Rachael Davis
Price hikes are a frustrating but unsurprising part of all our lives right now, with everything gradually costing more and more whilst often providing less and less.
While the cost of living continues to bite, you’d be forgiven for indulging in a little endorphin-releasing chocolate to take the edge off. Unfortunately, if you’re a Hershey’s fan, that little indulgence is about to cost more too.
The quintessential American chocolate brand is something of an umbrella corporation for tonnes of favourites, including: Reese’s, KitKat, Twizzlers, Jolly Rancher, Milk Duds, Skor, York, and a range of Cadbury products.
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Of course, it’s also the manufacturer of its own-brand treats, including Hershey’s bars and Kisses.
As cocoa prices hit record-breaking levels, Hershey’s has announced that it’s raising prices across its roster of US products. It won’t be meagre either, with retailers having been told to expect a ‘low double-digit’ percentage increase.
A specific figure has yet to be revealed, but a double-digit increase is considerable and will significantly increase retailers’ procurement costs.
Cocoa prices have rocketed thanks to a terrible cocoa season in West Africa. Extreme weather conditions and disease have decimated crops, significantly hurting supply and thus sending prices through the roof.
There have been rumblings to suggest that Nestlé and Mondelez will also have to increase their prices.
“This month, Hershey announced a new price action on the entirety of our U.S. confection portfolio,” said CEO Michele Buck during an earnings call.
“Over 75% of items in our portfolio remain under $4,” she noted.
As far as chocolate-snaffling seasons are concerned, the price hike may have a notable effect on Halloween candy spending. However, Hershey’s Senior VP and CFO, Steven Voskuil, said the full effects won’t be apparent until Easter 2026.
Hershey’s is also reportedly enacting a ‘Smart Complexity’ strategy that will simplify packaging and product assortments to cut costs. There is concern that this will amount to shrinkflation, or the phenomenon where prices remain steady or increase while product sizes, weights, or other values are decreased.
While you might think such measures would be taken by a company in dire straits, Hershey’s actually beat Wall Street forecasts in Q2 2025 following previous price hikes and cost-cutting initiatives.
Finimize explained: “Hershey’s margin comeback offers fresh confidence for the broader consumer staples sector, which has been squeezed by rising costs and pricing battles. Investors looking for dependable returns may see Hershey’s steady sales and resilient customer demand as signs the company has pricing power.
“That optimism is reflected in Morgan Stanley’s upgraded price target, even though Hershey shares barely budged after the earnings report.”