PMI duty-free revenues rise +11.3% in 2024; smoke-free products contribute strongly to growth

Philip Morris International (PMI) has reported strong duty-free revenue growth in the company’s 2024 financial results. Duty-free sales climbed +11.3% year-on-year and +14.4% in Q4.

The tobacco and smoke-free alternative product company reported overall revenues of US$37.88 billion, up +7.7% year-on-year. The numbers were buoyed by a surge in demand for PMI smoke-free products, including IQOS heated tobacco units (HTUs) and ZYN nicotine pouches.

In the EA, AU and PMI DF (duty free) reporting segment, PMI described the estimated total market for cigarettes and HTUs, excluding China, as “broadly stable” (318.9 billion units), with a decrease in cigarettes largely offset by HTU growth.

It noted the decrease in the estimated total market in Australia (-28.5%) and Korea (-2.2%) was offset by International Duty Free (+11.3%) and Japan (+1.4%).

The PMI smoke-free business accounted for 40% of total net PMI revenues and around 42% of gross profit (up 0.7pp and 0.9pp, respectively, against Q4 2023).

PMI estimates that 38.6 million adults now use the company’s smoke-free products (up +16% against December 2023). They are now available in 95 country markets.

PMI CEO Jacek Olczak said: “2024 was a remarkable year for PMI. We delivered very strong full-year results driven by the continued growth of IQOS and ZYN in addition to a robust combustibles performance.

“The long-awaited US FDA authorisation of all ZYN nicotine pouches currently marketed in the USA [see our story here] is further evidence of the compelling science supporting smoke-free products. We hope our other pending FDA applications will be accelerated.

“We also hope other countries follow the example of the USA and embrace effective tobacco harm reduction measures. This is especially important in places where smoke-free products are banned, resulting in the perpetuation of combustible cigarette consumption.”

PMI Duty Free Vice President Beste Ermaner discussed the company’s strong focus on developing its smoke-free products business during last October’s TFWA World Exhibition in Cannes. Click on the image above to watch her interview with The Moodie Davitt Report Founder & Chairman Martin Moodie.