Question · Q3 2025
Eric Adam Serotta asked about the premium price point strategy for ON+ during its initial launch in three states, relative to ON and other competitors. He also inquired about the significant year-over-year increase in controllable costs within the smokeable segment, how these costs are managed going forward, and if they constrained the segment's OCI growth in the quarter.
Answer
CEO Billy Gifford confirmed ON+ is positioned as a premium-priced product due to its differentiation and consumer experience, noting introductory price promotions would be used. CFO Sal Mancuso advised against quarter-by-quarter analysis of controllable costs due to timing, emphasizing long-term cost management through programs like 'Optimize and Accelerate' and the effective use of data analytics and revenue growth management tools. He highlighted that smokeable OCI was up 2.5% year-to-date.