Shares of Altria (MO) are under modest selling pressure into Thursday’s open as the cigarette maker met expectations on the bottom-line for the third quarter, but realized a 1.5% drop in revenue that was larger than Wall Street anticipated.
Additionally, the company raised the lower end of its FY25 profit guidance by two cents but kept the high-end only a penny better than expectations.
Altria (MO) now expects adjusted earnings to be between $5.37 to $5.45 per share, representing a growth rate of 3.5% to 5%, up from the previous range of $5.35 to $5.45 per share, with the $5.41 midpoint of the new range below the $5.44 consensus estimate.
In the fourth quarter, EPS is expected to moderate as the company laps the lower share count tied to the 2024 accelerated share repurchase program, and the benefit of the Master Settlement Agreement legal fund expiration.
“Our guidance contemplates the current estimated impact of increased tariffs on our costs, based on presently available information. In addition, our guidance assumes limited impact on combustible and e-vapor product volumes from enforcement efforts against products that have evaded the regulatory process and that NJOY ACE does not return to the marketplace this year,” Altria said in a statement.
For the reported quarter, Altria (MO) earned an adjusted profit of $1.45, up 3.6% from a year ago and in-line with expectations and reflected higher adjusted OCI and fewer shares outstanding.
Net revenues decreased 3.0% to $6.1, primarily driven by lower net revenues in the smokeable and oral tobacco products segments. Revenue net of excise taxes decreased 1.7% to $5.3 billion.
By shipment volume, smokeable products domestic cigarette shipment volume was down 8.2%, impacted by the continued growth of flavored disposable e-vapor products.
When adjusted for trade inventory movements, calendar differences and other factors, total estimated domestic cigarette industry volume decreased by an estimated 8%.
Oral tobacco products segment reported domestic shipment volume decreased 9.6%, primarily driven by retail share losses, calendar differences, trade inventory movements and other factors, partially offset by the industry’s growth rate.
Shares last traded at a loss of 4%, putting Altria (MO) on track to trade in the red for a fourth consecutive day.