Altria Profit Falls as Smokers Choose Cheaper Cigarettes — Update

By Katherine Hamilton

Altria Group had lower profit in the second quarter, as consumers are trading down for cheaper cigarettes.

Sales of discount cigarettes jumped 67% in the quarter, while Altria's Marlboro brand and other premium cigarettes saw sales fall by single-digit percentages. Cheaper cigarettes are gaining market share because customers are feeling pressured by inflation, the tobacco company said Thursday.

Total profit fell to $2.3 billion, or $1.37 a share, from $2.38 billion, or $1.41 a share, a year earlier. Adjusted earnings were $1.48 a share, two cents below what analysts were expecting.

The company's stock fell 7% to $69.52 on Thursday morning.

Altria said pressure on consumers' discretionary spending was partly to blame for the 3% decline in cigarettes' domestic shipment volume. Total revenue in the smokeable segment increased less than 1%.

In Altria's oral-tobacco business, which includes on! nicotine pouches, revenue fell 5.3%. Nicotine pouches are considered one of the biggest markets for growth among tobacco companies, as more people are moving away from traditional smoking.

Rival Philip Morris International, which spun off from Altria in 2008, has had more success with its pouch Zyn. Last week, the company shared plans to invest more in expanding its Zyn portfolio after shipments of the product rose nearly 2% in the latest quarter.

Altria said it lost retail share and struggled with trade inventory movements in its oral tobacco business during the quarter. Domestic shipment volumes fell 8.5%.

Total revenue across the business was roughly flat at $6.11 billion. Analysts surveyed by FactSet forecast revenue of $5.35 billion.

Altria narrowed its full-year guidance for adjusted earnings per share to a range of $5.61 to $5.72, from a previous range of $5.56 to $5.72.

The new outlook reflects Altria's expectation that it will get a greater benefit from cigarette import and export activity in the second half of the year compared with the first.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

July 30, 2026 10:58 ET (14:58 GMT)