Philip Morris International (PM) reported better-than-expected results in the previous three-month period, while the tobacco company reiterated its full-year outlook.
The cigarette and vape maker reported adjusted earnings, excluding currency, of $2.17 a share for the June quarter, up from $1.91 the year before. The consensus on FactSet was for $2.03. Revenue improved more than 10% to $11.19 billion, topping the average analyst estimate on FactSet of $10.6 billion. On an organic basis, sales climbed 7.6% annually.
Philip Morris' total shipment volume increased by 2.5% to 205.2 billion units, buoyed by growth of 7.5% in smoke-free products. Shipment volume for cigarettes was up 1.1%, while electronic vapor jumped 55%. Heated tobacco unit shipment volume climbed 7.6% to 41.8 billion units.
For the 2026 full year, the group continues to project adjusted EPS, excluding currency, to be in a range of $8.11 to $8.26. The Street is looking for $8.38. It also maintained its organic revenue growth estimate of 5% to 7% for the current year.
The company's shares advanced 3% in Tuesday trade, taking the stock's year-to-date gain to 20%.
"With a robust first half under our belt, including continued momentum and strong results in our smoke-free business, we are well positioned to deliver on our full-year targets while investing for future growth," Chief Executive Jacek Olczak said in a statement.
The conflict in the Middle East has had a "minor impact" on the company's business so far, primarily affecting transport, energy and other input costs, it said. High energy prices and supply disruptions in a number of markets have yet to lead to a noticeable change in consumer behavior, according to Philip Morris.
The US and Iran resumed their conflict this month just weeks after signing a memorandum of understanding to end the war that began at the end of February.
"The situation remains volatile, and it is difficult to assess the broader long term implications for the consumer or the global cost environment," the company said. "We will continue to closely monitor developments to assess the mid-to-long term consequences."
For the ongoing quarter, Philip Morris anticipates adjusted EPS to come in between $2.20 and $2.25, including a foreign-currency headwind of $0.08 at prevailing exchange rates. The current consensus on FactSet is for non-GAAP EPS of $2.42.
The company anticipates its topline to grow by a mid-single-digit in the third quarter on an organic basis, with "modest organic margin expansion," Chief Financial Officer Emmanuel Babeau said in prepared remarks for an earnings call. Shipments of heated tobacco units are pegged at 41 billion, according to Babeau.
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