Philip Morris International (PM) Morgan Stanley Global Consumer & Retail Conference 2025 summary

Strategic overview and market trends

• Smoke-free products now represent over 40% of sales and are available in 100+ markets, with multiple product platforms in 30+ markets.

• All three platforms—heat-not-burn, pouches, and e-vapor—are seen as essential to meet diverse smoker needs and drive conversion from cigarettes.

• Smoke-free product growth is expected to be around 10-12%, outpacing the industry average and offsetting cigarette volume declines for five consecutive years.

• Major untapped markets like India, Vietnam, and Turkey present significant future growth opportunities.

• Regulatory environments are evolving, with more mature conversations around nicotine and harm reduction supporting category growth.

ZYN and U.S. pouch category performance

• ZYN experienced supply constraints in Q4 but ramped up capacity faster than expected, leading to accelerated volume growth in Q3.

• Marketing and promotional efforts in Q3 drove a sharp increase in brand equity and consumer engagement.

• ZYN commands a premium price and captures over 50% of category growth, despite a price gap with competitors.

• FDA decisions on pending PMTAs are expected to further support portfolio expansion and growth in 2024-2026.

• The U.S. pouch category is the fastest-growing tobacco segment, with robust outlook through 2026.

International IQOS and regulatory landscape

• IQOS continues double-digit growth, holding share despite regulatory headwinds like flavor bans and tax equalization in key markets such as Japan and Poland.

• Japan is approaching a 50/50 split between combustibles and smoke-free products, with staged tax increases planned through 2029.

• Regulatory and tax changes may cause short-term slowdowns but do not alter the long-term growth trajectory.

• Innovation remains a key driver, with new IQOS versions and improved user experiences planned.

• Expansion into new geographies and continued product innovation are expected to sustain growth.