Mondelez India cuts ad spend by 5% in FY25 as profits collapse

Mondelez India Foods Private Limited pared its advertising and promotional expenditure by nearly 5 percent in FY25, even as the FMCG major saw a sharp erosion in profitability over the year, according to its latest financial filings.

Advertising and promotional expenses declined to Rs 1,520.81 crore in FY25 from Rs 1,603.15 crore in FY24, signalling tighter marketing spend amid rising costs and pressure on margins.

The company reported revenue from operations of Rs 12,502.95 crore in FY25, down 1.9 percent from Rs 12,746.98 crore in the previous financial year. Total income declined more sharply, falling to Rs 12,601.65 crore from Rs 13,844.46 crore, a year-on-year drop of 9 percent, largely due to a steep fall in other income.

Total expenses rose 13.2 percent to Rs 12,549.06 crore in FY25 from Rs 11,082.44 crore a year earlier, driven by higher raw material, employee and finance costs. The cost of materials consumed increased 24.2 percent to Rs 7,007.12 crore, while employee benefit expenses rose 6.4 percent to Rs 830.25 crore. Finance costs jumped nearly fourfold to Rs 202.78 crore.

As a result, profit before tax collapsed to Rs 52.59 crore in FY25 from Rs 2,762.02 crore in FY24, marking a year-on-year decline of over 98 percent. Net profit for the year stood at Rs 10.51 crore, compared with Rs 2,081.90 crore in the previous year, reflecting a near wipe-out of earnings.

Total tax expense declined sharply to Rs 42.08 crore from Rs 680.12 crore in FY24, in line with the fall in profitability.

Despite the cutback in advertising and promotional spend, Mondelez India remained one of the country’s largest advertisers in the packaged foods segment, even as cost inflation and higher financing charges weighed heavily on its bottom line in FY25.

Mondelez India Foods Private Limited is the Indian arm of global snacking giant Mondelez International and owns brands such as Cadbury, Dairy Milk, 5 Star, Oreo, Bournvita and Tang in the country.