Danone Anticipates Up to €70 Million Loss Due to Baby Formula Recalls

Danone SA has provided its initial estimate regarding the financial repercussions of the recent recalls of infant formula due to a contamination scare. The company anticipates a financial impact ranging from €35 million to €70 million ($82.4 million) in the first quarter of the year.

Deputy Chief Executive Officer Juergen Esser stated in an interview, “After that one-off impact, we should progressively go back to a normal situation. Therefore, we also confirmed this morning with lots of confidence our guidance for the full year.”

Most of the affected formula had already been sold and consumed last year by the time the products needed to be removed from shelves. As a result, Danone did not experience many returns. However, some retailers opted to remove all products from their shelves while they sorted through which items were affected by the recalls, leading to temporary shortages for customers.

Read more: Danone Infant Formula Recalls Expand in UK, Ireland

Other major formula producers, including Nestlé SA and Groupe Lactalis, were also impacted by the contamination crisis following the detection of the toxin cereulide, which can cause nausea and vomiting in consumers.

In its financial results report on Friday, Danone projected a like-for-like sales growth of 3% to 5% for 2026. During a call with analysts, Esser estimated that the impact from the recalls would account for between 0.5% and 1% of net sales in the first quarter.

As of 3:07 p.m. in Paris, Danone shares had decreased by 0.7%, after initially dropping as much as 2.1% earlier in the day.

Analysts’ estimates regarding the financial impact on Danone have varied widely, ranging from tens of millions of euros to over €1 billion.

Philipp Navratil, CEO of Nestlé, criticized rival companies on Thursday for their slow response during the recalls, although he did not name any specific companies. “We lost no time and decided to recall immediately,” he remarked. “We were surprised that others took longer to act.”

In response, Esser emphasized Danone’s commitment to safety, stating, “Danone is extremely responsible and would never take any risks on the issue. As soon as the authorities changed the requirements, we went out and recalled what needed to be recalled.”

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Copyright 2026 Bloomberg.

Danone SA has provided its initial estimate regarding the financial repercussions of the recent recalls of infant formula due to a contamination scare. The company anticipates a financial impact ranging from €35 million to €70 million ($82.4 million) in the first quarter of the year.

Deputy Chief Executive Officer Juergen Esser stated in an interview, “After that one-off impact, we should progressively go back to a normal situation. Therefore, we also confirmed this morning with lots of confidence our guidance for the full year.”

Most of the affected formula had already been sold and consumed last year by the time the products needed to be removed from shelves. As a result, Danone did not experience many returns. However, some retailers opted to remove all products from their shelves while they sorted through which items were affected by the recalls, leading to temporary shortages for customers.

Read more: Danone Infant Formula Recalls Expand in UK, Ireland

Other major formula producers, including Nestlé SA and Groupe Lactalis, were also impacted by the contamination crisis following the detection of the toxin cereulide, which can cause nausea and vomiting in consumers.

In its financial results report on Friday, Danone projected a like-for-like sales growth of 3% to 5% for 2026. During a call with analysts, Esser estimated that the impact from the recalls would account for between 0.5% and 1% of net sales in the first quarter.

As of 3:07 p.m. in Paris, Danone shares had decreased by 0.7%, after initially dropping as much as 2.1% earlier in the day.

Analysts’ estimates regarding the financial impact on Danone have varied widely, ranging from tens of millions of euros to over €1 billion.

Philipp Navratil, CEO of Nestlé, criticized rival companies on Thursday for their slow response during the recalls, although he did not name any specific companies. “We lost no time and decided to recall immediately,” he remarked. “We were surprised that others took longer to act.”

In response, Esser emphasized Danone’s commitment to safety, stating, “Danone is extremely responsible and would never take any risks on the issue. As soon as the authorities changed the requirements, we went out and recalled what needed to be recalled.”

Related:

Copyright 2026 Bloomberg.