By Evie Liu

Americans are eating more salty and function-driven snacks, while traditional sweets -- particularly chocolate -- face growing pressure. The shift could redraw the industry's competitive landscape, benefiting some companies while hurting others, a Mizuho analyst says.

While Americans are still snacking, what they reach for is evolving. Since 2010, chocolate has lost the most ground among snack categories, with their share in total snack consumption down 2.6 percentage points, analyst John Baumgartner wrote in a Friday note. Meanwhile, salty snacks gained 1.5 percentage points and pastries gained 1.4 percentage points.

Sugar confection -- think gummies and chewy candy -- has taken share, and their bold flavors continue to attract younger consumers. Since 2019, sugar confection has gained 1.1 percentage point in market share, Baumgartner says, noting that Gen Z consumption is running about 25% higher over the past five years.

Health trends are increasingly shaping consumer choices. The growing use of GLP-1 weight-loss drugs, greater scrutiny of ingredients, and government policies around food assistance are all nudging consumers away from traditional indulgences. Meanwhile, demand for snack bars, meat snacks, and fruit snacks -- viewed as more functional -- are rising.

Pricing is another key factor behind consumer decisions. Years of food inflation have left consumers more sensitive to value, leading to a diverging market. Shoppers either trade up to premium, differentiated products -- often marketed as clean-label or high-protein -- despite higher prices, or trade down to cheaper private labels as they seek savings.

New formats, flavors, and ingredients are driving growth pockets across categories. In sugar confection, products like gummy clusters have gained traction, while in salty snacks, better-for-you ingredients are fueling growth. Companies that can adapt to shifting consumer preferences and balance price and value stand to gain.

Utz Brands stands out as the clearest beneficiary of this shifting preference thanks to its lineup of salty snacks, says Baumgartner. The stock is trading well below its historical multiples. While near-term volumes have been soft, he believes promotional deals and continued shelf gains could help the company grow over the next one to two years. Shares are down 27.3% so far this year.

Mondelez International is also well positioned thanks to its diversified portfolio that reaches beyond chocolates into cookies, crackers, pastries and premium snacks. The stock is up 9.6% so far this year.

Hershey, by contrast, faces challenges because of its heavy reliance on chocolate products. While Hershey has been investing in innovation and diversification, Baumgartner thinks meaningful results could take years to materialize. Shares are up 11.2% this year.

Write to Evie Liu at evie.liu@barrons.com

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April 10, 2026 17:34 ET (21:34 GMT)

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