Philip Morris International Reports 2025 Third-Quarter & First Nine-Months Results;
Raises Full-Year Adjusted Diluted EPS Guidance and Revises Assumptions;
Third-Quarter Reported Diluted EPS Grew 13.2% to $2.23,

STAMFORD, CT, October 21, 2025 – Philip Morris International Inc. (PMI) (NYSE: PM) today announces its 2025 third quarter results.1

"In the third quarter, we continued to invest in the growth of our increasingly profitable smoke-free business, while achieving record quarterly smoke-free gross profit and adjusted diluted EPS," said Jacek Olczak, Chief Executive Officer.

"Our global smoke-free portfolio is outgrowing the industry by a clear margin, driving positive total volumes, strong top-line growth and impressive margin expansion."

"We are on track to exceed our industry-leading 2024-26 growth targets and upgrade our 2025 full-year adjusted diluted EPS forecast."

•Smoke-free business (SFB): Our smoke-free business accounted for 41% of total net revenues (up by 2.9pp vs. Q3 last year) and over 42% of total gross profit (up by 2.5pp vs. Q3 last year). Our smoke-free products (SFP) are now available in 100 markets, nearly half of which have at least two of our three flagship brands (IQOS, ZYN and VEEV) available for sale. Our SFB continues to deliver superior performance, with shipment volumes up by 16.6%, net revenues growing by 17.7% (13.9% organically) and gross profit increasing by 19.5% (14.8% organically).

•Inhalable smoke-free products: IQOS continues to strengthen its overall position as the second largest nicotine ‘brand’ in markets where present (gaining 0.9pp of combined cigarette and HTU industry volumes to reach 9.1% share) and is driving the growth of the global heat-not-burn category, where PMI holds approximately 76% volume share. HTU adjusted in-market sales (IMS) volume, which excludes the net impact of estimated distributor and wholesaler inventory movements, grew by 9.0% against a strong prior year comparator.

•In Japan, notwithstanding a significant intensifying of competition, adjusted IMS grew by an estimated 6.0%, with IQOS continuing to hold its share of the heat-not-burn category. IQOS HTU adjusted market share of total nicotine increased by 1.8pp to 31.7%. The overall category exceeds 50% of total nicotine offtake share in 14 out of 20 major cities and 10 prefectures.

•In Europe, adjusted IMS reached a record 15 billion units and grew by an estimated 7.3%, with a further acceleration in Italy and strong growth in many markets, notably Greece, Spain and Romania. As we continue to roll out the ILUMA i device, we are continuously innovating on IQOS consumables, with DELIA sourcing incremental users from new cohorts of legal-age smokers, and LEVIA growing its appeal among legal-age vapers. IQOS HTU adjusted market share increased by 1.2pp to 10.7%.

1 Explanation of PMI's use of non-GAAP measures cited in this document and reconciliations to the most directly comparable U.S. GAAP measures can be found in the “Non-GAAP Measures, Glossary and Explanatory Notes” section of this release, in Exhibit 99.2 to the company's Form 8-K dated October 21, 2025, and at www.pmi.com/2025Q3earnings.

•Outside Europe and Japan, strong adjusted IMS growth continued and offtake share increased in key cities across the globe, including Cairo, Mexico City, Tunis, Riyadh, Seoul, Jakarta and Kuala Lumpur. In Indonesia, the broader roll-out of BONDS by IQOS continues as a complementary offer to IQOS ILUMA with promising early results.

In the e-vapor category, VEEV continued its increasingly profitable growth, and is now available in 46 markets. Shipment volumes grew by 91.0%, driven by Europe and Indonesia. Within the closed pods segment, VEEV holds a top 3 position in 15 markets, including the #1 position in 8 markets. PMI remains committed to building and commercializing the brand in a focused, responsible and profitable manner as VEEV increasingly sources from non-IQOS legal-age nicotine users.

•Oral SFP: Shipment volume increased by 16.9% in pouch or pouch equivalents (20.2% in cans), fueled by nicotine pouches, which more than doubled outside the U.S. and Nordics, and in the U.S. grew by 37% to 205 million cans.

•In the U.S., ZYN accelerated its offtake growth to a remarkable 39% in Q3 as estimated by Nielsen, also driving category growth to over 40%. The growth of ZYN was supported by a wide range of commercial activities to further enhance the strength and presence of the brand, and ensure competitive price positioning following several quarters of reduced activity due to supply constraints. In addition, we implemented select short-term 'relaunch' promotions to mark ZYN's return to full availability and boost trial among legal-age smokers. While this had an impact on Americas Region Q3 net revenue and operating income growth, we expect U.S. ZYN to remain best-in-class in terms of profitability for the group, reinforcing the attractive outlook for the category.

•The growth of the international nicotine pouch business was fueled by strong offtake and geographic expansion. Our focus remains on switching legal-age smokers with a relevant product portfolio. Pakistan, the UK, Poland, and South Africa delivered strong performances. Following further launches, ZYN is now available in 46 international markets.

•Combustibles: Notwithstanding expected lower volumes, net revenues grew by 4.3% (up 1.0% organically) fueled by high single-digit pricing, partly offset by negative mix dynamics. This drove another quarter of robust gross profit growth of 7.7% (4.8% organically). Marlboro reached 10.9% category share, its highest quarterly market share since the 2008 spin. Our overall cigarette category share was broadly stable for the first nine-months.

•Dividend: Increased regular quarterly dividend by 8.9% to $1.47 per share, or an annualized $5.88 per share.

2 One milliliter of e-vapor liquid equivalent to 10 units; 2024 volume of e-vapor in billions of units: Q1 0.3, Q2 0.4, Q3 0.5, Q4 0.5

3 For a list of adjusting items refer to additional information section of this release

Note: Sums might not foot to total due to rounding.

Reported diluted EPS is forecast to be in a range of $7.39 to $7.49, at prevailing exchange rates, versus reported diluted EPS of $4.52 in 2024. Excluding a total 2025 adjustment of $0.07 per share, this forecast represents a projected increase of 13.5% to 15.1% versus adjusted diluted EPS of $6.57 in 2024. Also excluding a favorable currency impact of $0.10, at prevailing exchange rates, this forecast represents a projected increase of 12.0% to 13.5% versus adjusted diluted EPS of $6.57 in 2024, as outlined in the above table.

This forecast assumes:

•An estimated total international industry volume decline of around 1% for cigarettes and HTUs, excluding China and the U.S.;

•Total cigarette and smoke-free product shipment volume growth for PMI of around 1%. We expect smoke-free product volume growth of 12% to 14%, partly offset by cigarette volume declines of around 2%. SFP volume growth continues to assume 10% to 12% growth in HTU adjusted IMS volumes, and U.S. nicotine pouch second-half shipment growth broadly in-line with offtake growth before trade inventory movements.

•Net revenue growth of around 6% to 8% on an organic basis;

•Organic operating income growth of 10% to 11.5%, including the impact of higher U.S. investments;

•Full-year amortization of acquired intangibles of $0.50 per share, including the amortization of IQOS commercialization rights in the U.S. related to the agreement to end our commercial relationship with Altria Group, Inc. covering IQOS in the U.S.;

•An effective tax rate, excluding discrete tax events, of around 22%;

•Operating cash flow of more than $11.5 billion at prevailing exchange rates, subject to year-end working capital requirements; this now includes dividend income from our deconsolidated Canadian affiliate.

•Capital expenditures of around $1.6 billion, almost entirely due to investments supporting the smoke-free business;

•Further net debt to adjusted EBITDA ratio improvement as we continue to target a ratio of around 2x by the end of 2026; and

•No share repurchases in 2025.

Factors described in the Forward-Looking and Cautionary Statements section of this release represent continuing risks to these projections.

With our smoke-free business now operating at scale across our regions, including substantial growth from our U.S. business, PMI plans to implement an evolved organizational model with two primary business units: International and U.S. The updated organizational structure is designed to enhance our agility and to support our journey to become a smoke-free company under the leadership of CEO Jacek Olczak. This change is scheduled for implementation effective January 1, 2026, and as a result we anticipate realigning our reportable segments.

The current four geographic segments will be replaced with three new segments: International Smoke-Free, International Combustibles, and U.S. The company plans to report its financial results based on the new segments as of the first quarter of 2026. In the weeks following our 2025 full-year earnings announcement, the company plans to disclose select historical financial information for the 2023 to 2025 period based on the new segments.

A conference call hosted by Emmanuel Babeau, Chief Financial Officer, will be webcast at 9:00 a.m., Eastern Time, on October 21, 2025. Access the webcast at www.pmi.com/2025Q3earnings.

Operating Review - Third-Quarter 2025

Net Revenues (in millions)						Total PMI						Europe						SSEA, CIS & MEA						EA, AU & PMI GTR						Americas
2024						9,911						4,197						2,964						1,602						1,148
Price						305						220						254						35						(204)
Volume/Mix						245						49						(62)						108						150
Other						37						—						40						—						(3)
Acquisitions & Divestitures						(38)						(38)						—						—						—
Currency						385						291						77						23						(6)
2025						10,845						4,719						3,273						1,768						1,085
vs. Q3 2024						9.4%						12.4%						10.4%						10.4%						(5.5)%
Organic growth						5.9%						6.4%						7.8%						8.9%						(5.0)%

•Estimated industry volume (excluding China and the U.S.) for cigarettes and HTUs decreased by 0.8%.

•PMI's shipment volume increased by 0.7% with SFP volumes up by 16.6%, with all SFP categories growing strongly, and cigarette volumes down by 3.2% with declines in all regions.

•Net revenues increased by 5.9% on an organic basis, mainly reflecting: a favorable pricing variance due to higher combustible tobacco pricing; and favorable volume/mix driven by higher smoke-free products volume, notwithstanding lower volumes and unfavorable mix for cigarettes.

•Adjusted operating income increased by 7.5% on an organic basis, mainly reflecting the same factors as for net revenues, partly offset by higher marketing, administration and research costs.

•The estimated market for cigarettes and HTUs decreased by 4.8% to 141.9 billion units, with a 6.3% decrease for cigarettes and continued HTU growth. Markets with notable decreases include Ukraine (down by 15.0%), Poland (down by 9.7%), and United Kingdom (down by 17.0%).

•PMI's shipment volume decreased by 2.2% with cigarettes down by 6.8% and SFP up by 10.5%.

•PMI HTUs share of the total cigarette and HTU market increased by 1.2pp on an adjusted basis.

•Net revenues increased by 6.4% on an organic basis, reflecting: a favorable pricing variance driven by higher combustible tobacco pricing, and favorable volume/mix driven by higher smoke-free products volume, notwithstanding lower volumes and unfavorable mix for cigarettes.

•Adjusted operating income increased by 9.1% organically, mainly due to the same factors as for net revenues.

•The estimated market for cigarettes and HTUs increased by 1.2% to 399.9 billion units, mainly due to Bangladesh (up by 23.5%), India (up by 9.1%), and Turkey (up by 2.5%), partly offset by Vietnam (down by 8.3%) and Indonesia (down by 2.7%).

•PMI's shipment volume increased by 0.7% with SFP up by 23.3%, and cigarettes down by 1.1%.

•PMI's HTU adjusted in-market sales volume, fueled by broad growth across the region, increased by an estimated 13.3%.

•Net revenues increased by 7.8% on an organic basis, primarily reflecting: a favorable pricing variance, predominantly driven by higher combustible tobacco pricing; while higher SFP volume was more than offset by unfavorable cigarette mix due to the below mentioned commercial model change in Indonesia.

•A change in our commercial model for the below tier-one cigarette segment in Indonesia in the fourth quarter of 2024 resulted in lower net revenue growth, with no meaningful impact on operating income.

•Adjusted operating income increased by 17.9% on an organic basis, mainly reflecting a favorable price variance, predominantly driven by higher combustible tobacco pricing, partly offset by higher marketing, administration and research costs.

•The estimated market for cigarettes and HTUs, excluding China, was broadly stable (82.5 billion units), with a decrease in cigarettes offset by HTU growth. Notable increases in South Korea (up by 2.6%) and Global Travel Retail (up by 4.6%) were offset by Australia (down by 59.2%) and Taiwan (down by 2.3%).

•PMI's shipment volume increased by 7.1% with SFP up by 17.8%, and cigarettes down by 4.6%.

•PMI's HTU adjusted in-market sales volume increased by an estimated 8.2%.

•Net revenues increased by 8.9% on an organic basis, predominantly reflecting a favorable volume/mix, driven by higher smoke-free products volume.

•Adjusted operating income increased by 11.9% organically, mainly due to the same factor as for net revenues.

•The estimated market for cigarettes and HTUs, excluding the U.S., decreased by 6.2% to 44.1 billion units, driven by a decrease in the cigarette market. The decrease was mainly due to Brazil (down by 9.8%) and Mexico (down by 11.3%), partly offset by Argentina (up by 5.0%).

•PMI's shipment volume increased by 0.6% with SFP up by 26.9%, and cigarettes down by 4.7%.

•Oral SFP shipments increased by 29.1% to 238 million cans, predominantly driven by ZYN nicotine pouches in the U.S.

•Net revenues decreased by 5.0% organically, mainly reflecting an unfavorable price variance in the U.S., including the impact of special promotions to mark ZYN's return to full availability, with all promotional costs including retailer incentives taken in net revenue. This was partly offset by higher SFP volumes.

•Adjusted operating income decreased by 43.5% on an organic basis, primarily reflecting: the same factors as for net revenues; and higher marketing, administration and research costs.

Operating Review - First Nine Months 2025

Net Revenues (in millions)						Total PMI						Europe						SSEA, CIS & MEA						EA, AU & PMI GTR						Americas
2024						28,172						11,547						8,393						4,959						3,273
Price						1,251						647						596						68						(60)
Volume/Mix						847						204						(92)						210						525
Other						26						—						37						—						(11)
Acquisitions & Divestitures						(126)						(126)						—						—						—
Currency						116						241						8						(30)						(103)
2025						30,286						12,513						8,942						5,207						3,624
vs. YTD 2024						7.5%						8.4%						6.5%						5.0%						10.7%
Organic growth						7.5%						7.4%						6.4%						5.6%						13.9%

•Estimated industry volume (excluding China and the U.S.) for cigarettes and HTUs decreased by 0.7%.

•PMI's shipment volume increased by 1.8% with smoke-free volumes up by 14.3%, with all SFP categories growing strongly, and cigarette volumes down by 1.3%.

•Net revenues increased organically by 7.5%, mainly reflecting: a favorable pricing variance due to higher combustible tobacco pricing; and favorable volume/mix, driven by higher smoke-free volume, notwithstanding unfavorable mix and lower cigarette volumes.

•Adjusted operating income increased by 12.5% organically, reflecting: the same factors as for net revenues; partly offset by marketing, administration and research costs as well as manufacturing costs.

•PMI's shipment volume decreased by 1.2% with cigarettes down by 6.0% and SFP up by 12.2%.

•Net revenues increased organically by 7.4%, reflecting a favorable price variance, predominantly due higher combustible tobacco pricing; and favorable volume/mix, driven by higher smoke-free products volume, notwithstanding lower volumes and unfavorable mix for cigarettes.

•Adjusted operating income increased by 9.4% on an organic basis, primarily reflecting: the same factors as for net revenues; partly offset by higher marketing, administration and research costs.

•PMI's shipment volume increased by 2.1% with SFP up by 15.8% and cigarettes up by 1.0%.

•Net revenues increased organically by 6.4%, mainly reflecting: a favorable price variance, predominantly driven by combustible tobacco pricing; while unfavorable cigarette mix due to an already mentioned commercial model change in Indonesia was largely offset by higher cigarette and SFP volume.

•Adjusted operating income increased by 16.5% on an organic basis, mainly reflecting: a favorable price variance as well as higher cigarette and SFP volume, partly offset by higher marketing, administration and research costs as well as manufacturing costs (notably tobacco leaf).

•PMI's shipment volume increased by 5.8% with SFP up by 12.1% and cigarettes down by 2.1%.

•Net revenues increased 5.6% organically, mainly reflecting favorable volume/mix, driven by SFP volume and favorable price variance, driven by higher combustible tobacco pricing.

•Adjusted operating income increased 14.7% organically, reflecting the same factors as for net revenues.

•PMI's shipment volume increased by 4.2% with SFP up by 32.3% and cigarettes down by 1.2%.

•Net revenues increased 13.9% organically with favorable volume/mix, driven by SFP volume and an unfavorable U.S. price variance largely offset by cigarette pricing outside of the U.S.

•Adjusted operating income increased by 12.8% organically, due to the same factors as for net revenues, partly offset by higher marketing, administration and research costs as well as manufacturing costs.

Philip Morris International is a leading international consumer goods company, actively delivering a smoke-free future and evolving its portfolio for the long term to include products outside of the tobacco and nicotine sector. The company’s current product portfolio primarily consists of cigarettes and smoke-free products, including heat-not-burn, nicotine pouch and e-vapor products. Our smoke-free products are available for sale in 100 markets, and as of June 30, 2025 PMI estimates they were used by over 41 million legal-age consumers around the world, many of whom have moved away from cigarettes or significantly reduced their consumption. The smoke-free business accounted for 41% of PMI’s first-nine months 2025 total net revenues. Since 2008, PMI has invested over $14 billion to develop, scientifically substantiate and commercialize innovative smoke-free products for adults who would otherwise continue to smoke, with the goal of completely ending the sale of cigarettes. This includes the building of world-class scientific assessment capabilities, notably in the areas of pre-clinical systems toxicology, clinical and behavioral research, as well as post-market studies. Following a robust science-based review, the U.S. Food and Drug Administration has authorized the marketing of Swedish Match’s General snus and ZYN nicotine pouches and versions of PMI’s IQOS devices and consumables - the first-ever such authorizations in their respective categories. Versions of IQOS devices and consumables and General snus also obtained the first-ever Modified Risk Tobacco Product authorizations from the FDA. With a strong foundation and significant expertise in life sciences, PMI has a long-term ambition to expand into wellness and healthcare areas and aims to enhance life through the delivery of seamless health experiences. References to “PMI”, “we”, “our” and “us” mean Philip Morris International Inc., and its subsidiaries. For more information, please visit www.pmi.com and www.pmiscience.com.

This press release contains projections of future results and goals and other forward-looking statements, including statements regarding expected financial or operational performance; capital allocation plans; investment strategies; regulatory outcomes; market expectations; business plans and strategies. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. In the event that risks or uncertainties materialize, or underlying assumptions prove inaccurate, actual results could vary materially from those contained in such forward-looking statements. Pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, PMI is identifying important factors that, individually or in the aggregate, could cause actual results and outcomes to differ materially from those contained in any forward-looking statements made by PMI.

PMI's business risks include: excise tax increases and discriminatory tax structures; increasing marketing and regulatory restrictions that could reduce our competitiveness, eliminate our ability to communicate with adult consumers, or ban certain of our products in certain markets or countries; health concerns relating to the use of tobacco and other nicotine-containing products and exposure to environmental tobacco smoke; litigation related to tobacco and/or nicotine use and intellectual property; intense competition; the effects of global and individual country economic, regulatory and political developments, natural disasters and conflicts; the impact and consequences of Russia's invasion of Ukraine; changes in adult smoker behavior; the impact of natural disasters and pandemics on PMI's business; lost revenues as a result of counterfeiting, contraband and cross-border purchases; governmental investigations; unfavorable currency exchange rates and currency devaluations, and limitations on the ability to repatriate funds; adverse changes in applicable corporate tax laws; recent and potential future tariffs imposed by the U.S. and other countries; adverse changes in the cost, availability, and quality of tobacco and other agricultural products and raw materials, as well as components and materials for our electronic devices; and the integrity of its information systems and effectiveness of its data privacy policies.

PMI's future profitability may also be adversely affected should it be unsuccessful in its attempts to introduce, commercialize, and grow smoke-free products or if regulation or taxation do not differentiate between such products and cigarettes; if it is unable to successfully introduce new products, promote brand equity, enter new markets or improve its margins through increased prices and productivity gains; if it is unable to expand its brand portfolio internally or through acquisitions and the development of strategic business relationships; if it is unable to attract and retain the best global talent, including women or diverse candidates; or if it is unable to successfully integrate and realize the expected benefits from recent transactions and acquisitions. Future results are also subject to the lower predictability of our smoke-free products performance.

PMI is further subject to other risks detailed from time to time in its publicly filed documents, including PMI's Annual Report on Form 10-K for the fourth quarter and year ended December 31, 2024, and the Quarterly Report on Form 10-Q for the third quarter ended September 30, 2025, which will be filed in the coming days. PMI cautions that the foregoing list of important factors is not a complete discussion of all potential risks and uncertainties. PMI does not undertake to update any forward-looking statement that it may make from time to time, except in the normal course of its public disclosure obligations.

Reconciliations of non-GAAP measures in this release to the most directly comparable U.S. GAAP measures can be found in Exhibit 99.2 to the Form 8-K dated October 21, 2025, and at www.pmi.com/2025Q3earnings. A glossary of key terms, definitions and explanatory notes is available in the aforementioned Exhibit 99.2 and on the same webpage, where additional financial schedules, as well as adjustments and other calculations have also been made available.

Management reviews net revenues, gross profit, operating income, operating income margin, operating cash flow and earnings per share, or "EPS," on an adjusted basis, which may exclude the impact of currency and other items such as acquisitions, divestitures, restructuring costs, tax items and other special items. Additionally, starting in 2022 and on a comparative basis, for these measures other than net revenues and operating cash flow, PMI includes adjustments to add back amortization expense on acquisition related intangible assets that are recorded as part of purchase accounting and contribute to PMI’s revenue generation, as well as impairment of intangible assets, if any. While amortization expense on acquisition related intangible assets is excluded in these adjusted measures, the net revenues generated from these acquired intangible assets are included in the company's adjusted measures, unless otherwise stated. Currency-neutral and organic growth rates reflect the way management views underlying performance for these measures. PMI believes that such measures provide useful insight into underlying business trends and results. Management reviews these measures because they exclude changes in currency exchange rates and other factors that may distort underlying business trends, thereby improving the comparability of PMI’s business performance between reporting periods. Furthermore, PMI uses several of these measures in its management compensation program to promote internal fairness and a disciplined assessment of performance against company targets. PMI discloses these measures to enable investors to view the business through the eyes of management.

Non-GAAP measures used in this release should neither be considered in isolation nor as a substitute for the financial measures prepared in accordance with U.S. GAAP.

•"PMI" refers to Philip Morris International Inc. and its subsidiaries. Trademarks and service marks that are the registered property of, or licensed by, the subsidiaries of PMI, are italicized.

•Comparisons are made to the same prior-year period unless otherwise stated.

•References to total industry (or total market), PMI shipment volume and PMI market share performance reflect cigarettes and heated tobacco units, unless otherwise stated.

•As of the first quarter of 2022, total industry volume, PMI in-market sales volume and PMI market share for the following geographies include the cigarillo category in Japan: the total international market, EA, AU & PMI GTR Region, and Japanese domestic market.

•References to total international market, defined as worldwide cigarette and heated tobacco unit volume excluding the U.S., total industry (or total market) and market shares are PMI estimates for tax-paid products based on data from a number of internal and external sources and may, in defined instances, exclude the People's Republic of China. Past reported periods may be updated to ensure comparability and to incorporate the most current information for industry and market share reporting.

•"Combustible tobacco products" is the term PMI uses to refer to cigarettes and other tobacco products that are combusted.

•In-market sales or "IMS" is defined as sales to the trade channels, which serve the end legal age nicotine users. Depending on the market and distribution model, IMS may represent an estimate. Consequently, past reported periods may be updated to ensure comparability and to incorporate the most current information.

•From time to time, PMI’s shipment volumes and IMS are subject to the impact of distributor inventory movements (or wholesaler inventory movements in certain markets where PMI does not sell to distributors), and estimated total industry/market volumes are subject to the impact of inventory movements in various trade channels that include estimated trade inventory movements of PMI’s competitors arising from market-specific factors that significantly distort reported volume disclosures. Such factors may include changes to the manufacturing supply chain, shipment methods, consumer demand, timing of excise tax increases or other influences that may affect the timing of sales to customers. In such instances, in addition to reviewing PMI shipment volumes, IMS, certain estimated total industry/market volumes and estimated market share on a reported basis, management reviews these measures on an adjusted basis that excludes the impact of distributor and/or estimated trade inventory movements. Management also believes that disclosing PMI's shipment volumes, IMS, estimated total industry/market volumes and estimated market share in such circumstances on a basis that excludes the impact of distributor and/or estimated trade inventory movements, improves the comparability of performance and trends for these measures over different reporting periods.

•Consumer offtake or offtake is the term PMI uses to refer to an approximation of purchases by consumers based on various market specific sources (e.g., Nielsen).

•"Total shipment volume" is defined as the combined total of cigarette, heated tobacco, oral smoke-free products (excluding snuff, snuff leaf and U.S. chew) and
e-vapor shipment volume in equivalent units, unless otherwise stated.

•"SSEA, CIS & MEA" stands for South & Southeast Asia, Commonwealth of Independent States, and Middle East & Africa.

•"EA, AU & PMI GTR" stands for East Asia, Australia and PMI Global Travel Retail.

•2025 volumes of nicotine pouches from U.S. based Global Travel Retail locations are recorded in Americas segment, financial impact is recorded in EA, AU & PMI GTR segment. No meaningful U.S. travel retail volumes in prior year.

•Following the sale of Vectura Group Ltd. on December 31, 2024, we updated our segment reporting in January 2025 by including the ongoing Wellness & Healthcare segment results in the Europe segment. In addition, PMI renamed its “PMI Duty Free” business to “PMI Global Travel Retail” effective in the first quarter of 2025. As a result of this change, our segment that includes our duty free business was renamed East Asia, Australia & PMI Global Travel Retail (“EA, AU & PMI GTR”). As of the first quarter of 2025, PMI began reporting on this basis.

•Following the deconsolidation of PMI's Canadian subsidiary, Rothmans, Benson & Hedges, Inc. (RBH) on March 22, 2019, PMI continues to report the volume and corresponding royalty revenues of brands sold by RBH for which other PMI subsidiaries are the trademark owner. These include Next, TEREA and VEEV. The volume and corresponding royalty revenues for these brands sold by RBH were not material to PMI for all periods presented.

•Within the tables and schedules presented throughout this earnings release, certain columns and rows may not add due to the use of rounded numbers for disclosure purposes.

•"Cost of sales" consists principally of: tobacco leaf, non-tobacco raw materials, labor and manufacturing costs; shipping and handling costs; and the cost of devices produced by third-party electronics manufacturing service providers. Estimated costs associated with device warranty programs are generally provided for in cost of sales in the period the related revenues are recognized.

•"Marketing, administration and research costs" include the costs of marketing and selling our products, other costs generally not related to the manufacture of our products (including general corporate expenses), and costs incurred to develop new products. The most significant components of our marketing, administration and research costs are marketing and sales expenses and general and administrative expenses.

•"Cost/Other" in the Consolidated Financial Summary table of total PMI and the four segments of this release reflects the currency and acquisition/divestiture-neutral variances of: cost of sales (excluding the volume/mix cost component); marketing, administration and research costs (including restructuring costs); and amortization and impairment of intangibles. “Cost/Other” also includes the currency and acquisition/divestiture-neutral net revenue variance, unrelated to volume/mix and price components, attributable to: fees for certain distribution rights billed to customers in certain markets in the SSEA, CIS & MEA Region.

•"Adjusted Operating Income Margin" is calculated as adjusted operating income, divided by net revenues.

•"Adjusted EBITDA" is defined as earnings before interest, taxes, depreciation, amortization and equity (income)/loss in unconsolidated subsidiaries, excluding restructuring costs, impairment of intangibles, and unusual items.

•"Net debt" is defined as total debt, less cash and cash equivalents.

•Growth rates presented on an organic basis reflect adjusted results, excluding currency, acquisitions and divestitures.

•Management reviews net revenues, gross profit, operating income, operating income margin, operating cash flow and earnings per share, or "EPS," on an adjusted basis, which may exclude the impact of currency and other items such as acquisitions, divestitures, restructuring costs, tax items and other special items. Additionally, starting in 2022 and on a comparative basis, for these measures other than net revenues and operating cash flow, PMI includes adjustments to add back amortization expense on acquisition related intangible assets that are recorded as part of purchase accounting and contribute to PMI’s revenue generation, as well as impairment of intangible assets, if any. While amortization expense on acquisition related intangible assets is excluded in these adjusted measures, the net revenues generated from these acquired intangible assets are included in the company's adjusted measures, unless otherwise stated. Currency-neutral and organic growth rates reflect the way management views underlying performance for these measures. PMI believes that such measures provide useful insight into underlying business trends and results. Management reviews these measures because they exclude changes in currency exchange rates and other factors that may distort underlying business trends, thereby improving the comparability of PMI’s business performance between reporting periods. Furthermore, PMI uses several of these measures in its management compensation program to promote internal fairness and a disciplined assessment of performance against company targets. PMI discloses these measures to enable investors to view the business through the eyes of management.

•When PMI provides its expectation for adjusted net revenues, adjusted operating income and margin, adjusted earnings per share and adjusted operating cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures, as described above, generally is not available without unreasonable effort due to potentially high variability, complexity, and low visibility as to the items that would be excluded from the GAAP measure in the relevant future period, such as restructuring costs, amortization and impairment of acquired intangibles and other special items, changes in currency exchange rates, the impact and timing of potential acquisitions and divestitures, and other structural changes or their probable significance. The variability of the excluded items may have a significant, and potentially unpredictable, impact on our future GAAP results.

•Non-GAAP measures used by PMI should neither be considered in isolation nor as a substitute for the financial measures prepared in accordance with U.S. GAAP. For a reconciliation of non-GAAP measures to the most directly comparable U.S. GAAP measures, see the "Select Financial Information and Reconciliations of Non-GAAP Financial Measures" section of this document.

•U.S. GAAP Treatment of a country as a Highly Inflationary Economy: following the categorization of a country by the International Practices Task Force of the Center for Audit Quality as having a three-year cumulative inflation rate greater than 100%, the country is considered highly inflationary in accordance with U.S. GAAP. For such countries, PMI accounts for the operations of its local affiliates as highly inflationary, and to treat the U.S. dollar as the functional currency of the affiliates. Such treatment was effective July 1, 2018, for Argentina, April 1, 2022, for Turkey, and October 1, 2024 for Egypt.

•"Fair value adjustment for equity security investments" reflects the adjustment resulting from share price movements in passive investments for publicly traded entities that are not controlled or influenced by PMI. Under U.S. GAAP, such adjustments are required to be reflected directly in the income statement. Adjustments reflect share price movements in PMI's investments in India and Sri Lanka.

•"Income tax impact associated with Swedish Match AB financing" reflects a deferred tax benefit (cost) for unrealized foreign currency losses (gains) on intercompany loans related to the Swedish Match acquisition financing reflected in PMI's consolidated statements of earnings. The underlying pre-tax foreign currency movements fully offset in the consolidated statements of earnings and were reflected as currency translation adjustments in PMI's consolidated statements of stockholders' (deficit) equity.

•Egypt sales tax charge: In the third quarter of 2024, following a ruling issued by the Higher Administrative Court in Egypt and subsequent evaluation of available remedies, PMI concluded that an adverse outcome was probable and recorded a pre-tax charge of $45 million in relation to tax assessments for general sales tax deducted on imported cutfiller for the years 2014 to 2016.

•Loss on Sale of Vectura Group: In September 2024, PMI announced the execution of a definitive agreement to sell Vectura to Molex Asia Holdings Ltd. On December 31, 2024, we completed the sale. As a result, PMI recorded a pre-tax loss in 2024 of $199 million, primarily related to an impairment charge of $198 million recorded in the third quarter related to Vectura's classification as held for sale.

•Smoke-free business ("SFB”) is the term PMI uses to refer to all of its smoke-free products. SFB also includes wellness and healthcare products, as well as consumer accessories, such as lighters and matches.

•Smoke-free products ("SFPs”) is the term PMI uses to refer to all of its products that provide nicotine without combusting tobacco, such as heat-not-burn, e-Vapor, and oral smokeless, and that therefore generate far lower levels of harmful chemicals. As such, these products have the potential to present less risk of harm versus continued smoking.

•Wellness and Healthcare products primarily refer to products associated with inhaled therapeutics and oral and intra-oral delivery systems.

•"Heated tobacco units" or "HTU" is the term PMI uses to refer to heated tobacco consumables, which include our BLENDS, DELIA, HEETS, HEETS Creations (defined collectively as "HEETS"), SENTIA, TEREA, TEREA CRAFTED, and TEREA Dimensions, as well as the KT&G-licensed brands, Fiit and Miix (outside of South Korea). HTU's also include zero tobacco heat-not-burn consumables (LEVIA).

•Unless otherwise stated, market share for HTUs is defined as the in-market sales volume for HTUs as a percentage of the total estimated industry sales volume for cigarettes and HTUs. For Japan, total estimated industry sales volume also includes cigarillos.

•"Adjusted market share for HTUs" is defined as the total in-market sales volume for PMI HTUs as a percentage of the total estimated sales volume for cigarettes and HTUs, excluding the impact of estimated distributor and wholesaler inventory movements.

•Unless otherwise stated, all references to IQOS are to PMI's IQOS devices and heated tobacco consumables.

•IQOS heat-not-burn devices are precisely controlled heating devices into which a specially designed and proprietary tobacco units are inserted and heated to generate an aerosol.

•"PMI heat-not-burn products" or "PMI HTUs" or "IQOS HTUs" include licensed KT&G heat-not-burn products.

•“Total PMI SFPs users” is defined as the sum of “Total IQOS users”, “Total oral smokeless users", “Total e-Vapor users” of PMI products and considering “Poly-users across PMI SFPs categories”.

•“Total IQOS users” is defined as the estimated number of Legal Age (minimum 18 years1) users of PMI heat-not-burn products, for which PMI HTUs represented at least a portion of their daily tobacco consumption over the past seven days.

The estimated number of adults who have "switched to IQOS and stopped smoking" reflects:

•for markets where there are no heat-not-burn products other than PMI heat-not-burn products: daily individual consumption of PMI HTUs represents the totality of their daily tobacco consumption in the past seven days;

•for markets where PMI heat-not-burn products are among other heat-not-burn products: daily individual consumption of HTUs represents the totality of their daily tobacco consumption in the past seven days, of which at least 70% is PMI HTUs.

•“Total PMI oral smokeless users” are defined as the estimated number of Legal Age (minimum 21 years in the U.S and minimum 18 years11outside the U.S) users of oral smokeless products who consumed at least one of PMI oral smokeless products (nicotine pouches in the U.S., and nicotine pouches or snus outside the U.S) over the past seven days.

•“Total PMI e-Vapor users” is defined as the estimated number of Legal Age (minimum 18 years1) users of e-Vapor products, who consumed at least one of PMI
e-Vapor products in the past seven days.

•“Poly-users across PMI SFPs categories” are defined as the estimated number of Legal Age (minimum 18 years1) users who used multiple PMI SFPs over the past seven days.

•The above SFPs user metrics reflect PMI estimates, which are based on PMI's proprietary Nicotine Containing Products Tracker (NCPT) in combination with SFP multicategory offtake volume trends. The NCPT methodology estimates rely on NCPT e-Vapor, oral smokeless (except the U.S.) and poly-usage data, which is calibrated using Total IQOS user data, leveraging our deep understanding of PMI’s heat-not-burn category and its size. Total PMI oral smokeless users in the U.S. are approximated through volume-based estimations, as NCPT data for the U.S. is not currently available.

Note: PMI SFPs user estimates are derived from sample-based estimations from NCPT at 95% Confidence Interval. The accuracy and reliability of PMI SFPs users estimates may vary based on sample size, market maturity and availability of information.

•"Oral smoke-free product volume" excludes snuff, snuff leaf and U.S. chew and is measured in cans or, for the purposes of total shipment volumes, in pouches or pouch equivalents.

•"Other Oral SFP volume" includes tobacco bits and chew bags.

11Minimum 18 years or older depending on market regulation

•Oral smoke-free products conversion: (i) nicotine pouches: 15 pouches per can in the U.S. and approximately 20 pouches per can outside the U.S.; (ii) snus products: weighted average 21 pouches equivalent per can; (iii) moist snuff products: weighted average 17 pouches equivalent per can; (iv) tobacco bits products: weighted average 30 pouches equivalent per can; (v) chew bags products: weighted average 20 pouches per can.

•E-vapor products conversion: one milliliter of e-vapor liquid equivalent to 10 units.