Philip Morris Hits Record High!

Image Source: TradingView

By Brian Nelson, CFA

On April 23, Philip Morris (PM) reported excellent first quarter results with revenue and non-GAAP earnings per share coming in higher than the consensus forecasts. Total net revenues advanced to $9.3 billion, which was up 5.8% on a reported basis and 10.2% on an organic basis. Gross profit increased to $6.3 billion, up 11.8% on a reported basis and 16% on an organic basis. Operating income increased to $3.5 billion, up 16.4% on a reported basis and 16% organically. Adjusted diluted earnings per share increased 12.7%, to $1.69, in the quarter.

Management was optimistic in the earnings report:

We achieved exceptionally strong performance in the first quarter, with continued volume growth supporting an excellent top-line performance and very strong margin expansion. Our smoke-free business goes from strength to strength, delivering organic growth of over 20% in net revenues and over 33% in gross profit. We remain confident in our ability to deliver superior results, despite an uncertain and volatile global economic environment, and now forecast double-digit adjusted diluted EPS growth in dollar terms for the full-year. 

Looking to all of 2025, Philip Morris’ net revenue growth is targeted around 6-8% on an organic basis, with organic operating income growth to be between 10.5%-12.5%. The tobacco giant expects reported diluted earnings per share in the range of $7.01-$7.14, with adjusted diluted earnings per share targeted at $7.36-$7.49 (up 12%-14%) and adjusted diluted earnings per share, excluding currency, expected to be between $7.26-$7.39 (up 10.5%-12.5%). 2025 operating cash flow is targeted to be more than $11 billion at prevailing exchange rates, with capital expenditures of around $1.5 billion, which includes further investments in ZYN capacity in the U.S. We’re huge fans of Philip Morris’ stock.

—–