Revenue down, earnings flat
Volumes decline in both segments
In Q4, Altria saw volumes decline across both its business segments. In the Smokeable Products segment, revenues decreased 2.7% YoY to $5.1 billion, mainly due to a 7.5% drop in shipment volume and higher promotional investments, partly offset by higher pricing.
Domestic cigarette shipment volume was down 7.9% in Q4, mainly due to declines in the industry caused by the growth of illicit e-vapor products and pressures on customers’ discretionary incomes. Marlboro shipments were down nearly 13% in the quarter. While cigarette shipments in the premium segment were down almost 11%, shipments in the discount category more than doubled, mainly due to the inflationary environment.
Revenues in the Oral Tobacco Products segment rose 2% to $706 million in Q4, driven mainly by higher pricing. Domestic shipment volume was down 6.3%, mainly due to retail share losses and trade inventory movements. Shipment volume for on! nicotine pouches was up 0.7% to 44.2 million cans.
Total US oral tobacco category share for on! nicotine pouches was 7.7% in Q4, down 1 share point from the previous year. In the US, the nicotine pouch category grew to 56.9% of the oral tobacco category, reflecting an increase of 10.4 share points versus the previous year. on!’s share of the nicotine pouch category fell 5.3 share points YoY to 13.4%.
Outlook
For fiscal year 2026, Altria expects adjusted EPS to range between $5.56-5.72, reflecting a growth of 2.5-5.5% from fiscal year 2025. The company expects adjusted EPS growth to be weighted to the back half of the year, reflecting a gradual increase in cigarette import and export activity over the course of the year.