NYSE$PM

Philip Morris International Inc. · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported diluted EPS of $1.01 and adjusted diluted EPS of $1.60, representing currency-neutral growth of 16.9%.

Philip Morris International's second-quarter results showed strong business momentum with total cigarette and HTU shipment volume growth of 3.3%, driving double-digit growth in net revenues and currency-neutral adjusted diluted EPS. The acquisition of Swedish Match, fueled by ZYN's growth in the U.S., is accelerating the company's smoke-free transformation.

  • Reported net revenues were up by 19.0%, excluding currency.
  • Market share for HTUs in IQOS markets increased by 1.6 points to 9.2%.
  • Total IQOS users at quarter-end were estimated at approximately 27.2 million, with 19.4 million having switched to IQOS and stopped smoking.
  • ZYN nicotine pouch shipment volume in the U.S. reached 89.9 million cans, a 53.1% increase versus second-quarter 2022 Swedish Match shipments.

Headline financials

Total Revenue

$8.97B

Previous: $7.83B+14.5%
EPS (adj)

$1.60

Previous: $1.48+8.1%
Adj. Operating Margin

39.4%

No prior period
Capital Expenditures

-$639M

Previous: -$478M-33.7%
Free Cash Flow

$929M

Previous: $1.76B-47.1%
Net Income

$1.57B

Previous: $2.23B-29.8%
Operating Income

$2.57B

Previous: $3.06B-16.0%
Gross Profit

$5.74B

Previous: $5.18B+10.7%
Cash & Equivalents

$3.49B

Previous: $5.04B-30.7%
Total Assets

$61.9B

Previous: $41B+51.0%

Revenue & EPS history

Philip Morris · Revenue · Quarterly

$8.97B

Q2 2023+14.5%vs Q2 2022
Beat estimate in 12 of 15 quarters(80%)
ActualEstimate

Revenue by segment

Philip Morris · $5.61B total across 1 segment · Q3 2022

  • Combustible Products
    $5.61B-3.2%

Forward guidance

PMI is raising its full-year 2023 forecast for organic net revenue growth to a range of 7.5% to 8.5% and currency-neutral adjusted diluted EPS growth to a range of 8.0% to 9.5%.

Tailwinds

  • An estimated total international industry volume decline for cigarettes and HTUs, excluding China and the U.S., of 0.5% to 1.5%.
  • Total cigarette and HTU shipment volume growth for PMI of up to +1%.
  • HTU shipment volume of 125 to 130 billion units, broadly in line with anticipated adjusted in-market sales volume and reflecting an acceleration in growth versus 2022.
  • Net revenue growth of approximately 7.5% to 8.5% on an organic basis.
  • Strong full-year performance for Swedish Match’s existing operations, underpinned by strong shipment volume growth for ZYN in the U.S.

Headwinds

  • A cigarette shipment volume decline of approximately 1.5% to 2.5%.
  • An adjusted operating income margin decline of 50 to 150 basis points on an organic basis, with the decline likely toward the upper (150 basis point) end of the range, notably due to technical factors.
  • Incremental investments to drive future growth, including the commercialization of ILUMA and around $150 million with a broadly even split between the U.S. and the Wellness and Healthcare segment.
  • Wellness and Healthcare segment net revenues of around $300 million (including smoking cessation products), with an adjusted operating loss of around $150 million, primarily due to investments in research and development.
  • No share repurchases in 2023.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+0.8%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.2%

Avg return

30 days after

55%

40 / 73 earnings

Positive

+10.9%

Q4 2024

Best reaction

-16.9%

Q1 2018

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+6.5%+5.0%+23.5%
Q4 2025+0.4%+2.3%-6.6%
Q3 2025-4.0%-0.3%-1.5%
Q2 2025-0.4%+1.7%+0.1%
Q1 2025+2.3%+3.1%+8.6%
Q4 2024+10.9%+13.0%+15.2%
Q3 2024+10.5%+9.2%+10.3%
Q2 2024+3.9%+5.7%+12.0%
Q1 2024+5.3%+1.0%+5.9%
Q4 2023-2.5%-2.5%+1.4%
Q3 2023-0.7%-2.6%-1.4%
Q2 2023-1.3%-1.6%-4.5%
Q1 2023-3.7%-2.8%-8.2%
Q4 2022+1.1%+0.4%-2.9%
Q3 2022+0.0%+2.3%+11.3%
Q2 2022+6.8%+7.5%+11.5%
Q1 2022-0.3%-0.3%-1.8%
Q4 2021+3.7%+5.4%-14.6%
Q3 2021-0.4%-0.6%-6.1%
Q2 2021-1.4%+0.5%+3.6%
Q1 2021+2.7%+3.2%+6.3%
Q4 2020+5.0%+6.7%+7.4%
Q3 2020-5.2%-4.4%-0.4%
Q2 2020+4.3%+5.4%+7.3%
Q1 2020-4.9%-4.2%-8.3%
Q4 2019+4.2%+6.6%+4.0%
Q3 2019+1.8%+2.6%+7.2%
Q2 2019+9.5%+7.0%+4.8%
Q1 2019-1.4%-0.7%+1.6%
Q4 2018+5.9%+6.7%+15.8%
Q3 2018+5.0%+4.7%+2.1%
Q2 2018+2.6%+1.7%+3.5%
Q1 2018-16.9%-18.7%-20.4%
Q4 2017+1.1%+4.2%+9.5%
Q3 2017-2.7%-3.5%-8.8%
Q2 2017-1.7%-3.1%-5.2%
Q1 2017-3.8%-0.7%+0.7%
Q4 2016+5.4%+5.9%+14.9%
Q3 2016+0.5%+0.8%-6.5%
Q2 2016-3.3%-3.1%-2.6%
Q1 2016-2.5%
Q4 2015-0.3%
Q3 2015+3.9%
Q2 2015+3.8%
Q1 2015+9.1%
Q4 2014-1.0%
Q3 2014+2.9%
Q2 2014+1.6%
Q1 2014-1.5%
Q4 2013+4.4%
Q3 2013+1.0%
Q2 2013-1.2%
Q1 2013-2.2%
Q4 2012+3.1%
Q3 2012-4.1%
Q2 2012-0.6%
Q1 2012+0.1%
Q4 2011+1.1%
Q3 2011+0.5%
Q2 2011-1.7%
Q1 2011-1.2%
Q4 2010+0.8%
Q4 2007+0.8%
Q3 2010-1.0%
Q2 2010+0.7%
Q1 2009+0.7%
Q1 2010-0.0%
Q4 2009-1.4%
Q3 2008+2.5%
Q3 2009+2.5%
Q2 2009-2.1%
Q2 2008-2.1%
Q4 2008-2.1%

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