Nestle says sales growth and profits are down.
The Swiss food giant makes everything from Kitkat bars to Nescafe coffee.
It saw sales rise just 3.5 percent in the first half, below forecasts.
Profits falling to just over four billion Swiss francs.
Reuters consumer goods correspondent Martine Geller says the company faces challenges on every front:
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"Nestle overall faces a lot of pressures, like all consumer goods makers, from slowing economies around the world, and even more demanding consumers. Aside from that there are new competitors getting stronger. In particular, JAB Holdings has done nine coffee acquisitions in the last four years and now is becoming a huge competitor."
Coffee now the key battleground for the company.
Nescafe is the global market leader for instant, while Nespresso created the market for coffee capsules.
And Nestle hopes innovation will help it catch up in the US market, where it lags local rivals.
Nestle far from alone in battling headwinds.
Nestle is betting that pricey coffee could be the way forward.
