Altria Group, Inc., best known for its Marlboro cigarettes, continues its transition to smokeless products while facing ongoing challenges in the combustible products sector.
Progress of smoke-free products
In the e-cigarette space, Altria is banking on NJOY’s potential. In the third quarter of 2024, NJOY consumable shipments increased 15,6% year-over-year to 10,4 million units. NJOY device shipments nearly tripled to 1,1 million units. NJOY’s market share in the U.S. consumable segment grew to 6,2% in the quarter.
Oral tobacco products also saw notable growth. Revenue increased more than 5% to $722 million, driven by favorable pricing and increased shipment volume. Domestic shipment volume increased 1,2% during the period. On! nicotine pouches were a particular contributor to this performance, now representing 8,9% of the U.S. oral tobacco market, with shipment volume increasing 46% year-over-year.
Challenges in the fuel products sector
Altria's combustible products segment continues to face significant challenges. Revenues decreased slightly to $5,54 billion, primarily due to an 8,6% decline in domestic cigarette shipment volumes. This decrease was driven by overall industry declines and loss of retail market share. Inflationary pressures are impacting smokers' discretionary income, which is weighing on volumes.
Despite these challenges, Marlboro showed some resilience, with its share of the premium segment increasing by 0,3 percentage points to 59,3%. However, its overall market share in the cigarette category declined by 0,6 percentage points to 41,7% in the third quarter.
Future prospects
Altria remains committed to diversifying its portfolio by investing in smoke-free alternatives, while managing ongoing challenges related to combustible products. The performance of NJOY and oral tobacco products indicates progress toward a more balanced product offering, although the full transition to a smoke-free future remains a complex challenge.