Executive Summary

Q4 delivered stable top-line and solid profit metrics despite category headwinds: net revenues were essentially flat at $5.97B (-$1M YoY), reported EPS surged to $1.79 on tax benefits, and adjusted EPS rose 9.3% YoY to $1.29, with segment margin expansion led by Smokeable (+220 bps adj. OCI margin) and Oral (+640 bps) .
2025 outlook: adjusted EPS guidance initiated at $5.22–$5.37 (2–5% growth), assuming one fewer shipping day, limited impact from illicit e‑vapor enforcement, reinvestment of cost savings, and lower net periodic benefit income; adjusted tax rate 23–24%, capex $175–$225M, D&A ≈$290M .
Capital returns remain a core pillar: completed $3.4B buyback in 2024 and authorized a new $1B repurchase program expected by 12/31/2025; paid $6.8B in 2024 dividends, and declared a $1.02/sh quarterly dividend on Feb 27, 2025 .
Structural/regulatory overhangs intensify: management says the e‑vapor marketplace is “broken” due to illicit disposables (>60% of category) and is reassessing 2028 smoke‑free volume/revenue goals and NJOY accretion targets; separate ITC ruling could block ACE imports by Mar 31, 2025 absent USTR rejection or workaround .
Potential stock catalysts: USTR decision on ITC order (by Mar 31, 2025), visibility on FDA/DOJ enforcement vs illicit e‑vapor, Ploom PMTA/MRTPA combo submission mid‑2025, and execution on $1B buyback and 2025 EPS bridge .

What Went Well and What Went Wrong

What Went Well

Margin resilience and pricing power: Smokeable adjusted OCI rose 5.5% with adj. OCI margin up 220 bps to 61.2%; Oral adjusted OCI rose 13% with adj. OCI margin up 640 bps to 69.5% . Management cited “robust net price realization of 11.3%” in Q4 for Smokeable .
On! momentum and earlier profitability: on! shipments +44% YoY to 43.9M cans; U.S. oral share at 8.9% (+200 bps YoY); Helix achieved profitability in Q4, ahead of its 2025 goal. Quote: “Helix achieved profitability for the first time in the fourth quarter, ahead of its 2025 goal.” .
Capital returns and balance sheet: Completed $3.4B repurchase (73.5M shares, avg $46.26) and launched a new $1B program; total 2024 cash returns topped $10.2B, debt/EBITDA at ~2.1x. Quote: “We returned over $10.2 billion of cash to shareholders…” .

What Went Wrong

Cigarette volume and share pressure: total cigarette shipments fell 8.8% YoY in Q4; Marlboro total category share slipped to 41.3% (-100 bps YoY; -30 bps QoQ) as discount grew to 30.4% (+170 bps YoY), reflecting cumulative inflation and cross‑category movement to illicit vapes .
Illicit e‑vapor dominates category: management estimates >60% of e‑vapor is illicit, compromising smoke‑free goals and NJOY targets. Quote: “We believe the regulatory structure is broken and the tobacco marketplace is not operating as Congress intended.” .
NJOY ITC risk: final determination (subject to 60‑day USTR review) would bar ACE imports/sales; management working on design changes but highlighted risk to menthol-authorized portfolio. Q: “Does guidance assume pulling ACE?” A: Range reflects multiple scenarios; levers available, but specifics not quantified .

Financial Results

Consolidated Snapshot (chronological: oldest → newest)

Metric	Q4 2023	Q3 2024	Q4 2024
Net Revenues ($B)	$5.975	$6.259	$5.974
Reported Diluted EPS ($)	$1.16	$1.34	$1.79
Adjusted Diluted EPS ($)	$1.18	$1.38	$1.29

Notes: Q4 reported EPS benefited from $0.55/share income tax items tied to JUUL/ABI valuation allowance releases .

Segment Performance (Revenues Net of Excise, Adjusted OCI, Margins)

Smokeable Products

Metric	Q4 2023	Q3 2024	Q4 2024
Revenues net of excise ($B)	$4.350	$4.652	$4.424
Adjusted OCI ($B)	$2.568	$2.935	$2.709
Adjusted OCI Margin (%)	59.0%	63.1%	61.2%

Oral Tobacco Products

Metric	Q4 2023	Q3 2024	Q4 2024
Revenues net of excise ($B)	$0.647	$0.695	$0.663
Adjusted OCI ($B)	$0.408	$0.464	$0.461
Adjusted OCI Margin (%)	63.1%	66.8%	69.5%

KPIs and Mix

Cigarettes and Oral Tobacco

KPI	Q4 2023	Q3 2024	Q4 2024
Total Cigarette Shipments (sticks, mm)	18,204	17,641	16,593
Marlboro Total Category Retail Share (%)	42.3	41.7	41.3
on! Shipments (cans, mm)	30.4	41.9	43.9
on! U.S. Oral Category Share (%)	6.9	8.9	8.9
Oral Tobacco Total Shipments (cans/pack eq, mm)	193.1	197.1	192.3

NJOY (E‑vapor)

KPI	Q4 2023	Q3 2024	Q4 2024
Consumables Shipments (units, mm)	—	10.4	12.8 (+15.3% YoY)
Devices Shipments (units, mm)	—	1.1	1.1 (+22.2% YoY)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted Diluted EPS	FY 2025	—	$5.22–$5.37; growth +2–5% vs $5.12 base; includes 1 fewer ship day (Q1), assumes limited illicit enforcement impact, reinvest cost savings, lower net periodic benefit income	New
Adjusted Effective Tax Rate	FY 2025	—	23%–24%	New
Capital Expenditures	FY 2025	—	$175–$225M	New
Depreciation & Amortization	FY 2025	—	≈$290M	New
Share Repurchase	Through 12/31/2025	Completed $3.4B in 2024	New $1.0B authorization, expected completion by 12/31/2025	Maintained high cash return with new plan
Dividend	Ongoing	$1.02/sh quarterly dividend rate set Aug 2024	$1.02/sh declared payable Apr 30, 2025	Maintained
2028 Smoke‑Free Goals	Through 2028	Grow volumes ≥35% vs 2022; double smoke‑free net revenues to $5B with $2B from innovative	Reassessing smoke‑free volume and revenue goals due to illicit e‑vapor prevalence; update when market clarifies	Reassessing
NJOY Targets	2025–2027	Prior: cash flow accretive in 2025; EPS accretive in 2026; ROIC > WACC by 2027	Management believes current e‑vapor market conditions compromise achieving these targets	Under review

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2, Q2’24)	Previous Mentions (Q-1, Q3’24)	Current Period (Q4’24)	Trend
Illicit e‑vapor market/regulatory	Illicit disposables >60% of category; cross‑category shift raised est. cigarette decline contribution to ~2–3%; DOJ/FDA task force formation; states adopting registries	Continued enforcement commentary; reiterated illicit dominance; reaffirmed 2024 EPS with 2 extra ship days	“Regulatory structure is broken”; illicit >60% persists; reassessing 2028 smoke‑free goals and NJOY targets	Deteriorating regulatory backdrop; urgency rising
NJOY performance	Momentum in distribution (>100k stores), device share, menthol MGO; sequential volume gains	Q3: consumables 10.4mm; device 1.1mm; 6.2% consumables share	Q4 consumables 12.8mm; devices 1.1mm; consumables share 6.4%; ITC ruling risk; engineers working on design workarounds	Solid operational progress; legal risk elevated
Oral pouches (on!)	Strong growth; trade program; new packaging and equity campaign; U.S. share 8.1% Q2	Q3 oral rev +5.4%; adj. OCI +2.0%; on! share 8.9%; Skoal impairment	Q4 on! share 8.9% (+200 bps YoY); shipments +44%; Helix profitable in Q4	Positive, improving profitability
Smokeable pricing vs. volumes	Net price realization ~10%; adj. OCI margins ~61–62% despite volume declines	Q3 Smokeable adj. OCI +7.1%; margin 63.1%	Q4 Smokeable adj. OCI +5.5%; margin 61.2%; volumes -8.8%	Margin strength vs. structural volume pressure
Heated tobacco (Ploom)/RRP pipeline	PMTA work progressing; on! PLUS PMTAs filed; SWIC test in GB	Reaffirmed innovation focus	Combined Ploom PMTA+MRTPA planned mid‑2025; SWIC small-scale test in GB ongoing	Pipeline milestones approaching
Macro/tariffs	Consumer under cumulative inflation pressure; inventory dynamics	Emphasized back‑half EPS drivers	Management sees cumulative inflation pressure; limited tariff exposure due to diversified sourcing	Macro headwind persists; tariff risk low

Management Commentary

“2024 was another pivotal year for Altria… strong financial results and significant cash returns to our shareholders.” – CEO Billy Gifford .
“We believe the regulatory structure is broken and the tobacco marketplace is not operating as Congress intended.” – CEO Billy Gifford on illicit e‑vapor .
“Helix achieved profitability for the first time in the fourth quarter, ahead of its 2025 goal.” – CEO Billy Gifford .
“Our core tobacco businesses generated solid financial performance… Adjusted OCI margins expanded to 61.2% [Q4]… supported by robust net price realization of 11.3%.” – CFO Sal Mancuso .
On guidance phasing and NJOY/ITC: “We run a number of scenarios… there are always puts and takes… we feel good about the guidance we’ve provided.” – CFO Sal Mancuso .

Q&A Highlights

NJOY/ITC contingency: Analysts probed whether guidance assumes an ACE market exit; management emphasized scenario planning within the range and multiple levers; engineering work underway on design changes to address patents .
Cigarette dynamics: Cumulative inflation and cross‑category movement continue; secular decline estimated at 2.5% excluding cross‑category; cross‑category impact ~3–4% over last 12 months .
Cost phasing: Q4 controllable cost uptick flagged as timing; overall disciplined allocation and analytics-driven promotional efficiency .
on! pricing elasticity: Pricing up with strong volume growth; improved promotional efficiency; brand loyalty indicators encouraging .
Tariff exposure: Management cited alternative manufacturing outside China, implying limited exposure to potential China tariffs .

Estimates Context

S&P Global consensus for Q4 2024 EPS and revenue was unavailable at the time of analysis due to data access limits. As a result, we cannot characterize beats/misses versus consensus for the quarter. We will update when S&P Global estimates are accessible.

Key Takeaways for Investors

Margin defense is working: strong net price realization and cost discipline lifted segment margins despite volume/mix pressure; this underpins the 2025 EPS guide even in a tough category backdrop .
Regulatory inflection remains the swing factor: sustained illicit e‑vapor activity weighs on combustibles and regulated pod systems; any step‑up in enforcement or additional FDA authorizations could change the narrative rapidly .
NJOY legal risk near‑term: pending USTR decision on ITC order (deadline Mar 31, 2025) is a binary catalyst; management is pursuing product modifications; watch for settlement/design‑around headlines .
Attractive capital return profile: new $1B buyback, stable $1.02/sh quarterly dividend, and leverage ~2.1x create support for TSR while smoke‑free investments continue .
Oral pouches are the bright spot: on! growth and earlier-than-planned Helix profitability offset MST declines; U.S. authorization of on! PLUS would be an incremental catalyst .
2025 guide appears prudent: embeds fewer ship days and limited enforcement impact; execution on cost reinvestment and RRP pipeline (Ploom PMTA/MRTPA mid‑2025) will be key to multiple expansion .
Watchlist: updates to 2028 smoke‑free goals/NJOY targets, state/federal enforcement actions, and segment mix shifts (discount share, oral pouches) as drivers of trajectory and sentiment .

Supporting detail and data sources:

Q4 2024 8‑K 2.02 press release and schedules .
Q4 2024 earnings call transcript .
Jan 30, 2025 press release (duplicate of Exhibit 99.1 content) –.
Q3 2024 press release for trend context –.
Q2 2024 earnings call for trend context –.
Dividend declaration (Feb 27, 2025) .

ALTRIA GROUP, INC. (MO)·Q4 2024 Earnings Summary