Philip Morris International: Smoking Hot 2Q26

Research evidence excerpt

Philip Morris International: Smoking Hot 2Q26

22 July 2026

Callum Elliott, CFA, ACA

+44 20 7676 7183

U.S. Tobacco callum.elliott@bernsteinsg.com

Philip Morris International Inc Victoria Nice, CFA

+44 20 7762 5862

Rating victoria.nice@bernsteinsg.com

Market-Perform Henry Dennis

Price Target +44 20 7676 6776

henry.dennis@bernsteinsg.com

PM 175.00 USD

Simran Cheema

+44 20 7676 6705

simran.cheema@bernsteinsg.com

PMI reported its 2Q26 results this morning with a strong set of numbers, led by remarkable

Close Date 21 Jul 2026

growth in the cigarette business, which saw positive cigarette volume growth, around 4%pts

PM Close Price (USD) 188.04

ahead of consensus, despite fiery cigarette pricing of +10%. On net this strength of cigarette

Price Target (USD) 175.00

volumes and pricing leads to revenue 5.5% ahead of consensus, and EPS nearly 8% ahead.

Upside/(Downside) (7)%

PM has lagged Altria by around 10%pts YTD, but these exceptional results should see this gap

52-Week Range 194.90/142.11

narrow meaningfully today.

SPX 7,509.20

Who needs ZYN growth? For most of the past two years, the debate around PMI has FYE Dec

centered squarely around growth of ZYN - first the explosive growth observed in 2024, and Div Yield 3.1%

then more recently the dramatic slowdown observed in the wake of competitive launches Market Cap (USD) (M) 293,071

from BAT last year. ZYN progress continues to underwhelm this quarter, with management EV (USD) (M) 341,548

citing a US pouch shipment volume growth of +1.8%, which is presumably flattered by Performance YTD 1M 6M 12M

timing of shipments related to ZYN Ultra launch in June, as well as benefitting from the Absolute (%) 17.2 8.6 10.6 13.8

increased number of pouches per can. Nevertheless, the futility of this ZYN myopia could SPX (%) 9.7 0.1 9.2 19.1