Altria's Pricing Power Offsets Cigarette Volume Declines in Second Quarter

Earnings

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Summary · why it matters

Altria Group's smokeable products segment saw domestic cigarette shipment volume fall 3.2% year over year in the second quarter of 2026, but net revenues net of excise taxes rose 2% as higher net pricing offset the decline. Excluding trade inventory movements, the volume decline was estimated at 4.5%, compared with an estimated 5% decline for the overall U.S. cigarette industry. Smokeable price realization was 4.5%, driven by strong net pricing for Marlboro, though partly offset by a greater mix of the lower-priced Basic brand as some adult smokers traded down. Adjusted operating companies income increased 2.4% and adjusted OCI margin expanded 30 basis points to 64.8%, with higher pricing and refunds of taxes and duties on imported cigarettes more than offsetting lower shipment volumes, increased promotional investments, a greater mix of discount products, and higher costs. The quarter demonstrated that pricing continued to help offset the financial impact of lower cigarette shipment volumes, even as changing consumer purchasing patterns and a growing mix of discount products remain challenges.

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