(Reuters) – Philip Morris International raised its annual profit forecast on Tuesday, citing continued demand for its Zyn nicotine pouches and price increases for its cigarettes.
Shares of the world’s largest cigarette maker rose more than 3 percent in early trading, helped by second-quarter sales that exceeded expectations.
Philip Morris reported second-quarter revenue of $9.47 billion, beating analysts’ expectations of $9.18 billion, according to LSEG data.
Like its competitors, Philip Morris has raised cigarette prices to offset falling sales volumes amid tighter regulation and heightened awareness of the health risks of smoking.
The company is also working to increase production of Zyn sachets, a brand acquired through the acquisition of Swedish Match in 2022, to meet demand in the United States.
Shipment volumes of these tobacco-free nicotine pouches increased 50.3% in the second quarter, compared to the same period last year, despite supply constraints and the suspension of online sales of the product in the United States.
The increase in sales follows an increase of almost 80% in the previous quarter.
Philip Morris now expects full-year adjusted earnings per share of $6.67 to $6.79, compared with a previous forecast of $6.55 to $6.67 per share.
The tobacco company also expects U.S. nicotine pouch shipment volumes to be between 560 million and 580 million cans, up from a previously forecast 560 million cans.
(Reporting Juveria Tabassum and Emma Rumney; Diana Mandiá, edited by Blandine Hénault)
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