Mondelez is spitting out its gum business. At least, in some parts of the world.
Another surprising pandemic casualty, gum sales tumbled in the early days of Covid, as foot traffic at convenience stores slowed and more people stayed home. And who needs fresh breath when you’re wearing a mask?
And even before the pandemic, Mondelez’s gum revenues in certain markets were dipping.
So the snack and candy maker announced Tuesday during an investor event that it is divesting its gum business, including Dentyne and Trident, in developed markets like North America and parts of Europe. (It will hold onto its gum business in emerging markets.)
The company has just started looking for a buyer and there’s no timeline yet for a sale, a spokesperson told CNN Business. The decision comes after Mondelez launched a review of its gum business last year.
It’s also planning to divest its Halls cough drops business entirely.
Candy sales soared during the pandemic, as stressed-out consumers bought sweet comfort foods in abundance. Gum? Not so much. The gum market has since improved, but Mondelez (MDLZ) is betting that its chocolates and baked goods, like Oreos, Chips Ahoy, Toblerone and Cadbury, will be better for business.
“Mondelez International is reshaping its portfolio, with a long-term vision to accelerate growth and generate 90% of revenue in chocolate and biscuits, including baked snacks,” the company said in a statement Tuesday.
The company has increased its baked goods portfolio with a number of acquisitions in recent years.
Earlier this year, for example, it completed its purchase of Chipita, a company that sells croissants and other baked goods in Europe. Mondelez plans to use brands like Chipita to develop new products that combine chocolate with baked goods.
The recent acquisitions have helped drive sales. In the first quarter, the company reported a 7.3% increase net revenues, thanks in part to adding more brands to the fold.