Cadbury-parent Mondelez International forecast a bigger-than-estimated drop in its annual profit on Tuesday, signaling pressures from higher costs, including from surging cocoa prices, sending its shares down nearly 6% after the bell.

The company is specifically focused on its chocolate business as it navigates cocoa cost inflation, Chief Executive Dirk Van de Put said. The company previously said it expects to raise prices.

MDLZ's fourth-quarter earnings decline year over year amid a challenging operating environment marked by cocoa cost inflation.

The outlook for food producers who rely on cocoa is more challenging in FY25 as unforeseen weather deterioration in West Africa drives negative revisions to production forecasts, while this impact on supply suggests higher for longer costs.

Mondelez International Inc shares slumped in after-hours trading after the snack food company said “unprecedented cocoa cost inflation” would drive down earnings this year.