Hershey Expands AI Across Supply Chain, Marketing Ahead of 2027 Recovery
Hershey is deploying AI across supply chain, marketing, and operations to drive efficiency and support a 2027 margin recovery plan.
The Hershey Company said it is expanding the use of AI systems across its supply chain, marketing, and manufacturing operations as part of a plan to recover margins by 2027 after cost pressure linked to cocoa prices. The company outlined the strategy during its April 1 Investor Day, positioning AI-driven systems as a core part of its operating model.
Hershey said it is deploying decision intelligence tools to automate supply chain responses across production and inventory planning. It said these systems are expected to generate about $50 million in productivity gains and reduce inventory by $100 million over two years.
The company said it is introducing “Connected Worker” tools and digitally integrated factory systems to support manufacturing and labor efficiency. These systems are designed to improve production visibility and consistency across facilities.
In marketing, Hershey said AI-enabled tools have reduced the cost of producing creative assets by 50%. It said these tools have shortened development timelines from months to weeks and allow campaigns to be deployed across multiple markets within days.
Hershey said these investments are tied to a broader effort to improve execution across its portfolio and retail channels. It said it is restructuring its commercial model under a unified system called “ONE Hershey,” combining its confection and salty snack businesses under a single customer-facing approach.
The company reiterated a target of 2% to 4% organic revenue growth and 6% to 8% earnings per share growth over time. It said productivity gains from supply chain systems and automation are expected to support margin recovery in 2027.
Alongside these changes, Hershey said it will increase research and development spending by 25% to support product and technology initiatives.
The company also said it will make targeted updates to a portion of its product portfolio over the next two years, while maintaining core formulations for its flagship products.