a number of cities that we are seeing some significant growth there. So we believe we still have a good growth rate for a few years in convenience. And then away from home, bit the same story. It was not really something that we were focused on. Because we felt that we had to prioritize our growth in the other channels. But now in the in the days that we see food not necessarily growing as fast, we are starting focus more and more on away from home. And I believe that there is a big opportunity for us. Away from home is quite particular in the sense that you need to develop products and innovations together with the client often. I am thinking about McDonald's here or some of the other QSRs or a range for company cafeterias and things like that. So you need to really put in place an infrastructure to make that happen. We are now doing that on a global basis, and I think the opportunity for us there is gonna be quite substantial in the years to come. So I would focus a little bit more on what it could represent first on why we are not yet as developed as we should be. I think at this stage, it really gives us a significant opportunity to grow more than you would expect with the normal channels.

Okay. Great context. And then just as a, second question, the organic sales growth in the front half of the year is already tracking well, I suppose in line with at least 2%, for the full year. Obviously a bit better than 2%. And, you know, into the back half of the year, I mostly see easier volume compares and most of your regions. Globally. I realize there will be some normalization of pricing. But if you look into the back half of the year, just kind of sticking around that 2% range and not being a bit more forthright about a bit more upside. Is that just uncertainty in the global macros, which, by the way, makes total sense? Are you seeing things in the business that you would just flag for us maybe globally, that would you know, cause you some concern about potential deceleration Just any context for, you know, what is now gonna be a potentially wide range for back half top line outcomes?

We are not-- we do not see any major concerns. Clearly, we told you already that the Middle East crisis is causing us some headaches on top and bottom. More to the bottom line, quite frankly, but we still lost quite a bit of revenue in the first half. So that is factored into, the first half, and will be, and it is in our guidance for the second part of the year. So other than that, I would say what we said about, continuous momentum in emerging markets in North America and, Europe rebound, particularly on the volume mix line. Still stands valid. But that is also why we say at least 2%. And, look. We do not want to get ahead of our stats. Let's see how Q3 pans out. In Q3, there is still an element in Europe that is related to the unprecedented heat wave and we see, you know, some markets in chocolate specifically being quite impacted. And so, look, I think there might be more upside than the 2% but that is why we say at least 2%,. And, but I would not get to a number that is necessarily much higher than 2.5% in the second part of the year.

Okay. Thanks so much.

Thank you. I think that is it. That was the last question. So I want to thank you for connecting to the call. We are very satisfied with our results. We have a good view on the second half. We think it is gonna be a strong second half for the company, and also, we will see you during the next earnings call or hear you during the next earnings call. Thank you.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.