Philip Morris International Reports 6.5% Revenue Growth to $19.4 Billion in First Half of 2025

Philip Morris International Inc. (PMI) reported a significant increase in its financial performance for the six months ended June 30, 2025, with net revenues reaching $19.4 billion, a 6.5% increase from $18.3 billion in the same period of 2024. The company's operating income also rose to $7.3 billion, up 11.8% from $6.5 billion year-over-year. This growth was primarily driven by favorable pricing, particularly in the combustible tobacco segment, and an increase in smoke-free product volumes, despite a decline in cigarette volumes.

In terms of profitability, net earnings attributable to PMI increased by 25.8% to $5.7 billion, translating to diluted earnings per share of $3.67, compared to $2.92 in the prior year. The increase in earnings was supported by a lower effective tax rate of 19.5%, down from 24.2% in the previous year, and a significant rise in income from equity investments, which surged by 65.1% to $580 million. However, the company recorded a goodwill impairment charge of $41 million during the second quarter, impacting its overall financial results.

Strategically, PMI has made notable advancements, including the completion of its acquisition of Swedish Match AB, which has enhanced its portfolio in the smoke-free product category. The company also reacquired the rights to commercialize IQOS in the U.S. from Altria Group, effective May 2024, allowing PMI to fully control its marketing and distribution efforts in this key market. Additionally, PMI has expanded its smoke-free product offerings, with ZYN nicotine pouches and IQOS devices now available in 97 markets.

Operationally, PMI's shipment volumes for the first half of 2025 showed a mixed performance. While cigarette volumes decreased slightly by 0.3% to 300 billion units, smoke-free product volumes increased by 13.1%, with heated tobacco units (HTUs) growing by 10.5%. The company reported a total shipment volume of 375.9 billion units, reflecting a 1.7% increase overall. PMI's market share for cigarettes and HTUs in international markets (excluding China and the U.S.) improved to 29.2%, up from 28.8% in the previous year.

Looking ahead, PMI anticipates continued growth in its smoke-free product segment, projecting a full-year increase in shipment volumes of around 1%, with smoke-free products expected to grow by 12% to 14%. However, the company remains cautious about potential regulatory challenges and market conditions that could impact its operations, particularly in regions facing economic and political instability. PMI's management is focused on navigating these challenges while advancing its transformation towards a smoke-free future.