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Marlboro Parent Philip Morris International's Smoke-Free Segment Powers Q2 Gains

Marlboro parent Philip Morris International Inc. (NYSE:PM) saw its stock dip on Tuesday following the release of its second-quarter fiscal year 2025 earnings report.

While the tobacco giant’s revenue increased by 7.1% year-over-year (+6.8% organic) to $10.14 billion, it slightly missed the analyst consensus estimate of $10.32 billion.

However, Philip Morris delivered adjusted earnings of $1.91 per share, surpassing both the consensus of $1.86 and the management guidance of $1.80-$1.85.

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A key highlight of the report was the continued robust performance of its smoke-free business, which now accounts for a significant portion of the company’s financials.

Smoke-free products contributed 41% of total net revenues (up by 2.9 percentage points versus last year) and over 42% of total gross profit (up by 3.8 percentage points).

Shipment volumes of these products increased by 11.8%, with net revenues growing by 15.2% (14.5% organically), and gross profit increasing by 23.3% (21.5% organically).

This underscores the company’s strategic shift towards a smoke-free future, as articulated by CEO Jacek Olczak, who noted these results “reflect excellent momentum in our multicategory smoke-free business.”

Within the smoke-free portfolio, inhalable smoke-free products, primarily centered on IQOS, exceeded $3 billion in quarterly net revenues.

The company reported ...