Mondelez International (MDLZ) is expected to report "in-line" Q2 results, with ongoing weakness in its North American business likely offset by strength in emerging markets and pricing in Europe, RBC Capital Markets said in a note Friday.

The firm expects "below consensus organic growth" in North America, citing soft consumer demand and continued retailer destocking. The firm's channel checks indicate sustained weakness in the US packaged food and snacking.

In Europe, Mondelez is raising chocolate prices to offset elevated cocoa costs. While RBC is monitoring potential pressure on consumers in the region, it said elasticities remain low and stable.

Despite cocoa prices staying high, Mondelez is fully hedged for the year and should "deliver profitability in-line" with guidance.

However, the brokerage flagged reduced confidence in fiscal 2026 earnings per share growth if pricing relief doesn't materialize.

RBC has an outperform rating on the company's stock with a $71 price target.

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