Philip Morris' Leadership in Heated Tobacco and Pouches Should Drive Impressive Top-Line Growth

Philip Morris International is the world’s largest tobacco company by volume, with cigarette sales to roughly 170 countries. Despite such dominance, its goal is to completely replace its cigarette sales with reduced-risk alternatives. As of 2024, roughly 40% of revenue came from smoke-free products, though its goal of two-thirds of revenue by 2030 looks lofty and we forecast it’ll be reach roughly 50% by 2029. This does not reflect us expecting PMI to underperform in reduced-risk, but rather the steady and sizable contributions from traditional smokeable products.