Q1 2025 Philip Morris International Inc Earnings Call Transcript
Key Points
- Philip Morris International Inc (PM) reported a strong start to 2025 with double-digit increases in organic net revenue, operating income, and adjusted diluted EPS.
- The smoke-free business performed exceptionally well, with shipment volumes up 14.4% year on year and organic net revenue growth of 20%.
- ZYN shipments in the US increased by 53%, exceeding initial expectations, and international nicotine pouch can volumes grew by 53%.
- IQOS delivered close to 10% HTU-adjusted IMS growth, with strong performance in Japan and Europe.
- The company achieved a 16% organic operating income growth and a 250 basis points expansion in adjusted operating income margins to 40.7%.
- Currency volatility led to a $0.07 unfavorable currency variance, impacting adjusted diluted EPS.
- There was a notably negative geographic mix in combustibles due to increased volumes in lower-margin markets like Turkey and Egypt.
- The annualization impact of the EU characterizing flavor ban affected IQOS growth in Europe.
- The company faces uncertainties in the global economic outlook, which could impact future performance.
- ZYN experienced out-of-stock issues in the US, affecting retailer inventories and potentially slowing growth.
Good day, and thank you for standing by. Welcome to the Philip Morris International 2025 first-quarter results conference call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your speaker today, James Bushnell, Vice President of Investor Relations and Financial Communications. Please go ahead.
Welcome. Thank you for joining us. Earlier today, we issued a press release containing detailed information on our 2025 first-quarter results. The press release is available on our website at pmi.com.
A glossary of terms, including the definition for smoke-free products as well as adjustments, other calculations, and reconciliations to the most directly comparable US GAAP measures for non-GAAP financial measures cited in this presentation, are available in Exhibit 99.2 to the company's Form 8-K dated April 23, 2025, and on our Investor Relations website.
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