PM 8-K — Smart Summary

Philip Morris International Inc. reported Q1 2026 financial results on April 22, 2026. Reported diluted EPS declined 9.3% to $1.56, driven by a non-cash fair value adjustment on its minority shareholding in India, while adjusted diluted EPS grew 16.0% to $1.96. The company updated its 2026 full-year adjusted diluted EPS forecast for currency only, maintaining underlying growth targets.

• Net revenues increased 9.1% (2.7% organically) to $10.1 billion vs. $9,301 million in Q1 2025
• Gross profit increased 10.1% (3.8% organically) to $6,905 million vs. $6,270 million in Q1 2025; adjusted gross profit margin of 68.1% (up 0.6pp)
• Operating income increased 9.8% (0.9% organically) to $3,893 million vs. $3,544 million in Q1 2025
• Adjusted operating income increased 10.0% (0.9% organically) to $4,168 million; adjusted OI margin of 41.1% (up 0.4pp)
• Net earnings attributable to PMI declined 9.4% to $2,438 million vs. $2,690 million in Q1 2025
• Reported diluted EPS declined 9.3% to $1.56 vs. $1.72 in Q1 2025
• Adjusted diluted EPS grew 16.0% to $1.96 vs. $1.69 in Q1 2025; grew 5.3% excluding currency to $1.78
• Net cash used in operating activities was $(399) million vs. $(350) million in Q1 2025, a (14.0)% change

• International Smoke-Free: net revenues $3,836 million, up 24.7% reported (15.8% organically) vs. $3,076 million; gross profit $2,684 million, up 28.6% (19.4% organically); shipment volume grew 11.9%; adjusted OCI $4,224 million, up 15.7% (10.1% organically)
• International Combustibles: net revenues $5,688 million, up 6.8% reported (1.0% organically) vs. $5,326 million; gross profit $3,842 million, up 9.8% (3.9% organically); shipment volume declined 5.1%; adjusted OCI grew 10.1% organically
• U.S. Segment: net revenues $622 million, down 30.8% reported (31.6% organically) vs. $899 million; gross profit $380 million, down 44.5% (44.1% organically); total smoke-free shipment volumes decreased 21.2% including ZYN shipments declining 23.5% to 2.3 billion pouches (155 million cans); adjusted OCI declined 75.3% to $100 million
• Total Smoke-Free net revenues: $4,379 million, up 12.4% (5.3% organically) vs. $3,895 million; smoke-free business accounted for 43% of total net revenues (up 1.3pp)
• Total Combustible Tobacco net revenues: $5,767 million, up 6.7% (0.9% organically) vs. $5,407 million

• Cash and cash equivalents of $5,450 million as of March 31, 2026, vs. $4,872 million as of December 31, 2025
• Total debt of $51,948 million as of March 31, 2026 (short-term borrowings $5,693 million, current portion of long-term debt $2,447 million, long-term debt $43,808 million)
• Net debt of $46,498 million as of March 31, 2026 vs. $43,963 million as of December 31, 2025
• Net Debt to Adjusted EBITDA ratio of 2.61x (12-month rolling) vs. 2.53x at December 31, 2025; company targets a ratio of close to 2.0x by end of 2026
• Total Debt to Adjusted EBITDA ratio of 2.92x (12-month rolling) vs. 2.81x at December 31, 2025
• No share repurchases planned for 2026

• "Our performance exceeded our expectations in the first quarter, with an outstanding delivery from IQOS driving very good growth for the group against a strong prior-year comparison," said Jacek Olczak, Group CEO PMI.
• "Building on excellent broad-based momentum in the international smoke-free business and 16% adjusted diluted EPS growth in Q1, we are well positioned to continue delivering best-in-class performance in 2026," said Jacek Olczak, Group CEO PMI.

• 2026 full-year reported diluted EPS forecast of $7.56 to $7.71 at prevailing exchange rates
• 2026 full-year adjusted diluted EPS forecast of $8.36 to $8.51, representing growth of 10.9% to 12.9% vs. $7.54 in 2025
• Excluding favorable currency impact of $0.25, adjusted diluted EPS growth of 7.5% to 9.5% vs. $7.54 in 2025
• Q2 2026 adjusted diluted EPS of $2.02 to $2.07, including an estimated favorable currency impact of 2 cents at prevailing exchange rates
• Net revenue organic growth of 5% to 7%; organic operating income growth of 7% to 9%
• Operating cash flow around $13.5 billion at prevailing exchange rates; capital expenditures of $1.4 to $1.6 billion
• Broadly stable total PMI cigarette and SFP shipment volume, with high-single digit SFP shipment volume growth and cigarette shipment volume decline of around 3%
• Effective tax rate, excluding discrete tax events, of around 21.5%; no share repurchases planned