This story has been updated to reflect the difference between e-cigarettes, which heat up a liquid containing nicotine into a vapor, and heated tobacco products, which heat up tobacco.
Philip Morris International Inc.’s stock was down 1.7% on Thursday after the tobacco company missed Wall Street’s fourth-quarter earnings estimate and said its 2024 earnings would fall short.
Philip Morris International
PM,
said its iQOS heated tobacco products surpassed its Marlboro cigarettes in terms of net revenue, as cigarette shipment volume dropped by 1.9%.
Philip Morris International said fourth-quarter net income fell to $2.19 billion, or $1.41 a share in the fourth quarter, from $2.38 billion, or $1.54 a share, in the year-ago quarter.
Read more: Camel, Newport among brands seeing write-down of $34 billion by owner British American Tobacco
Adjusted profit of $1.36 a share fell short of the FactSet consensus estimate of $1.45 a share.
Revenue increased by 11% to $9.05 billion, in line with the analysts’ estimate.
Looking ahead, Philip Morris expects 2024 earnings of $5.90 a share to $6.02 a share, below the analyst estimate of $6.60 a share.
Total iQOS users stood at 28.6 million at year-end, up by 3.7 million from the end of 2022. Out of the total number, 20.8 million had switched to heated tobacco products.
Total cigarette volume fell 0.5%, including a 0.8% drop in Marlboro units to 60.2 million units.
Philip Morris International said its market share for heated-tobacco units (HTUs) rose by 1.2% to 9.1%.
The company said smoke-free products reached nearly 40% of its total net revenues and more than 40% of gross profit in the fourth quarter.
Philip Morris International also marked the one-year anniversary of its combination with Swedish Match, which had “stellar U.S. performance of ZYN, a brand of nicotine pouches.
The company’s iQOS products heat up tobacco into a vapor, which is then inhaled by the user. E-cigarettes heat up a liquid that contains nicotine into a vapor. Both are described as smokeless tobacco products.
Prior to Thursday’s trades, Philip Morris International’s stock was down by 2.8% so far in 2024, while the S&P 500 is up by 4.7%.
