Altria Group, Inc. MO

The business

Altria sells cigarettes in the United States, and almost nothing about that sentence has changed in fifty years except the price and the volume. Philip Morris USA sells Marlboro, which held 39.7% of the total cigarette category and 59.5% of the premium segment in the first quarter of 2026; the smokeable segment did $20.5B of gross revenue in 2025 against $2.8B for smokeless, so the combustible engine is roughly 88% of net revenue and an even larger share of operating income. The rest is Helix (on! nicotine pouches), NJOY (e-vapor), and an equity-method stake in Anheuser-Busch InBev worth on the order of $10B. This is a cash-cow franchise: one premium brand, protected distribution, and pricing power that has compounded for decades.

The fact the income statement hides is the shape of the decline. Cigarette shipment volume fell 10.0% in 2025, well above the mid-single-digit rate the category ran for years, pressured by illicit disposable vapes that the FDA has struggled to keep off shelves and by squeezed discretionary income among lower-income smokers. Yet net revenue fell only 3.1% and adjusted EPS rose 4.4%, because Altria raised prices enough to more than offset the lost sticks. The first quarter of 2026 offered a tentative reprieve: domestic cigarette volume decline moderated to 2.4%, helped by trade-inventory timing and retail-share gains, though Marlboro shipments themselves still fell 7.8%. Whether 10% was the new structural rate or an illicit-vape spike that enforcement reverses is the whole question.