Key Points
- Revenue and profit exceeded expectations: Q3 net sales reached $119.0 million, up 31.2% YoY; net income rose 70.3% to $21.1 million.
- Nicotine pouch boom: Modern Oral sales totaled $36.7 million, up 628% YoY, accounting for 30.8% of total revenue.
- Domestic production plan: TPB plans to launch its first white pouch production line in the U.S. in the first half of 2026.
- Lower regulatory costs: FDA PMTA-related expenses fell to $0.5 million, down nearly 60% year-over-year.
2Firsts, November 6, 2025 – Headquartered in Louisville, Kentucky, Turning Point Brands (TPB) reported its Q3 2025 earnings, with results well above expectations. The company’s strong performance was fueled primarily by the Modern Oral (nicotine pouch) segment, prompting an upward revision of its full-year guidance.
Nicotine Pouches Lead Growth; U.S. Production Line Planned
In Q3 2025, TPB generated $119.0 million in net sales (+31.2% YoY), $70.4 million in gross profit (+39.7%), and $21.1 million in net income (+70.3%).
Modern Oral sales reached $36.7 million, up 627.6% YoY and 22% quarter-over-quarter, representing 30.8% of total company revenue. This segment not only drove revenue expansion but also contributed to a more favorable margin structure.
CEO Graham Purdy stated that Modern Oral’s performance “exceeded expectations,” adding that the company plans to launch its first U.S.-based white pouch production line in the first half of 2026 to strengthen domestic manufacturing and supply chain control.
TPB also raised its full-year Modern Oral sales forecast to $125–130 million (from $100–110 million previously).
Oral Tobacco Segment Up 80.8%
The Stoker’s segment (comprising Modern Oral, Moist Snuff Tobacco, and Looseleaf chewing tobacco) recorded $74.8 million in sales, up 80.8% YoY, representing 63% of total revenue. Traditional oral tobacco products maintained low- to mid-single-digit growth, continuing to provide stable cash flow.
The Zig-Zag segment (rolling papers and smoking accessories) reported $44.2 million in sales, down 10.5% YoY, primarily due to TPB’s strategic exit from U.S. distribution of the Clipper lighter brand. Excluding this impact, the segment achieved mid-single-digit sequential growth, with its gross margin improving to 57.5%.
PMTA Expenses Decline; Strong Cash Position
Selling, general, and administrative expenses rose to $44.5 million (+50.5% YoY), reflecting investments in Modern Oral marketing and logistics. FDA PMTA-related costs dropped to $0.5 million, nearly 60% lower than the prior year, suggesting easing regulatory expenditure.
As of September 30, 2025, TPB held $201.0 million in cash and $98.8 million in net debt, with total liquidity of $268.0 million. Following a $97.5 million equity raise, the company plans to amend its share repurchase and ATM offering authorizations to $200 million each, supporting future investments and potential acquisitions.
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