Core Insights - Philip Morris International exceeded earnings expectations for Q4 2024, driven by its expanding smoke-free product lineup [2][3] - The company reported adjusted EPS of $1.55, surpassing the estimated $1.50, and revenue of $9.71 billion, exceeding the forecasted $9.44 billion [2][4] Financial Performance - Q4 2024 metrics include: - EPS: $1.55 (14% increase YOY from $1.36) [4] - Revenue: $9.71 billion (7.3% increase YOY from $9.05 billion) [4] - Adjusted operating income: $3.52 billion (15.3% increase YOY from $3.05 billion) [4] - Smoke-free revenue: $3.9 billion (9.2% increase YOY from $3.6 billion) [4] - Combustibles revenue: $5.8 billion (6% increase YOY from $5.4 billion) [4] Strategic Shift - The company is strategically shifting towards smoke-free products, which now account for 40% of overall revenue and approximately 42% of gross profit [2][3] - The focus on smoke-free growth is highlighted by the investment in Swedish Match, enhancing its portfolio with the ZYN brand [6] Product Segment Growth - Revenue from smoke-free products grew by 40% in Q4 2024, with Heated Tobacco Units (HTUs) shipments increasing by 5.1% and cigarette shipments rising by 1.1% [7] - The company aims to transition consumers from traditional smoking to healthier alternatives [7] Regulatory and Geographic Expansion - Regulatory successes include U.S. FDA authorization of ZYN nicotine pouches and IQOS devices as Modified Risk Tobacco Products, enhancing credibility for smoke-free alternatives [8] - Adjusted International Market Share (IMS) grew significantly in Japan and Europe, with smoke-free products gaining traction in Italy and Spain [9] Challenges and Outlook - The company faces challenges such as ongoing litigation, including a non-cash impairment charge of $2.3 billion related to the Canadian affiliate RBH [10] - Despite challenges, traditional products remain significant, with Marlboro accounting for 39% of cigarette shipment volume [10] - For 2025, the company projects adjusted EPS between $7.04 and $7.17, indicating a potential increase of up to 9.1% from 2024 [11][12]

Core Insights - Philip Morris reported revenue of $9.71 billion for the quarter ended December 2024, reflecting a 7.3% increase year-over-year and a surprise of +3.67% over the Zacks Consensus Estimate of $9.36 billion [1] - The earnings per share (EPS) was $1.55, up from $1.36 in the same quarter last year, with an EPS surprise of +2.65% compared to the consensus estimate of $1.51 [1] Financial Performance Metrics - Shipment Volume for PMI Cigarettes and Heated Tobacco Units (HTUs) was 35.72 billion, slightly below the average estimate of 36.16 billion [4] - In Europe, the shipment volume for cigarettes was 38.39 billion, exceeding the estimate of 38.21 billion [4] - Total net revenues by geography showed significant growth, with Europe at $4.06 billion (+12.2% year-over-year), Americas at $1.26 billion (+131.4% year-over-year), and SSEA, CIS & MEA at $2.87 billion (+6% year-over-year) [4] - Net revenues from smoke-free products excluding Wellness and Healthcare reached $410 million, a +9.6% increase year-over-year, while revenues from Wellness and Healthcare were $87 million, up +26.1% year-over-year [4] - Total combustible tobacco revenues were $5.82 billion, reflecting a +6% year-over-year change, while total smoke-free revenues excluding Wellness and Healthcare were $3.80 billion, showing an +8.9% year-over-year change [4] Stock Performance - Philip Morris shares have returned +7.5% over the past month, outperforming the Zacks S&P 500 composite's +2.1% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - Philip Morris International (PM) shares reached an all-time high following better-than-expected results and guidance driven by strong demand for non-smoking alternatives [1][5] - The company reported fourth-quarter adjusted earnings per share (EPS) of $1.55, with revenue increasing 7% year-over-year to $9.7 billion, surpassing Visible Alpha forecasts [1][5] Sales Performance - Sales of smoke-free products rose 9% to $3.9 billion, while sales of combustibles increased 6% to $5.8 billion [2] - Shipment volume grew 2% to 193.1 billion, with oral smoke-free products up 22% to 4.6 billion, heated tobacco products rising 5% to 35.7 billion, and cigarette sales increasing 1% to 152.8 billion [2] Management Commentary - CEO Jacek Olczak stated that the company has "strong momentum across all categories" and expressed confidence in its smoke-free transformation and brand portfolio to deliver value for shareholders [3] - The company anticipates full-year adjusted EPS between $7.04 and $7.17, exceeding the Visible Alpha estimate of $7.01 [3] Stock Performance - Shares of Philip Morris International increased by 7% to $140.16, previously reaching a record high of $146.77, and have gained over 50% in value over the past year [4]

2024 Fourth-Quarter and Full-Year Results February 6, 2025 Introduction • A glossary of terms as well as adjustments, other calculations and reconciliations to the most directly comparable U.S. GAAP measures for non-GAAP financial measures cited in this presentation are available in Exhibit 99.2 to the company's Form 8-K dated February 6, 2025 and on our Investor Relations website with additional non- GAAP reconciliations available at the end of this presentation 2 Forward-Looking and Cautionary Statements ...

Philip Morris International Inc. PM shares are trading higher on Thursday after fourth-quarter FY24 earnings result.The company reported revenue growth of 7.3% year-on-year to $9.71 billion, beating the analyst consensus estimate of $9.44 billion.The smoke-free business accounted for 40% of the company’s total net revenues, up by 0.7pp versus the fourth quarter last year.Cigarette and Heated Tobacco unit (HTU) shipment volume in fourth-quarter grew by 1.9% Y/Y, reflecting growth of 5.1% and 1.1% for HTUs an ...

Core Insights - Philip Morris reported quarterly earnings of $1.55 per share, exceeding the Zacks Consensus Estimate of $1.51 per share, and up from $1.36 per share a year ago, representing an earnings surprise of 2.65% [1] - The company achieved revenues of $9.71 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.67% and increasing from $9.05 billion year-over-year [2] - Philip Morris shares have increased approximately 8.8% year-to-date, outperforming the S&P 500's gain of 3.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.60 on revenues of $8.9 billion, and for the current fiscal year, it is $7.04 on revenues of $39.34 billion [7] - The estimate revisions trend for Philip Morris is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Tobacco industry is currently ranked in the top 21% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Turning Point Brands, another company in the Tobacco industry, is expected to report quarterly earnings of $0.65 per share, reflecting a year-over-year decline of 17.7% [9]

Investment in Smoke-Free Products - Philip Morris International (PMI) has invested over $14 billion since 2008 to develop smoke-free products, aiming to end cigarette sales entirely[13]. - The acquisition of Swedish Match in November 2022 has positioned PMI as a leader in oral nicotine delivery, enhancing its smoke-free product portfolio with the ZYN brand[14]. - PMI's smoke-free products are available in 95 markets, with nicotine pouches expanding to 37 markets[21]. Market Performance - Total shipment volume, including cigarettes and heated tobacco units, increased by 2.5% in 2024 to 756.6 billion units, with heated tobacco units reaching 139.7 billion units, up from 125.3 billion units in 2023[26]. - Marlboro accounted for approximately 40% of PMI's total cigarette shipment volume in 2024, with a 3.7% increase in shipment volume[22][26]. - PMI's total international market share rose to 28.7% in 2024, up from 28.3% in 2023, with cigarette market share at 23.5% and heated tobacco unit market share at 5.2%[29]. - The company holds a market share of at least 15% in approximately 100 markets globally, including major markets like France, Germany, and Japan[29]. Strategic Partnerships and Relationships - The company plans to end its commercial relationship with Altria Group for IQOS in the U.S. by April 30, 2024, gaining full rights to commercialize IQOS[15]. - An agreement reached in 2022 with PM USA relates to IQOS commercialization rights in the U.S., including intellectual property rights[56]. Workforce and Employment - As of December 31, 2024, the company employed approximately 83,100 people worldwide, including full-time, temporary, and part-time staff[41]. - The company operates in approximately 170 markets with employees representing more than 130 nationalities, reflecting the demographics of the countries served[44]. - The company has maintained its global EQUAL-SALARY certification, which is a valuable component of its reputation as an employer[46]. Regulatory and Environmental Compliance - The company is subject to multiple laws and regulations in its heavily regulated industry, impacting its operational costs and market demand[47][50]. - The company has implemented environmental management programs in accordance with ISO 14001 and ISO 45001 standards, focusing on reducing its carbon footprint and compliance with environmental laws[49]. - The company closely monitors the evolving regulatory landscape related to sustainability and implements initiatives aligned with its sustainability strategy[48]. Consumer Health Strategy - PMI's Wellness and Healthcare strategy focuses on developing oral and inhaled consumer health products, although revenue from cannabinoids is expected to be negligible in the near term[16]. Seasonal Trends - The company experienced higher SFP adult user growth in the first half of each year compared to the second half due to seasonal influences[60]. Intellectual Property - The company has a large number of granted patents and pending patent applications worldwide, which are material to its business[54].

Financial Performance - PMI reported adjusted net revenues of $30.5 billion for the full year 2024, reflecting a 5.2% increase compared to the previous year[6]. - Net revenues for PMI in 2024 reached $9,706 million, reflecting a 7.3% increase from $9,047 million in 2023[21]. - Total net revenues for 2024 reached $37,878 million, a 7.4% increase from $35,174 million in 2023[28]. - The company reported a net earnings attributable to PMI of $(579) million for the fourth quarter of 2024, down from $2,196 million in the same quarter of 2023[16]. - Net earnings for the year ended December 31, 2024, decreased by 9.3% to $7,503 million from $8,268 million in 2023[63]. - Basic earnings per share for Q4 2024 was $(0.38), a significant decline from $1.41 in Q4 2023[63]. Revenue Breakdown - Total combustible tobacco revenues increased by 6.0% to $5,819 million in 2024, compared to $5,489 million in 2023[21]. - Smoke-free product revenues, excluding wellness and healthcare, rose by 8.9% to $3,800 million in 2024, up from $3,489 million in 2023[21]. - Wellness and healthcare revenues grew by 26.1% to $87 million in 2024, compared to $69 million in 2023[21]. - Total smoke-free revenues, excluding wellness and healthcare, amounted to $14,327 million, a 14.3% increase from $12,534 million in 2023[26]. - Smoke-free products, including wellness and healthcare, generated $14,660 million in revenues, a 14.2% increase from $12,840 million in 2023[26]. Market and User Growth - The total shipment volume for PMI in 2024 was 1.1 million units, with heated tobacco units (HTUs) accounting for 30% of total shipments, up from 25% in 2023[6]. - The number of total IQOS users reached 20 million globally, representing a 15% increase year-over-year[9]. - PMI's market share for heated tobacco units in Japan reached 35%, up from 32% in the previous year[9]. - PMI anticipates a continued expansion in the SSEA, CIS & MEA regions, targeting a 10% growth in market share by 2025[6]. Operating Income and Margins - PMI's adjusted operating income margin for 2024 was 40%, an increase from 38% in 2023[6]. - Total PMI operating income for 2024 reached $3,259 million, a 12.8% increase from $2,889 million in 2023[37]. - Adjusted operating income for 2024 was $3,519 million, reflecting a 15.3% growth compared to $3,052 million in 2023[40]. - Adjusted Operating Income Margin for total PMI was 38.8% in 2024, compared to 37.8% in 2023, indicating a 1.0 percentage point increase[59]. Research and Development - The company invested $1.2 billion in research and development for new smoke-free products in 2024, a 10% increase from 2023[6]. Charges and Impairments - PMI completed the sale of Vectura Group Ltd. for a pre-tax loss of $199 million, primarily due to an impairment charge[7]. - The company recorded a pre-tax charge of $140 million in Q3 2023 related to the termination of the agreement with the Foundation for a Smoke-Free World[7]. - The company incurred restructuring charges of $180 million in 2024, up from $109 million in 2023, representing a 65.1% unfavorable change[53]. - The impairment of goodwill and other intangibles decreased significantly to $27 million in 2024 from $680 million in 2023, a 96.0% improvement[53]. - The South Korea Indirect Tax Charge accounted for $204 million in 2024, marking a 100.0% unfavorable change from the previous year[56]. Cash Flow and Assets - Net cash provided by operating activities for the year ended December 31, 2024, increased by 32.7% to $12,217 million from $9,204 million in 2023[71]. - Total assets as of December 31, 2024, were $61,784 million, down from $65,304 million in 2023[65]. - Total debt decreased to $45,695 million in 2024 from $47,909 million in 2023, resulting in a Total Debt to Adjusted EBITDA ratio of 2.93[67]. - Cash and cash equivalents increased to $4,216 million in 2024 from $3,060 million in 2023[65].

Group 1 - Philip Morris International (NYSE: PM) is recognized as a strong dividend business despite facing industry challenges in recent years due to a gradual decline in smoking rates [1] - The author emphasizes the importance of dividend investing as a pathway to financial freedom, highlighting its accessibility for individuals seeking to build long-term wealth [1] - The author's professional background includes extensive experience in mergers and acquisitions (M&A), business valuation, and financial modeling across various sectors, which informs their investment strategy [1] Group 2 - The article aims to share insights and experiences related to dividend investing, with the goal of demystifying the process for others [1] - The focus on sectors such as technology, real estate, software, finance, and consumer staples indicates a diversified investment approach [1]

Core Insights - The earnings season is ongoing, influenced by tariff concerns and a strong US Dollar Index (DXY) which has increased approximately 8% since late September 2024 [1] Group 1: Economic Impact - The strong US Dollar has led to one of the more challenging year-over-year currency comparisons for companies [1]