ALTRIA GROUP, INC.
For the period ended Sep 30, 2026. Filed Oct 29, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Oct 29, 2026
MO$76.12-1.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-07-30.
0000764180-26-000094
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-10-29.
0000764180-26-000114
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 363 previous paragraphs and 367 current paragraphs.
251 unchanged; 89 reworded; 21 added; 19 removed; 4 previous and 6 current paragraphs rearranged.
Tables are not compared: 16 previous and 16 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
We are a leader in nicotine with a growing portfolio of products for adult nicotine consumers age 21+. Today, we are focused on elevating everyday moments by offering adult nicotine consumers a range of product choices and the information they need to make informed decisions.
Current report
Our American roots stretch back more than 200 years, and our operating companies’ brands have served adult nicotine consumers for generations. The brand portfolios of our operating companies include Marlboro®, Black & Mild®, Copenhagen®, Skoal®, on!®and NJOY®. Our wholly owned subsidiaries include Philip Morris USA Inc. (“PM USA”), John Middleton Co. (“Middleton”), U.S. Smokeless Tobacco Company LLC (“USSTC”), Helix Innovations LLC (“Helix”) and NJOY, LLC (“NJOY”).
Current report
For additional information, see Note 1. Background and Basis of Presentation.
Current report
We recorded net pre-tax losses of $36 million and $34 million from our investment in ABI for the nine and three months ended September 30, 2025, respectively, consisting primarily of mark-to-market losses on certain ABI financial instruments associated with its share commitments.
Current report
Net revenues, which include excise taxes billed to customers, increased $238 million (1.4%), due primarily to higher net revenues in our smokeable products segment.
Current report
(Income) losses from investments in equity securities was favorable $89 million (22.4%), due primarily to higher income from our equity investment in ABI.
Current report
Adjusted net earnings attributable to Altria of $7,245 million increased $279 million (4.0%), due primarily to higher OCI and higher income from our equity investment in ABI. Adjusted diluted EPS of $4.33 increased by 5.1%, due primarily to higher adjusted net earnings attributable to Altria and fewer shares outstanding.
Current report
Net revenues, which include excise taxes billed to customers, increased $60 million (1.0%), due primarily to higher net revenues in our smokeable products segment.
Current report
Cost of sales increased $61 million (4.2%), due primarily to higher manufacturing costs in our smokeable products and oral tobacco products segments and 2026 costs related to the USSTC Facilities Consolidation, partially offset by lower shipment volume in our smokeable products segment.
Current report
Operating income increased $83 million (2.6%), due primarily to higher OCI.
Current report
Provision for income taxes increased $76 million (10.9%), due primarily to a prior year net income tax benefit from tax reserves associated with our investment in ABI and higher earnings before income taxes.
Current report
In September 2026, Helix, NJOY and certain of their trade partners filed a lawsuit in the U.S. District Court for the Northern District of Texas claiming that the FDA routinely has failed to comply with its obligation under the FSPTCA to issue marketing orders within the 180-day statutory review period following receipt of a PMTA. Among other relief, plaintiffs have requested that the court order the FDA to adopt a new rule or process under the FSPTCA to facilitate compliance with statutory deadlines for the issuance of marketing orders with respect to PMTAs. In October 2026, the court granted the parties’ request to stay the litigation to permit the FDA to engage in rulemaking to address the defects in the current rule identified in the lawsuit.
Current report
In September 2026, the State of California enacted legislation banning the manufacture and import of single-use, battery-powered e-vapor products effective January 2027 and the retail sale of such products effective January 2028.
Current report
Reported OCI increased $327 million (3.9%), due primarily to higher pricing, which includes higher promotional investments, and higher refunds of taxes and duties paid on imported cigarettes ($182 million), partially offset by volume/cigarette mix ($580 million), higher manufacturing costs ($150 million) and higher tobacco and health and certain other litigation items ($41 million).
Current report
Reported and adjusted OCI increased $111 million (3.8%) and $116 million (3.9%), respectively, due primarily to higher pricing, which includes higher promotional investments, and higher refunds of taxes and duties paid on imported cigarettes ($104 million), partially offset by volume/cigarette mix ($199 million) and higher costs ($80 million), consisting primarily of manufacturing costs.
Current report
Marlboro’s retail share of the total cigarette category was 39.5%, a decrease of 1.0 share point versus the prior year and unchanged sequentially. Marlboro’s retail share of the premium segment was 60.0%, an increase of 0.3 share points versus the prior year and 0.4 share points sequentially.
Current report
Net revenues, which include excise taxes billed to customers, decreased $26 million (1.2%), due primarily to lower shipment volume ($140 million), partially offset by higher pricing ($121 million), which includes higher promotional investments.
Current report
Reported OCI decreased $140 million (10.1%), due primarily to lower shipment volume ($122 million), 2026 costs related to the USSTC Facilities Consolidation ($87 million) and higher costs ($42 million), partially offset by higher pricing, which includes higher promotional investments.
Current report
Net revenues, which include excise taxes billed to customers, were essentially unchanged as lower shipment volume ($41 million) was offset by higher pricing ($43 million), which includes higher promotional investments.
Current report
Reported OCI decreased $25 million (5.4%), due primarily to lower shipment volume ($35 million), higher costs ($19 million) and 2026 costs related to the USSTC Facilities Consolidation ($9 million), partially offset by higher pricing, which includes higher promotional investments.
Current report
▪Effective August 18, 2026, USSTC increased the list price on its Copenhagen popular price products, Skoaland Red Seal brands by $0.10 per can and on the balance of its Copenhagen brands by $0.12 per can. USSTC also increased the list price on its Husky brands by $0.08 per can.
Removed paragraphs (19)
Previous report
Our wholly owned subsidiaries include leading manufacturers of both combustible and smoke-free products. In combustibles, we own Philip Morris USA Inc. (“PM USA”), the most profitable U.S. cigarette manufacturer, and John Middleton Co. (“Middleton”), a leading U.S. cigar manufacturer.
Previous report
In smoke-free products, we own U.S. Smokeless Tobacco Company LLC (“USSTC”), the leading global moist smokeless tobacco (“MST”) manufacturer, Helix Innovations LLC (“Helix”), a leading manufacturer of oral nicotine pouches, and NJOY, LLC (“NJOY”), an e-vapor manufacturer with products covered by marketing granted orders (“MGO”) from the U.S. Food and Drug Administration (“FDA”). Additionally, we have a majority-owned joint venture, Horizon Innovations LLC (“Horizon”), for the U.S. marketing and commercialization of heated tobacco stick products. As of the date of this Form 10-Q, Horizon had no products in the U.S. marketplace.
Previous report
The brand portfolios of our operating companies include Marlboro®, Black & Mild®, Copenhagen®, Skoal®, on!® and NJOY®. Trademarks related to Altria referenced in this Form 10-Q are the property of Altria or our subsidiaries or are used with permission.
Previous report
▪Income Tax Items: We recorded income tax items of $30 million and $42 million for the six and three months ended June 30, 2026, respectively, due to an income tax benefit related to the resolution of prior year tax audits, partially offset by income tax expense associated with a tax basis adjustment related to our investment in ABI. For further discussion, see Note 11. Income Taxes (“Note 11”).
Previous report
Net revenues, which include excise taxes billed to customers, increased $178 million (1.6%), due primarily to higher net revenues in our smokeable products segment.
Previous report
Adjusted net earnings of $4,698 million increased $176 million (3.9%), due primarily to higher OCI and higher income from our equity investment in ABI, partially offset by lower net periodic benefit income, excluding service cost. Adjusted diluted EPS of $2.80 increased by 4.9%, due primarily to higher adjusted net earnings and fewer shares outstanding.
Previous report
Net revenues, which include excise taxes billed to customers, were essentially unchanged as higher net revenues in our smokeable products segment and all other category (which includes 2025 acquisition-related items) were offset by lower net revenues in our oral tobacco products segment.
Previous report
Cost of sales increased $96 million (6.7%), due primarily to 2026 costs related to USSTC Facilities Consolidation, higher manufacturing costs and higher per unit settlement charges in our smokeable products segment, partially offset by lower shipment volume in our smokeable products segment.
Previous report
Operating income decreased $94 million (2.9%), due primarily to lower OCI and higher general corporate expenses.
Previous report
(Income) losses from investments in equity securities, which decreased $61 million (41.2%), were negatively impacted by unfavorable special items from our investment in ABI as discussed above.
Previous report
Provision for income taxes decreased $109 million (14.7%), due primarily to favorable tax items and lower earnings before income taxes. For additional information, see Note 11.
Previous report
Reported and adjusted OCI increased $216 million (4.0%) and $229 million (4.2%), respectively, due primarily to higher pricing, which includes higher promotional investments, higher refunds of taxes and duties paid on imported cigarettes ($78 million), partially offset by volume/cigarette mix ($381 million) and higher costs ($110 million).
Previous report
Reported OCI increased $12 million (0.4%), due primarily to higher pricing, which includes higher promotional investments, and higher refunds of taxes and duties paid on imported cigarettes ($27 million), partially offset by volume/cigarette mix ($221 million), higher tobacco and health and certain other litigation items ($63 million) and higher costs ($44 million).
Previous report
Net revenues, which include excise taxes billed to customers, decreased $25 million (1.8%), due primarily to lower shipment volume ($99 million), partially offset by higher pricing ($78 million), which includes higher promotional investments.
Previous report
Reported OCI decreased $115 million (12.4%), due primarily to lower shipment volume ($87 million), 2026 costs related to USSTC Facilities Consolidation ($78 million) and higher costs ($25 million), partially offset by higher pricing, which includes higher promotional investments.
Previous report
Net revenues, which include excise taxes billed to customers, decreased $40 million (5.3%), due primarily to lower shipment volume ($74 million), partially offset by higher pricing ($31 million), which includes higher promotional investments.
Previous report
Reported OCI decreased $117 million (23.5%), due primarily to 2026 costs related to USSTC Facilities Consolidation ($78 million) and lower shipment volume ($67 million), partially offset by higher pricing, which includes higher promotional investments.
Previous report
Adjusted OCI decreased $40 million (8.0%), due primarily to lower shipment volume, partially offset by higher pricing, which includes higher promotional investments.
Previous report
Capital expenditures for 2026 are expected to be in the range of $375 million to $450 million, an increase from the previous range of $300 million to $375 million, primarily driven by investments to support the USSTC Facilities Consolidation, and are expected to be funded from operating cash flows.
Reworded paragraphs (89)
Previous wording
In this MD&A section, we refer to the following “adjusted” financial measures: adjusted operating companies income (loss) (“OCI”); adjusted OCI margins; adjusted net earnings; adjusted diluted earnings per share (“EPS”); and adjusted effective tax rates. We also refer to the ratio of debt-to-Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization, as defined in our credit agreement, which includes certain adjustments). These financial measures are not required by, or calculated in accordance with, United States generally accepted accounting principles (“GAAP”) and may not be calculated the same as similarly titled measures used by other companies. These financial measures should thus be considered as supplemental in nature and not considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. For a further description of these non-GAAP financial measures, see the Non-GAAP Financial Measures section below.
Current wording
In this MD&A section, we refer to the following “adjusted” financial measures: adjusted operating companies income (loss) (“OCI”); adjusted OCI margins; adjusted net earnings attributable to Altria; adjusted diluted earnings per share (“EPS”); and adjusted effective tax rates. We also refer to the ratio of debt-to-Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization, as defined in our credit agreement, which includes certain adjustments). These financial measures are not required by, or calculated in accordance with, United States generally accepted accounting principles (“GAAP”) and may not be calculated the same as similarly titled measures used by other companies. These financial measures should thus be considered as supplemental in nature and not considered in isolation or as a substitute for the related financial information prepared in accordance with GAAP. For a further description of these non-GAAP financial measures, see the Non-GAAP Financial Measures section below.
Previous wording
We have a leading portfolio of nicotine products for U.S. nicotine consumers age 21+. We are Moving Beyond Smoking® by responsibly transitioning adult smokers to a smoke-free future, competing vigorously for existing smoke-free adult nicotine consumers and exploring new growth opportunities - beyond the United States and beyond nicotine (“Vision”). We previously established our 2028 Enterprise Goals (“2028 Goals”) to provide our investors with specific metrics to measure our progress as we execute on our Vision. For further discussion of our 2028 Goals, see our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”).
Current wording
We are Moving Beyond Smoking® by responsibly transitioning adult smokers to a smoke-free future, competing vigorously for existing smoke-free adult nicotine consumers and exploring new growth opportunities - beyond the United States and beyond nicotine (“Vision”). We previously established our 2028 Enterprise Goals (“2028 Goals”) to provide our investors with specific metrics to measure our progress as we execute on our Vision. For further discussion of our 2028 Goals, see our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K”).
Previous wording
Our investments in equity securities include Anheuser-Busch InBev SA/NV (“ABI”), the world’s largest brewer, and Cronos Group Inc. (“Cronos”), a leading Canadian cannabinoid company.
Current wording
We also have a majority-owned joint venture, Horizon Innovations LLC, for the U.S. marketing and commercialization of heated tobacco stick products. Our investments in equity securities include Anheuser-Busch InBev SA/NV (“ABI”), the world’s largest brewer, and Cronos Group Inc. (“Cronos”), a leading Canadian cannabinoid company.
Previous wording
Through the second quarter of 2026, U.S. adult nicotine consumers continued to face inflationary pressure on discretionary income, with impacts more pronounced among lower-income consumers. Heightened geopolitical risk and uncertainty following the recent developments in the Middle East contributed to increased energy price volatility, with gas prices averaging $4.05 per gallon during June. Gas prices contributed to elevated inflation in June of 3.5%, above the Federal Reserve’s 2% target.
Current wording
Through the third quarter of 2026, U.S. adult nicotine consumers continued to face inflationary pressures on discretionary income, particularly among price sensitive consumers. Geopolitical uncertainty and developments in the Middle East have continued to contribute to energy price volatility, with gas prices averaging $4.36 per gallon in September. Elevated energy costs contributed to September inflation of 3.7%, remaining above the Federal Reserve’s 2% target.
Previous wording
Overall discretionary income pressures on adult nicotine consumers have resulted in increased discount brand share and contributed to evolving adult nicotine consumer preferences, each of which has negatively impacted the sales volumes of certain of our operating companies’ premium brands. For the second quarter of 2026, the discount retail share of the cigarette category reached 33.8%, an increase of 2.6 share points versus the second quarter of 2025 and 0.5 share points sequentially. When adjusted for trade inventory movements, our smokeable products segment domestic cigarette shipment volume declined by an estimated 4.5% in the second quarter of 2026 versus the second quarter of 2025. When adjusted for trade inventory movements, total estimated domestic cigarette industry volume declined by 5% in the second quarter of 2026 versus the second quarter of 2025. We believe moderating estimated domestic cigarette industry volume decline, which began in the third quarter of 2025, continues to primarily be driven by reduced cross-category movement between cigarettes and illicit flavored disposable e-vapor products. Additionally, we believe that a significant number of adult nicotine consumers switch among nicotine categories, use multiple forms of nicotine products and try innovative nicotine products, such as e-vapor products and oral nicotine pouches. The U.S. nicotine pouch category continued to grow throughout the second quarter of 2026 to 59.9% of the U.S. oral tobacco category, an increase of 8.1 share points versus the second quarter of 2025 and 1.8 share points sequentially. As innovative smoke-free products evolve to better address the preferences of adult nicotine consumers, these consumers continue to transition from cigarettes and MST products to innovative smoke-free products, which has reduced the sales volumes of our operating companies’ cigarette and MST products.
Current wording
Overall discretionary income pressures on adult nicotine consumers have resulted in increased discount brand share and contributed to evolving adult nicotine consumer preferences, each of which has negatively impacted the sales volumes of certain of our operating companies’ premium brands. For the third quarter of 2026, the discount retail share of the cigarette category reached 34.1%, an increase of 2.0 share points versus the third quarter of 2025 and 0.3 share points sequentially. When adjusted for trade inventory movements, our smokeable products segment domestic cigarette shipment volume declined by an estimated 4% in the third quarter of 2026 versus the third quarter of 2025. When adjusted for trade inventory movements, total estimated domestic cigarette industry volume declined by 5% in the third quarter of 2026 versus the third quarter of 2025. The U.S. nicotine pouch category continued to grow throughout the third quarter of 2026 to 61.2% of the U.S. oral tobacco category, an increase of 5.8 share points versus the third quarter of 2025 and 1.3 share points sequentially. As innovative smoke-free products evolve to better address the preferences of adult nicotine consumers, these consumers continue to transition from cigarettes and moist smokeless tobacco (“MST”) products to innovative smoke-free products, which has reduced the sales volumes of our operating companies’ cigarette and MST products.
Previous wording
Various states and the federal government have taken regulatory and enforcement actions against manufacturers, distributors and retailers of illicit flavored disposable e-vapor products. For example, the FDA and U.S. Customs and Border Protection have made it more difficult to import properly declared illicit e-vapor products, seized unauthorized e-vapor products and issued warning letters to importers. Despite these enforcement measures, insufficient actions against manufacturers, distributors and retailers of nicotine products requiring FDA review for which no premarket tobacco product applications (“PMTA”) have been submitted have allowed such products to continue to proliferate in the market. We expect that effective enforcement against illicit products will occur more gradually than initially expected and continue to monitor the overall dynamics and competitive threats to our brands across multiple nicotine categories.
Current wording
Various states and the federal government have taken regulatory and enforcement actions against manufacturers, distributors and retailers of illicit flavored disposable e-vapor products. For example, the U.S. Food and Drug Administration (“FDA”) and U.S. Customs and Border Protection have made it more difficult to import properly declared illicit e-vapor products, seized unauthorized e-vapor products and issued warning letters to importers. Despite these enforcement measures, insufficient actions against manufacturers, distributors and retailers of nicotine products requiring FDA review for which no premarket tobacco product applications (“PMTA”) have been submitted have allowed such products to continue to proliferate in the market. We expect that effective enforcement against illicit products will occur gradually and continue to monitor the overall dynamics and competitive threats to our brands across multiple nicotine categories.
Previous wording
Consolidated Results of Operations for the Six Months Ended June 30, 2026
Current wording
Consolidated Results of Operations for the Nine Months Ended September 30, 2026
Previous wording
The changes in net earnings and diluted EPS for the six months ended June 30, 2026, from the six months ended June 30, 2025, were due primarily to the following:
Current wording
The changes in net earnings attributable to Altria and diluted EPS for the nine months ended September 30, 2026, from the nine months ended September 30, 2025, were due primarily to the following:
Previous wording
For a discussion of special items and other business drivers affecting the comparability of statements of earnings amounts and reconciliations of adjusted net earnings and adjusted diluted EPS, see Consolidated Operating Results below.
Current wording
For a discussion of special items and other business drivers affecting the comparability of statements of earnings amounts and reconciliations of adjusted net earnings attributable to Altria and adjusted diluted EPS, see Consolidated Operating Results below.
Previous wording
▪Fewer Shares Outstanding: Fewer shares outstanding were due to shares we repurchased under our share repurchase programs.
Current wording
▪Fewer Shares Outstanding: Fewer shares outstanding were due to shares we repurchased under our share repurchase program.
Previous wording
▪Operations: The increase of $153 million in operations (which excludes the impact of special items shown in the table above) was due primarily to higher OCI and higher income from our equity investment in ABI, partially offset by lower net periodic benefit income, excluding service cost.
Current wording
▪Operations: The increase of $250 million in operations (which excludes the impact of special items shown in the table above) was due primarily to higher OCI and higher income from our equity investment in ABI.
Previous wording
The changes in net earnings and diluted EPS for the three months ended June 30, 2026, from the three months ended June 30, 2025, were due primarily to the following:
Current wording
The changes in net earnings attributable to Altria and diluted EPS for the three months ended September 30, 2026, from the three months ended September 30, 2025, were due primarily to the following:
Previous wording
For a discussion of special items and other business drivers affecting the comparability of statements of earnings amounts and reconciliations of adjusted net earnings and adjusted diluted EPS, see Consolidated Operating Results below.
Current wording
For a discussion of special items and other business drivers affecting the comparability of statements of earnings amounts and reconciliations of adjusted net earnings attributable to Altria and adjusted diluted EPS, see Consolidated Operating Results below.
Previous wording
▪Operations: The increase of $35 million in operations (which excludes the impact of special items shown in the table above) was due primarily to higher OCI and higher income from our equity investment in ABI, partially offset by higher general corporate expenses and lower net periodic benefit income, excluding service cost.
Current wording
▪Operations: The increase of $97 million in operations (which excludes the impact of special items shown in the table above) was due primarily to higher OCI and higher income from our equity investment in ABI.
Previous wording
We report our financial results in accordance with GAAP. However, our management also reviews certain financial results, including OCI, OCI margins, net earnings and diluted EPS, on an adjusted basis, which excludes certain income and expense items that our management believes are not part of underlying operations. These items may include, for example, loss on early extinguishment of debt, charges related to restructuring and other exit activities, asset impairment charges, acquisition, disposition and integration-related items, equity investment-related special items, certain income tax items, charges associated with tobacco and health and certain other litigation items, resolutions of certain non-participating manufacturer (“NPM”) adjustment disputes under the Master Settlement Agreement (“NPM Adjustment Items”) and amortization expense associated with definite-lived intangible assets (“amortization of intangibles”). While amortization of intangibles is excluded from our adjusted financial measures, net revenues generated from these definite-lived intangible assets during the periods presented, if applicable, are included in our adjusted financial measures. In addition, our management reviews the ratio of debt-to-Consolidated EBITDA, which we use as a factor to determine our ability to access the capital markets and make investments in pursuit of our Vision. Consolidated EBITDA is calculated in accordance with our Credit Agreement (defined below in Liquidity and Capital Resources) and includes certain adjustments. Our management does not view any of these special items to be part of our underlying results as they may be highly variable, may be unusual or infrequent, are difficult to predict and can distort underlying business trends and results. Our management also reviews income tax rates on an adjusted basis, which may exclude certain income tax items from our reported effective tax rate.
Current wording
We report our financial results in accordance with GAAP. However, our management also reviews certain financial results, including OCI, OCI margins, net earnings attributable to Altria and diluted EPS, on an adjusted basis, which excludes certain income and expense items that our management believes are not part of underlying operations. These items may include, for example, loss on early extinguishment of debt, charges related to restructuring and other exit activities, asset impairment charges, acquisition, disposition and integration-related items, equity investment-related special items, certain income tax items, charges associated with tobacco and health and certain other litigation items, resolutions of certain non-participating manufacturer (“NPM”) adjustment disputes under the Master Settlement Agreement (“NPM Adjustment Items”) and amortization expense associated with definite-lived intangible assets (“amortization of intangibles”). While amortization of intangibles is excluded from our adjusted financial measures, net revenues generated from these definite-lived intangible assets during the periods presented, if applicable, are included in our adjusted financial measures. In addition, our management reviews the ratio of debt-to-Consolidated EBITDA, which we use as a factor to determine our ability to access the capital markets and make investments in pursuit of our Vision. Consolidated EBITDA is calculated in accordance with our Credit Agreement (defined below in Liquidity and Capital Resources) and includes certain adjustments. Our management does not view any of these special items to be part of our underlying results as they may be highly variable, may be unusual or infrequent, are difficult to predict and can distort underlying business trends and results. Our management also reviews income tax rates on an adjusted basis, which may exclude certain income tax items from our reported effective tax rate.
Previous wording
In 2025, we recorded impairments of the values of the goodwill and other intangible assets within our e-vapor reporting unit as a result of the U.S. International Trade Commission (“ITC”) exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE into the United States and our expectation that effective enforcement against illicit flavored disposable e-vapor products would occur more gradually than initially anticipated. As of December 31, 2025, the estimated fair value and carrying value of the e-vapor goodwill was $610 million after recording impairments during the first and fourth quarters of 2025. In addition, the carrying value of the e-vapor reporting unit’s net assets (including the effect of intercompany debt), which was negative, approximated its estimated fair value.
Current wording
In 2025, we recorded impairments of the values of the goodwill and other intangible assets within our e-vapor reporting unit as a result of the U.S. International Trade Commission (“ITC”) exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE into the United States and our expectation that effective enforcement against illicit flavored disposable e-vapor products would occur more gradually than initially anticipated. As of December 31, 2025, the carrying value of the e-vapor reporting unit goodwill was $610 million, after recording impairments during the first and fourth quarters of 2025, and the estimated fair value of the reporting unit approximated its carrying value. In addition, the carrying value of the e-vapor reporting unit’s net assets (including the effect of intercompany debt), which was negative, approximated its estimated fair value.
Previous wording
We believe that the estimated fair value of the e-vapor reporting unit at December 31, 2025 remains reasonable and there are no events or circumstances indicating an impairment for the six and three months ended June 30, 2026. Fair value calculations are sensitive to changes in certain judgments and assumptions. The significant judgments and assumptions that drive the fair value of the reporting unit are the (i) timing and extent of effective enforcement against illicit flavored disposable e-vapor products; (ii) timing and likelihood of regulatory authorizations of e-vapor products, including of NJOY’s products; (iii) timing of the commercialization of NJOY e-vapor products in the United States; (iv) long-term growth of the e-vapor category; and (v) conversion rates of illicit flavored disposable e-vapor consumers to FDA-authorized e-vapor products and, specifically, NJOY’s e-vapor products. Fair value calculations can be negatively affected by changes in these judgments and assumptions, some of which relate to broader macroeconomic conditions and governmental actions outside of our control. If these assumptions or judgments regarding the expectations for the future state of the e-vapor category and NJOY’s business fail to materialize as anticipated, if we experience unfavorable outcomes with respect to litigation proceedings (including actions alleging patent infringement), or if the discount rate used to estimate the fair value increases, we could have additional non-cash impairments of our e-vapor reporting unit goodwill in future periods, which could be material. Based on our 2025 annual impairment test, a hypothetical 1% increase in the discount rate used to estimate the fair value of the e-vapor reporting unit would have resulted in a goodwill impairment charge of approximately $150 million. For further discussion of these factors, see Operating Results by Business Segment - Business Environment below.
Current wording
We believe that the estimated fair value of the e-vapor reporting unit at December 31, 2025 remains reasonable and there are no events or circumstances indicating an impairment for the nine and three months ended September 30, 2026. Fair value calculations are sensitive to changes in certain judgments and assumptions. The significant judgments and assumptions that drive the fair value of the reporting unit are the (i) timing and extent of effective enforcement against illicit flavored disposable e-vapor products; (ii) timing and likelihood of regulatory authorizations of e-vapor products, including of NJOY’s products; (iii) timing of the commercialization of NJOY e-vapor products in the United States; (iv) long-term growth of the e-vapor category; and (v) conversion rates of illicit flavored disposable e-vapor consumers to FDA-authorized e-vapor products and, specifically, NJOY’s e-vapor products. Fair value calculations can be negatively affected by changes in these judgments and assumptions, some of which relate to broader macroeconomic conditions and governmental actions outside of our control. If these assumptions or judgments regarding the expectations for the future state of the e-vapor category and NJOY’s business fail to materialize as anticipated, if we experience unfavorable outcomes with respect to litigation proceedings (including actions alleging patent infringement), or if the discount rate used to estimate the fair value increases, we could have additional non-cash impairments of our e-vapor reporting unit goodwill in future periods, which could be material. Based on our 2025 annual impairment test, a hypothetical 1% increase in the discount rate used to estimate the fair value of the e-vapor reporting unit would have resulted in a goodwill impairment charge of approximately $150 million. For further discussion of these factors, see Operating Results by Business Segment - Business Environment below.
Previous wording
We believe that the estimated fair value of the Skoal trademark at December 31, 2025 remains reasonable and there are no events or circumstances indicating an impairment for the six and three months ended June 30, 2026. If the decline in sales volume for Skoal is higher than currently estimated and results in material revenue declines, we believe there may be a material adverse effect on the significant assumptions used in performing our valuation. If Skoal’s actual revenue and income or long-term outlook are significantly unfavorable compared to forecasted performance used to estimate the fair value or if the discount rate used to estimate the fair value increases, we could have material non-cash impairments of the Skoal trademark in future periods. Based on the 2025 annual impairment test, a hypothetical 1% increase in the discount rate used to estimate the fair value of Skoal trademark would have resulted in an impairment charge of approximately $90 million. For further discussion of these factors, see Operating Results by Business Segment - Business Environment below.
Current wording
We believe that the estimated fair value of the Skoal trademark at December 31, 2025 remains reasonable and there are no events or circumstances indicating an impairment for the nine and three months ended September 30, 2026. If the decline in sales volume for Skoal is higher than currently estimated and results in material revenue declines, we believe there may be a material adverse effect on the significant assumptions used in performing our valuation. If Skoal’s actual revenue and income or long-term outlook are significantly unfavorable compared to forecasted performance used to estimate the fair value or if the discount rate used to estimate the fair value increases, we could have material non-cash impairments of the Skoal trademark in future periods. Based on the 2025 annual impairment test, a hypothetical 1% increase in the discount rate used to estimate the fair value of Skoal trademark would have resulted in an impairment charge of approximately $90 million. For further discussion of these factors, see Operating Results by Business Segment - Business Environment below.
Previous wording
The following table provides a reconciliation of adjusted net earnings and adjusted diluted EPS for the six months ended June 30:
Current wording
The following table provides a reconciliation of adjusted net earnings attributable to Altria and adjusted diluted EPS for the nine months ended September 30:
Previous wording
The following table provides a reconciliation of adjusted net earnings and adjusted diluted EPS for the three months ended June 30:
Current wording
The following table provides a reconciliation of adjusted net earnings attributable to Altria and adjusted diluted EPS for the three months ended September 30:
Previous wording
The following special items affected the comparability of statements of earnings amounts for the six and three months ended June 30, 2026 and 2025:
Current wording
The following special items affected the comparability of statements of earnings amounts for the nine and three months ended September 30, 2026 and 2025:
Previous wording
(2)Recorded as general corporate expense. Amounts are net of insurance recoveries of $7 million and $25 million for the six months ended June 30, 2026 and 2025, respectively, and $7 million and $3 million for the three months ended June 30, 2026 and 2025, respectively. To date, we incurred total costs of $172 million, primarily associated with the ITC exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE in the United States and patent infringement lawsuits related to the NJOY Transaction, which were offset by insurance recoveries of $71 million.
Current wording
(2)Recorded as general corporate expense. Amounts are net of insurance recoveries of $17 million and $34 million for the nine months ended September 30, 2026 and 2025, respectively, and $10 million and $9 million for the three months ended September 30, 2026 and 2025, respectively. To date, we incurred total costs of $181 million, primarily associated with the ITC exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE in the United States and patent infringement lawsuits related to the NJOY Transaction, which were offset by insurance recoveries of $81 million.
Previous wording
Additionally, we recorded a non-cash, pre-tax charge of $25 million for the six months ended June 30, 2025 for the change in the fair value of the contingent payments associated with the NJOY Transaction, which was recorded as general corporate expense and included in marketing, administration and research costs in our condensed consolidated statements of earnings. For further information, see Contingent Paymentsin Note 5. Financial Instruments.
Current wording
Additionally, we recorded a non-cash, pre-tax charge of $25 million for the nine months ended September 30, 2025 for the change in the fair value of the contingent payments associated with the NJOY Transaction, which was recorded as general corporate expense and included in marketing, administration and research costs in our condensed consolidated statements of earnings. For further information, see Contingent Paymentsin Note 5. Financial Instruments.
Previous wording
▪Asset Impairment, Exit and Implementation Costs: We recorded pre-tax exit and implementation costs of $78 million for the six and three months ended June 30, 2026 related our plan to transition USSTC’s manufacturing operations at our Nashville, Tennessee plant to a new facility to be constructed on our existing campus in Hopkinsville, Kentucky (“USSTC Facilities Consolidation”). We recorded pre-tax exit and implementation costs of $16 million and $10 million for the six and three months ended June 30, 2026, respectively, and $30 million and $15 million for the six and three months ended June 30, 2025, respectively, related to our Optimize & Accelerate initiative (“Initiative”). For further discussion and a breakdown of these costs by segment, see Note 3. Exit and Implementation Costs.
Current wording
▪Asset Impairment, Exit and Implementation Costs: We recorded pre-tax exit and implementation costs of $87 million and $9 million for the nine and three months ended September 30, 2026, respectively, related to our plan to transition USSTC’s manufacturing operations at our Nashville, Tennessee plant to a new facility to be constructed on our existing campus in Hopkinsville, Kentucky (“USSTC Facilities Consolidation”). We recorded pre-tax exit and implementation costs of $19 million and $3 million for the nine and three months ended September 30, 2026, respectively, and $43 million and $13 million for the nine and three months ended September 30, 2025, respectively, related to our Optimize & Accelerate initiative (“Initiative”). For further discussion and a breakdown of these costs by segment, see Note 3. Exit and Implementation Costs.
Previous wording
We recorded a non-cash impairment charge of $873 million to reduce the carrying value of the e-vapor reporting unit goodwill to its estimated fair value for the six months ended June 30, 2025 in our all other category. For further discussion, see Note 2.
Current wording
We recorded a non-cash impairment charge of $873 million to reduce the carrying value of the e-vapor reporting unit goodwill to its estimated fair value for the nine months ended September 30, 2025 in our all other category. For further discussion, see Note 2.
Previous wording
▪Amortization of Intangibles: We recorded pre-tax amortization expense associated with definite-lived intangible assets of $46 million and $74 million for the six months ended June 30, 2026 and 2025, respectively, and $23 million and $37 million for the three months ended June 30, 2026 and 2025, respectively, in marketing, administration and research costs in our condensed consolidated statements of earnings.
Current wording
▪Amortization of Intangibles: We recorded pre-tax amortization expense associated with definite-lived intangible assets of $67 million and $112 million for the nine months ended September 30, 2026 and 2025, respectively, and $21 million and $38 million for the three months ended September 30, 2026 and 2025, respectively, in marketing, administration and research costs in our condensed consolidated statements of earnings.
Previous wording
▪ABI-Related Special Items: We recorded net pre-tax losses of $78 million and $77 million for the six and three months ended June 30, 2026, respectively, due primarily to a dilution loss resulting from ABI’s share activity that reduced our ABI ownership interest, partially offset by mark-to-market gains on certain ABI financial instruments associated with its share commitments.
Current wording
▪ABI-Related Special Items: We recorded net pre-tax losses of $41 million for the nine months ended September 30, 2026 due primarily to a dilution loss resulting from ABI’s share activity that reduced our ABI ownership interest, partially offset by mark-to-market gains on certain ABI financial instruments associated with its share commitments. We recorded net pre-tax earnings of $37 million for the three months ended September 30, 2026 due primarily to mark-to-market gains on certain ABI financial instruments associated with its share commitments.
Previous wording
Cost of sales increased $78 million (2.9%), due primarily to higher manufacturing costs and higher per unit settlement charges in our smokeable products segment and 2026 costs related to USSTC Facilities Consolidation, partially offset by lower shipment volume in our smokeable products segment and lower NJOY costs.
Current wording
Cost of sales increased $139 million (3.4%), due primarily to higher manufacturing costs in our smokeable products and oral tobacco products segments and 2026 costs related to the USSTC Facilities Consolidation, partially offset by lower shipment volume in our smokeable products segment and lower NJOY costs.
Previous wording
Excise taxes on products decreased $127 million (8.2%), due primarily to higher refunds of taxes and duties paid on imported cigarettes and lower shipment volume in our smokeable products segment.
Current wording
Excise taxes on products decreased $257 million (10.8%), due primarily to higher refunds of taxes and duties paid on imported cigarettes and lower shipment volume in our smokeable products segment.
Previous wording
Marketing, administration and research costs were essentially unchanged, as higher tobacco and health and certain other litigation items, higher general corporate expenses and higher spending in our oral tobacco products segment were mostly offset by lower amortization of intangibles, lower costs related to our Initiative and lower costs in our all other category.
Current wording
Marketing, administration and research costs increased $51 million (2.9%), due primarily to higher spending in our smokeable products segment, which includes higher tobacco and health and certain other litigation items, higher general corporate expenses and higher spending in our oral tobacco products segment, partially offset by lower amortization of intangibles and lower costs related to our Initiative.
Previous wording
Operating income increased $1,074 million (21.4%), due primarily to higher OCI (which includes the impact of a non-cash impairment of the e-vapor reporting unit goodwill in 2025).
Current wording
Operating income increased $1,157 million (14.0%), due primarily to higher OCI (which includes the impact of a non-cash impairment of the e-vapor reporting unit goodwill in 2025).
Previous wording
Reported net earnings of $4,481 million increased $1,026 million (29.7%), due primarily to higher operating income. Reported basic and diluted EPS of $2.67, each increased by 30.9%, due primarily to higher reported net earnings.
Current wording
Reported net earnings attributable to Altria of $6,999 million increased $1,169 million (20.1%), due primarily to higher operating income. Reported basic and diluted EPS of $4.18, each increased by 21.2%, due primarily to higher reported net earnings attributable to Altria.
Previous wording
Excise taxes on products decreased $57 million (7.0%), due primarily to lower shipment volume in our smokeable products segment and higher refunds of taxes and duties paid on imported cigarettes.
Current wording
Excise taxes on products decreased $130 million (15.8%), due primarily to higher refunds of taxes and duties paid on imported cigarettes and lower shipment volume in our smokeable products segment.
Previous wording
Marketing, administration and research costs increased $44 million (7.1%), due primarily to higher tobacco and health and certain other litigation items and higher general corporate expenses, partially offset by lower spending in our all other category and smokeable products segment and lower amortization of intangibles.
Current wording
Marketing, administration and research costs increased $45 million (7.8%), due primarily to higher spending in our smokeable products segment, which includes higher tobacco and health and certain other litigation items, and higher spending in our all other category, partially offset by lower amortization of intangibles.
Previous wording
(Income) losses from investments in equity securities, which decreased $46 million (15.8%), were negatively impacted by unfavorable special items from our investment in ABI as discussed above.
Current wording
(Income) losses from investments in equity securities was favorable $135 million (100+%), due primarily to higher income from our equity investment in ABI, which includes the impact of favorable special items discussed above.
Previous wording
Reported net earnings of $2,298 million decreased $80 million (3.4%), due primarily to lower operating income and unfavorable results from our investments in equity securities, partially offset by favorable income tax items. Reported basic and diluted EPS of 1.37, each decreased by 2.8%, due primarily to lower reported net earnings, partially offset by fewer shares outstanding.
Current wording
Reported net earnings attributable to Altria of $2,518 million increased $143 million (6.0%), due primarily to favorable results from our investments in equity securities and higher operating income, partially offset by unfavorable income tax items. Reported basic and diluted EPS of $1.51, each increased by 7.1%, due primarily to higher reported net earnings attributable to Altria.
Previous wording
Adjusted net earnings of $2,480 million increased $47 million (1.9%), due primarily to higher OCI, favorable results from our investments in equity securities, partially offset by higher general corporate expenses and lower net periodic benefit income, excluding service cost. Adjusted diluted EPS of $1.48 increased by 2.8%, due primarily to higher adjusted net earnings and fewer shares outstanding.
Current wording
Adjusted net earnings attributable to Altria of $2,547 million increased $103 million (4.2%), due primarily to higher OCI and higher income from our investments in equity securities. Adjusted diluted EPS of $1.52 increased by 4.8%, due primarily to higher adjusted net earnings attributable to Altria.
Previous wording
The U.S. nicotine industry faces a number of business, legal and regulatory challenges that have materially adversely affected and may continue to materially adversely affect our business, results of operations, cash flows or financial position or our ability to achieve our
Current wording
The U.S. nicotine industry faces a number of business, legal and regulatory challenges that have materially adversely affected and may continue to materially adversely affect our business, results of operations, cash flows or financial position or our ability to achieve our Vision. These challenges, some of which are discussed in more detail in Note 12, and in Part I, Item 1A Risk Factors in our 2025 Form 10-K, include:
Previous wording
Effective April 2022, the U.S. Congress expanded the statutory definition of tobacco products to include products containing nicotine derived from any source, including synthetic nicotine. See Premarket Review Pathways for Tobacco Products and Market Authorization Enforcement below for additional information. Currently, however, the statutory definition of tobacco products does not cover products containing nicotine analogues, which are designed to imitate the effects of nicotine. As a result, products containing nicotine analogues are not subject to the FDA regulatory framework for tobacco products.
Current wording
Under the FSPTCA and its related regulations, tobacco products are defined as any products made or derived from tobacco or containing nicotine derived from any source and intended for human consumption. Currently, the FDA maintains that the statutory definition of tobacco products does not cover products containing nicotine analogues, which are designed to imitate the effects of nicotine.
Previous wording
▪tobacco products that were first regulated by the FDA in 2016, including cigars, e-vapor products and oral nicotine pouches that are not Pre-existing Tobacco Products, are generally products for which either an SE report or PMTA needed to be filed by September 9, 2020; and
Current wording
▪tobacco products that were already on the market and first regulated by the FDA in 2016, including cigars, e-vapor products and oral nicotine pouches that are not Pre-existing Tobacco Products, are generally products for which either an SE report or PMTA needed to be filed by September 9, 2020; and
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Current report — wording carried from elsewhere
USSTC receive unfavorable determinations on any SE report currently pending with the FDA, we believe PM USA and USSTC can replace the vast majority of these product volumes with other FDA authorized products or with Pre-existing Tobacco Products.
Current report — wording carried from elsewhere
▪Graphic Warnings: In March 2020, the FDA issued a final rule requiring 11 textual warnings accompanied by color graphics depicting certain negative health consequences of smoking on cigarette packaging and advertising. PM USA and other cigarette manufacturers filed lawsuits challenging the final rule on substantive and procedural grounds. In December 2022, the
Current report — wording carried from elsewhere
▪Effective October 18, 2026, PM USA increased the list price of Marlboro (excluding Mainline Menthol and 72s Menthol) and L&M by $0.17 per pack. PM USA also increased the list price of all its other premium cigarette brands by $0.22 per pack.
Current report — wording carried from elsewhere
Adjusted OCI decreased $17 million (3.7%), due primarily to lower shipment volume and higher costs, partially offset by higher pricing, which includes higher promotional investments.
Current report — wording carried from elsewhere
▪Effective February 23, 2025, Helix increased the list price on itson! brand by $0.20 per can.
Current report — wording carried from elsewhere
In August 2026, our Board of Directors (“Board”) approved a 4.7% increase in the quarterly dividend rate to $1.11 per share of our common stock versus the previous rate of $1.06 per share. Our current annualized dividend rate is $4.44 per share. We have a progressive dividend goal targeting mid-single digits dividend growth annually through 2028. Future dividend payments remain subject to the discretion of our Board.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
▪Fewer Shares Outstanding: Fewer shares outstanding were due to shares we repurchased under our share repurchase programs.
Previous report — wording carried elsewhere
Vision. These challenges, some of which are discussed in more detail in Note 12, and in Part I, Item 1A Risk Factors in our 2025 Form 10-K, include:
Previous report — wording carried elsewhere
Modifications to currently marketed products, including modifications that result from, for example, (i) changes to the quantity of tobacco product(s) in a package, (ii) a manufacturer being unable to acquire ingredients or (iii) a supplier or contract manufacturer being unable to maintain the consistency required in ingredients or manufacturing processes, could trigger the FDA’s premarket review process. Additionally, a manufacturer may be unable to maintain consistency in manufacturing processes as it increases the scale of its manufacturing operations in response to market expansion or product introduction. These circumstances could cause a manufacturer to
Previous report — wording carried elsewhere
Marlboro’s retail share of the premium segment was 59.6%, unchanged versus the prior year and an increase of 0.1 share point sequentially.