Philip Morris International (NYSE:PM) reported fourth-quarter earnings that beat Wall Street expectations, driven by double-digit growth in its smoke-free portfolio and the continued dominance of ZYN nicotine pouches in the U.S. market.
The Stamford, Connecticut-based tobacco giant posted adjusted earnings of $1.70 per share, edging past the $1.67 consensus estimate.
Total revenue for the quarter reached $10.4 billion, a 7.3% increase from the prior year, as the company’s transition away from traditional cigarettes reached a new milestone.
Smoke-free products now account for 41.5% of total net revenues and nearly 43% of gross profit, led by the robust performance of IQOS and ZYN.
"We achieved another remarkable year in 2025, with net revenues surpassing $40 billion," Chief Executive Officer Jacek Olczak said.
The company’s smoke-free business saw shipment volumes jump 12.8% for the full year, with the IQOS heated tobacco system maintaining its position as a top-tier nicotine brand in major international markets.
In the U.S., ZYN continued its rapid expansion, helping Philip Morris offset a 2.2% decline in global cigarette shipment volumes.
Looking ahead, the company issued a confident forecast for 2026, projecting adjusted earnings in the range of $8.38 to $8.53 per share—above the analyst consensus of $8.33.
Management also introduced new three-year growth targets, aiming for a 9% to 11% compound annual growth rate in adjusted diluted EPS through 2028 as it targets a "substantially smoke-free" future by the end of the decade.