PMI revenue increases by over 9 per cent as IQOS volume picks up

Philip Morris International (PMI) has reported a 9.3 per cent increase on an organic basis, in its 2023 third quarter revenue, driven by total cigarette and heated tobacco unit (HTU) shipment volume growth of 2.2 per cent, the favorable product mix impact of smoke-free products, and combustible tobacco pricing of 9 per cent.

The volume increase reflected a growth of 18 per cent for HTUs and a decline of 0.5 per cent for cigarettes.

Market share for HTUs in IQOS markets was up by 1.2 points to 9 per cent, as total IQOS users at quarter-end went up by 0.2 million to approximately 27.4 million, compared to the previous quarter.

PMI said approximately 19.7 million of these users had switched to IQOS and stopped smoking.

“We delivered a very strong performance in the third quarter, surpassing $9 billion (£7.4bn) in quarterly net revenues for the first time and generating record quarterly adjusted diluted EPS of $1.67, representing currency-neutral growth of 20.3 per cent,” said Jacek Olczak, chief executive.

“This reflects continued excellent business momentum, driven by strong IQOS performance, resilient combustible trends and the exceptional growth of ZYN — which has surpassed our expectations yet again.”

ZYN nicotine pouch shipment volume in the US of 105.4 million cans represented growth of 65.7 per cent versus third-quarter 2022 shipments of 63.6 million cans by Swedish Match, the previous owner of the brand.

The net revenues from the companies smoke-free products portfolio, which has grown 16.5 per cent to $3.3bn, now account for 36.2 per cent of the company’s total revenues.  

In September, PMI has announced an updated ambition for more than two-thirds of the company’s total net revenues to come from smoke-free products by 2030.