PM · 10-Q · 2026Q3 · Full report

Combustibles Market Demand

Philip Morris International Inc. · 2026-10-23 · Importance 19 · Surprise 24

Consumption of tax-paid cigarettes continues to decline in many of PMI’s markets. The filing attributes the decline to increased taxes and pricing, diminishing social acceptance of smoking, health concerns, competition, economic and geopolitical uncertainty, and illicit products. It also states that governmental actions and private restrictions have reduced industry volumes for combustible products in many markets and are expected to continue reducing consumption.

Key facts

• For the nine months year-to-date, International Combustibles cigarette shipments decreased 1.2% to 452.2 billion units, with decreases in Russia, Mexico and Germany partly offset by Turkey and Egypt. source
• PMI says declining cigarette consumption could materially adversely affect revenues, cash flows, profitability, and its ability to fund its smoke-free transformation. source
• Governmental actions and diminishing social acceptance have reduced industry volumes for PMI's combustible products in many markets, and PMI expects these factors to continue reducing combustible consumption levels. source
• PMI says increases in cigarette taxes are expected to adversely affect cigarette sales through lower consumption, shifts to other combustible products and lower-priced cigarette categories, cross-border purchases, and illicit products. source
• For the nine months ended September 30, 2026, estimated cigarette and heated-tobacco industry volume excluding China and the U.S. declined 0.4%. source
• For the three months ended September 30, 2026, estimated cigarette and heated-tobacco industry volume excluding China and the U.S. was broadly stable, decreasing 0.1%. source
• International Combustibles cigarette shipments were broadly flat at 158.0 billion units in the third quarter; increases in Turkey, Indonesia and Egypt offset declines in Russia, Poland and Japan. source
• Consumption of tax-paid cigarettes continues to decline in many of Philip Morris International Inc.'s markets. source