September 2026: Philip Morris International Nudges Up 2026 Profit Outlook on Favorable Currency Winds
Ahead of his presentation at the Barclays Global Consumer Conference, Philip Morris International (PMI) raised its full-year 2026 reported diluted earnings per share forecast, citing favorable foreign exchange rate movements as the sole driver behind the revision.
The company now expects full-year reported diluted earnings per share to land between $7.28 and $7.43. Excluding a total adjustment of $1.07 per share, the revised forecast range for adjusted diluted earnings per share is $8.35 to $8.50, representing a projected growth rate of 10.7% to 12.7% compared to $7.54 recorded in 2025. A favorable currency impact at prevailing exchange rates is now expected to add $0.24 per share, up from the previously anticipated $0.15 per share. Stripping out foreign exchange effects, organic adjusted diluted earnings per share growth projections remain steady at 7.5 percent to 9.5 percent, or $8.11 to $8.26 per share.
Additionally, Philip Morris adjusted its third-quarter outlook for currency only, setting a new target range of $2.29 to $2.34 per share. The third-quarter guidance now reflects a one-cent favorable currency impact, reversing a previously expected eight-cent unfavorable drag. All underlying business and operational assumptions remain unchanged from the details issued on July 22, 2026 (FY26 – R2).
| Guidance Metric | FY25 | FY26 (Initial) | FY26 – R1 | FY26 – R2 | FY26 – R3 |
|---|---|---|---|---|---|
| Reported Diluted EPS | $7.26 | $7.56-$7.71 | $7.18-$7.33 | $7.19-$7.34 | $7.28-$7.43 |
| Adjustments: | |||||
| Amortization of Intangibles | $0.50 | $0.50 | $0.50 | $0.50 | $0.50 |
| Fair Value Equity Adjustments | ($0.18) | $0.22 | $0.22 | $0.16 | $0.16 |
| Restructuring Charges | $0.14 | $0.03 | $0.03 | $0.03 | $0.03 |
| Swedish Match Financing Tax Impact | ($0.25) | $0.05 | $0.05 | $0.06 | $0.06 |
| Non-Cash Impairment (RBH) | — | — | $0.33 | $0.33 | $0.33 |
| Egypt Sales Tax Settlement | — | — | — | ($0.01) | ($0.01) |
| Other Adjustments | $0.07 | — | — | — | — |
| Total Adjustments | $0.28 | $0.80 | $1.13 | $1.07 | $1.07 |
| Adjusted Diluted EPS | $7.54 | $8.36-$8.51 | $8.31-$8.46 | $8.26-$8.41 | $8.35-$8.50 |
| Adjusted EPS Growth vs. 2025 | — | 10.9%-12.9% | 10.2%-12.2% | 9.5%-11.5% | 10.7%-12.7% |
| Less: Favorable FX Impact | — | $0.25 | $0.20 | $0.15 | $0.24 |
| Adjusted Diluted EPS (Ex-FX) | $7.54 | $8.11-$8.26 | $8.11-$8.26 | $8.11-$8.26 | $8.11-$8.26 |
| Adjusted Organic Growth (Ex-FX) | — | 7.5%-9.5% | 7.5%-9.5% | 7.5%-9.5% | 7.5%-9.5% |
August 2026: Philip Morris International and Altria Partner on U.S. Manufacturing Contract to Boost Efficiency and Regional Supply
Altria Group, Inc. and Philip Morris International Inc. have entered into a contract manufacturing agreement under which Philip Morris USA, an operating subsidiary of Altria, will produce traditional combustible cigarettes for PMI’s non-U.S. affiliates. The collaboration leverages the manufacturing capabilities of PM USA to support PMI’s international market needs while allowing both organizations to maintain distinct commercial operations. Initial shipments under the arrangement are expected to begin in early 2027, subject to operational readiness and applicable regulatory requirements. Neither company anticipates that the agreement will have a material financial impact on its 2026 financial results.
Under the terms of the agreement, Altria and PMI will continue to operate entirely independently, each maintaining sole responsibility for their own commercialization, distribution, and regulatory activities. PMI explicitly reaffirmed that it has no presence in or plans to enter the U.S. combustible cigarette market, and this manufacturing partnership will not alter that stance.
For Altria, the collaboration aligns directly with its 2028 Enterprise Goals by maximizing operational efficiency at its domestic facilities and generating economic returns. Crucially, the cigarette import/export mechanism is critical for Altria to benefit from federal duty drawback provisions, allowing the company to claim rebates on federal excise duties paid. The resulting economic benefits will help fund Altria’s strategic investments in its long-term smoke-free Vision.
For PMI, establishing a cigarette manufacturing footprint in the United States offers a strategic advantage by optimizing supply chain logistics and shipments across the Americas region. By utilizing PM USA’s existing production capacity, PMI can fulfill international combustible demand more efficiently while concentrating its primary capital investments on accelerating its global smoke-free transition.
June 2026: Philip Morris International Updates 2026 EPS Forecast for Currency and Non-Cash Impairment Only
PMI issued revised guidance updating its FY26 reported diluted EPS forecast to $7.18-$7.33 to reflect shifting currency dynamics and a non-cash impairment of its Canadian affiliate, Rothmans, Benson & Hedges (RBH). Triggered by an updated five-year plan reflecting current industry dynamics, the $500 million charge (33 cents per share) leaves the deconsolidated Canadian affiliate with a remaining carrying value under $100 million.
Striping out a total $1.13 per share adjustment, full-year adjusted diluted EPS is forecast at $8.31-$8.46 (up 10.2%-12.2% vs. 2025). Crucially, excluding a $0.20 currency tailwind, underlying organic growth remains securely anchored at 7.5%-9.5% ($8.11-$8.26 ex-FX). The moderated currency outlook stems from Q2 transactional FX impacts on deferred tax liabilities from a strengthening Russian ruble, updating the Q2 adjusted EPS target to $1.97-$2.02, which now includes a 3-cent currency headwind (instead of 2-cent tailwind). All other operational assumptions remain completely unchanged.
| Guidance Metric | Previous FY26 Forecast | Updated FY26 Forecast | Delta | Commentary |
| Reported Diluted EPS | $7.56 – $7.71 | $7.18 – $7.33 | ($0.38) | Impacted by the RBH charge ($0.33) and lower FX tailwinds ($0.05) |
| Amortization of Intangibles | $0.50 | $0.50 | — | Unchanged |
| Fair Value Equity Adjustments | $0.22 | $0.22 | — | Unchanged |
| Restructuring Charges | $0.03 | $0.03 | — | Unchanged |
| Swedish Match Financing Tax Impact | $0.05 | $0.05 | — | Unchanged |
| Non-Cash Impairment (RBH) | — | $0.33 | +$0.33 | New discrete non-cash charge introduced |
| Total Adjustments | $0.80 | $1.13 | +$0.33 | Higher add-backs due strictly to the RBH accounting charge. |
| Adjusted Diluted EPS | $8.36 – $8.51 | $8.31 – $8.46 | ($0.05) | Decline reflects the lower favorable currency impact |
| Adjusted EPS Growth vs. 2025 | 10.9% – 12.9% | 10.2% – 12.2% | (0.7 pp) | Comped against a 2025 adjusted base of $7.54 |
| Less: Favorable Currency Impact | $0.25 | $0.20 | ($0.05) | Calibration of prevailing exchange rates |
| Adjusted Diluted EPS (Ex-FX) | $8.11 – $8.26 | $8.11 – $8.26 | — | Identical. Underlying operational trajectory is intact |
| Adjusted Organic Growth (Ex-FX) | 7.5% – 9.5% | 7.5% – 9.5% | — | Identical. Matches original full-year growth targets |
May 2026: Philip Morris International Appoints Massimo Andolina as New CFO
Philip Morris International (PMI) announced that Massimo Andolina will become Chief Financial Officer (CFO) effective August 1, 2026, succeeding Emmanuel Babeau, who is stepping down after six years in the role. Babeau joined PMI in 2019 as an external hire following senior finance roles at other multinational companies.
Andolina is a longtime PMI executive with more than two decades at the company. He currently serves as President of Europe Region and has previously held several senior leadership positions, including Senior Vice President, Global Operations and Vice President, PMI Transformation. He will report directly to CEO Jacek Olczak and oversee the company’s global financial strategy.
April 2026: Philip Morris Expands Ducati Partnership to Promote ZYN in MotoGP
Philip Morris International (PMI) has announced an expansion of its long-standing partnership with Ducati Corse, extending the collaboration into the 2026 MotoGP season and beyond. A key development in this new phase is the introduction of PMI’s ZYN nicotine pouch brand on Ducati’s MotoGP bike liveries at selected races. The partnership, which dates back to 2003 when Ducati entered MotoGP, has evolved alongside both organizations. PMI is now using the platform to promote its smoke-free product portfolio, positioning ZYN – described as the world’s leading nicotine pouch brand – as a central element of its branding strategy within the sport. MotoGP is viewed as a global platform with a predominantly adult audience, allowing PMI to engage consumers while adhering to its responsible marketing framework.
Both companies emphasized that the expanded partnership is built around shared values of innovation, performance, and progress. PMI sees the collaboration as a way to accelerate its ambition of making cigarettes obsolete, while Ducati views the relationship as supporting its continued technological and competitive leadership in MotoGP.
April 2026: PMI Deepens Ferrari Ties with Hypersail Partnership Focused on Innovation
Philip Morris International (PMI) has announced it will become the Principal Partner of Ferrari’s Hypersail project, extending a collaboration that dates back over 50 years to their long-standing relationship in Formula 1. The Hypersail initiative represents Ferrari’s move into ocean racing, centered on a 30-meter full-foiling monohull yacht designed to test cutting-edge technologies in areas such as aerodynamics, energy efficiency, and advanced control systems. The vessel is expected to launch and begin sea trials in 2026, powered entirely by renewable energy.
For PMI, the partnership aligns with its broader positioning around science-driven innovation and its transition toward smoke-free products, using the project as a platform to showcase technological progress and cross-industry collaboration. Overall, the deal reinforces the strategic and symbolic alignment between the two companies, leveraging a high-profile engineering project to highlight innovation, sustainability, and long-term transformation.
March 2026: PMI Expands U.S. Operations with New Business Solutions Center in Tampa
Philip Morris International (PMI) has announced an investment of approximately $50 million to establish a new Business Solutions Center in Tampa, Florida. The facility is expected to create around 180 direct and indirect jobs and will consolidate key functions – including business solutions, distribution operations, and customer service – into a single hub. The initiative is intended to improve operational efficiency across these areas. The center will be located at Highwoods Bay Center in Tampa’s Westshore Business District (5426 Bay Center Drive). The investment includes capital expenditures for the build-out of the workspace as well as a 10-year lease commitment.
Since 2022, PMI has invested more than $1 billion in U.S.-based manufacturing, operational capabilities, and workforce development (through September 30, 2025). These investments include a $600 million project to develop a ZYN nicotine pouch manufacturing facility in Aurora, Colorado; a $232 million expansion of the existing ZYN production site in Owensboro, Kentucky; and more than $37 million to support expanded operations at the company’s manufacturing facility in Wilson, North Carolina. PMI employs more than 3,000 people in the U.S. and operates multiple manufacturing facilities across the country.
March 2026: Philip Morris Recasts Historical Data Under New Three-Segment Reporting Structure
Philip Morris International (PMI) published recast historical shipment volumes and financial data to reflect its new reporting structure, which took effect on January 1, 2026. The company has reorganized its reportable segments into three divisions: International Smoke-Free, International Combustibles, and U.S., aligning its financial reporting more closely with its evolving smoke-free strategy.
To help investors compare results under the new structure, the company released supplemental historical information covering shipment volumes and selected financial metrics for 2023 through 2025. The data has been posted on the company’s website and included in a filing with the U.S. Securities and Exchange Commission. The recast figures are intended for comparability purposes and do not alter previously reported consolidated results or represent a restatement of prior financial statements. According to the company, consolidated financial performance remains unchanged except for certain internal reclassifications related to the new reporting format.
As part of the update, Philip Morris also introduced Operating Companies Income (OCI) as a new profitability metric. In addition, a new line item titled “Corporate expenses and other” has been added to the consolidated income statement. This category will include foreign-exchange gains or losses and share-based compensation costs that were previously recorded within cost of sales and marketing, administration, and research expenses. The changes reflect the company’s updated organizational model built around two primary business units – International and U.S. – and are intended to provide investors with clearer visibility into the performance of its smoke-free and combustible product businesses.
Download PMI Recast Data
December 2025: Philip Morris International Extends its Partnership with Scuderia Ferrari
Philip Morris International (PMI) extended its partnership with Scuderia Ferrari HP and with Ferrari Challenge Trofeo Pirelli – the single-marque motorsport championship created in 1993 – for the 2026 season and beyond. ZYN brand will feature on Scuderia Ferrari HP Formula 1 liveries at select races throughout the seasons, starting with Abu Dhabi Grand Prix 2025 scheduled for December 7, 2025. The PMI-Ferrari partnership spans more than five decades – making it one of the strongest in sports history.
December 2025: Philip Morris International at the MS Global Consumer & Retail Conference
Philip Morris International (PMI) Chief Executive Officer, Jacek Olczak, addressed investors at the Morgan Stanley Global Consumer & Retail Conference. Jacek reiterated a confident growth trajectory for the smoke-free businesses while acknowledging tax-driven headwinds ahead in Japan’s heated tobacco market. He mentioned that smoke-free products are delivering sustained demand and higher mix economics versus combustibles, with the global smoke-free category growing at around 10% with material acceleration in specific categories and markets. PMI targets to grow its smoke-free business at 10-12% rate and continues to see smoke-free portfolio (heated tobacco, nicotine pouches and vapes) as the principal long-term driver of value and margin expansion as combustibles decline.
Nicotine pouches – and the ZYN brand in particular – were underscored as standout performers in the U.S. market. Olczak cited pouch category growth in the order of ~30% year-on-year in key tracked channels, with ZYN capturing a leading share and securing over 50% of the category despite being priced at a premium. ZYN was sold at a 60-65% premium per-pouch versus the leading competitor earlier in the year; the Company has seen promotional normalization since the supply constraints eased. Importantly, PMI emphasized that ZYN’s consumer sourcing is broad: early adoption drew users from traditional oral tobacco, but adoption quickly diversified – ZYN is drawing roughly equal share of new users from cigarettes, vaping and traditional smokeless products (one third from each). Jacek highlighted c. 7% share of total tobacco spend for the pouch category in the U.S. tracked channels today and expects continued category expansion into 2026.
Heated tobacco (IQOS) remain a core growth engine, with international IQOS volumes growing 11-12% in unit volume in the year under discussion. However, Japan presents a notable regulatory headwind: authorities intend to implement staged tax equalization for heated tobacco, with changes beginning in 2026. Olczak warned that this staged tax harmonization will exert pricing and volume pressure in Japan in 2026 and beyond, creating a short-term volume headwind for heated tobacco in a market that accounts for significant share of global heated tobacco value. The Company expects to manage pass-through and competitive dynamics but flagged the tax change as a material near-term consideration.
On margins and capital allocation, PMI stressed that smoke-free mix is structurally margin-accretive and that the Company sees further gross-margin upside as scale and portfolio optimization progress. ZYN has shown the ability to command a premium while growing fast, and IQOS scale economics are improving as the category matures. Financial priorities include returning leverage to a targeted ~2x net debt/EBITDA range, continued disciplined M&A (with selective, primarily small-scale bolt-on opportunities in smoke-free) and sustaining dividend growth as leverage normalizes. Olczak reiterated that incremental capital needs for smoke-free capacity are moderate (hundreds of millions, not billions) relative to overall cash generation.
In sum, PMI presented a constructive multi-year outlook driven by smoke-free adoption, strong nicotine pouch momentum in the U.S. led by ZYN, and ongoing IQOS growth – tempered temporarily by country-level regulatory/tax events (such as, Italy in 2024 and Japan in 2026) and evolving commercial dynamics (pricing, promotions and new product introductions).
The final thought: Smoke-free transition remains intact and value-accretive, but 2026 will require careful navigation of tax and competitive pressures in specific markets.
October 2025: Philip Morris International Files for Five-part, $3.5 Billion Notes Offering
Philip Morris International files for five-part $3.5 billion notes offering:
| Note | Coupon | Maturity | Amount | Spread2 |
| Floating Rate Notes due 2028 | Compounded SOFR1 plus 0.660% p.a. | October 27, 2028 | $300 million | N/A |
| 3.875% Notes due 2028 | 3.875% | October 27, 2028 | $750 million | +43bps |
| 4.000% Notes due 2030 | 3.875% | October 29, 2030 | $750 million | +58bps |
| 4.250% Notes due 2032 | 4.250% | October 29, 2032 | $850 million | +68bps |
| 4.625% Notes due 2035 | 4.625% | October 29, 2035 | $850 million | +78bps |
Download Final Term Sheet for the 5-part notes offering
October 2025: Italy’s Antitrust Regulator Opened an Investigation into Philip Morris International for Unfair Commercial Practices
Italy’s antitrust regulator opened an investigation into Philip Morris Interntional (PMI) for alleged unfair commercial practices for its smoke-free tobacco products. PMI allegedly promoted its products in an unclear and misleading way, using expressions like “smoke-free” and slogans such as “a future without smoke”. “These expressions may be unclear and misleading for consumers, as they refer to products that are not free from potential harmful health effects, are not less harmful than others, and may cause addiction – despite the absence of combustion”, the watchdog stated. The regulator carried out inspections at Philip Morris Italy offices and the manufacturing site in Bologna.
PMI stated that it had always acted in compliance with the applicable regulations, adding “communication is factual, truthful, and fully consistent with Italian and European legislation, which associates the absence of smoke with the absence of combustion”. PMI will continue to cooperate with the regulator throughout the proceedings “to demonstrate the full legitimacy of its actions”.
PMI invested €1Bn for the PMI Manufacturing & Technology Center in Bologna to produce IQOS tobacco sticks at scale. The investment resulted in the largest factory set-up in Italy since 2000 and rendered Italy a keen supporter of RRPs at the EU-level.
October 2025: Philip Morris Announces Voluntary Delisting of Philip Morris Pakistan from PSX
Philip Morris has International (PMI) formally announced the voluntary delisting of Philip Morris Pakistan (PMPK) from the Pakistan Stock Exchange (PSX), following a strategic share buyback that concentrated nearly all ownership in the hands of its parent companies. In an official notice to the Chief Listing Officer of PSX, Philip Morris Pakistan confirmed that its sponsors, Philip Morris Investments B.V. and Philip Morris Brands SARL, now hold 98% of the company’s shares after completing the buyback program. PMI also submitted an undertaking to purchase the remaining shares (i.e. 2% equity in the company) held by the minority shareholders at a price of Rs1,300 per share up until September 29, 2026. PSX accepted PMI’s voluntary delisting request.
Philip Morris Pakistan emphasized that the decision aligns with its long-term strategy to streamline operations and optimize corporate structure. The delisting will formally end Philip Morris Pakistan’s presence on the Pakistan Stock Exchange, where it has been a listed entity for years.
September 2025: Philip Morris International’s Footprint in the EU
A Philip Morris International (PMI)-sponsored report prepared by EY-Parthenon examines the PMI’s economic, social, and cognitive impact within the European Union between 2019 and 2023. The report, which seems to be commissioned for use in lobbying activities amidst the EU Tobacco Product Directive (TPD) and EU Tobacco Taxation Directive (TTD) revisions, notes that PMI contributed around €289 billion to the EU economy over this period, driven by business activity, retailer margins, and tax revenues. In 2023 alone, its activities added €65.8 billion to the EU’s GDP, equal to about 0.38% of the total, while supporting one million jobs across the value chain and contributing €38 billion in taxes. PMI’s investments in the EU totaled €43.4 billion in five years, with €19.6 billion spent on suppliers, heavily involving small and medium-sized enterprises, and €625 million spent on purchasing EU-grown tobacco, which in turn influenced €10.5 billion in farmers’ wages. Exports of cigarettes and smoke-free products reached €33.4 billion in 2019–2023, highlighting the company’s significant role in European trade flows.
The social footprint shows that PMI directly employed 21,488 full-time equivalents in 2023, indirectly supported more than 80,000 jobs in its supply chain, and induced another 30,000 through household spending, creating an overall multiplier of 6.15. Its wider retail network influenced almost 675,000 jobs across the EU. Wages supported by PMI’s operations during 2019–2023 amounted to €51.45 billion, including €17.29 billion through retail and wholesale and €10.5 billion through agricultural employment. The company emphasizes workplace culture, diversity, and equal pay, holding Top Employer and Equal Salary certifications across multiple countries, and has launched hybrid work schemes, talent development initiatives, and programs for students and interns.
On the cognitive side, PMI invested €301 million in research and development across the EU between 2019 and 2023, alongside €37 million in training and 2.5 billion learning hours globally. Much of this investment focused on smoke-free innovation, employee upskilling, and partnerships with universities and research institutions. The company supports entrepreneurship initiatives and has introduced programs in countries such as Italy, Spain, Greece, and Bulgaria to advance sustainable farming, scientific research, and student development. These efforts reflect its broader transformation toward a smoke-free future, with more than 40% of global revenues now coming from smoke-free products manufactured largely in the EU.
Overall, the report presents PMI as an important contributor to EU economic growth, employment, and innovation, while emphasizing its transition away from combustible products. Its activities are framed as reinforcing Europe’s industrial resilience, sustaining rural livelihoods, and investing in skills and research that align with its long-term ambition of a smoke-free future
Download the report: PMI’s Footptint in the EU
September 2025: Philip Morris International Reaffirms FY25 Guidance
Philip Morris International (PMI) reaffirms FY25 Guidance of reported diluted EPS of $7.24 to $7.37 and adjusted diluted EPS of $7.43 to $7.56, representing growth of 13% to 15% and 11.5% to 13.5%, excluding currency. Moreover, US$ weakness implies a favorable currency impact of $0.10 at prevailing exchange rates. With strong volume momentum over the summer months, including IQOS and ZYN offtake, and despite increasing competition in smoke-free products, PMI is on track to deliver the strongest EPS growth since 2011 excluding the pandemic recovery.
For the July-August 2025 period (since the end of Q2 2025), PMI underlines:
– Combustible volume recovery in Turkey and volume dynamics in Egypt better-than-expected
– Continued strong IQOS growth
– ZYN and VEEV growth in the international markets
– Strong momentum in U.S. ZYN offtake, which has accelerated further since Q2 2025 to around 32% growth in the first 8 weeks of Q3. PMI had previously assumed 800-840 million cans in shipments for 2025. PMI now assumes H2 2025 shipment volume growth broadly in line with offtake growth as it intensifies the commercial activities amid increasing competition, subject to distributor & wholesaler inventory movements which include some additional normalization in Q3 2025 following the restocking in the first half of the year and the return to full availability (note: “subject to” clause seems to be added to flag the risk of over-stocking in H1 2025 and could indicate the possibility of a further downside to the FY25 shipment volume).
PMI shipped 314 million ZYN cans in the U.S. in H2 2024. Assuming 32% growth (inline with the offtake growth), H2 2025 shipment could be around 414 million cans. Adding up the 392 million cans shipped in H1 2025, total 2025 shipment volume for ZYN in the U.S. would be 806 million cans – which corresponds to the low end of the previous 800-840 million cans guidance.
July 2025: Philip Morris International Launches Smoke Free Travel Website
Philip Morris International (PMI) launched SmokeFreeTravel.com, a global digital platform designed to support adult nicotine users who are seeking smoke-free alternatives while traveling. The platform enables users to discover the availability of smoke-free products — such as, IQOS heated tobacco, VEEV vapes and ZYN nicotine pouches — across key airport hubs and domestic markets. By integrating product information with travel planning to improve accessibility and transparency for over 360 million international travelers, PMI aims to create more consumer engagement opportunities through its duty-free and travel retail channels. Smoke-free products are available in 260 of the more than 500 airports covered by PMI worldwide.
July 2025: The Short Story of Philip Morris International
Tobacco Insider, the leading authority in the Tobacco Industry, issued a short note on the success story of Philip Morris International (PMI): “You only have to do a few things right in your life”
PMI had many failures over the past decade:
– Tried to merge with Altria
– Had to pay $2.7 billion to Altria to acquire back its own product
– Invested in R&D more than the rest of the industry combined to successfully develop only one product (- what about the Platforms 2, 3, 4?)
– Acquired many technologies/patents from which it failed to develop anything – Acquired e-cigarette businesses (all defunct now)
– Ventured into the vaccine business (defunct)
– Ventured into Rx drugs (defunct)
– Ventured into the insurance business to offer RRP users health insurance with lower premiums (defunct)
– Failed to become predominantly smoke-free by 2025
– Failed to deliver $1Bn revenue from Beyond Nicotine by 2025
– Ran “Unsmoke” campaign, a global PR disaster.
The list of failures can be extended; but, you got the point. Meanwhile, PMI did two right strategic moves which was enough to dominate the tobacco / nicotine industry’s future
– Developed and successfully commercialized the IQOS heated tobacco platform (- an area in which it can hold competitive advantage in a sustainable manner) while its competitors were busy running publicity stunts on their non-existent RRP franchises
– Acquired Swedish Match & ZYN.
June 2025: Philip Morris International Launches “Invested in America” Campaign
Philip Morris International (PMI) unveiled “Invested in America”, an advertising campaign that highlights the Company’s deep-rooted commitment and increased contributions to America and Americans. The campaign’s message is based on the role PMI is playing in powering job growth, revitalizing manufacturing, improving public health by offering adults 21+ who smoke better choices, and strengthening communities across the nation.
The campaign will be launched on July 3 with full-page print advertisements and a corresponding digital outreach. “Invested in America” will highlight the four pillars of PMI’s American commitment:
– America’s Manufacturing Comeback: With announced plans to invest over $800 million in new and expanded U.S. manufacturing facilities to produce smoke-free products, PMI is growing American manufacturing and creating high-skilled, high-paying jobs that contribute to thriving communities.
– Advancing Public Health: PMI, which has never sold cigarettes in the U.S., is on a mission to help America’s ~30 million smokers replace combustible cigarettes with FDA-authorized, smoke-free alternatives that are scientifically substantiated to be a better choice.
– Strengthening Communities: PMI’s approach to corporate citizenship involves strategic investment in communities and is committed to causes that matter to Americans, including supporting military veterans and their families, promoting economic empowerment, and responding to natural disasters.
– Purpose-Driven Performance: With $14+ billion invested globally in smoke-free innovation since 2008, PMI is driving transformative solutions while delivering strong business results.
June 2025: Philip Morris International (PMI) is Now the World’s Third Most Valuable CPG Company
Following a 75% surge in share price over the past 12 months, Philip Morris International (PMI) becomes the third most valuable consumer (packaged) goods company in the world with $284 billion market cap – behind P&G ($391 billion) and Coca-Cola ($306 billion), but ahead of Nestle ($271 billion), L’Oréal ($230 billion) and Pepsi ($181 billion). In the 1990s, Philip Morris (now Altria; then Philip Morris USA, Philip Morris International, Miller Breweries and Kraft combined) was the world’s largest consumer goods company. PMI is now in a position to be hopeful about reclaiming this title as a standalone tobacco company.
June 2025: Philip Morris International (PMI) Reaffirms FY25 Forecast at the 2025 dbAccess Global Consumer Conference
At the 2025 dbAccess Global Consumer Conference, Philip Morris International (PMI) reaffirmed 2025 Full-Year Forecast for reported diluted EPS of $7.01 to $7.14 and adjusted diluted EPS of $7.36 to $7.49, representing a growth of 12% to 14% (or, 10.5% to 12.5% on a currency-neutral basis) versus the adjusted diluted EPS of $6.57 in 2024.
The key message PMI tried to deliver at the Deutsche Bank Global Consumer Conference:
“Positioned for long-term, sustainable growth with a diverse portfolio and an emphasis on innovation, harm reduction, and financial discipline”
PMI projects an organic revenue growth of 6% to 8% and organic operating income growth of 10.5% to 12.5% in 2025. This growth is driven primarily by smoke-free products, which now offer superior financial metrics, including higher revenue per unit and gross margins ~5pp higher than those of combustible products.
PMI is experiencing robust momentum in its smoke-free portfolio, which includes IQOS (heated tobacco), ZYN (nicotine pouches), and VEEV (vape). IQOS continues to be a strong performer globally, with nearly 10% growth in Japan and over 7% growth in Europe, despite the impact of flavor bans that will eliminate around 1 billion sticks from the market in 2025. PMI expects a gradual recovery in Europe as the year progresses. VEEV, while not the company’s top priority, has also shown strong traction, achieving number one market share in five EU countries – including Italy, Czech Republic, Romania, and Greece. PMI is focused on profitable, targeted growth in the vape category. The multi-category strategy, which integrates IQOS, ZYN, and VEEV, is already active in 16 markets and aims to provide a full nicotine experience tailored to different moments and preferences, without cannibalizing individual brand performance.
ZYN has been a major highlight, particularly in the U.S., where it saw over 50% growth in Q1 2025. PMI is scaling up production to resolve recent supply shortages, with normal inventory levels expected by Q3 2025. Outside the U.S. and Nordic countries, ZYN achieved triple-digit growth in markets like Austria, Poland, the UK, South Africa, and the Philippines. ZYN is emerging as a lifestyle product, particularly among younger adults, and is even viewed by some consumers as a stimulant or cognitive enhancer.
Looking ahead, PMI remains committed to achieving its target of two-thirds of revenue from smoke-free products by 2030. When/if large, currently restricted markets such as Turkey, Brazil, India, Argentina, and Vietnam, open to reduced-risk products, they could significantly accelerate PMI’s smoke-free transformation. While PMI’s combustible cigarette segment has shown unusual volume growth recently (due to demographic and geopolitical factors), this should not be seen as a long-term trend; PMI expects a return to low-single-digit declines in 2025.
Regulatory developments remain mixed. PMI praised countries like the U.S., Italy, and the Philippines for their science-based approach to tobacco harm reduction, while criticizing others – along with certain NGOs and the WHO – for obstructing progress through ideology rather than evidence. PMI also expressed cautious optimism about U.S. regulatory direction under new FDA leadership, particularly regarding PMTA and MRTP processes that could support wider adoption of reduced-risk products.
April 2025: Philip Morris International (PMI) Issues $2.5 Billion in New Notes
Philip Morris International announced the issuance of $2.5 billion in new notes across four different tranches. The Company issued $400 million in Floating Rate Notes due 2028, $750 million in 4.125% Notes due 2028, $750 million in 4.375% Notes due 2030, and $600 million in 4.875% Notes due 2035. The Floating Rate Notes will bear interest based on the Compounded The Secured Overnight Financing Rate (SOFR) plus 0.83%, payable quarterly. SOFR is 4.36% at the time of writing. The 2028, 2030, and 2035 fixed-rate notes will pay semi-annual interest.
The proceeds from the offering are intended for general corporate purposes, which may include repaying outstanding commercial paper, refinancing existing debts, or meeting working capital requirements.
February 2025: Philip Morris International (PMI) Presents at CAGNY 2025
Philip Morris International (PMI) presented at the Consumer Analyst Group of New York (CAGNY) conference, outlining its progress towards a smoke-free future, growth strategy and financial performance. The key message PMI delivered is:
“PMI’s strategy is firmly centered on accelerating the transition to a smoke-free future while maintaining strong revenue and profit growth, global industry leadership and superior shareholder returns. With IQOS and ZYN driving both the top- and bottom-line growth, PMI is well-positioned to dominate the global smoke-free nicotine industry”
Transformation to a Smoke-free future:
– PMI is shifting away from combustible cigarettes towards smoke-free alternatives for the past decade. Smoke-free products now account for nearly $15 billion in net revenue, spanning close to 100 markets. PMI aims to have over 2/3 of its net revenues from smoke-free products by 2030 (note: we project that they will fail to achieve this target). In 2024, PMI generated 38.7% of its revenue from smoke-free (- 60% in top-5 operating income markets).
– Within a decade of launch, PMI’s flagship heated tobacco product, IQOS, already overtook Marlboro in terms of net revenue. IQOS net revenue exceeded $11 billion in 2024. Market share for IQOS has grown significantly since it was first introduced in 2015, now ranking #2 nicotine brand (behind Marlboro) in 76 launch markets.
– ZYN, PMI’s nicotine pouch brand, has become the #1 smoke-free nicotine brand in the U.S. – generating close to $2 billion net revenue in 2024. For further details: USA: ZYN Pouches
– PMI is focusing on multiple smoke-free platforms, including heated tobacco, nicotine pouches, and e-vapor – with the aim to capture the growing segment of poly-users (i.e. consumers who use multiple nicotine product types).
Growth Strategy:
– PMI is in transformation from a declining cigarette business to a growth-oriented, smoke-free company. Since 2020, PMI’s shipment volume grew by 2% per annum (- vs. a 2% per annum decline realized in the previous 5 years). In this period, 20% p.a. growth in smoke-free products more than compensated the 0.5% p.a. decline in cigarettes. PMI expects 178-181 billion sticks volume from smoke-free in 2025 (+13% vs. FY24).
– An annual growth of 6-8% in revenue, 8-10% in operating income and 9-11% in EPS is projected in the 2024-26 period. Favorable & improving smoke-free unit economics (net revenue & gross profit per 1’000 units) is the key growth pillar.
– Improving currency profile (driven by increased US market exposure and smoke-free growth), pricing (cigarette pricing up +8.7% in FY24) and cost savings ($2 billion savings targeted in 2024-26) allow PMI to deliver growth in US$ terms despite major currency headwinds (i.e. US$ strength aginst €, JPY and emerging market currencies)
– Total global nicotine market is close to stable with continued migration to smoke-free products. PMI maintains a strong leadership in most attractive smoke-free categories (i.e. ex-vapes). PMI has 75% global share in heated tobacco and 42% in nicotine pouches (more than 60% in the US). Overall, PMI owns 50% share in the global smoke-free category vs. 24% in cigarettes.
– PMI sees USA (with $25 billion profit pool) as the most important growth market and expects it to become PMI’s biggest market by net revenues in the mid-term (i.e. in 3-5 years).
Regulatory stance:
– PMI remains a leader in science-backed, FDA-authorized smoke-free products: it is the first & only company to receive (1) a marketing order in the nicotine pouch and heated tobacco category, (2) a modified risk product order in the heated tobacco category.
– PMI emphasizes its “laser focus” on responsible marketing and youth access prevention, underlining the low use rates for ZYN and IQOS among the underage, and advocates for stronger enforcement against illicit nicotine products, which undermine the harm reduction efforts.
Financial Performance:
– PMI maintains a strong cash flow conversion (105% in FY24), with over $10 billion in free cash flow generated in 2024. PMI targets a net debt-to-EBITDA ratio of ~2.0x by 2026, with further improvement expected in 2025 from 2.66x at the end of 2024. More than 60% of PMI’s debt is effectively in € with a weighted average maturity of 7 years.
– PMI continues to prioritize dividend growth (long-term target payout: ~75% of adjusted diluted EPS) and has a strong track record of delivering superior shareholder value – by consistently outperforming the MSCI World Tobacco Index, broader US Consumer Staples and S&P500 in Total Shareholder Returns (TSR).
Download PMI’s CAGNY 2025 Presentation.
September 2024: Philip Morris International (PMI) Takes US$220 Million Loss on Sale of Vectura
PMI expects to take a US$220 million loss on the sale of inhaled-medicine maker, Vectura to Molex Asia Holdings. PMI is likely to disclose US$0.14 per share one-off adjustment when it releases the Q3 2024 results on October 22, 2024. In Q2 2023 Earnings release, PMI already reported an asset impairment charge of $680 million ($0.44/share) as the estimated fair value of its Healthcare unit was assessed to be below its carrying value. Accordingly, PMI’s healthcare initiatives are set to result in a total loss of US$900 million in the 2023-24 period – leaving aside the loss of corporate focus on the transformation of the core recreational nicotine delivery business (due to the ill-conceived healthcare initiatives). For further details on the Vectura disposal and PMI’s Beyond Nicotine initiatives, refer to: Beyond Nicotine: Philip Morris International.
September 2024: PMI Reaffirms FY24 Guidance
At the Barclays Global Consumer Staples Conference, PMI reaffirmed the FY24 Guidance (last updated in the earnings release of July 23, 2024): reported diluted EPS of $5.89 to $6.01. Excluding a total adjustment of $0.44 per share and an unfavorable FX impact of $0.34 per share, PMI’s FY24 guidance represents a FX-neutral increase of 11% to 13% versus adjusted diluted EPS of $6.01 in 2023.
In addition to reaffirming the FY24 Guidance, PMI notes that
– delivering growth in US$ terms (not only on a FX-adjusted basis) is key for cash-flow management (e.g. due to the commitment to the dividend)
– its currency profile is improving with increasing presence in the US (increasing US$ revenue) and US$ weakening against €/¥
– heated tobacco is set to overtake cigarettes (in terms of market size/volume) in Japan next year (2025)
– they expect acceleration in heated tobacco momentum in H2 2024 (- including a recovery in Italy)
– ZYN stock-outs caused a slowdown in the overall nicotine pouch category growth in the US (i.e. it is not any nicotine pouch product, but ZYN, driving the category growth)
– PMI BoD may consider re-initiation of share-backs in 2025 provided that they are fully confident about reaching the 2x leverage target in 2026.
June 2024: PMI Revises FY24 Guidance
At the DB Global Consumer Conference, PMI provided a revised FY24 forecast (for the currency only):
– Diluted EPS in a range of $5.77 to $5.89, at prevailing exchange rates (increased by $0.07)
– Adjusted diluted EPS in a range of $6.26 to $6.38 (excluding a total adjustment of $0.49 per share), representing a projected increase of 4.2% to 6.2% versus $6.01 in 2023 (adjustments remain unchanged)
– Unfavorable currency impact reduced $0.07 from $0.36 to $0.29 per share
– Adjusted diluted EPS, ex-currency in a range of $6.55 to $6.67, representing a projected increase of 9% to 11% versus $6.01 in 2023 (remains unchanged)
– Underlying assumptions remain unchanged versus the Q1 2024 earning release of April 23, 2024
– On track for strong H1 2024 and FY24 performance: focused on delivering growth in organic and US$ terms
PMI also stated that raising bonds could be a problem if they were not so active in transformation to RRPs and there a number of lenders lending money on a framework that links the rates to the success in transformation to the RRPs. Moreover, nowadays, a number of lenders define a new role for themselves: encouraging businesses to transform into one that is sustainable and profitable over a long period of time (- traditionally a role played by the shareholders).
