PM · 10-Q · 2026Q3 · Full report

Russia and Ukraine Conflict Exposure

Philip Morris International Inc. · 2026-10-23 · Importance 50 · Surprise 24

At September 30, 2026, Russian operations had approximately $5.6 billion in assets, including about $3.1 billion of cash and cash equivalents held mostly in rubles; Russia accounted for around 7% of PMI’s net revenues for the first nine months of 2026. PMI’s 23% equity interest in Russian distributor JSC TK Megapolis had a $0.3 billion carrying value, or $0.9 billion including cumulative foreign-currency translation losses. Ukrainian operations had approximately $0.6 billion in assets and generated around 1% of net revenues in the first nine months of 2026; production at the Kharkiv factory remained suspended, while the Lviv-region facility began local production in April 2024 after more than $30 million of investment. The filing said strikes had disrupted supply-chain and logistics infrastructure in Ukraine and were expected to affect operating income in 2026, while a Russian divestment could result in material impairment.

Key facts

• PMI is working to mitigate potential impacts from restrictions banning exports of electronic cigarettes and similar personal electric vaporizing devices, including IQOS devices, to Russia. source
• Developments related to the conflict and trade restrictions have or may have a material adverse impact on PMI's business, results, cash flows and financial position, and may result in impairment charges. source
• As a result of Russia's invasion of Ukraine, certain taxing jurisdictions, including the United States, have proposed punitive tax legislation for companies doing business in Russia, which could materially adversely affect PMI's effective tax rate if enacted. source
• As of September 30, 2026, PMI's Ukrainian operations had approximately $0.6 billion in total assets, excluding intercompany balances. source