PMI(PM) - 2025 Q4 - Annual Results

Financial Performance - Total net revenues for 2025 reached $30 billion, representing a 5% organic growth year-over-year[6] - Total PMI revenues for 2025 were $40,648 million, representing a 7.3% increase from $37,878 million in 2024[25] - The company reported a significant increase in Net Earnings for 2025, totaling $11,848 million, up 57.9% from $7,503 million in 2024[64] - Net earnings attributable to PMI for 2025 reached $2,141 million, compared to a loss of $(579) million in 2024, resulting in a net earnings for basic and diluted EPS of $11,316 million in 2025, up from $7,034 million in 2024[17] - Basic Earnings Per Share for 2025 was $7.27, a 60.5% increase from $4.53 in 2024[64] - 2025 diluted EPS increased to $1.37, a 100% change from $(0.38) in 2024, with a yearly increase to $7.26 from $4.52, representing a 60.6% growth[19] Revenue Breakdown - Total smoke-free net revenues for 2025 were $4,354 million, a 12.0% increase from $3,887 million in 2024, with significant growth in SSEA, CIS & MEA at 33.2%[22] - Total net revenues for combustible tobacco reached $23,794 million in 2025, a 2.5% increase from $23,218 million in 2024[25] - Total net revenues for smoke-free products amounted to $16,854 million in 2025, reflecting a 15.0% growth compared to $14,660 million in 2024[25] - Total combustible tobacco net revenues for 2025 were $6,008 million, a 3.2% increase from $5,819 million in 2024, with Europe showing a 6.5% growth[22] Operating Income and Margins - The adjusted operating income margin for 2025 was 40%, up from 38% in 2024, indicating improved operational efficiency[6] - Total reported operating income for 2025 was $14,892 million, an increase of 11.1% compared to $13,402 million in 2024[53] - Adjusted operating income for 2025 reached $3,129 million, reflecting an 8.6% increase year-over-year[56] - Adjusted operating income excluding currency and acquisitions/divestitures for the total PMI was $16,243 million, an increase of 10.6% from $14,688 million in 2024[53] Product Performance - The number of total IQOS users increased to 20 million, with a 15% growth in user adoption compared to 2024[11] - PMI's e-Vapor product line saw a 25% increase in sales volume, contributing significantly to overall revenue growth[12] - The wellness segment within smoke-free products saw a decline of 17.2% in net revenues, dropping to $72 million from $87 million in 2024[22] - The company plans to launch three new smoke-free products in 2026, aiming to capture an additional 5% market share in the smoke-free segment[9] Debt and Financial Position - The company reported a net debt of $15 billion, with a debt-to-equity ratio of 1.2, indicating a stable financial position[6] - Total Debt as of December 31, 2025, was $48,835 million, up from $45,695 million in 2024[70] - Net Debt at the end of 2025 was $43,963 million, an increase from $41,479 million in 2024[70] Future Outlook - The company anticipates adjusted earnings per share (EPS) to grow by 8% in 2026, driven by continued expansion in smoke-free product offerings[8] - The company plans to continue expanding its smoke-free product offerings, with a focus on increasing market share in emerging markets[22] - The company anticipates continued growth in smoke-free product revenues, driven by increased market penetration and product innovation[25] Regional Performance - The SSEA, CIS & MEA region reported a significant operating income increase of 19.5%, reaching $4,096 million in 2025 compared to $3,429 million in 2024[36] - In Europe, reported operating income for 2025 was $7,165 million, up 9.4% from $6,547 million in 2024[53] - The Americas region saw a decline in operating income, dropping to $505 million in 2025, a decrease of 7.8% from $548 million in 2024[36] Adjusted Financial Metrics - Adjusted EBITDA for 2025 was $17,375 million, compared to $15,580 million in 2024, indicating a strong growth trajectory[70] - Adjusted gross profit for smoke-free products increased by 19.9% to $11,688 million in 2025, compared to $9,719 million in 2024[33] - Total adjusted gross profit for PMI in 2025 was $27,282 million, an 11.0% increase from $24,549 million in 2024[33]