Philip Morris International Reports Q3 Earnings Growth of 13.8%
According to a report by CNBC on October 19, Philip Morris International (PMI) released its financial report for the third quarter of 2023, achieving a net income of $9.14 billion, a 13.8% increase compared to the same period last year when it earned $8.03 billion. While the company's revenue fell below market expectations, its heated tobacco products and ZYN nicotine pouch business performed successfully.
As of September 30th, quarterly PMI reports a revenue of $9.14 billion, a growth of 13.8% compared to the same period last year when it reported $8.03 billion. The company's operating income has increased to $3.37 billion, representing a growth of 13.5%.
Jacek Olczak, CEO of PMI, announced that the company has exceeded $9 billion in net income for the first time this quarter. He attributed this growth to the success of IQOS, their heated tobacco product, and Zyn, the oral nicotine pouch.
In recent years, as the demand for combustible tobacco products decreases and certain market regulations become more stringent, PMI has shifted its focus away from its traditional cigarette core market. The company is now turning to smokeless products and respiratory medicines; shipments of heated tobacco, including e-cigarettes, increased by 18% in this quarter.
Despite a 0.5% decrease in sales volume of its traditional cigarettes, the net income of this category increased by 4.3% due to price hikes. Additionally, the company's Zyn nicotine pouch division experienced a significant 65.7% growth in sales volume. Orozco stated, "Once again, this exceeds our expectations.
Zyn Nicotine Pouches are a smokeless tobacco oral product promoted by the company as a cleaner and more discreet way to consume nicotine. Despite opposition from public health officials regarding the harm caused by cigarette smoking, this is seen as an effort by the company to increasingly focus on healthcare and wellness.
According to analysts, the company's report differs from Wall Street's expectations as follows: Earnings per share were adjusted to $1.67, compared to the projected $1.62, while revenue amounted to $9.14 billion, slightly lower than the expected $9.17 billion. Philip Morris International (PMI) has revised its full-year profit outlook to a range of $6.05 to $6.08 per share, representing a growth of 10% to 10.5%.
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