Philip Morris Posts 14.8% EPS Growth to $7.54, 41.5% Revenues from Smoke-Free
Philip Morris delivered adjusted EPS of $7.54 in 2025, up 14.8%, with net revenues surpassing $40B on 10.6% organic operating income growth. Smoke-free shipments rose 12.8% to account for 41.5% of net revenues and management forecasts 11.1%-13.1% EPS growth for 2026.
1. 2025 Financial Performance
Philip Morris delivered adjusted EPS of $7.54, up 14.8%, on net revenues above $40 billion. Organic operating income rose 10.6%, lifting the adjusted operating margin to 40.4%.
2. Smoke-Free Product Growth
Smoke-free shipments grew 12.8%, driving a 15% increase in smoke-free net revenues and a 20.3% rise in gross profit. These products accounted for 41.5% of total net revenues and 43% of gross profit, with IQOS heated tobacco, ZYN pouches and VEEV e-vapor leading growth.
3. Combustible Segment Trends
Combustible cigarette shipments fell 1.5%, but pricing actions boosted combustible net revenues by 2.5% and gross profit by 5.2%. Continued productivity measures underpinned margins and cash generation from legacy products.
4. 2026 Outlook
Management forecasts adjusted EPS growth of 11.1% to 13.1% for 2026, or 7.5% to 9.5% excluding currency benefits, reflecting confidence in smoke-free momentum. Ongoing expansion of reduced-risk categories is expected to support above-industry earnings growth.