How Stronger Q2 Results and Upgraded 2025 Outlook Will Impact Philip Morris International (PM) Investors

• Philip Morris International recently reported stronger results for the second quarter and first half of 2025, with sales of US$10.14 billion and net income of US$3.04 billion in the second quarter, both higher than the prior year.
• The company also raised its full-year 2025 guidance, now expecting diluted EPS between US$7.24 and US$7.37 and organic operating income growth of 11% to 12.5%.
• We'll explore how the revised earnings outlook, reflecting continued margin and sales strength, could influence Philip Morris International's investment narrative.

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Philip Morris International Investment Narrative Recap

Owning Philip Morris International hinges on a belief in the company's ability to successfully shift its portfolio from declining combustible products to faster-growing smoke-free offerings. The company's latest earnings beat and raised full-year guidance support continued momentum in this transition, with strong operating income growth a clear near-term catalyst. However, with combustibles still a major revenue driver, ongoing regulatory and tax headwinds remain the most immediate risk. The recent results do not materially change these factors, but suggest positive progress on the catalyst side.

Among recent announcements, the upward revision of full-year 2025 earnings guidance stands out. By projecting diluted EPS of US$7.24 to US$7.37 and 11% to 12.5% organic operating income growth, Philip Morris International aims to reassure investors that its margin expansion and smoke-free push are gaining traction, directly addressing the catalyst driving near-term sentiment.

But conversely, investors should stay mindful of the ongoing drag from regulatory risks and persistent illicit trade that could...

Read the full narrative on Philip Morris International (it's free!)

Philip Morris International's outlook anticipates $49.4 billion in revenue and $14.3 billion in earnings by 2028. This projection is based on an 8.1% annual revenue growth rate and a $6.1 billion increase in earnings from the current $8.2 billion.

Uncover how Philip Morris International's forecasts yield a $184.32 fair value, a 13% upside to its current price.

Exploring Other Perspectives

While consensus is optimistic, the lowest analyst forecasts before these results expected revenue growth of just 6.5% per year and earnings of US$14.1 billion by mid-2028. These analysts focus on regulatory hurdles and risks to both cigarette and smoke-free market growth, arguing outcomes may fall short. Your own outlook may shift as you consider how new earnings change the story.

Explore 9 other fair value estimates on Philip Morris International - why the stock might be worth as much as 38% more than the current price!

Build Your Own Philip Morris International Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Philip Morris International research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Philip Morris International research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Philip Morris International's overall financial health at a glance.

No Opportunity In Philip Morris International?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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