Nestlé CEO Laurent Freixe said his predecessors were involved in new product categories, including health supplements that “weakened the structure of the organization” as he ruled out large-scale acquisitions or asset sales to boost growth.

Freixe, the company that replaced Mark Schneider last August, said in an interview with the Financial Times that diversity under Schneider led has led to Nestlé's core business lines - coffee, Petcare and Food - being ignored.

"If you...if you...what you're all focused on developing new spaces...you're going to weaken the core. I think it's part of the problem Nestlé has been facing," Frex said.

In 2017, Schneider became the second outsider to win the highest position in Nestlé's nearly 160-year history. The former healthcare executive continues a series of acquisitions, including food allergy treatments and fitness supplements, in an attempt to rebalance Nestlé’s portfolio into a healthier, higher amount category.

Schneider was replaced by Freixe, whose growth slowed down late in his tenure, a veteran of Nestlé for nearly 40 years. People familiar with the company say Schneider's straightforward style clashes with the consensus corporate culture of the groups that permeate Kit Carter and Nescafe.

Now, Freixe is at his best, and he is refocusing Nestlé on its core brand and trying to restore his lost culture. The Frenchman, who worked in Hungary, Spain and Latin America, has moved the main area head back to Nestlé's vast headquarters in Vevey, overlooking Lake Geneva.

Although Freixe said he and Schneider "have a good understanding of each other", the main difference between them is that he has "intimate" knowledge of the internal functioning of the Nestlé machine. "So maybe it's my style, I'm very close to the people, so that's a big advantage," he said.

Some consumer goods companies predict that U.S. tariffs will lead to another round of price increases following post-pandemic inflation. But Freixe believes there are other more powerful momentums at work.

"Demand is relatively weak, supply recovers, and competition is fierce. This is usually more moderate than inflation," he said, adding that these forces would outweigh the price pressures of tariffs and climate change, which ruins the coffee and cocoa harvest.

Nestlé and its competitors reported that tired consumers turned to cheaper alternatives and sales growth slowed. Last year, Nestlé's organic growth fell to 2.2% from 7.2% a year ago. Swiss companies reported net profit fell by 290 million.

Unilever, Reckitt Benckiser and Danone are all scaling down – selling underperforming brands and turning them to higher profit categories to resume growth. But Freixe said he focused on revitalizing Nestlé’s core business.

“There will always be someone… (see) portfolio (management) as a quick solution,” he said. “I don’t think we should ever forget that M&A is not a strategy.”

Nestenberg CEOs are not affected by popular logic, which will make the company more dynamic. Frex said he didn't "see the merits of Nestlé" as long as it could take advantage of its scale and "bring speed."

However, some analysts question why Nestlé sticks to its struggling frozen food business. Sales of its frozen and refrigerated food range, including Digiorno pizza and hot bag snacks, fell 15.5% to 4.3 billion SFR last year, partly due to Nestlé’s frozen meal business in Canada.

Even though packaged food sales have been slowing for nearly a decade and healthy diets are rising, Frex insists that the category is not “basically wrong”.

"The frequency of consumption … we are leaders. It's important," he said. However, Freixe acknowledged it's losing "relevance and competitiveness", adding that Nestlé is trying to lower prices.

Nestlé’s boss has hinted that he will be willing to sell brands that live in structurally unattractive categories, and Nestlé has no brand that “can win.”

This includes getting out of Nestlé’s troubled water business. A French Senate committee report this week found that the government covered up Nestlé's illegal filtration treatment of products marked "natural mineral water."

Nestlé said the committee's conclusions indicate that clearer and more consistent regulations are needed and that all its natural mineral aquatic products are safe to drink. Frex said the company is looking for investors to enter into a joint venture agreement for the water business.

Last November, Freixe cut Nestlé's interim margin guidance by at least 17%, from the 17.5% to 18.5% range set by Schneider and launched a $2.8 billion cost-cutting drive.

He said this is a time when “we need realism” rather than a “dream” to pay tribute to consumer demand and the rapidly growing tariff regime of U.S. President Donald Trump.

Although Freixe acknowledged that demand was weak, he insisted that the growing popularity of GLP-1 weight loss pills, including Ozempic and Wegovy, was not the reason.

A recent Cornell University study found that consumers using GLP-1 drugs reduced their grocery spending by nearly 6% on average. Frex said Nestlé did not experience sales declines after growing drug use, and its portfolio (facing coffee and pet food) means any impact the company has on the future is in good shape.

He added that early sales of new products specially designed for GLP-1 users, such as Nestle’s high-protein prepared meals, are promising.

Meanwhile, Trump's appointment of Robert F Kennedy as U.S. Secretary of Health raised another potential issue for Freixe. Kennedy embraces policies aimed at curbing consumption of superprocessed foods and reducing Americans’ sugar intake.

This could have a significant impact on Nestlé’s candy and prepared catering businesses, which account for 15% of global sales.

But, Frex said Nestlé "is very consistent" with Kennedy's mission. “The quality of food, nutritional density, and promoting regenerative agriculture is our agenda.”