Philip Morris International reported strong first-quarter results exceeding expectations, driven by robust performance in its smoke-free business, particularly IQOS. Despite a decline in reported diluted EPS due to non-cash adjustments, the company achieved significant growth in adjusted diluted EPS, signaling underlying business strength and effective strategic execution.
Net revenues increased by 9.1% (2.7% organically) to $10.1 billion, with contributions from both smoke-free and combustible businesses.
positiveAdjusted Diluted EPS grew by 16.0% to $1.96 (5.3% excluding currency), exceeding prior year performance.
positiveInternational Smoke-Free Segment net revenues increased by 24.7% (15.8% organically) fueled by strong volume growth and increasing profitability.
positiveIQOS continues to be a primary growth engine, surpassing Marlboro as the #1 nicotine 'brand' in markets where present.
positiveGross profit increased by 10.1% (3.8% organically), expanding gross margin through pricing, operating leverage, and SFP mix benefits.
positiveReported diluted EPS declined by 9.3% to $1.56, primarily due to a non-cash fair value adjustment of a minority shareholding in India.
attentionInternational Combustibles Segment shipment volume declined by 5.1%, with notable decreases in Indonesia, Russia, Germany, and Mexico.
attentionU.S. Segment net revenues decreased by 31.6% organically, reflecting lower ZYN volumes due to distributor and trade inventory movements and an unfavorable price comparison.
negativeU.S. Segment adjusted gross profit decreased by 44.1% on an organic basis.
negativeThe Middle East conflict has had a small impact on business, affecting shipments and contributing to increased transport, energy, and input costs.
attentionMargin expansion indicates improving profitability and operational efficiency. Measured in basis points (bps): 100 bps = 1.0%.
| Segment | Current | Prior Yr | YoY | % Total | CC |
|---|---|---|---|---|---|
International Smoke-Free | N/A | — | — | — | +15.8% |
International Combustibles | N/A | — | — | — | +1.0% |
U.S. | N/A | — | — | — | -31.6% |
| Total Revenue | $0.00M | — | — | 100.0% | — |
Segment performance shows business unit health and growth drivers. Constant currency (CC) removes FX impact for like-for-like comparison.
Forward-looking guidance is subject to change and does not constitute a guarantee. Actual results may differ materially from these estimates.
Performance exceeded expectations in Q1, driven by IQOS.
Well-positioned to continue delivering best-in-class performance in 2026.
Smoke-free business is the primary growth engine.
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Operational metrics provide insight into business drivers and customer engagement beyond traditional financial measures.