We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
PM's Q3 adjusted EPS rose 5.4% to $2.36, while revenues grew 5.5% to $11.44 billion, beating estimates.
Strong combustible pricing and smoke-free demand drove growth, with U.S. revenues surging 22.7% on ZYN gains.
PM updates 2026 adjusted EPS outlook to $8.29-$8.44 and maintains its 5-7% organic revenue growth forecast.
Philip Morris International Inc. (PM - Free Report) reported third-quarter 2026 results, wherein both top and bottom lines beat the Zacks Consensus Estimate and increased year over year.
PM posted quarterly adjusted earnings of $2.36 per share, which increased 5.4% year over year. Excluding currency effects, the adjusted earnings jumped 5.8% year over year. The bottom line beat the Zacks Consensus Estimate of $2.30.
Philip Morris International Inc. Price, Consensus and EPS Surprise
Net revenues of $11,438 million increased 5.5% on a reported basis and 7.1% organically year over year. Revenues beat the Zacks Consensus Estimate of $11,409 million. Growth was driven by favorable combustible pricing and smoke-free product demand. Total shipment volumes increased 0.6% to 206.2 billion units.
PM’s Quarterly Performance: Key Metrics and Insights
Adjusted gross profit increased 6.7% (up 8.3% organically) to $7,860 million. Adjusted gross profit margin expanded 80 basis points to 68.7%, supported by favorable combustible pricing, scale benefits and the smoke-free product mix.
Adjusted operating income rose 9.6% to $5,117 million, while adjusted operating margin expanded 160 basis points to 44.7%.
Decoding PM’s Segment Performance
Net revenues in the International Smoke-Free segment increased 0.7% (up 3.4% organically) to $3,867 million, reflecting favorable volume/mix from higher heated tobacco unit (“HTU”) and e-vapor volumes, alongside favorable HTU pricing. Adjusted gross profit increased 0.8% (up 3.3% organically) to $2,705 million. Shipment volumes grew 2.7% to 44.5 billion units, supported by growth in Taiwan, Global Travel Retail, Greece, Germany and Bulgaria. HTU shipments increased 1.5% to 41.5 billion units, while HTU adjusted in-market sales rose 7.1%. VEEV e-vapor shipments surged 61.6%, reflecting continued geographic expansion.
Net revenues in the International Combustibles segment increased 6.5% (up 7.8% organically) to $6,725 million. Growth reflected favorable pricing and the restructuring of distribution terms in certain markets, partly offset by an unfavorable geographic mix. Adjusted gross profit increased 8.6% (up 9.8% organically) to $4,610 million. Cigarette shipment volumes remained broadly flat at 158 billion units. Higher shipments in Turkey, Indonesia and Egypt offset declines in Russia, Poland and Japan. The segment benefited from 8.9% pricing growth, while elevated energy-related input costs remained a headwind. Marlboro's cigarette category share increased 50 basis points to a record 11.4%.
Net revenues in the U.S. segment jumped 22.7% to $845 million, driven by higher ZYN shipments, favorable pricing comparisons against prior-year promotions and contributions from the Wellness and cigar businesses. Adjusted gross profit increased 23.9% to $544 million, with organic growth of 23.8%. Total segment shipment volumes increased 2.3% to 3.7 billion equivalent units. ZYN shipments grew 4.2% to 3.2 billion pouches. Adjusted operating companies income increased 1.5% organically to $171 million, reflecting higher marketing investments. Management plans additional investments in the fourth quarter to support ZYN portfolio expansion and the transition to 20-pouch cans.
Philip Morris: Other Updates
The company ended the quarter with cash and cash equivalents of $6,683 million, long-term debt of $41,709 million and a total shareholder deficit of $5,945 million.
Philip Morris also raised its quarterly dividend 8.8% to $1.60 per share.
Sneak Peek Into PM’s Outlook
For 2026, Philip Morris now expects adjusted earnings of $8.29-$8.44 per share, indicating growth of 9.9-11.9%. Earlier, the metric was expected in the $8.26-$8.41 per share range, implying 9.5-11.5% growth. Excluding currency, adjusted earnings are projected at $8.11-$8.26 per share, implying an increase of 7.5-9.5%. Reported earnings per share are expected in the $7.11-$7.26 range. Earlier, the metric was expected in the $7.19-$7.34 per share range.
For 2026, PM still expects net revenues to increase 5-7% on an organic basis. The operating income on an organic basis is likely to rise 7-9%.
Management now expects total cigarette and smoke-free product shipment volumes to grow in 2026, compared with its previous forecast of broadly stable to slightly growing volumes. Smoke-free shipments are expected to increase at a high-single-digit rate, while cigarette volumes are projected to decline at a rate similar to the year-to-date trend.
Management still expects an operating cash flow of around $13.5 billion in 2026. Capital expenditures are likely to be in the band of $1.4 billion to $1.6 billion, primarily implying investments to support the smoke-free business.
Shares of this Zacks Rank #3 (Hold) company have gained 2.9% in the past three months compared with the industry’s growth of 1.2%.
The consensus estimate for Chefs' Warehouse’s current fiscal-year sales and earnings implies growth of 10.8% and 34.2%, respectively, from the year-ago reported figures. Chefs' Warehouse delivered a trailing four-quarter earnings surprise of 30.4%, on average.
Mama's Creations, Inc. (MAMA - Free Report) manufactures and markets fresh deli-prepared foods in the United States. At present, MAMA holds a Zacks Rank of 2. Mama's Creations delivered a trailing four-quarter earnings surprise of 121.7%, on average.
The consensus estimate for Mama's Creations’ current fiscal-year sales and earnings implies growth of 30.3% and 66.7%, respectively, from the year-ago figures.
Lamb Weston Holdings, Inc. (LW - Free Report) engages in the production, distribution and marketing of frozen potato products in the United States, Canada, Mexico and internationally. LW presently carries a Zacks Rank of 2. Lamb Weston delivered a trailing four-quarter earnings surprise of 22.1%, on average.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal-year earnings indicates growth of 7.6% from the year-ago numbers.
View the Zacks #1 Rank List
Image: Bigstock
PM Q3 Earnings Beat Estimates on Strong Pricing & Sales Growth
Key Takeaways
Philip Morris International Inc. (PM - Free Report) reported third-quarter 2026 results, wherein both top and bottom lines beat the Zacks Consensus Estimate and increased year over year.
PM posted quarterly adjusted earnings of $2.36 per share, which increased 5.4% year over year. Excluding currency effects, the adjusted earnings jumped 5.8% year over year. The bottom line beat the Zacks Consensus Estimate of $2.30.
Philip Morris International Inc. Price, Consensus and EPS Surprise
Philip Morris International Inc. price-consensus-eps-surprise-chart | Philip Morris International Inc. Quote
Net revenues of $11,438 million increased 5.5% on a reported basis and 7.1% organically year over year. Revenues beat the Zacks Consensus Estimate of $11,409 million. Growth was driven by favorable combustible pricing and smoke-free product demand. Total shipment volumes increased 0.6% to 206.2 billion units.
PM’s Quarterly Performance: Key Metrics and Insights
Adjusted gross profit increased 6.7% (up 8.3% organically) to $7,860 million. Adjusted gross profit margin expanded 80 basis points to 68.7%, supported by favorable combustible pricing, scale benefits and the smoke-free product mix.
Adjusted operating income rose 9.6% to $5,117 million, while adjusted operating margin expanded 160 basis points to 44.7%.
Decoding PM’s Segment Performance
Net revenues in the International Smoke-Free segment increased 0.7% (up 3.4% organically) to $3,867 million, reflecting favorable volume/mix from higher heated tobacco unit (“HTU”) and e-vapor volumes, alongside favorable HTU pricing. Adjusted gross profit increased 0.8% (up 3.3% organically) to $2,705 million. Shipment volumes grew 2.7% to 44.5 billion units, supported by growth in Taiwan, Global Travel Retail, Greece, Germany and Bulgaria. HTU shipments increased 1.5% to 41.5 billion units, while HTU adjusted in-market sales rose 7.1%. VEEV e-vapor shipments surged 61.6%, reflecting continued geographic expansion.
Net revenues in the International Combustibles segment increased 6.5% (up 7.8% organically) to $6,725 million. Growth reflected favorable pricing and the restructuring of distribution terms in certain markets, partly offset by an unfavorable geographic mix. Adjusted gross profit increased 8.6% (up 9.8% organically) to $4,610 million. Cigarette shipment volumes remained broadly flat at 158 billion units. Higher shipments in Turkey, Indonesia and Egypt offset declines in Russia, Poland and Japan. The segment benefited from 8.9% pricing growth, while elevated energy-related input costs remained a headwind. Marlboro's cigarette category share increased 50 basis points to a record 11.4%.
Net revenues in the U.S. segment jumped 22.7% to $845 million, driven by higher ZYN shipments, favorable pricing comparisons against prior-year promotions and contributions from the Wellness and cigar businesses. Adjusted gross profit increased 23.9% to $544 million, with organic growth of 23.8%. Total segment shipment volumes increased 2.3% to 3.7 billion equivalent units. ZYN shipments grew 4.2% to 3.2 billion pouches. Adjusted operating companies income increased 1.5% organically to $171 million, reflecting higher marketing investments. Management plans additional investments in the fourth quarter to support ZYN portfolio expansion and the transition to 20-pouch cans.
Philip Morris: Other Updates
The company ended the quarter with cash and cash equivalents of $6,683 million, long-term debt of $41,709 million and a total shareholder deficit of $5,945 million.
Philip Morris also raised its quarterly dividend 8.8% to $1.60 per share.
Sneak Peek Into PM’s Outlook
For 2026, Philip Morris now expects adjusted earnings of $8.29-$8.44 per share, indicating growth of 9.9-11.9%. Earlier, the metric was expected in the $8.26-$8.41 per share range, implying 9.5-11.5% growth. Excluding currency, adjusted earnings are projected at $8.11-$8.26 per share, implying an increase of 7.5-9.5%. Reported earnings per share are expected in the $7.11-$7.26 range. Earlier, the metric was expected in the $7.19-$7.34 per share range.
For 2026, PM still expects net revenues to increase 5-7% on an organic basis. The operating income on an organic basis is likely to rise 7-9%.
Management now expects total cigarette and smoke-free product shipment volumes to grow in 2026, compared with its previous forecast of broadly stable to slightly growing volumes. Smoke-free shipments are expected to increase at a high-single-digit rate, while cigarette volumes are projected to decline at a rate similar to the year-to-date trend.
Management still expects an operating cash flow of around $13.5 billion in 2026. Capital expenditures are likely to be in the band of $1.4 billion to $1.6 billion, primarily implying investments to support the smoke-free business.
Shares of this Zacks Rank #3 (Hold) company have gained 2.9% in the past three months compared with the industry’s growth of 1.2%.
Image Source: Zacks Investment Research
Stocks to Consider
The Chefs' Warehouse, Inc. (CHEF - Free Report) distributes specialty food and center-of-the-plate products in the United States, the Middle East and Canada. At present, CHEF carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The consensus estimate for Chefs' Warehouse’s current fiscal-year sales and earnings implies growth of 10.8% and 34.2%, respectively, from the year-ago reported figures. Chefs' Warehouse delivered a trailing four-quarter earnings surprise of 30.4%, on average.
Mama's Creations, Inc. (MAMA - Free Report) manufactures and markets fresh deli-prepared foods in the United States. At present, MAMA holds a Zacks Rank of 2. Mama's Creations delivered a trailing four-quarter earnings surprise of 121.7%, on average.
The consensus estimate for Mama's Creations’ current fiscal-year sales and earnings implies growth of 30.3% and 66.7%, respectively, from the year-ago figures.
Lamb Weston Holdings, Inc. (LW - Free Report) engages in the production, distribution and marketing of frozen potato products in the United States, Canada, Mexico and internationally. LW presently carries a Zacks Rank of 2. Lamb Weston delivered a trailing four-quarter earnings surprise of 22.1%, on average.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal-year earnings indicates growth of 7.6% from the year-ago numbers.