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カタログ表


アメリカ合衆国
証券取引委員会
ワシントン D. C. 20549
形式 10-Q
(マーク1) 
↓ ↓
1934年証券取引法第13条又は15(D)条に規定する四半期報告
本四半期末まで2024年9月30日
OR 
↓ ↓
1934 年証券取引所法第 13 条または第 15 条 （ d ） に基づく移行報告書
中国から日本への過渡期については、日本政府は中国政府を中国政府に転換し、中国政府は中国政府を中国政府に転換した
手数料書類番号001-33708
フィリプモリスです。
(登録者の正確な氏名はその定款に記載)
バージニア13-3435103
(明またはその他の司法管轄権
法人または組織 ）		(税務署の雇用主
識別番号 ） 。
677 Washington Blvd ， Suite 1100スタンフォードコネチカット州06901
（ 主 要 執行 役 所の 住 所 ）(郵便番号)
登録者の電話番号 （ エリアコードを含む ）(203)905-2410
前回報告以降に変更された場合の旧氏名 · 住所 · 会計年度

同法第12条(B)に基づいて登録された証券：
各クラスのタイトル 取引コード登録された各取引所の名称
普通株で額面がない午後3時半ニューヨーク証券取引所
2024年満期の債券金利は0.625PM24Bニューヨーク証券取引所
3.250% 2024 年の債券PM24Aニューヨーク証券取引所
2.750% 2025 年の債券PM25ニューヨーク証券取引所
3.375% 2025 年の債券PM 25 Aニューヨーク証券取引所
2.750% 2026 年満期PM 26 Aニューヨーク証券取引所
2.875% 2026 年満期債券PM26ニューヨーク証券取引所
0.125% 2026 年満期債券PM 26 Bニューヨーク証券取引所
3.125% 2027 年満期債券PM27ニューヨーク証券取引所
3.125% 2028 年満期債券PM28ニューヨーク証券取引所
2.875% 2029 年満期債券PM29ニューヨーク証券取引所
3.375% 2029 年満期債券PM29Aニューヨーク証券取引所
3.750% 2031 年満期債券PM 31 Bニューヨーク証券取引所
0.800% 2031 年満期PM31ニューヨーク証券取引所
3.125% 2033 年満期PM33ニューヨーク証券取引所
2.000% 2036 年満期PM36ニューヨーク証券取引所
各クラスのタイトル 取引コード登録された各取引所の名称
1.875% 2037 年満期PM37Aニューヨーク証券取引所
6.375% 2038 年満期PM38ニューヨーク証券取引所
1.450% 2039 年満期PM 39ニューヨーク証券取引所
4.375% 2041 年満期PM41ニューヨーク証券取引所
4.500% 2042 年満期PM42ニューヨーク証券取引所
3.875% 2042 年満期PM42Aニューヨーク証券取引所
4.125% 2043 年満期PM 43ニューヨーク証券取引所
4.875% 2043 年満期PM 43 Aニューヨーク証券取引所
4.250% 2044 年満期PM 44ニューヨーク証券取引所
再選択マークは、登録者が(1)過去12ヶ月以内に(または登録者にそのような報告の提出を要求するより短い期間内に)1934年の証券取引法第13条または15(D)節に提出を要求したすべての報告書を提出したかどうか、および(2)このような提出要求を過去90日以内に遵守してきたことを示すはい  シュ いいえ “

再選択マークは、登録者が過去12ヶ月以内(または登録者がそのような文書の提出を要求されたより短い時間以内)に、S−T規則405条(本章232.405節)に従って提出を要求した各相互作用データファイルを電子的に提出したか否かを示すはい  シュ いいえ “

登録者が大型加速申告会社，加速申告会社，非加速申告会社，小さな報告会社，あるいは新興成長型会社であることを再選択マークで示す。取引法第12 b-2条の規則における“大型加速申告会社”、“加速申告会社”、“小申告会社”、“新興成長型会社”の定義を参照されたい。
大型加速ファイルサーバ    シュ                        加速ファイラー ↓ ↓  
非加速ファイラー ↓ ↓ 小規模報道会社 ↓ ↓
新興成長会社 ↓ ↓
新興成長型企業であれば、登録者が延長された移行期間を使用しないことを選択したか否かを再選択マークで示し、取引所法第13(A)節に提供された任意の新たまたは改正された財務会計基準を遵守する“

登録者が空殻会社であるか否かをチェックマークで示す(取引法第12 b-2条で定義される)↓ ↓*シュ
2024 年 10 月 18 日、 1,554,833,410 登録者の普通株式の発行済株式、 1 株当たりの額面価値なし。
1
カタログ表

フィリプモリスです。
目次ページ
 
  第…ページ，第
PART I—
第1項。
連結決算計算書
2024 年、 2023 年 9 月 30 日までの 9 ヶ月間
2024 年、 2023 年 9 月 30 日までの 3 ヶ月間
連結決算計算書
2024 年、 2023 年 9 月 30 日までの 9 ヶ月間
2024 年 9 月 30 日と 2023 年 9 月 30 日までの 3 ヶ月
連結貸借対照表
2024 年 9 月 30 日、 2023 年 12 月 31 日
7 – 8
連結キャッシュ · フロー · 決算表
2024 年、 2023 年 9 月 30 日までの 9 ヶ月間
9 – 10
連結株主資本 （ 赤字 ） 精算表
2024 年、 2023 年 9 月 30 日までの 9 ヶ月間
2024 年、 2023 年 9 月 30 日までの 3 ヶ月間
13 – 52
第二項です。
53 – 116
第四項です。
パート II—
第1項。
プロジェクト1 A
第二項です。
五番目です
第6項。

本レポートにおいて、「 PMI 」、「当社」、「当社」および「当社」は、 Philip Morris International Inc. を指します。その子会社。

本レポートに記載されている商標およびサービスマークは、 Philip Morris International Inc. の子会社の登録財産、またはライセンス供与されています。イタリア語です
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第1部-財務情報
項目 1 。財務諸表。
フィリップ · モリス · インターナショナル株式会社関連会社
連結損益計算書
(in数百万ドル （ 1 株あたりのデータを除く ）
(未監査)
 9 月 30 日までの 9 ヶ月間、
 20242023
純収入1 & 2 （ 注 7 、 12 ）
$28,172 $26,127 
販売コスト9,906 9,431 
総利益18,266 16,696 
マーケティング · 管理 · 研究費用 （ 注釈 4 、 7 、 15 、 18 ）8,123 7,364 
商誉の損耗 （ 注 4 ）— 665 
営業収入10,143 8,667 
利子支出，純額817 788 
年金その他の給付費用 （ 注 3 ）44 36 
所得税前収益9,282 7,843 
所得税支給2,145 2,019 
株式投資 · 有価証券 （ 損益 ） / 純(852)(131)
純収益$7,989 $5,955 
非持株権の純収益に起因することができる353 338 
PMI に起因する純利益$7,636 $5,617 
1 株当たりのデータ （ 注 6 ） ：
基本1株当たりの収益$4.90 $3.61 
希釈して1株当たり収益する$4.89 $3.61 
(1) 関連当事者からの純利益を含む $2,866百万ドルとドル2,631 2024 年 9 月 30 日と 2023 年 9 月 30 日に終了した 9 ヶ月間
(2) 純売上高は、製品に対する消費税を差し引いたものです。 2024 年 9 月 30 日と 2023 年の 9 ヶ月間、製品に対する消費税は $38,535百万ドルとドル37,140 それぞれ 100 万ドル。









簡明な連結財務諸表の付記を参照。

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フィリップ · モリス · インターナショナル株式会社関連会社
連結損益計算書
(in数百万ドル （ 1 株あたりのデータを除く ）
(未監査)
 9 月 30 日までの 3 ヶ月間、
 20242023
純収入1 & 2 (Note 12）
$9,911 $9,141 
販売コスト3,366 3,165 
総利益6,545 5,976 
マーケティング · 管理 · 研究費 （ 注 7 、 18 ）
2,891 2,606 
営業収入3,654 3,370 
利子支出，純額189 261 
年金その他の給付費用 （ 注 3 ）15 8 
所得税前収益3,450 3,101 
所得税支給735 1,031 
株式投資 · 有価証券 （ 損益 ） / 純(500)(101)
純収益3,215 2,171 
非持株権の純収益に起因することができる133 117 
PMI に起因する純利益$3,082 $2,054 

1 株当たりのデータ （ 注 6 ） ：
基本1株当たりの収益$1.98 $1.32 
希釈して1株当たり収益する$1.97 $1.32 
(1) 関連当事者からの純利益を含む $1,0451000万ドルと300万ドルです857 2024 年 9 月 30 日と 2023 年 9 月 30 日までの 3 ヶ月間
(2) 純売上高は、製品に対する消費税を差し引いたものです。 2024 年 9 月 30 日と 2023 年の 3 ヶ月間、製品に対する消費税は $13,773百万ドルとドル13,092 それぞれ 100 万ドル。





簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
連結決算計算書
(in数百万ドル ）
(未監査)

9 月 30 日までの 9 ヶ月間、
20242023
純収益$7,989 $5,955 
その他の総合利益 （ 損失 ） （ 所得税引外 ） ：
通貨換算調整の変更 ：
未実現利益 （ 損失 ） 、所得税を差し引いた $14 2024 年と $（12） in 2023
(365)(669)
所得税を差し引いた利益への転嫁 （ 損益 ） $0 2024 年と 2023 年 （ 注釈 11 、 15 、 18 ）
155 4 

純損失および事前サービスコストの変更 ：
純損失、事前サービス費用および純移行費用の償却額 （ 所得税を差し引いた ）26） in 2024 and $（ ）20） in 2023
103 59 

ヘッジとして計上されるデリバティブの公正価値の変化 ：
所得税を差し引いた認識された利益 （ 損失 ） $（28） in 2024 and $（56） in 2023
126 304 
（ 利益 ） 損失を利益に転嫁し、所得税を差し引いた $30 2024 年と $30 2023 年に
(137)(155)
その他総合利益 （ 損失 ） 合計(118)(457)
総合利益合計7,871 5,498 
以下に起因する総合利益 （ 損失 ） の減少 ：
非制御的権益312 139 
PMI に起因する総合利益$7,559 $5,359 


















簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
連結決算計算書
(in数百万ドル ）
(未監査)
9 月 30 日までの 3 ヶ月間、
20242023
純収益$3,215 $2,171 
その他の総合利益 （ 損失 ） （ 所得税引外 ） ：
通貨換算調整の変更 ：
未実現利益 （ 損失 ） 、所得税を差し引いた $144 2024 年と $（95） in 2023
(730)158 
所得税を差し引いた利益への転嫁 （ 損益 ） $0 2024 年と 2023 年
— 2 

純損失および事前サービスコストの変更 ：
純損失、事前サービス費用および純移行費用の償却額 （ 所得税を差し引いた ）8） in 2024 and $（6） in 2023
36 18 

ヘッジとして計上されるデリバティブの公正価値の変化 ：
所得税を差し引いた計上利益 （ 損失 ） $27 2024 年と $（8） in 2023
(160)58 
（ 利益 ） 損失を利益に転嫁し、所得税を差し引いた $7 2024 年と $8 2023 年に
(43)(51)
その他総合利益 （ 損失 ） 合計(897)185 
総合利益合計
2,318 2,356 
以下に起因する総合利益 （ 損失 ） の減少 ：
非制御的権益198 74 
PMI に起因する総合利益$2,120 $2,282 
















簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
簡明総合貸借対照表
(in数百万ドル ）
(未監査)
 
九月三十日
2024		十二月三十一日
2023
資産
現金 · 現金同等物$4,258 $3,060 
貿易売掛金 （ 引当額を差し引く54 2024 年と $79 2023 年 ） 。 (1)
4,239 3,461 
その他の売掛金 （ 引当額を差し引く21 2024 年と $35 2023 年 ） 。
952 930 

在庫：
葉タバコ1,980 1,942 
その他の原料2,368 2,293 
完成品5,007 6,539 
9,355 10,774 
その他流動資産1,992 1,530 

流動資産総額		20,796 19,755 

財産、設備、コストで		17,512 17,080 
減算：減価償却累計9,964 9,564 
7,548 7,516 
善意 （ 注 4 ）17,144 16,779 
その他の無形資産純 （ 注釈 4 ）11,916 9,864 
株式投資 （ 注釈 12 ）5,631 4,929 
所得税を繰延する1,012 814 
その他の資産 （ 引当を除く ）26 2024 年と $25 2023 年 ） （ 注 18 ）
2,845 5,647 
総資産$66,892 $65,304 

(1) 関連当事者からの貿易債権を含む $768百万ドルとドル710 2024 年 9 月 30 日と 2023 年 12 月 31 日にそれぞれ 100 万ドルです 詳細は注釈 12 を参照。 関連当事者 — 株式投資その他。






簡明な連結財務諸表の付記を参照。
継続する
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フィリップ · モリス · インターナショナル株式会社関連会社
連結貸借対照表 （ 続き ）
(in数百万ドルのシェアデータを除く ）
(未監査)
 
九月三十日
2024		十二月三十一日
2023
負債.負債
短期借入 （ 注 10 ）$152 $1,968 
長期債務の経常比率 （ 注 10 ）4,833 4,698 
売掛金3,511 4,143 
負債を計算すべきである
マーケティング · セールス1,043 862 
所得税を除く税金6,594 7,514 
雇用費1,235 1,262 
配当金に応じる2,119 2,041 
他にも2,820 2,737 
所得税1,059 1,158 
流動負債総額23,366 26,383 

長期債務 （ 注 10 ）		44,237 41,243 
所得税を繰延する2,547 2,335 
雇用コスト2,957 3,046 
所得税その他の負債1,498 1,743 
負債総額74,605 74,750 

不測の事態 （ 注 8 ）

株主 （ 赤字 ） 持分

普通株式、無額面
   (2,109,316,331 2024 年と 2023 年に発行された株式 ）
— — 
追加実収資本2,283 2,285 
事業への収益再投資35,556 34,090 
その他累積総合損失 （ 注 11 ）(11,892)(11,815)
25,947 24,560 
減 ： 買戻し株式のコスト
   (554,486,775 そして 556,891,800 2024 年と 2023 年のシェア ）
35,641 35,785 
PMI 株主総赤字(9,694)(11,225)
非制御的権益1,981 1,779 
株主総損失額(7,713)(9,446)
負債総額及び株主資本 （ 赤字 ）$66,892 $65,304 





簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
キャッシュフロー表簡明連結報告書
(in数百万ドル ）
(未監査)
 
 9 月 30 日までの 9 ヶ月間、
 20242023
営業活動によって提供された （ 使用された ） 現金
純収益$7,989 $5,955 
純収益が営業キャッシュフローと一致するように調整する
減価償却および償却費用1,310 1,029 
善意その他の無形資産の減損 （ 注 4 ）27 680 
ベクトゥラクチャグループの売却予想に伴う減損 （ 注 18 ）
198 — 
繰延所得税 （ 給付 ） 引当20 34 
資産減価償却 · 退出費用 （ 現金支払を除いた ） （ 注 15 ）134 35 
買収会社からの影響を差し引いた変更のキャッシュ効果 ：
売掛金、純 (1)
(987)(267)
在庫情報1,265 (181)
売掛金(261)(623)
発生負債 · その他経常資産(643)(922)
所得税(241)(201)
年金計画拠出額 （ 注 3 ）(81)(96)
他にも(515)459 
経営活動提供の現金純額8,215 5,902 
投資活動によって提供された （ 使用された ） 現金
資本支出(1,166)(1,010)
買収 （ 取得現金除外 ） （ 注釈 18 ）44 — 
株式会社アルトリアグループ合意 （ 注 18 ）— (1,775)
株式投資(124)(111)
デリバティブ担保の発行 · 決済、 （ 支払 ） · 返済 （ 注 5 ）(159)(110)
他にも(128)(24)
投資活動提供の現金純額(1,533)(3,030)
 
(1) 関連当事者からの金額を含む $（111)百万元と(1302024 年 9 月 30 日、 2023 年 9 月 30 日











簡明な連結財務諸表の付記を参照。

継続する
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フィリップ · モリス · インターナショナル株式会社関連会社
現金フロー表簡明連結報告書(継続)
(in数百万ドル ）
(未監査)
 
 9 月 30 日までの 9 ヶ月間、
 20242023
金融活動によって提供された （ 使用された ） 現金
初期満期別短期借入活動 ：
正味発行 （ 返済 ） —90 日未満の満期$(1,452)$356 
発行 —90 日以上の満期100 1,109 
返済 —90 日以上の満期(433)(554)
スウェーデンの Match Ab 買収に関する信用ファシリティの返済— (4,430)
長期債務収益5,194 9,959 
長期債務の返済(2,381)(2,034)
支払済み配当金(6,091)(5,941)
デリバティブの担保受入 / 決済、受入 / （ 返済 ）22 2 
スウェーデンマッチ Ab の非支配権を取得する支払い — (883)
非支配権益活動その他 （ 注 18 ）
(337)(269)
融資活動提供の現金純額(5,378)(2,685)
現金、現金等価物および限定現金に及ぼす為替レート変動の影響(149)(370)
現金、現金等価物、および限定現金(1):
(減少を)増やす1,155 (183)
期初残高3,146 3,217 
期末残高$4,301 $3,034 

(1) 上記の現金、現金同等物および制限現金の金額には、制限現金 $が含まれます。43百万ドルとドル17 2024 年 9 月 30 日、 2023 年 9 月 30 日現在、それぞれ 100 万ドル。86百万ドルとドル10 2023 年 12 月 31 日現在、 2022 年 12 月 31 日現在、連結バランスシートの他の経常資産に含まれています。







簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
連結株主持分 （ 赤字 ） 計算書
2024 年 9 月 30 日および 2023 年 9 月 30 日までの 9 ヶ月間
(in株当たり金額を除く数百万ドル ）
(未監査)
 PMI 株主資本 （ 赤字 ）  
 ごく普通である
在庫品		その他の内容
支払い済み
資本		収益.収益
再投資
♪the the the
業務.業務		積算
他にも
総合損失		コスト
すでに買い戻した
在庫品		非制御性
利益．		総額
バランス 2023 年 1 月 1 日$— $2,230 $34,289 $(9,559)$(35,917)$2,646 $(6,311)
純収益5,617 338 5,955 
その他の総合利益 （ 損失 ） 、所得税引外(438)(19)(457)
株式賞の発行について 29 129 158 
発表された配当金($3.84 1 株あたり ）
(5,987)(5,987)
非持株権益への配当金(407)(407)
非支配権益に対する子会社の株式の売却 （ 買入れ ） （ 注 18 ）(6)180 (831)(657)
バランス、 2023 年 9 月 30 日$— $2,253 $33,919 $(9,817)$(35,788)$1,727 $(7,706)
残高、 2024 年 1 月 1 日$— $2,285 $34,090 $(11,815)$(35,785)$1,779 $(9,446)
純収益7,636 353 7,989 
その他総合利益 （ 損失 ） 、所得税引外(77)(41)(118)
株式賞の発行 (2)144 142 
発表された配当金($3.95 1 株あたり ）
(6,170)(6,170)
非持株権益への配当金(360)(360)
取得 （ 注 18 ）
159 159 
非支配権益者への子会社の株式の売却 （ 買入れ ） 91 91 
2024 年 9 月 30 日残高$— $2,283 $35,556 $(11,892)$(35,641)$1,981 $(7,713)




簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
連結株主持分 （ 赤字 ） 計算書
2024 年および 2023 年 9 月 30 日までの 3 ヶ月間
(in株当たり金額を除く数百万ドル ）
(未監査)
 PMI 株主資本 （ 赤字 ）  
 ごく普通である
在庫品		その他の内容
支払い済み
資本		収益.収益
再投資
♪the the the
業務.業務		積算
他にも
総合損失		コスト
すでに買い戻した
在庫品		非制御性
利益．		総額
残高、 2023 年 7 月 1 日$— $2,240 $33,893 $(10,045)$(35,791)$1,743 $(7,960)
純収益  2,054   117 2,171 
その他総合利益 （ 損失 ） 、所得税引外   227  (42)185 
株式賞の発行について 40   3  43 
発表された配当金($1.30 1 株あたり ）
  (2,028)   (2,028)
非持株権益への配当金     (89)(89)
非支配権益者への子会社の株式の売却 （ 買入れ ） (27) 1  (2)(28)
バランス、 2023 年 9 月 30 日$— $2,253 $33,919 $(9,817)$(35,788)$1,727 $(7,706)
2024 年 7 月 1 日残高$— $2,249 $34,582 $(10,930)$(35,645)$1,802 $(7,942)
純収益  3,082   133 3,215 
その他総合利益 （ 損失 ） 、所得税引外   (962) 65 (897)
株式賞の発行について 34   4  38 
発表された配当金($1.35 1 株あたり ）
  (2,108)   (2,108)
非持株権益への配当金     (98)(98)
非支配権益者への子会社の株式の売却 （ 買入れ ）   79 79 
2024 年 9 月 30 日残高$— $2,283 $35,556 $(11,892)$(35,641)$1,981 $(7,713)


簡明な連結財務諸表の付記を参照。
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フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
 
注1背景とプレゼンテーションの基礎 ：

背景

フィリップ · モリス · インターナショナル株式会社アメリカ合衆国バージニア州 （ 以下、 U. S. とも呼ばれる ） に設立された持株会社です。アメリカ合衆国またはアメリカ合衆国 ） の子会社および関連会社およびそのライセンシーが主にタバコおよび無煙製品の製造および販売に従事しています。本財務諸表において、「 PMI 」という用語はフィリップ · モリス · インターナショナルのことを指します。その子会社。

Smoke—Free Business （SFB） は、 PMI がすべての禁煙製品を指す用語です。SFb には、ウェルネスやヘルスケア製品、ライターやマッチなどのコンシューマーアクセサリーも含まれています。

無煙製品 （ 本明細書では「 SFP 」とも呼ばれる ） は、ヒートノンバーン、電子蒸気、経口無煙など、タバコを燃焼させることなくニコチンを供給するすべての製品を指すために PMI が使用する用語であり、したがって有害化学物質のレベルをはるかに低減させる。そのため、これらの製品は喫煙継続と比較して危害のリスクを減らす可能性があります。

「プラットフォーム 1 」は、 PMI が使用する用語であり、特に設計された独自のタバコユニットを挿入して加熱してエアロゾルを生成する精密制御加熱装置を使用する PMI の無煙製品を指します。

2024 年 9 月 17 日、 PMI は、 PMI の完全子会社である Vectura Fertin Pharma Inc. が、Vectura Group Ltd. （ 旧 Vectura Group plc 、以下、「 Vectura 」または「 Vectura Group 」という ） を Molex Asia Holdings Ltd. に売却することに合意しました。取引は、規制当局の承認により、タイミングに影響を与える可能性のあるその他の慣習的な取引条件を条件として、 2024 年末までに完了する予定です。詳細は注釈 18 を参照。 買収と資産剥離.

陳述の基礎

PMI の中間連結財務諸表は未監査です。 これらの中間連結財務諸表は、米国において一般的に認められている会計原則 （ 以下「米国 GAAP 」といいます ） に準拠して作成され、これらの原則は一貫して適用されています。米国 GAAP に従って作成された年次財務諸表に通常含まれる特定の情報および脚注開示は省略されています。PMI の経営陣は、提示された中間結果の公正な記述に必要なすべての調整が反映されているとの意見です。 このような調整はすべて通常の繰り返し性質であった。 中間期間の純収益および PMI に起因する純利益は、必ずしも通期の予想される結果を示すものではありません。

合併と 2023 年のスウェーデンマッチ事業の既存の地域構造への統合に向けた進展に続き、 PMI は 2024 年 1 月にセグメントレポートを更新し、以前のスウェーデンマッチセグメントの結果を PMI に含めました。 4 人 既存の地理的セグメント。ザ 4 人 既存の地理的セグメントは、ヨーロッパ地域、南 · 東南アジア、独立国家共同体、中東 · アフリカ地域 （ 「 SSEA 、 CIS & MEA 」 ） 、東アジア、オーストラリア、 PMI 免税地域 （ 「 EA 、 AU & PMI DF 」 ） 、米州地域です。ウェルネス & ヘルスケア （ 「 W & H 」 ） セグメントは変更なし。

上記の新しいセグメント構造の結果、一部の前年度の金額は、当年のプレゼンテーションに合わせるために再分類されました。 注釈 4 を参照。 商誉その他の無形資産、純、 注7細分化市場報告 略称は 15 。 資産減価償却 · 退出コスト もっと詳細を知っています。 これらの再分類は、 PMI の連結財務状況、営業結果、および各期間のキャッシュフローに影響を与えませんでした。

これらの財務諸表は、 2023 年 12 月 31 日に終了した PMI の年次報告書 （ Form 10—k ） に記載された監査連結財務諸表および関連注釈と併せて読める必要があります。

注2株式計画：
2022 年 5 月、 PMI の株主は Philip Morris International Inc. を承認した。2022 年業績インセンティブ計画 （ 「 2022 計画」 ）2022 年計画に基づき、 PMI は適格な従業員に制限付き株式および制限付き株式単位、業績に基づく現金インセンティブ報酬および業績に基づく株式報酬を付与することができます。Up to 25 2022 年計画に基づき、 PMI の 100 万株の普通株式を発行する可能性があります。 2024 年 9 月 30 日現在、 2022 年計画の助成可能な株式は 19,188,146.
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2017 年 5 月、 PMI の株主は Philip Morris International Inc. を承認した。2017 年度非社員取締役株式報酬計画 （ 以下「 2017 年度非社員取締役計画」 ） 非従業員取締役とは、 PMI または PMI が直接的または間接的に保有する株式の正社員でない PMI 取締役会のメンバーを定義します。 50当該法人の取締役選挙に議決権を有する全株種の総議決権の% 。 Up to 1 2017 年の非従業員取締役計画に基づき、 PMI の普通株式 100 万株を付与することができます。 2024 年 9 月 30 日現在、本計画に基づく付与可能な株式は 855,920.

制限付き株式単位 （RSU）

2024 年 9 月 30 日および 2023 年 9 月 30 日までの 9 ヶ月間に、 RSU の報酬に関連する適格な従業員に付与された株式および付与日時加重平均公正価値は以下の通りでした。
数量
株
付与		加重平均授与日授与された RSU 賞あたりの公正価値
20242,005,920 $ 89.58 
20231,756,750 $ 101.96 

RSU 賞に関連する報酬費用は以下の通りでした。
RSU 賞に関連する報酬費用
(単位：百万)9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
2024$ 115 $ 31 
2023$ 124 $ 38 
2024 年 9 月 30 日現在、 PMI は $190 RSU の賞金に関連した未認識の補償費用の総額 100 万ドルです コストは、通常、賞の元の制限期間中に認識されます。 3年 賞の日の後、または死亡、障害、または年齢に達した場合 58.

2024 年 9 月 30 日までの 9 ヶ月間、 1,826,668 RSU 賞授与。 すべての授与された賞の付与日の公正価値は約 $でした。156 100 万ドル 2024 年 9 月 30 日に終了した 9 ヶ月間に付与された RSU 賞の公正価値の総額は約 $168 100 万ドル

パフォーマンスシェアユニット賞

2024 年 9 月 30 日と 2023 年 9 月 30 日までの 9 ヶ月間に、 PMI は特定の役員に PSU アワードを授与しました。 PSU の賞は、通常、助成時にあらかじめ決定された特定のパフォーマンス指標の達成を必要とします。 3年制 パフォーマンスサイクルです

2023 年 9 月 30 日までの 9 ヶ月間に付与された PSU の業績指標は、 PMI の総株主利益率 （ 以下「 TSR 」 ） を、あらかじめ定められたピアグループに対して絶対ベースで構成しました。40（ 株価上昇率 ） 、 PMI の通貨中立複合調整希釈済み株当たり利益成長率 （30重量% ） 、および持続可能性指数で構成される 二つ ドライバー：

•製品サステナブル性 (20重量% ） は、主に無煙製品の利点を最大化し、たばこを意図的に段階的に廃止し、消費後の廃棄物を削減するための PMI の取り組みの進捗を測定します。

•オペレーションサステナビリティ (10気候変動への取り組み、自然保全、サプライチェーンにおける人々の生活の質の向上、エンパワーメントされたインクルーシブな職場の育成を通じて、 PMI とそのステークホルダーに利益をもたらすための PMI の取り組みの進捗状況を測定します。

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2024 年 9 月 30 日に終了した 9 ヶ月間の PSU の業績指標、目標および相対的重みは、 PMI の持続可能性戦略および報告の発展に対応することを目的としたサステナビリティ指数の特定の構成要素の調整を除いて、 2023 年 9 月 30 日に終了した 9 ヶ月間の PSU の業績指標、目標および相対的重みと同じです。

PSU の業績指標は、企業取引、会計法または税法の変更、資産の償却、訴訟または請求の調整、為替損益、予算外の設備投資およびその他の事象を含む、重要な範囲で異常またはまれに発生する事象の影響を反映するために、適切な場合に調整される場合があります。

加重されたパフォーマンス因子の合計 三つ 各 PSU 賞の指標は、賞の終わりに付与される PSU のパーセンテージを決定します。 3年制 パフォーマンスサイクルです そのような PSU の最低パーセンテージは ゼロ目標の割合は 100 最大のパーセンテージは 200. 各 PSU は参加者に 1つは 普通株式のシェア 総重み付き PSU 性能係数は 100 目標の PSU の数が付与されます。業績サイクルの終了時には、参加者は、業績サイクルの間に普通株式に対して支払われた累積配当に相当する金額を取得します。

2024 年 9 月 30 日および 2023 年 9 月 30 日までの 9 ヶ月間に、適格な従業員に付与された株式および PSU 報酬に関連する付与日の 1 株当たり公正価値は以下のとおりです。
付与済み株式数重み付けの-
平均 PSU 付与日
その他の業績要因による公正価値 		重み付けの-
平均 PSU 助成日
TSR 業績要因による公正価値
(Perシェア ）(Perシェア ）
2024543,560 $ 89.01 $ 85.72 
2023482,360 $ 102.02 $ 133.54 

PSU 賞の付与日の公正価値は、その他の業績要因を対象とした付与日の PMI の株式市場価格を用いて決定されました。TSR パフォーマンスファクタの対象となる PSU 市場ベースの賞の付与日の公正価値は、モンテカルロシミュレーションモデルを用いて決定されました。 TSR パフォーマンスファクタの対象となる PSU 賞の付与日の公正価値を決定するには、以下の仮定を使用しました。
20242023
平均無リスク金利 (a)
4.2 %4.1 %
平均予想ボラティリティ (b)
19.9 %24.3 %
(a) 米国財務省の利回り曲線に基づく。
(b) 観測された歴史的ボラティリティを用いて決定。
PSU 賞に関連する報酬費用
(単位：百万)9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
2024$ 58 $ 9 
2023$ 51 $ 6 

2024 年 9 月 30 日現在、 PMI は $42 未付の PSU 賞に関連する未認識補償費用の総額 100 万ドル。 コストは、賞のパフォーマンスサイクル、または死亡、障害、または年齢に達した場合に認識されます。 58.

2024 年 9 月 30 日までの 9 ヶ月間、 916,452 PSU 賞授与。 すべての授与された賞の付与日の公正価値は約 $でした。86 100 万ドル 2024 年 9 月 30 日に終了した 9 ヶ月間に付与された PSU 賞の公正価値の総額は約 $83 100 万ドル


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注3給付プラン：

PMI の子会社の従業員の年金補償は、適切な範囲で別々のプランを通じて提供されます。その多くは、現地の法定要件によって管理されます。さらに、 PMI は特定の米国退職者および特定の非米国退職者に対して医療やその他の給付を提供しています。一般的に、米国以外の退職従業員の医療給付は地方政府の計画を通じてカバーされています。

連結決算計算書当たりの年金およびその他の従業員給付費用は、以下のとおりです。
 9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
(単位：百万)2024202320242023
正味年金費用 （ 所得 ）$(58)$(61)$(19)$(24)
正味雇用後費用93 88 31 29 
退職後の純費用9 9 3 3 
年金およびその他の給付総額$44 $36 $15 $8 

年金計画

純サイクル利益コストの構成要素

正味の定期年金費用は以下のとおりである。
 
年金.年金(1)
 9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
(単位：百万)2024202320242023
サービスコスト$162 $130 $53 $45 
利子コスト173 193 57 64 
計画資産の期待リターン(299)(273)(99)(92)
償却：
純損失69 21 23 5 
前期サービスコスト(ポイント)(1)(2)— (1)
定期年金純コスト$104 $69 $34 $21 
(1) 主に非米国ベースの確定給付退職計画。

雇い主が金を供給する

PMI は、税金控除可能であり、その資金提供年金プランの特定の資金調達要件を満たす範囲で、拠出を行い、拠出する予定です。雇用者の拠出金 $81 2024 年 9 月 30 日までの 9 ヶ月間に年金計画に 100 万ドルが支払われました。現在、 PMI は 2024 年の残りの期間中に約ドルの追加拠出を行う見込みです。48 現行の税金法と給付法に基づいて年金計画に 100 万ドルを寄付しましたただし、この推計は、税法その他の給付法の変更、および年金資産の長期収益率を大幅に上回るまたは下回る資産パフォーマンス、または金利および為替レートの変更の結果として変更される可能性があります。

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注4商誉その他の無形資産 （ ネット ）

2024 年度親善及び非償却無形資産の減損審査

2024年第2四半期、PMIは営業権と償却不可能無形資産の潜在的減値の年間審査を完了し、そのすべての報告単位と償却不可能無形資産に対して数量化評価を行った。この審査の結果として違います。減価費用が必要です。PMIの各報告単位の公正価値はその帳簿価値より大きく高いが、健康と医療保健報告単位を除いて、その公正価値は低い20公正な価値は帳簿価値のパーセントを超える。PMIは、仮定および推定された任意の変化、不利な臨床試験結果、規制部門の承認を得られなかった、または他の市場要因が、将来の追加的な営業権および他の無形資産の減少をもたらす可能性があるので、この報告部門を監視し続ける。また、PMIのロシア報告部門の資産には、現在の経済、政治、規制、社会条件、外国為替変動のため、これらの資産の公正価値の予測が困難であるため、リスクが残っている。2024年9月30日までのロシア業務は2.9総資産、会社間残高は含まれていません。その約1.010億ドルは現金と現金等価物からなり、主に現地通貨(ロシアルーブル)で保有されている。また私たちは23PMIのロシアにおける流通業者オランダ法によると、Megapolis Distribution B.V.はJSC TK Megapolisの持株会社であり、%の株式を持っている。詳細は付記8を参照されたい緊急事態そして注12関連先-持分投資その他.

グッドウィル

善意の動きは以下の通りである。

(単位：百万)ヨーロッパ
SSEA 、 CIS & MEA
EA 、 AU 、 PMI DF
アメリカ.アメリカウェルネス & ヘルスケア総額
2023年12月31日の残高$4,173 $2,877 $492 $8,847 $390 $16,779 
原因による変更 ：
買収と資産剥離— 510 — — (65)445 
通貨(52)29 5 (74)12 (80)
2024 年 9 月 30 日残高$4,121 $3,416 $497 $8,773 $337 $17,144 

注釈 1 で説明されている。 紹介の背景と根拠PMI は 2024 年 1 月にセグメントレポートを更新し、以前のスウェーデンマッチセグメントの結果を地理セグメントに含めた。その結果、上記の表の 2023 年 12 月 31 日時点の親善残高には、旧スウェーデンマッチセグメントから欧州およびアメリカセグメントへの再分類が含まれています。

善意の増加は、主に 2024 年第 2 四半期に PMI がエジプトでユナイテッド · タバコ · カンパニーを買収した際の購入価格配分によるものです。2024 年第 3 四半期には、上記の増加は、ベクトゥラクタグループの予想売却および為替変動に関連して処分グループに割り当てられた善意によって一部相殺されました。エジプトでの買収とベクトゥラグループの売却予定の詳細については、注釈 18 を参照してください。 買収と資産剥離.

2024 年 9 月 30 日時点のグッドディーンは、主に PMI のスウェーデンの Match Ab と Fertin Pharma A / S の買収、およびエジプト、ギリシャ、インドネシア、メキシコ、フィリピン、セルビアでの買収を反映しています。
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その他無形資産

その他の無形資産の詳細は以下の通りです。
2024年9月30日2023年12月31日
(単位：百万)加重平均残存寿命総帳簿金額累計償却するネットワークがあります総帳簿金額累計償却するネットワークがあります
償却不可無形資産$4,630 $4,630 $4,543 $4,543 
無形資産を償却すべきです
商標15 年間2,230 $848 1,382 2,267 $784 1,483 
商品化権の再取得 IQOS アメリカでは
5 年間2,777 231 2,546 — — — 
特許を含む開発技術8 年間338 118 220 774 329 445 
取引先関係やその他11 年間3,805 667 3,138 3,843 450 3,393 
その他無形資産総額$13,780 $1,864 $11,916 $11,427 $1,563 $9,864 

償却不可無形資産は、実質的に次のものから構成されます。 ZYN インドネシアおよびメキシコでの買収に関連する商標およびその他の商標、ならびに 2024 年第 2 四半期における PMI のエジプトでの買収の暫定購入価格配分に関連するたばこ製造ライセンス （ 注釈 18 参照 ） 。 買収と売却 詳細はこちら ） 。2023 年 12 月 31 日以降の増加は、主にエジプトのたばこ製造ライセンスの承認によるものであり、部分的に米ドルの為替変動によって相殺されました。92 2024 年の第 1 四半期の税引前減価償却費は27 100 万ドルは、主にウェルネスとヘルスケアセグメントの進行中の研究開発プロジェクトに充てられます。税引前減損料の $27 2024 年 9 月 30 日に終了した 9 ヶ月間の PMI の連結決算計算書のマーケティング、管理、研究費用に 100 万ドルを計上しました。

2023 年 12 月 31 日からの償却可能無形資産の残高増額は、主に IQOS 買収日 （ 2024 年 5 月 1 日 ） における米国における商業化権は、その他の無形資産 （ 純 ） として （ 注釈 18 参照 ） 。 買収と資産剥離部分的に開発された技術資産で相殺されました。454 ベクトゥラグループの売却予想に関連して売却予定として再分類された （ 注釈 18 参照 ） 。 買収と資産剥離） とドルの通貨変動621000万ドルです

2023 年 12 月 31 日からの累積償却額の変更は、主に 2024 年の償却額によるものです。588 開発された技術資産の累積償却額によって一部相殺されました267 Vectura グループの予想される売却および $の為替変動に関連して、売却のために保有されているとして再分類された百万20 100 万ドル2024 年 9 月 30 日に終了した 9 ヶ月間の無形資産の償却は、売上原価 （ $46 マーケティング、管理、研究費用 （ $200 万ドル ）542 PMI の連結決算表では 100 万ドルです。
今後 5 年間の償却費用は約 $と見積もられています。993 無形資産の償却を必要とする追加取引が起こらないと仮定して 100 万ドル以下この金額には償却が含まれます。 IQOS 米国における商業化権利 （ 注釈 18 参照 ） 買収と資産剥離).

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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
2023 年度親善及び非償却無形資産の減損審査

2023年第2四半期、PMIは、営業権および潜在的減価の償却不可能無形資産の年間審査を完了したため、健康および医療報告機関の推定公正価値がその帳簿価値よりも低いことが決定された。そのため、調達マネージャー協会は営業権減価費用#ドルを記録した6652023年9月30日までの9カ月間の総合収益表では，将来のキャッシュフロー減少の影響が予想され，主に2023年6月に健康·ヘルスケア業務が開発されている吸入型アスピリン製品により不利な臨床試験結果が得られた。また，償却不可能無形資産の減価テストを行ったため，調達マネージャー指数に記録されている税前減価費用は#ドルであった15PMI 2021年の買収の1つに関連して行われている研究開発プロジェクトに100万ドルが使用されている。この税引き前の減価費用は1ドルです152023年9月30日までの9カ月間の総合収益表では，マーケティング，行政，研究コストが100万ドルを記録した。


注5金融商品 ：

概要

PMI は、世界各地に製造 · 販売施設を構え、為替レートや金利の変化などのリスクにさらされています。その結果、 PMI は、対外事業、第三者取引および会社間取引における純投資に関連する為替および金利の変動に対するエクスポージャーを軽減するために、引渡可能および非引渡可能先行き為替契約、為替スワップおよび為替オプション （ 総称して「為替契約」といいます ） 、金利契約を使用しています。PMI がエクスポージャーされる主な通貨は、ユーロ、エジプトポンド、インドネシアルピー、日本円、メキシコペソ、フィリピンペソ、ロシアルーブル、スイスフランです。

さらに、 PMI が製品の製造に使用する特定の材料は、市場価格リスクにさらされます。PMI は、商品デリバティブ契約 （ 「商品契約」 ） を使用して、これらの材料の特定の商品構成要素の市場価格の変動に対するエクスポージャーを管理しています。

これらの外貨契約、金利契約、商品契約を総称してデリバティブ契約と呼ぶ。PMIはレバレッジデリバティブの一方ではなく、政策によってはデリバティブ金融商品を投機目的に使用しない。基本的に、PMIのすべての派生金融商品は総純額決済手配を守らなければならず、これにより、参加者が違約した場合、相殺権が発生する。これらの契約には、決算純額決済権による相殺可能な強制実行権が含まれているが、PMI選択は、簡素化された総合貸借対照表に毛単位でこれらの契約を列記する。このような手配に関連した担保は現金形式であり、制限されない。入金担保の変化は投資活動のキャッシュフローに計上され、受信した担保の変化は融資活動のキャッシュフローに計上される。ヘッジ会計資格に適合する金融商品は、開始時であっても、期間保証期間中であっても、ヘッジ期間中であっても、ヘッジされた保証商品と被期間保証項目との間で特定のレベルの有効性を維持しなければならない。PMIは正式にヘッジツールとヘッジ項目との間の性質と関係、およびそのリスク管理目標、各種ヘッジ取引を行う戦略とヘッジ有効性を評価する方法を記録した。さらに、予測取引のヘッジについては、予測取引の重要な特徴および予想条項を具体的に決定し、各予測取引が発生する可能性がなければならない。予測された取引が発生しない可能性が高いと考えられる場合，収益や損失は収益で確認される.

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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
各期末のデリバティブ残高の名目総額は以下のとおりです。
(単位：百万)2024 年 9 月 30 日2023 年 12 月 31 日まで
ヘッジ商品に指定されたデリバティブ契約 ：
外国為替契約$26,975 $21,987 
金利契約2,300 3,600 
商品契約17 20 
ヘッジ商品に指定されていないデリバティブ契約
外国為替契約21,101 17,658 
総額$50,393 $43,265 

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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
2024 年 9 月 30 日および 2023 年 12 月 31 日時点の連結貸借対照表に含まれる PMI のデリバティブ契約の公正価値は以下の通りです。
 派生資産派生負債
 公正価値公正価値
はい。はい。はい。はい。
(単位：百万)貸借対照表分類2024年9月30日2023年12月31日貸借対照表分類2024年9月30日2023年12月31日
ヘッジ商品に指定されたデリバティブ契約 ：
外国為替契約その他流動資産$328 $345 その他負債を計算すべき$203 $249 
その他の資産177 153 所得税その他の負債427 449 
金利契約その他流動資産— 1 その他負債を計算すべき43 78 
その他の資産— — 所得税その他の負債6 18 
商品契約その他流動資産— — その他負債を計算すべき3 5 
その他の資産— — 所得税その他の負債— 1 
ヘッジ商品に指定されていないデリバティブ契約
外国為替契約
その他流動資産 
100 85 その他負債を計算すべき337 425 
その他の資産— — 所得税その他の負債149 143 
連結バランスシートに記載されている総額デリバティブ契約 $605 $584  $1,168 $1,368 
連結貸借対照表の未相殺総額
金融商品(428)(374)(428)(374)
現金担保受領 · プレッジ(96)(109)(620)(551)
純額$81 $101 $120 $443 

PMI は、容易に観察可能な市場インプットをベースとした標準的な評価モデルを使用して、デリバティブ契約の公正価値を評価します。 PMI の外国為替先物契約、外国為替スワップおよび金利契約の公正価値は、現行の外国為替スポットレートおよび金利差額、および商品のそれぞれの満期日を用いて決定されます。 PMI の通貨オプションの公正価値は、外国為替スポットレートと金利差額、通貨ボラティリティ、満期日に基づくブラック · スコーズ方法論を用いて決定されます。 PMI の商品契約の公正価値は、現行のスポット市場価格と先物価格と商品のそれぞれの満期日を用いて決定されます。 PMI のデリバティブ契約は、 2024 年 9 月 30 日および 2023 年 12 月 31 日にレベル 2 に分類されています。

21
カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
2024 年 9 月 30 日および 2023 年 9 ヶ月間、 PMI のデリバティブ契約は、以下のように連結決算表および総合決算に影響を与えました。
（ 税引前、数百万単位 ）9 月 30 日までの 9 ヶ月間、
デリバティブ商品のその他の総合損益に計上される利益 （ 損失 ） 額決算説明書
損益の分類 （ 損益 ）
浅談導数		その他総合損益から当期利益に再分類した損益額収益で確認された収益/(赤字)金額
202420232024202320242023
ヘッジ商品に指定されたデリバティブ契約 ：
キャッシュフローのヘッジ：
外国為替契約$104 $290 純収入$133 $112 
販売コスト— — 
マーケティング · 管理 · 研究費4 52 
利子支出，純額(7)(13)
金利契約51 72 利子支出，純額37 34 
商品契約(1)(2)販売コスト— — 
公正価値ヘッジ：
金利契約
利子支出，純額(a)
$(7)$(24)
純投資ヘッジ(b):
外国為替契約(52)14 
利子支出，純額(c)
221 200 
ヘッジ商品に指定されていないデリバティブ契約
外国為替契約利子支出，純額214 212 
マーケティング · 管理 · 研究費 (d)
13 154 
総額$102 $374 $167 $185 $441 $542 
(a) これらの契約による利益 （ 損失 ） は、ヘッジ対象品目の公正価値の変化によって相殺されます。
(b) 主にユーロ · 米ドル間の為替 · 金利の変動に伴う純投資のヘッジ利益 （ 損失 ） 額
(c) 有効性試験から除外された金額の利益を表す
(d) 外国為替レートの変動に起因するこれらの契約の利益 （ 損失 ） は、ヘッジ対象となる会社間および第三者借入による利益 （ 損失 ） で一部相殺されます。













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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
2024 年 9 月 30 日および 2023 年 9 月 30 日までの 3 ヶ月間、 PMI のデリバティブ契約は、以下のように連結決算書および総合決算に影響を与えました。
（ 税引前、数百万単位 ）9 月 30 日までの 3 ヶ月間、
デリバティブ商品のその他の総合損益に計上される利益 （ 損失 ） 額決算説明書
損益の分類 （ 損益 ）
浅談導数		その他総合損益から当期利益に再分類した損益額収益で確認された収益/(赤字)金額
202420232024202320242023
ヘッジ商品に指定されたデリバティブ契約 ：
キャッシュフローのヘッジ：
外国為替契約$(184)$67 純収入$43 $73 
販売コスト— — 
マーケティング · 管理 · 研究費(3)(19)
利子支出，純額(2)(7)
金利契約(3)— 利子支出，純額12 12 
商品契約— (1)販売コスト— — 
公正価値ヘッジ：
金利契約
利子支出，純額(a)
$10 $(10)
純投資ヘッジ(b):
外国為替契約(630)453 
利子支出，純額(c)
74 73 
ヘッジ商品に指定されていないデリバティブ契約
外国為替契約利子支出，純額115 60 
マーケティング · 管理 · 研究費 (d)
(419)258 
総額$(817)$519 $50 $59 $(220)$381 
(a) これらの契約による利益 （ 損失 ） は、ヘッジ対象品目の公正価値の変化によって相殺されます。
(b) 主にユーロ · 米ドル間の為替 · 金利の変動に伴う純投資のヘッジ利益 （ 損失 ） 額
(c) 有効性試験から除外された金額の利益を表す
(d) 外国為替レートの変動に起因するこれらの契約の利益 （ 損失 ） は、ヘッジ対象となる会社間および第三者借入による利益 （ 損失 ） で一部相殺されます。

キャッシュフローヘッジ

PMI は、特定の予測取引に関連する為替、金利、商品価格リスクをヘッジするためにデリバティブ契約を締結しています。適格なキャッシュフローヘッジ契約に関連する損益は、基礎となるヘッジ取引が PMI の連結決算書に報告されるまで、累積されたその他の総合損失の構成要素として繰延されます。2024 年 9 月 30 日現在、 PMI は 2028 年 5 月までの様々な満了日が来るデリバティブ契約の取引をヘッジしています。キャッシュ · フロー · ヘッジに指定されたデリバティブ契約の支払額および決済額は、主に PMI のキャッシュ · フロー連結表の営業活動からのキャッシュ · フローに含まれます。
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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)

公正価値ヘッジ

PMI は、基準金利の変動による固定金利米ドル建て債務の公正価値の変化へのエクスポージャーを最小限に抑えるため、公正価値ヘッジとして指定された固定金利から変動金利契約を締結しています。公正価値ヘッジに指定され、適格なデリバティブ契約については、デリバティブの損益、およびヘッジリスクに起因するヘッジ項目に対する相殺損益は、当期決算に計上されます。2024 年 9 月 30 日時点のヘッジ債務の繰り越し額 （ 公正価値損益の累積調整を含む ） は、米ドルでした。952 100 万ドルのうち337 長期負債の現在の部分と $200 万が記録されました615 長期債務は連結バランスシートに計上されましたヘッジ債務の帳簿金額に含まれる公正価値利益 （ 損失 ） の累積額は、 $でした。46 2024 年 9 月 30 日現在 100 万ドル。

海外事業への純投資のヘッジ

PMI は、デリバティブ契約および特定の外貨建て債務およびその他の金融商品を、主にユーロ純資産の純投資ヘッジとして指定しています。 2024 年 9 月 30 日および 2023 年 9 月 30 日を末日とする 9 ヶ月間の非デリバティブ金融商品に関連する税引前損益は、通貨換算調整における累積その他の包括損失の構成要素として報告されました。18)100万ドルと$51 それぞれ 100 万ドル。2024 年 9 月 30 日および 2023 年 9 月 30 日までの 3 ヶ月間において、為替換算調整における累積その他の総合損失の構成要素として報告された非デリバティブ金融商品に関連する税引前損益は、 $（23)100万ドルと$27 それぞれ 100 万ドルです純投資ヘッジに指定されたデリバティブ契約の決済は、 PMI のキャッシュフロー連結表の投資活動からのキャッシュフローに含まれます。

Other Derivatives

PMI has entered into derivative contracts to hedge the foreign currency exchange and interest rate risks related to intercompany loans between certain subsidiaries and third-party loans. While effective as economic hedges, no hedge accounting is applied for these contracts; therefore, the gains (losses) relating to these contracts are reported in PMI’s condensed consolidated statements of earnings. Settlements of other derivative contracts are included primarily in cash flows from investing activities on PMI's condensed consolidated statements of cash flows.

Qualifying Hedging Activities Reported in Accumulated Other Comprehensive Losses

Derivative gains or losses reported in accumulated other comprehensive losses are a result of qualifying hedging activity. Transfers of these gains or losses to earnings are offset by the corresponding gains or losses on the underlying hedged item. Hedging activity affected accumulated other comprehensive losses, net of income taxes, as follows:
(in millions)For the Nine Months Ended September 30,For the Three Months Ended September 30,
 2024202320242023
Gain/(loss) as of beginning of period,$241 $266 $433 $408 
Derivative (gains)/losses transferred to earnings(137)(155)(43)(51)
Change in fair value126 304 (160)58 
Gain/(loss) as of September 30,$230 $415 $230 $415 

At September 30, 2024, PMI expects $67 million of derivative gains that are included in accumulated other comprehensive losses to be reclassified to the condensed consolidated statement of earnings within the next 12 months. These gains are expected to be substantially offset by the statement of earnings impact of the respective hedged transactions.
偶発的な機能
PMI のデリバティブ商品には偶発的特徴は含まれません。
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Table of Contents
Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Credit Exposure and Credit Risk
PMI is exposed to credit loss in the event of non-performance by counterparties. While PMI does not anticipate non-performance, its risk is limited to the fair value of the financial instruments less any cash collateral received or pledged. PMI actively monitors its exposure to credit risk through the use of credit approvals and credit limits and by selecting and continuously monitoring a diverse group of major international banks and financial institutions as counterparties.
Other Investments

Certain PMI investments, which are comprised primarily of money market funds, have been classified within Level 1 and had a fair value of $128 million at September 30, 2024. For the nine months and three months ended September 30, 2024, the unrealized pre-tax gains (losses) on these investments were immaterial.

Note 6. Earnings Per Share:
Basic and diluted earnings per share (“EPS”) were calculated using the following:
(in millions)For the Nine Months Ended September 30,For the Three Months Ended September 30,
 2024202320242023
Net earnings attributable to PMI$7,636 $5,617 $3,082 $2,054 
Less distributed and undistributed earnings attributable to share-based payment awards
22 17 9 6 
Net earnings for basic and diluted EPS$7,614 $5,600 $3,073 $2,048 
Weighted-average shares for basic EPS1,554 1,552 1,555 1,552 
Plus contingently issuable performance stock units (PSUs)(1)
2 1 1 2 
Weighted-average shares for diluted EPS1,556 1,553 1,556 1,554 
(1) Including rounding adjustment

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and therefore are included in PMI’s earnings per share calculation pursuant to the two-class method.

For the 2024 and 2023 computations, there were no antidilutive stock awards.

Note 7. Segment Reporting:

PMI’s subsidiaries and affiliates are primarily engaged in the manufacture and sale of cigarettes and smoke-free products, including heat-not-burn, e-vapor and oral nicotine products. Excluding the Wellness and Healthcare segment, PMI's segments are generally organized by geographic region and managed by segment managers who are responsible for the operating and financial results of the regions inclusive of combustible tobacco and smoke-free product categories sold in the region. As discussed in Note 1. Background and Basis of Presentation, in January 2024, PMI updated its segment reporting by including the former Swedish Match segment results into the four existing geographical segments. The four existing geographical segments are as follows: Europe Region; South and Southeast Asia, Commonwealth of Independent States, Middle East and Africa Region ("SSEA, CIS & MEA"); East Asia, Australia, and PMI Duty Free Region ("EA, AU & PMI DF"); and Americas Region. The Wellness and Healthcare segment remained unchanged.

PMI’s chief operating decision-maker evaluates geographical segment performance and allocates resources based on regional operating income, which includes results from all product categories sold in each region, excluding Wellness and Healthcare products. Business operations in the Wellness and Healthcare segment are evaluated separately.

PMI disaggregates its net revenues from contracts with customers by product category for each of PMI's four geographical segments. For the Wellness and Healthcare business, Vectura Fertin Pharma, net revenues from contracts with customers are included in the Wellness and Healthcare segment. PMI believes this best depicts how the nature, amount, timing and uncertainty of its revenue and cash flows are affected by economic factors.
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Table of Contents
Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)

Segment data were as follows:
(単位：百万)9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
2024202320242023
純収入：
ヨーロッパ$11,301 $10,465 $4,121 $3,823 
SSEA 、 CIS & MEA
8,393 7,922 2,964 2,777 
EA 、 AU 、 PMI DF
4,959 4,771 1,602 1,571 
アメリカ.アメリカ3,273 2,732 1,148 895 
ウェルネス · ヘルスケア246 237 76 75 
純収入$28,172 $26,127 $9,911 $9,141 
営業収入(赤字)：
ヨーロッパ$5,136 $4,551 $2,020 $1,717 
SSEA 、 CIS & MEA
2,623 2,437 960 823 
EA 、 AU 、 PMI DF
2,304 1,963 788 769 
アメリカ.アメリカ419 524 137 98 
ウェルネス · ヘルスケア(339)(808)(251)(37)
営業収入$10,143 $8,667 $3,654 $3,370 

PMI の製品カテゴリー別売上高は以下の通りです。
(単位：百万)9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
2024202320242023
純収入：
可燃性タバコ ：
ヨーロッパ$6,467 $6,084 $2,322 $2,160 
SSEA 、 CIS & MEA
7,390 6,988 2,612 2,485 
EA 、 AU 、 PMI DF
1,889 2,091 673 678 
アメリカ.アメリカ1,653 1,682 527 509 
可燃性タバコ総量17,399 16,845 6,134 5,832 
禁煙：
ウェルネス · ヘルスケアを除く禁煙 ：
ヨーロッパ4,834 4,381 1,799 1,663 
SSEA 、 CIS & MEA
1,003 934 352 292 
EA 、 AU 、 PMI DF
3,070 2,680 929 893 
アメリカ.アメリカ1,620 1,050 621 386 
ウェルネス · ヘルスケアを除く全面禁煙10,527 9,045 3,701 3,234 
ウェルネス & ヘルスケア246 237 76 75 
完全禁煙10,773 9,282 3,777 3,309 
PMI 総純利益$28,172 $26,127 $9,911 $9,141 
注 ： 製品カテゴリーや地域の合計は、四捨五入により PMI 合計に相当しない場合があります。

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カタログ表
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簡明合併財務諸表付記
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営業結果の比較可能性に影響を与える項目は以下のとおりです。

•エジプトの消費税課金 – 2024 年第 3 四半期、エジプト高等行政裁判所の判決とその後の利用可能な救済策の評価に続き、 PMI は悪結果の可能性があると結論付け、税引前課金 $を計上しました。45 2014 年から 2016 年の輸入カットフィラーに控除された一般消費税の税金評価に関連して 100 万ドル。この税引前費用は、 2024 年 9 月 30 日を末日とする 9 ヶ月間および 3 ヶ月間の連結決算表のマーケティング、管理および研究費用に計上され、 SSEA 、 CIS & MEA セグメントの業績に含まれています。
•ベクトゥラクチャグループの売却予想に伴う減損 – 2024 年 9 月、 PMI は Vectura を Molex Asia Holdings Ltd. に売却する最終契約の履行を発表しました。その結果、 PMI は 2024 年第 3 四半期に減価償却費用を計上しました198 ベクトゥラの分類に関連して 100 万ドルを売却した。この税引前費用は、 2024 年 9 月 30 日に終了した 9 ヶ月間および 3 ヶ月間の連結決算表のマーケティング、管理および研究費用に計上され、ウェルネスおよびヘルスケアセグメントの業績に含まれています。詳細は注釈 18 を参照。 買収と資産剥離.
•資産減価償却 · 出口コスト – 注記 15 を参照。 資産減価償却 · 退出コスト 2024 年 9 月 30 日と 2023 年 9 ヶ月間のセグメント別コスト内訳はこちら
•中東における流通体制の終了 – 第 1 四半期に 2023 年、 PMI は税引前費用を $80 中東での流通契約の終了後 100 万ドルこの税引前費用は、連結決算書において純利益の減少として計上され、 2023 年 9 月 30 日までの 9 ヶ月間の SSEA 、 CIS & MEA セグメントの決算に含まれています。
•善意その他の無形資産の減損 – 2023 年 9 月 30 日に終了した 9 ヶ月間の PMI は $680 ウェルネス · ヘルスケアセグメントに含まれていた無形資産の減損費用および償却不可の減損費用。 詳細は、注釈 4 を参照。 営業権その他無形資産，純額.
•韓国の間接税 – 2023 年 7 月 13 日、 PMI の韓国子会社である Pm Korea は、 2015 年の消費税増税とその後の韓国監査委員会による監査に関連して、消費税の納入不足を申し立てた事件に関連して、韓国最高裁判所から不利な判決を受けました。最高裁の判決は、裁判と控訴のレベルで北朝鮮に有利であった以前の判決を覆した。判決の結果、悪結果の可能性が高いと結論付けました。その結果、非現金税引前課金額 $を計上しました。204 連結決算計算書には、 2023 年 9 月 30 日に終了した 9 ヶ月間の EA 、 AU 、 PMI DF セグメントに含まれていた Pm Korea の以前に支払った金額の全額を反映しています。
•禁煙世界財団との契約終了について – 2023 年 9 月 29 日、 PMI と喫煙フリー世界財団 （ 以下「財団」といいます。 ） は、最終助成契約及び第 2 回修正 · 再修正プレッジ契約の終了 （ 以下「本契約」といいます。契約の条件の下で、 PMI は $140 当事者間の質疑契約の終了と引き換えに、 2023 の第 3 四半期に 100 万ドル。 その結果、 2023 年第 3 四半期に PMI は税引前費用を $140 プレッジ契約の早期終了に相当する 100 万ドル税引前費用は、 2023 年 9 月 30 日に終了した 9 ヶ月間および 3 ヶ月間の連結決算書において、マーケティング、管理および研究費用に計上され、以下のセグメントの営業結果に含まれています。60 百万 ）； SSEA 、 CIS & MEA （ $41 百万）； EA 、 AU & PMI DF （ $24 アメリカ合衆国 （ 百万ドル ）15 百万 ） 。

可燃性たばこ関連の純収益とは、これらの製品の販売から生じる営業収益 （ 顧客に請求される配送 · 取扱手数料、販売 · 販促インセンティブ、消費税を除いた ） を指します。 これらの純収益は、 PMI のタバコおよび燃焼された他のたばこ製品の販売で構成されています。その他のたばこ製品には、主にロールオーバーおよびメイクオーバーのタバコ、パイプタバコ、葉巻およびシガリョが含まれ、無煙製品を含まない。

禁煙関連純収益 （ ウェルネス · ヘルスケアを除く ） は、これらの製品の販売から生じる営業収益 （ 顧客に請求される配送 · 取扱料を含む ） を販売 · 販促インセンティブを除いた。
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カタログ表
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簡明合併財務諸表付記
(未監査)
消費税、該当する場合。これらの純売上高は、 PMI の可燃性タバコ製品以外の製品 （ 熱不燃、電子蒸気、経口製品など ） 、およびコンシューマーアクセサリーの販売で構成されています。

ウェルネス · ヘルスケア関連の純収益は、 PMI のウェルネス · ヘルスケア事業であるベクトゥラ · フェルティン · ファーマの営業実績に含まれる、主に吸入治療薬および経口および経口内デリバリーシステムに関連する製品の販売から生じる営業収益で構成されています。


注8意外な状況：
たばこ · ニコチン関連の訴訟
当社、および / または当社の子会社、および / または様々な管轄区域における当社の補償対象者に対して、幅広い事項をカバーする法的手続が係争中または脅かされている場合。当社の補償対象には、特定の事件において当事者として指名され、当社が弁護し、費用を支払うことに同意した販売代理店、ライセンス取得者、その他が含まれます。Altria Group， Inc. との流通契約の条件に従い、PMI は、 Altria および Philip Morris USA Inc. を補償します。（ 「 Pm USA 」 ） は、 Altria の米国タバコ子会社であり、 PMI が製造した製品または PMI のために契約製造した製品に実質的に基づくたばこ製品の請求に対して、 Pm USA は、 PMI のために契約製造されたたばこ製品を除く Pm USA が製造した製品に実質的に基づくたばこ製品の請求に対して PMI を補償します。
当社および子会社に対する係留中の事件に悪影響を及ぼす可能性があります。タバコまたはニコチン関連の係争中の訴訟の不利な結果または和解は、追加の訴訟の開始を促す可能性があります。
たばこ関連の訴訟の一部で請求された損害は重大であり、場合によっては 「医療費回復訴訟」 以下に説明すると、数十億米ドルに及ぶ可能性があります。複数の管轄区域における嘆願の変動は、訴訟請求における経営陣の実際の経験とともに、訴訟で指定され得る金銭的救済は、最終的な結果とはほとんど関係がないことを示しています。以下で説明するように、これまでたばこ関連の訴訟の弁護に大きく成功してきましたが、訴訟は不確実性があります。さらに、下記に記載されているように、 2024 年 3 月から、当社および当社子会社に対して経口ニコチン製品に関する訴訟が米国の特定の裁判所に提起されました。
当社および子会社は、不利な結果が生じる可能性があり、損失額を合理的に推定できると判断した場合には、連結財務諸表に係留訴訟引当金を計上します。現時点では、この注釈 8 に別段の記載がある場合を除く。 コンティンジェンシー、 有害な結果が生じる可能性が合理的です。法的防衛費用は発生したまま支出されます。
当社の連結財務諸表 （ 営業結果、キャッシュフローまたは財務状況を含む ） は、特定の四半期または会計年度において、不利な結果または係争中の訴訟の解決により重大な影響を受ける可能性があります。それにもかかわらず、訴訟には不確実性がありますが、当社および被告として指定された各子会社は、当社が係争中の訴訟に対する正当な防御と、不利な判決に対する上訴の正当な根拠があると信じており、それぞれの事件を担当する弁護士から助言を受けています。そのようなすべてのケースは、引き続き積極的に擁護されます。ただし、当社および子会社は、特定の場合において、当社にとって最善の利益であると信じる場合には、和解協議を行う場合があります。
この注釈 8 に別段の記載がある場合を除き、利用可能な情報を評価した後。 緊急事態（ i ） 可燃性たばこ製品関連係争中の事件について、損失が発生する可能性が高いと経営陣が結論付けていないこと。 （ ii ） 可燃性たばこ製品関連係争中の事件について、損失の可能性又は損失の範囲を経営陣が推定することができないこと。したがって、連結財務諸表において不利な結果に伴う損失の見積もりは発生していません。
CCAA 手続及びカナダにおける可燃性たばこ製品関連事件の保留
ケベック州控訴裁判所の判決の結果、 レトゥールノー そして ブライス 下記のケースは、当社の子会社 Rothmans ， Benson & Hedges Inc.（ 「 RBH 」 ） 、および他の被告である JTI Macdonald Corp. （ 「 JTIM 」 ） および Imperial Tobacco Canada Limited （ 「 ITL 」 ） は、 2019 年 3 月 22 日、 3 月 8 日、および 3 月 12 日にオンタリオ州高等裁判所において、企業債権者取り決め法 （ 「 CCAA 」 ） の下で保護を求めました。 CCAA は、カナダの企業が通常の事業を遂行しながら事業を再編することを認めるカナダの連邦法です。 初期 CCAA
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カタログ表
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簡明合併財務諸表付記
(未監査)
2019 年 3 月 22 日にオンタリオ州高等裁判所が下した命令により、 RBH は、 CCAA 提出後の通常の事業遂行に伴うすべての費用 （ 従業員、ベンダー、サプライヤーに対する義務を含む ） を支払う権限を与えています。RBH の決算は、 2019 年 3 月 22 日以降の連結財務諸表から連結解除されています。

CCAA訴訟の一部として，現在カナダではRBHおよび他の被告(PMIおよび我々の賠償対象(PM USAおよびAltria)を含む)に対するすべての可燃性タバコ製品に関する訴訟は2024年10月31日，すなわちカナダ各省で提起された喫煙·健康集団訴訟および医療コスト回収訴訟まで全面的に棚上げされている。これらの議事録のタイトルは以下の通りです“カナダは訴訟を見合わせています“安永社はすでにCCAAプログラムにおけるRBHの監督者に任命されている。反腐敗条約の手続きによると、裁判所は追加的な聴聞を手配し、訴訟手続きの棚上げ時間をさらに延長する見通しだ。2019年4月17日、オンタリオ州高等裁判所は、RBHおよび他の被告がカナダ最高裁判所に申請することを許可されず、控訴裁判所がL·トゥルノそしてブライス委員会はまた，カナダのすべての可燃性タバコ製品に関する訴訟の全面棚上げが有効であり，申請期限が棚上げ期限に延長される限り，訴訟を提起できることを提案した

RBH は、両方の責任と損害賠償の結果は レトゥールノーそしてブライス CCAA 手続は、 RBH がカナダで係争中のすべての可燃性たばこ製品関連の訴訟の取り決めまたは妥協計画を通じて解決を求めるフォーラムを提供します。2024 年 10 月 17 日、 CCAA 手続における裁判所任命の調停者およびモニターは、 RBH 、その関連会社およびその関連会社の補償対象者に対するカナダのたばこ請求および関連訴訟の包括的解決案の特定の条件を定めた妥協および取り決め案 （ 「提案案」 ） を提出しました。裁判所が任命した調停者とモニターも、 ITL と JTIm に対して実質的に同様の提案計画を提出した。

提案計画が想定した決議によると，RBH，ITL，JTIm(“会社”と総称する)は合計カナダドルのグローバル決済金額を支払う32.52000億ユーロ(約20億円)23.530億ドル)ですこの資金は、会社の手元の現金と現金等価物に加えて裁判所保証金に相当する前金によって提供される(元金の源泉徴収総額に制限される7501000万ユーロ(約180万円)543)と、全世界的な決済金額が全額支払われるまで、会社の税引後純収入の1パーセント(熱焼き製品、ニコライ袋、電子蒸気などの代替製品によって生成される収入を含まない)によって毎年支払われる。提案された計画が述べたように、民間航空部門の分配問題32.5RBH，ITLとJTImの間の10億総和解金額はまだ解決されていない。PMIおよびその賠償者を含むRBHおよびその付属会社は、提案された計画発効日前の行動に従って、RBHの可燃性および従来の無煙タバコ製品の製造、マーケティング、販売、使用または接触に関するクレームの発表を取得し、関連訴訟も却下されるであろう--以下のタイトルを含む“カナダは訴訟を見合わせています“代替製品事業(熱不燃焼，電子蒸気およびニコチン薬袋を含む)はRBH付属会社に移送される。提案された計画には，和解金額が支払われるまでRBHの業務を管理する運営契約も含まれている.

上記の条件を含む提案された計画は、当事者による更なる交渉、原告による投票、および CCAA 裁判所による承認の対象となります。 裁判所が任命した調停者およびモニターによって提案されたスケジュールによると （ CCAA 裁判所が命令した場合 ） 、提案された計画の投票は 2024 年 12 月に行われる。 原告によって受け入れられれば、提案された計画を承認すべきかどうかを検討するヒアリングは、 2025 の上半期に予想されます。
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カタログ表
フィリップ · モリス · インターナショナル株式会社関連会社
簡明合併財務諸表付記
(未監査)
カナダは訴訟を見合わせています

喫煙と健康訴訟 — カナダ

カナダでの最初の集団訴訟ではConseil Qébécois Sur Le Tabac et La SantéとJean-Yves Blaisは帝国タバコカナダ有限会社を訴えた カナダケベック高等裁判所ロスマンス、ベンセンとヘチス社とJTI-Macdonald Corp1998年11月に申請し、RBHと他のカナダ巻タバコメーカー(帝国タバコカナダ株式会社とJTI-Macdonald Corp.)被告は被告(“ブライス“集団訴訟”)。原告は、反喫煙組織と喫煙者個人が、いくつかの喫煙関連疾患を有すると言われているクラスの各メンバーに補償と懲罰的賠償を要求する。このクラスは2005年に認証を受けた。初審裁判所は2015年5月27日に判決を下した。初審裁判所はRBHと二つ他のカナダメーカーは責任を負い、クラスメンバーの補償的損害総額は約カナダドルであることが発見された15.510億ユーロ(約11.2判決前の利息も含めて10億ドル)。初審裁判所は連帯責任に基づいて補償性損害賠償を判決し，分配する20私たちの子会社(約カナダドル)3.110億ユーロ(約2.2判決前の利息も含めて10億ドル)。また，初審裁判所は民航局に判決を下した90,000 （ 約 $65,000)懲罰的賠償では、CADを割り当てる30,000 （ 約 $22,000)からRBHまで。初審裁判所はこの病気のレベルは99,957会員です。RBHはケベック控訴裁判所に控訴した。2015年10月、控訴裁判所はRBHに総額カナダドルの保証を提供するよう命令した226百万ドル163100万ドル)でレトゥールノー そして ブライス RBH は 2017 年 3 月まで分割払いで支払っています。 控訴裁判所は、インペリアル · タバコ · カナダ株式会社に対し、合計 CAD の担保を提出するよう命じた。 758百万ドル548 2017 年 6 月までの分割払い。 JTI Macdonald Corp. は、原告の動議に従って担保を提供する必要はありませんでした。 控訴裁判所は、担保は、審理裁判所の判決を確認する控訴裁判所の最終判決または控訴裁判所の更なる命令によって支払われると命じた。

2019年3月1日、控訴裁判所は、初審裁判所の責任裁決および補償性と懲罰的賠償裁決を基本的に確認するとともに、補償性損害賠償総額を約カナダドルに減少させる判決を発表した13.510億ユーロ(約9.8初審裁判所が利息を計算する際に誤ったことによる利息を含む10億ドル。補償性損害賠償金は共通と個別に基づいて行われ、分配金額は20%からRBH(約CAD2.710億ユーロ(約2.0判決前の利息も含めて10億ドル)。控訴裁判所は、被告が“ケベック民法”、“ケベック人権と自由憲章”、“ケベック消費者保護法”に違反し、喫煙の危険を十分に警告せず、消費者が喫煙の危険を理解することを密謀して阻止するという初審裁判所の判決を維持した。控訴裁判所はさらに，原告はこれらの過ちがクラスメンバーの負傷の原因であることを証明または十分に証明する必要がないと判断した。判決によると，被告はそれぞれの判決された損害賠償部分を預託しなければならないL·トゥルノ以下に説明する場合とブライス大小書き、約CAD1.110億ユーロ(約796百万)は、以下の信託口座に入金する60何日ですか。鉱物におけるRBHのシェアは約カナダドルである257百万ドル194百万)。購買マネージャー指数に記録されている税引前費用は#ドルです194その合併実績では100万ドルで$に相当する1422019年第1四半期にタバコ訴訟に関連する費用として税収純額を差し引く。この費用は、RBHが統合を解除する前に推定可能な損失を表す部分に対するPMIの評価を反映し、判決が要求する信託口座預金に対応する

カナダで起きた2つ目の集団訴訟ではセシリア·L·トゥルノは帝国タバコ有限会社ロスマンベンセン·ヘッジ社とJTI-Macdonald Corp.，ケベック上級裁判所、カナダ1998年9月に申請を提出し、RBHと他のカナダ巻タバコメーカー(帝国タバコカナダ有限会社とJTI-Macdonald Corp.)被告は被告(“L·トゥルノ“集団訴訟”)。原告は個人喫煙者で、クラスで喫煙中毒とされている各メンバーに補償と懲罰的賠償を要求している。クラスは2005年に認証を受けた。初審裁判所は2015年5月27日に判決を下した。初審裁判所はRBHと二つ他のカナダメーカーは責任を取って、共にカナダドルを獲得しました131百万ドル95100万ドルの懲罰的賠償に元値を分配する46百万ドル33百万)からRBHまで。初審法廷は依存症クラスの規模は918,000メンバーは、中毒類への補償性損害賠償を拒否していますが、証拠がクレームを十分に正確に証明できないためです。初審裁判所は、判決された懲罰的賠償を個別クラスメンバーに割り当てるクレーム手続きが高すぎて管理が困難であることを発見した。2019年3月1日、控訴裁判所は、初審裁判所の責任裁決と加元配分の懲罰的賠償総額を基本的に確認した裁決を発表した57百万ドル41RBHの利息も含めて百万ドルですご参照くださいブライス以上の説明は、この2つのセキュリティコマンドのさらなる詳細を理解するために説明されたL·トゥルノ そして ブライス案件とこの決定が調達マネージャー協会財務諸表に与える影響。

RBH and PMI believe the findings of liability and damages in both Létourneau and the Blais cases were incorrect and in contravention of applicable law on several grounds including, the following: (i) defendants had no obligation to warn class members who knew, or should have known, of the risks of smoking; (ii) defendants cannot be liable to class members who
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would have smoked regardless of what warnings were given; and (iii) defendants cannot be liable to all class members given the individual differences among class members.

In the third class action pending in Canada, Kunta v. Canadian Tobacco Manufacturers' Council, et al., The Queen's Bench, Winnipeg, Canada, filed June 12, 2009, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges her own addiction to tobacco products and chronic obstructive pulmonary disease (“COPD”), severe asthma, and mild reversible lung disease resulting from the use of tobacco products. She is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers, their estates, dependents and family members, as well as restitution of profits, and reimbursement of government health care costs allegedly caused by tobacco products.

In the fourth class action pending in Canada, Adams v. Canadian Tobacco Manufacturers' Council, et al., The Queen's Bench, Saskatchewan, Canada, filed July 10, 2009, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges her own addiction to tobacco products and COPD resulting from the use of tobacco products. She is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers who have smoked a minimum of 25,000 cigarettes and have allegedly suffered, or suffer, from COPD, emphysema, heart disease, or cancer, as well as restitution of profits.

In the fifth class action pending in Canada, Semple v. Canadian Tobacco Manufacturers' Council, et al., The Supreme Court (trial court), Nova Scotia, Canada, filed June 18, 2009, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges his own addiction to tobacco products and COPD resulting from the use of tobacco products. He is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers, their estates, dependents and family members, as well as restitution of profits, and reimbursement of government health care costs allegedly caused by tobacco products.

In the sixth class action pending in Canada, Dorion v. Canadian Tobacco Manufacturers' Council, et al., The Queen's Bench, Alberta, Canada, filed June 15, 2009, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges her own addiction to tobacco products and chronic bronchitis and severe sinus infections resulting from the use of tobacco products. She is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers, their estates, dependents and family members, restitution of profits, and reimbursement of government health care costs allegedly caused by tobacco products. To date, we, our subsidiaries, and our indemnitees have not been properly served with the complaint.
In the seventh class action pending in Canada, McDermid v. Imperial Tobacco Canada Limited, et al., Supreme Court, British Columbia, Canada, filed June 25, 2010, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges his own addiction to tobacco products and heart disease resulting from the use of tobacco products. He is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers who were alive on June 12, 2007, and who suffered from heart disease allegedly caused by smoking, their estates, dependents and family members, plus disgorgement of revenues earned by the defendants from January 1, 1954, to the date the claim was filed.

In the eighth class action pending in Canada, Bourassa v. Imperial Tobacco Canada Limited, et al., Supreme Court, British Columbia, Canada, filed June 25, 2010, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, the heir to a deceased smoker, alleges that the decedent was addicted to tobacco products and suffered from emphysema resulting from the use of tobacco products. She is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers who were alive on June 12, 2007, and who suffered from chronic respiratory diseases allegedly caused by smoking, their estates, dependents and family members, plus disgorgement of revenues earned by the defendants from January 1, 1954, to the date the claim was filed. In December 2014, plaintiff filed an amended statement of claim.

In the ninth class action pending in Canada, Suzanne Jacklin v. Canadian Tobacco Manufacturers' Council, et al., Ontario Superior Court of Justice, filed June 20, 2012, we, RBH, and our indemnitees (PM USA and Altria), and other members of the industry are defendants. The plaintiff, an individual smoker, alleges her own addiction to tobacco products and COPD resulting from the use of tobacco products. She is seeking compensatory and punitive damages on behalf of a proposed class comprised of all smokers who have smoked a minimum of 25,000 cigarettes and have allegedly suffered, or suffer, from COPD, heart disease, or cancer, as well as restitution of profits.

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Health Care Cost Recovery Litigation — Canada
In the first health care cost recovery case pending in Canada, Her Majesty the Queen in Right of British Columbia v. Imperial Tobacco Limited, et al., Supreme Court, British Columbia, Vancouver Registry, Canada, filed January 24, 2001, we, RBH, our indemnitee (PM USA), and other members of the industry are defendants. The plaintiff, the government of the province of British Columbia, brought a claim based upon legislation enacted by the province authorizing the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, resulting from a “tobacco related wrong.”
In the second health care cost recovery case filed in Canada, Her Majesty the Queen in Right of New Brunswick v. Rothmans Inc., et al., Court of Queen's Bench of New Brunswick, Trial Court, New Brunswick, Fredericton, Canada, filed March 13, 2008, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of New Brunswick based on legislation enacted in the province. This legislation is similar to the law introduced in British Columbia that authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the third health care cost recovery case filed in Canada, Her Majesty the Queen in Right of Ontario v. Rothmans Inc., et al., Ontario Superior Court of Justice, Toronto, Canada, filed September 29, 2009, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Ontario based on legislation enacted in the province. This legislation is similar to the laws introduced in British Columbia and New Brunswick that authorize the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the fourth health care cost recovery case filed in Canada, Attorney General of Newfoundland and Labrador v. Rothmans Inc., et al., Supreme Court of Newfoundland and Labrador, St. Johns, Canada, filed February 8, 2011, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Newfoundland and Labrador based on legislation enacted in the province that is similar to the laws introduced in British Columbia, New Brunswick and Ontario. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the fifth health care cost recovery case filed in Canada, Attorney General of Quebec v. Imperial Tobacco Limited, et al., Superior Court of Quebec, Canada, filed June 8, 2012, we, RBH, our indemnitee (PM USA), and other members of the industry are defendants. The claim was filed by the government of the province of Quebec based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the sixth health care cost recovery case filed in Canada, Her Majesty in Right of Alberta v. Altria Group, Inc., et al., Supreme Court of Queen's Bench Alberta, Canada, filed June 8, 2012, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Alberta based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the seventh health care cost recovery case filed in Canada, Her Majesty the Queen in Right of the Province of Manitoba v. Rothmans, Benson & Hedges, Inc., et al., The Queen's Bench, Winnipeg Judicial Centre, Canada, filed May 31, 2012, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Manitoba based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
In the eighth health care cost recovery case filed in Canada, The Government of Saskatchewan v. Rothmans, Benson & Hedges Inc., et al., Queen's Bench, Judicial Centre of Saskatchewan, Canada, filed June 8, 2012, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Saskatchewan based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”
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In the ninth health care cost recovery case filed in Canada, Her Majesty the Queen in Right of the Province of Prince Edward Island v. Rothmans, Benson & Hedges Inc., et al., Supreme Court of Prince Edward Island (General Section), Canada, filed September 10, 2012, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Prince Edward Island based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”

In the tenth health care cost recovery case filed in Canada, Her Majesty the Queen in Right of the Province of Nova Scotia v. Rothmans, Benson & Hedges Inc., et al., Supreme Court of Nova Scotia, Canada, filed January 2, 2015, we, RBH, our indemnitees (PM USA and Altria), and other members of the industry are defendants. The claim was filed by the government of the province of Nova Scotia based on legislation enacted in the province that is similar to the laws enacted in several other Canadian provinces. The legislation authorizes the government to file a direct action against cigarette manufacturers to recover the health care costs it has incurred, and will incur, as a result of a “tobacco related wrong.”

Combustible tobacco products litigation

Since 1995, more than 600 combustible tobacco product-related cases, including smoking and health, label-related, health care cost recovery, and public civil actions, have been filed by governmental entities or individual plaintiffs, or on behalf of a class or purported class of individual plaintiffs against a PMI entity. All resolved cases have been terminated in our favor and only a small number of cases remain pending. The pending cases include 9 proposed class actions, 17 health care cost recovery cases, 1 public civil action, and individual cases. The amounts at issue in the pending individual cases would not have a material adverse effect on our consolidated financial statements, including our results of operations, cash flows, or financial position. Of the pending combustible tobacco product-related cases, four were initially decided in favor of plaintiffs and remain on appeal, or are subject to an appeal. These four cases include the Blais Class Action and the Létourneau Class Action, described above under the caption "Smoking and Health Litigation — Canada," and two individual cases where final resolution in the amount of the verdict would not have a material adverse effect on our consolidated financial statements, including our results of operations, cash flows, or financial position.

Pending claims related to combustible tobacco products generally fall within the following categories:
Smoking and Health Proposed Class Actions: These cases primarily allege personal injury and are brought by individual plaintiffs on behalf of a class or purported class of individual plaintiffs. Plaintiffs' allegations of liability in these cases are based on various theories of recovery, including negligence, gross negligence, strict liability, fraud, misrepresentation, design defect, failure to warn, breach of express and implied warranties, violations of deceptive trade practice laws and consumer protection statutes. Plaintiffs in these cases seek various forms of relief, including compensatory and other damages, and injunctive and equitable relief. Defenses raised in these cases include licit activity, failure to state a claim, lack of defect, lack of proximate cause, assumption of the risk, contributory negligence, and statute of limitations.
As of September 30, 2024, there were 9 cases brought on behalf of classes of individual plaintiffs pending against us, our subsidiaries or indemnitees, compared with 9 such cases on September 30, 2023, and such cases are described above under the caption “Smoking and Health Litigation — Canada.”

Health Care Cost Recovery Litigation: These cases, brought by governmental and non-governmental plaintiffs, seek reimbursement of health care cost expenditures allegedly caused by tobacco products. Plaintiffs' allegations of liability in these cases are based on various theories of recovery including unjust enrichment, negligence, negligent design, strict liability, breach of express and implied warranties, violation of a voluntary undertaking or special duty, fraud, negligent misrepresentation, conspiracy, public nuisance, defective product, failure to warn, sale of cigarettes to minors, and claims under statutes governing competition and deceptive trade practices. Plaintiffs in these cases seek various forms of relief including compensatory and other damages, and injunctive and equitable relief. Defenses raised in these cases include lack of proximate cause, remoteness of injury, failure to state a claim, adequate remedy at law, “unclean hands” (namely, that plaintiffs cannot obtain equitable relief because they participated in, and benefited from, the sale of cigarettes), and statute of limitations.
As of September 30, 2024, there were 17 health care cost recovery cases pending against us, our subsidiaries or indemnitees in Brazil (1), Canada (10), Korea (1) and Nigeria (5), compared with 17 such cases on September 30, 2023.

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The health care cost recovery actions pending in Canada are described above under the caption “Health Care Cost Recovery Litigation — Canada.”

In the health care cost recovery case in Brazil, The Attorney General of Brazil v. Souza Cruz Ltda., et al., Federal Trial Court, Porto Alegre, Rio Grande do Sul, Brazil, filed May 21, 2019, we, our subsidiaries, and other members of the industry are defendants. Plaintiff seeks reimbursement for the cost of treating alleged smoking-related diseases in certain prior years, payment of anticipated costs of treating future alleged smoking-related diseases, and moral damages. Defendants filed answers to the complaint in May 2020.

In the first health care cost recovery case in Nigeria, The Attorney General of Lagos State v. British American Tobacco (Nigeria) Limited, et al., High Court of Lagos State, Lagos, Nigeria, filed March 13, 2008, we and other members of the industry are defendants. Plaintiff seeks reimbursement for the cost of treating alleged smoking-related diseases for the past 20 years, payment of anticipated costs of treating alleged smoking-related diseases for the next 20 years, various forms of injunctive relief, plus punitive damages. We are in the process of making challenges to service and the court's jurisdiction. Currently, the case is stayed in the trial court pending the appeals of certain co-defendants relating to service objections.
In the second health care cost recovery case in Nigeria, The Attorney General of Kano State v. British American Tobacco (Nigeria) Limited, et al., High Court of Kano State, Kano, Nigeria, filed May 9, 2007, we and other members of the industry are defendants. Plaintiff seeks reimbursement for the cost of treating alleged smoking-related diseases for the past 20 years, payment of anticipated costs of treating alleged smoking-related diseases for the next 20 years, various forms of injunctive relief, plus punitive damages. We are in the process of challenging the court's jurisdiction. Currently, the case is stayed in the trial court pending the appeals of certain co-defendants relating to service objections.
In the third health care cost recovery case in Nigeria, The Attorney General of Gombe State v. British American Tobacco (Nigeria) Limited, et al., High Court of Gombe State, Gombe, Nigeria, filed October 17, 2008, we and other members of the industry are defendants. Plaintiff seeks reimbursement for the cost of treating alleged smoking-related diseases for the past 20 years, payment of anticipated costs of treating alleged smoking-related diseases for the next 20 years, various forms of injunctive relief, plus punitive damages. In February 2011, the court ruled that the plaintiff had not complied with the procedural steps necessary to serve us. As a result of this ruling, plaintiff must re-serve its claim. We have not yet been re-served.
In the fourth health care cost recovery case in Nigeria, The Attorney General of Oyo State, et al., v. British American Tobacco (Nigeria) Limited, et al., High Court of Oyo State, Ibadan, Nigeria, filed May 25, 2007, we and other members of the industry are defendants. Plaintiffs seek reimbursement for the cost of treating alleged smoking-related diseases for the past 20 years, payment of anticipated costs of treating alleged smoking-related diseases for the next 20 years, various forms of injunctive relief, plus punitive damages. We challenged service as improper. In June 2010, the court ruled that plaintiffs did not have leave to serve the writ of summons on the defendants and that they must re-serve the writ. We have not yet been re-served.
In the fifth health care cost recovery case in Nigeria, The Attorney General of Ogun State v. British American Tobacco (Nigeria) Limited, et al., High Court of Ogun State, Abeokuta, Nigeria, filed February 26, 2008, we and other members of the industry are defendants. Plaintiff seeks reimbursement for the cost of treating alleged smoking-related diseases for the past 20 years, payment of anticipated costs of treating alleged smoking-related diseases for the next 20 years, various forms of injunctive relief, plus punitive damages. In May 2010, the trial court rejected our objections to the court's jurisdiction. We have appealed. Currently, the case is stayed in the trial court pending the appeals of certain co-defendants relating to service objections.

In the health care cost recovery case in Korea, the National Health Insurance Service v. KT&G, et. al., filed April 14, 2014, our subsidiary and other Korean manufacturers are defendants. Plaintiff alleges, among other things, that defendants concealed the health hazards of smoking, marketed to youth, added ingredients to make their products more harmful and addictive, and misled consumers into believing that Lights cigarettes are safer than regular cigarettes. The National Health Insurance Service seeks to recover damages allegedly incurred in treating 3,484 patients with small cell lung cancer, squamous cell lung cancer, and squamous cell laryngeal cancer from 2003 to 2012. The trial court dismissed the case in its entirety on November 20, 2020. The Appellate court granted the Plaintiff a de novo appeal in 2021 and determined that the appellate proceedings will take place in stages: wrongful conduct/product defect allegations first, then causation and finally issues such as standing/direct action. The plaintiff's appeal remains pending.

Public Civil Actions: Claims have been filed either by an individual, or a public or private entity, seeking to protect collective or individual rights, such as the right to health, the right to information or the right to safety. Plaintiffs' allegations of liability in these cases are based on various theories of recovery including product defect, concealment, and misrepresentation. Plaintiffs in
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these cases seek various forms of relief including injunctive relief such as banning cigarettes, descriptors, smoking in certain places and advertising, as well as implementing communication campaigns and reimbursement of medical expenses incurred by public or private institutions.

As of September 30, 2024, there was 1 public civil action pending against our subsidiary in Venezuela (1), compared with 1 such case on September 30, 2023.

In a public civil action in Venezuela, Federation of Consumers and Users Associations (“FEVACU”), et al. v. National Assembly of Venezuela and the Venezuelan Ministry of Health, Constitutional Chamber of the Venezuelan Supreme Court, filed April 29, 2008, we were not named as a defendant, but the plaintiffs published a notice pursuant to court order, notifying all interested parties to appear in the case. In January 2009, our subsidiary appeared in the case in response to this notice. The plaintiffs purport to represent the right to health of the citizens of Venezuela and claim that the government failed to protect adequately its citizens' right to health. The claim asks the court to order the government to enact stricter regulations on the manufacture and sale of tobacco products. In addition, the plaintiffs ask the court to order companies involved in the tobacco industry to allocate a percentage of their “sales or benefits” to establish a fund to pay for the health care costs of treating smoking-related diseases. In October 2008, the court ruled that plaintiffs have standing to file the claim and that the claim meets the threshold admissibility requirements. In December 2012, the court admitted our subsidiary and a subsidiary of British American Tobacco plc as interested third parties. In February 2013, our subsidiary answered the complaint. On February 27, 2024, the Attorney General of Venezuela filed, on behalf of defendants, a motion to dismiss the case for lack of prosecution.

Smoke-Free Products-Related Litigation

Claims have been filed against PMI and a subsidiary related to ZYN nicotine pouches. These cases were filed either on behalf of an individual plaintiff, or on behalf of a purported class of individuals. Plaintiffs assert a variety of common law and statutory claims, and seek various forms of relief, including monetary and equitable relief.

In the first case, a putative class action, Kelly v. Philip Morris International Inc., et al., filed March 19, 2024, before United States District Court for the Southern District of Florida, plaintiff alleges, among other things, addiction to nicotine resulting from the use of ZYN nicotine pouches (the "Kelly class action"). The named defendants are PMI and Swedish Match North America LLC. Plaintiff purports to represent classes comprised of (i) all persons who purchased ZYN products in the United States, (ii) all residents of Florida who purchased ZYN products, and (iii) all residents of Florida who, at the time of their use of ZYN products, were under the age of 21, and who procured and used ZYN products. He alleges, among other things, that defendants defectively designed ZYN products and sold them in an unreasonably unsafe and dangerous condition, marketed ZYN products to minors, and misrepresented or failed to warn consumers about information related to ZYN products, including information about health risks associated with these products. Plaintiff asserts strict liability design defect and failure to warn claims, as well as negligence and fraud claims and is seeking compensatory and punitive damages, attorney’s fees and costs, interest, and medical monitoring. On May 6, 2024, PMI and Swedish Match North America LLC filed motions to dismiss the complaint with prejudice. On August 20, 2024, the court granted Swedish Match North America LLC’s motion to dismiss the fraud claim and plaintiff’s request for medical monitoring, but denied the motion to dismiss other claims. The court gave plaintiff the opportunity to amend his complaint by November 4, 2024. On August 20, 2024, the court also denied PMI’s motion to dismiss without prejudice, granted plaintiff’s request to conduct jurisdictional discovery, and gave PMI the opportunity to refile its motion to dismiss by November 18, 2024. At this time, no estimated loss has been accrued in the consolidated financial statements for this proceeding and we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, from this proceeding.

In the second case, a putative class action, Bates-Ferreira v. Philip Morris International Inc., et al., filed March 29, 2024, before United States District Court for the Eastern District of California, plaintiff alleges, among other things, addiction to nicotine resulting from the use of ZYN nicotine pouches. The named defendants are PMI and Swedish Match North America LLC. Plaintiff purports to represent classes comprised of (i) all persons who used ZYN products in the United States, (ii) all persons who used ZYN products in the United States while under the age of 18, (iii) all residents of California who used ZYN products, and (iv) all residents of California who used ZYN products while under the age of 18. Plaintiff alleges, among other things, that defendants made misrepresentations about ZYN products in their advertising and marketing, marketed ZYN products to minors, and misrepresented or failed to disclose to consumers information about ZYN products, including information about health risks associated with these products. Plaintiff asserts fraud, unjust enrichment, breach of implied warranty, and breach of consumer protection, unfair competition and advertising statutes claims and is seeking compensatory and punitive damages, disgorgement of profits, attorney’s fees and expenses, interest and other applicable injunctive relief. On June 7, 2024, PMI and Swedish Match North America LLC filed motions to dismiss the complaint with prejudice, and Swedish Match North America
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LLC also filed a motion to stay the proceedings pending resolution of the Kelly class action. On August 5, 2024, plaintiff voluntarily dismissed his claim against PMI without prejudice. At this time, no estimated loss has been accrued in the consolidated financial statements for this proceeding and we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, from this proceeding.

In the third case, an individual complaint, Palmer v. Philip Morris International Inc., et al., filed April 3, 2024, before United States District Court for the Southern District of Florida, plaintiff alleges, among other things, addiction to nicotine resulting from the use of ZYN nicotine pouches. The named defendants are PMI and Swedish Match North America LLC. He alleges, among other things, that defendants defectively designed ZYN products and sold them in an unreasonably unsafe and dangerous condition, marketed ZYN products to minors, and misrepresented or failed to warn consumers about information related to ZYN products, including information about health risks associated with these products. Plaintiff asserts strict liability design defect and failure to warn claims, as well as negligence and fraud claims, and is seeking compensatory and punitive damages, attorney’s fees and costs, interest, and medical monitoring. On June 3, 2024, PMI and Swedish Match North America LLC filed motions to dismiss the complaint with prejudice. On August 20, 2024, the court granted Swedish Match North America LLC’s motion to dismiss the fraud claim and plaintiff’s request for medical monitoring, but denied the motion to dismiss other claims. The court gave plaintiff the opportunity to amend his complaint by November 4, 2024. On August 20, 2024, the court also denied PMI’s motion to dismiss without prejudice, granted plaintiff’s request to conduct jurisdictional discovery, and gave PMI the opportunity to refile its motion to dismiss by November 18, 2024. At this time, no estimated loss has been accrued in the consolidated financial statements for this proceeding and we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, from this proceeding.

In the fourth case, an individual complaint, Lendinara v. Philip Morris International Inc., et al., filed July 30, 2024, before United States District Court for the Southern District of Florida, plaintiff alleges, among other things, addiction to nicotine resulting from the use of ZYN nicotine pouches. The named defendants are PMI and Swedish Match North America LLC. He alleges, among other things, that defendants defectively designed ZYN products and sold them in an unreasonably unsafe and dangerous condition, marketed ZYN products to minors, and misrepresented or failed to warn consumers about information related to ZYN products, including information about health risks associated with these products. Plaintiff asserts strict liability design defect and failure to warn claims, as well as negligence and fraud claims, and is seeking compensatory and punitive damages, attorney’s fees and costs, interest, and medical monitoring. On September 19, 2024, the court granted the parties’ joint motion to apply its decisions on the motions to dismiss in Palmer to the Lendinara matter, including granting plaintiff’s request to conduct jurisdictional discovery and setting the same timeline for plaintiff to amend his complaint and for PMI to refile its motion to dismiss. At this time, no estimated loss has been accrued in the consolidated financial statements for this proceeding and we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, from this proceeding.

In the fifth case, a putative class action, Norris v. Philip Morris International Inc., et al., filed July 30, 2024, before United States District Court for the District of Connecticut, plaintiff alleges, among other things, addiction to nicotine resulting from the use of ZYN nicotine pouches. The named defendants are PMI and Swedish Match North America LLC. Plaintiff purports to represent classes comprised of (i) all persons who used ZYN products in the United States, (ii) all persons who used ZYN products in the United States while under the age of 18, (iii) all residents of Florida who used ZYN products, and (iv) all residents of Florida who used ZYN products while under the age of 18. Plaintiff alleges, among other things, that defendants made misrepresentations about ZYN products in their advertising and marketing, marketed ZYN products to minors, and misrepresented or failed to disclose to consumers information about ZYN products, including information about health risks associated with these products. Plaintiff asserts unjust enrichment, and breach of consumer protection, unfair trade and advertising statutes claims and is seeking compensatory and punitive damages, disgorgement of profits, attorney’s fees and expenses, interest and other applicable injunctive relief. On September 24, PMI and Swedish Match North America LLC filed motions to dismiss the complaint with prejudice. On October 2, 2024, Plaintiff filed a notice of voluntary dismissal without prejudice as to Swedish Match, which the Court ordered on October 3, 2024 At this time, no estimated loss has been accrued in the consolidated financial statements for this proceeding and we cannot determine the likelihood of loss, or reasonably estimate a range of loss, if any, from this proceeding.

District of Columbia Attorney General Investigation: On June 11, 2024, Swedish Match North America LLC ("SMNA") received a subpoena from the office of the Attorney General of the District of Columbia (“D.C.”). The subpoena requests, among other things, information concerning SMNA’s compliance with D.C.’s licensing regulations, age-verification requirements, and prohibition on the sale of flavored tobacco products, including with respect to ZYN nicotine pouches. SMNA is cooperating with the investigation. It is too early to assess the timeline on which such investigation will conclude or its outcome.

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Other Litigation

The Department of Special Investigations of the government of Thailand ("DSI") conducted an investigation into alleged underpayment by our subsidiary, Philip Morris (Thailand) Limited ("PM Thailand"), of customs duties and excise taxes relating to imports from the Philippines covering the period 2003-2007. On January 18, 2016, the Public Prosecutor filed charges against our subsidiary and seven former and current employees in the Bangkok Criminal Court alleging that PM Thailand and the individual defendants jointly and with the intention to defraud the Thai government, under-declared import prices of cigarettes to avoid full payment of taxes and duties in connection with import entries of cigarettes from the Philippines during the period of July 2003 to June 2006. The government sought a fine of approximately THB 80.8 billion (approximately $2.4 billion). In May 2017, Thailand enacted a new customs act. The new act, which took effect in November 2017, substantially limits the amount of fines that Thailand could seek in these proceedings. PM Thailand believes that its declared import prices are in compliance with the Customs Valuation Agreement of the World Trade Organization and Thai law and that the allegations of the Public Prosecutor are inconsistent with several decisions by Thai Customs and other Thai governmental agencies. Trial in the case began in November 2017 and concluded in September 2019. In November 2019, the trial court found our subsidiary guilty of under-declaration of the prices and imposed a fine of approximately THB 1.2 billion (approximately $35.8 million). The trial court dismissed all charges against the individual defendants. In December 2019, as required by the Thai law, our subsidiary paid the fine. This payment was included in other assets on the condensed consolidated balance sheets and negatively impacted net cash provided by operating activities in the condensed consolidated statements of cash flows in the period of payment. Both our subsidiary and the Public Prosecutor filed an appeal of the trial court's decision. The appellate court issued its decision on the appeals on June 1, 2022. The appellate court affirmed the findings of under-declaration of import prices of cigarettes but reduced the fine to approximately THB 122 million (approximately $3.6 million) finding the trial court erred in its calculation of the under-declaration and fine. The appellate court affirmed the acquittals of the individual defendants. Our subsidiary appealed the decision to the Supreme Court of Thailand. The Public Prosecutor also filed an appeal challenging the dismissal of charges against the individual defendants and the amount of the fine imposed. On September 5, 2024, the Supreme Court of Thailand issued its decision. The Supreme Court affirmed the findings of under-declaration of import prices of cigarettes but further reduced the fine imposed to THB 50 million (approximately $1.5 million), which PMI recorded as a pre-tax charge in the condensed consolidated statements of earnings for the nine months ended September 30, 2024. The Supreme Court also affirmed the acquittals of the individual defendants. Thailand is required to refund the payment made by our subsidiary in 2019 in excess of the THB 50 million (approximately $1.5 million) fine ultimately assessed by the Supreme Court.

The DSI also conducted an investigation into alleged underpayment by PM Thailand of customs duties and excise taxes relating to imports from Indonesia covering the period 2000-2003. On January 26, 2017, the Public Prosecutor filed charges against PM Thailand and its former Thai employee in the Bangkok Criminal Court alleging that PM Thailand and its former employee jointly and with the intention to defraud the Thai government under-declared import prices of cigarettes to avoid full payment of taxes and duties in connection with import entries during the period from January 2002 to July 2003. The government sought a fine of approximately THB 19.8 billion (approximately $592 million). In May 2017, Thailand enacted a new customs act. The new act, which took effect in November 2017, substantially limits the amount of fines that Thailand could seek in these proceedings. PM Thailand believes that its declared import prices are in compliance with the Customs Valuation Agreement of the World Trade Organization and Thai law, and that the allegations of the Public Prosecutor are inconsistent with several decisions already taken by Thai Customs and a Thai court. Trial in the case began in November 2018 and concluded in December 2019. In March 2020, the trial court found our subsidiary guilty of under-declaration of the prices and imposed a fine of approximately THB 130 million (approximately $3.9 million). The trial court dismissed all charges against the individual defendant. In April 2020, as required by Thai law, our subsidiary paid the fine. This payment is included in other assets on the condensed consolidated balance sheets and negatively impacted net cash provided by operating activities in the condensed consolidated statements of cash flows in the period of payment. Our subsidiary filed an appeal of the trial court's decision. In addition, the Public Prosecutor filed an appeal of the trial court's decision challenging the dismissal of charges against the individual defendant and the amount of the fine imposed. The appellate court issued its decision on the appeals on January 31, 2023. The appellate court affirmed the findings of under-declaration of import prices of cigarettes but reduced the fine imposed by the trial court. The appellate court directed the Public Prosecutor to coordinate with customs officials to calculate such reduced fine in accordance with the appellate court’s decision. The appellate court affirmed the acquittal of the individual defendant. Our subsidiary has appealed the decision to the Supreme Court of Thailand. The Public Prosecutor has filed an appeal to the Supreme Court of Thailand challenging the dismissal of charges against the individual defendant and the amount of the fine. Thailand is required to refund any payment made by our subsidiary in excess of any fine assessed by the courts.

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In July 2020, the Public Prosecutor’s office of Rome, Italy, notified our Italian subsidiary, Philip Morris Italia S.r.l. (“PM Italia”), as well as three former or current employees and a former external consultant of PM Italia in July and March 2020, respectively, that it concluded a preliminary investigation against them for alleged contravention of anti-corruption laws and related disruption of trade freedom. The Public Prosecutor alleges that the individuals involved promised certain personal favors to government officials from January to July of 2018 in exchange for favorable treatment for PM Italia, and that PM Italia lacked appropriate organizational controls to prevent the alleged actions by the individuals. In September 21, 2020, the Public Prosecutor issued his indictment and referred the matter to the court. At the preliminary hearing held on May 11, 2021, the judge decided to refer all charges/defendants (including our affiliate) to trial. The first trial hearing took place on September 22, 2021. BAT has filed a civil claim against PM Italia claiming vicarious liability for the alleged wrongdoings of its former or current employees and seeking EUR50 million (approximately $54 million) in damages. After various postponements, trial started on September 25, 2023, and will continue through a series of hearings until 2025 (the court set the calendar only through January 20, 2025, although other hearings will have to be scheduled thereafter). PM Italia believes the charges are without merit and will defend them vigorously.

The Ministry of Industry and Trade of the Russian Federation filed a petition before the Arbitrazh Court of the Moscow Region seeking the suspension of corporate rights that Megapolis Distribution B.V. (“MDBV”), a legal entity incorporated in the Netherlands, holds, pursuant to Dutch law, in JSC TK Megapolis (formerly CJSC TK Megapolis), which is the distributor of PMI’s products in Russia. Our affiliate holds a 23% equity interest in MDBV. On July 18, 2024, the court admitted the petition. On August 8, 2024, the Arbitrazh Court of the Moscow Region granted the forced localization, as requested by the Ministry of Industry and Trade. As a result, MDBV's interest and corporate rights in JSC TK Megapolis were transferred to JSC TK Megapolis. We currently expect such interest and corporate rights will be subsequently transferred to JSC TK Megapolis' indirect shareholders, or their designees, during the fourth quarter of 2024. For additional information, see Part I, Item 1. Financial Statements – Note 12. Related Parties – Equity Investments and Other.

On December 21, 2023, we were informed that Future Technology K.K. (“FTKK”) filed an application with Tokyo Customs against Sojitz Corporation (“Sojitz”), Philip Morris Japan Limited’s (“PMJL”) importer and distributor, due to alleged infringement of JP7299432. FTKK sought an order stopping the importation of TEREA consumables. FTKK did not in its application seek any monetary damages or costs. PMJL entered an appearance in the proceeding as an interested party and filed its response to FTKK's application on January 31, 2024. The Customs hearing was held on May 28, 2024. On June 27, 2024 expert advisors to Customs provided their opinion that the patent at issue was not infringed. On June 28, 2024, FTKK withdrew its Customs application. The proceeding is now concluded. On January 26, 2024, PMJL filed a declaratory judgment action in Tokyo District Court seeking a declaration that JP7299432 is invalid and/or not infringed. The declaratory judgment action has now concluded following FTKK's waiver of its right to seek relief from PMJL for infringement of JP7299432, which effectively resolved PMJL's request for a declaration of no liability for infringement of that patent.

In July and August 2024, respectively, FTKK filed two patent infringement actions against Sojitz, PMJL’s importer and distributor, for alleged infringement of two patents by TEREA consumables. FTKK asserts a claim for damages. PMJL is obligated to indemnify Sojitz for damages and intervened in the matters. Merits briefing in the matters is expected to commence in late 2024. PMJL intends to vigorously defend these matters.

Other patent challenges are pending in various jurisdictions.

We are also involved in additional litigation arising in the ordinary course of our business. While the outcomes of these proceedings are uncertain, management does not expect that the ultimate outcomes of other litigation, including any reasonably possible losses in excess of current accruals, will have a material adverse effect on our consolidated results of operations, cash flows or financial position.


Note 9. Income Taxes:
Income tax provisions for jurisdictions outside the United States of America, as well as state and local income tax provisions, were determined on a separate company basis, and the related assets and liabilities were recorded in PMI’s condensed consolidated balance sheets.

PMI’s effective tax rates for the nine months and three months ended September 30, 2024 were 23.1% and 21.3%, respectively. PMI’s effective tax rates for the nine months and three months ended September 30, 2023 were 25.7% and 33.2%, respectively.
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The effective tax rate for the nine months ended September 30, 2024, was unfavorably impacted by: (i) an increase in deferred tax liabilities related to the fair value adjustment of equity securities held by PMI ($185 million); and (ii) an impairment loss related to the sale of Vectura Group, partially offset by: (i) a deferred tax benefit for unrealized foreign currency losses on intercompany loans related to the Swedish Match acquisition financing reflected in the condensed consolidated statements of earnings ($9 million), while the underlying pre-tax foreign currency movements fully offset in the condensed consolidated statements of earnings and were reflected as currency translation adjustments in its condensed consolidated statements of stockholders' (deficit) equity; and (ii) a U.S. tax benefit for a worthless stock deduction under section 165(g) of the Internal Revenue Code related to PMI's investment in C.A. Tabacalera Nacional, a wholly owned foreign corporation incorporated in Venezuela ($47 million). For further details on PMI's ceased operations in Venezuela and the impairment loss related to the sale of Vectura Group, see Note 15. Asset Impairment and Exit Costs and Note 18. Acquisitions and Divestitures, respectively.

Changes in the tax laws of foreign jurisdictions could arise as a result of the Base Erosion and Profit Shifting project undertaken by the Organisation for Economic Co-operation and Development (“OECD”), which recommended changes to numerous long-standing tax principles. Many countries have enacted the OECD’s framework on a global minimum tax (referred to as “Pillar Two”), effective for taxable years beginning after December 31, 2023. PMI has determined that Pillar Two should not have a material impact on its 2024 consolidated financial statements.

The effective tax rate for the nine months ended September 30, 2023, was unfavorably impacted by: (i) an increase in deferred tax liabilities related to the unremitted earnings of PMI's Russian subsidiaries ($173 million) due to the unilateral suspension of certain Russian double tax treaties by the Russian authorities on August 8, 2023, with respect to certain payments including dividends; (ii) the non-deductible Wellness and Healthcare goodwill impairment charge; and (iii) a deferred tax costs for unrealized foreign currency losses on intercompany loans related to the Swedish Match acquisition financing reflected in the condensed consolidated statements of earnings ($41 million), while the underlying pre-tax foreign currency movements fully offset in the condensed consolidated statements of earnings and were reflected as currency translation adjustments in its condensed consolidated statements of stockholders' (deficit) equity.

The effective tax rate for the three months ended September 30, 2023 was unfavorably impacted by an increase in deferred tax liabilities related to the unremitted earnings of PMI's Russian subsidiaries ($173 million) and a deferred tax cost for unrealized foreign currency gains on intercompany loans related to the Swedish Match acquisition financing reflected in the condensed consolidated statements of earnings ($138 million).

PMI is regularly examined by tax authorities around the world and is currently under examination in a number of jurisdictions. The U.S. federal statute of limitations remains open for the years 2019 and onward. Foreign and U.S. state jurisdictions have statutes of limitations generally ranging from 3 to 5 years after the filing of a return.

Subsidiaries of PMI in Indonesia, principally PT Hanjaya Mandala Sampoerna Tbk ("HMS"), have recorded income tax receivables in the amount of 4.0 trillion Indonesian rupiah (approximately $267 million) relating to corporate income tax assessments paid to avoid potential penalties, primarily for domestic and other intercompany transactions for the years 2015 to 2021. Objection letters have been filed with the Tax Office and these assessments are being challenged at various levels in court. These income tax receivables are included in other assets in PMI’s condensed consolidated balance sheets at September 30, 2024 and December 31, 2023.

It is reasonably possible that within the next 12 months certain tax examinations will close, which could result in a change in unrecognized tax benefits along with related interest and penalties. An estimate of any possible change cannot be made at this time.

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Note 10. Indebtedness:
Short-term Borrowings:

At September 30, 2024 and December 31, 2023, PMI’s short-term borrowings and related average interest rates consisted of the following:
September 30, 2024December 31, 2023
(in millions)Amount OutstandingAverage RateAmount OutstandingAverage Rate
Commercial paper
$— — %$1,685 5.6 %
Bank loans
152 9.3 283 8.9 
$152 $1,968 

Given the mix of PMI's legal entities and their respective local economic environments, the average interest rate for bank loans above can vary significantly from day to day and country to country.

The fair values of PMI’s short-term borrowings, based on current market interest rates, approximate carrying value.

Long-term Debt:

At September 30, 2024 and December 31, 2023, PMI’s long-term debt consisted of the following:

(in millions)September 30, 2024December 31, 2023
U.S. dollar notes, 0.875% to 6.375% (average interest rate 4.572%), due through 2044
$34,082 $30,272 
Foreign currency obligations:
Euro notes, 0.125% to 3.750% (average interest rate 1.964%), due through 2039
8,126 8,526 
Swiss franc note, 1.625%, due 2024
— 299 
Euro credit facility borrowings related to Swedish Match AB acquisition, (average interest rate 4.009%), due through 2027
6,140 6,121 
Swedish krona notes, 1.395% to 2.710% (average interest rate 2.016%), due through 2029
236 236
Other (average interest rate 5.038%), due through 2032 (a)
486 487 
Carrying value of long-term debt49,070 45,941 
Less current portion of long-term debt4,833 4,698 
 $44,237 $41,243 
(a) Includes long-term bank loans at subsidiaries, as well as $41 million and $53 million in finance leases at September 30, 2024 and December 31, 2023, respectively.

The fair value of PMI’s outstanding long-term debt, which is utilized solely for disclosure purposes, is determined using quotes and market interest rates currently available to PMI for issuances of debt with similar terms and remaining maturities. At September 30, 2024, the fair value of PMI's outstanding long-term debt, excluding the aforementioned finance leases, was as follows:

(in millions)
September 30, 2024
Level 1$42,337 
Level 26,716 
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For a description of the fair value hierarchy and the three levels of inputs used to measure fair values, see Item 8, Note 2. Summary of Significant Accounting Policies of PMI's Annual Report on Form 10-K for the year ended December 31, 2023.

Credit Facilities related to the Financing of the Swedish Match Acquisition

In connection with PMI's all-cash recommended public offer to the shareholders of Swedish Match, on May 11, 2022, PMI entered into a credit agreement relating to a 364-day senior unsecured bridge facility. The facility provided for borrowings up to an aggregate principal amount of $17 billion, expiring 364 days after the occurrence of certain events unless extended. On June 23, 2022, PMI entered into a €5.5 billion (approximately $5.8 billion at the date of signing) senior unsecured term loan credit agreement consisting of a €3.0 billion (approximately $3.2 billion at the date of signing) tranche expiring three years after the occurrence of certain events and a €2.5 billion (approximately $2.6 billion at the date of signing) tranche expiring on June 23, 2027. In connection with the term loan facility, the aggregate principal amount of commitments under the 364-day senior unsecured bridge facility was reduced from $17 billion to $11 billion. On November 11, 2022, PMI acquired a controlling interest of 85.87% of the total issued shares in Swedish Match and acquired 94.81% of its outstanding shares as of December 31, 2022. In accordance with the Swedish Companies Act, PMI subsequently exercised its right to compulsorily redeem the remaining shares for which acceptances were not received and obtained legal title to 100% of the shares in Swedish Match on February 17, 2023.

PMI borrowed $8.4 billion under the bridge facility by delivering notices of borrowing for advances of $7.9 billion and $0.5 billion on November 7, 2022 and November 10, 2022, respectively. On November 21, 2022 and February 17, 2023, PMI repaid $4.0 billion and $4.4 billion, respectively, under the bridge facility. Effective February 20, 2023, the remaining outstanding commitments under the bridge facility were fully canceled and the bridge facility agreement was terminated in accordance with its terms.

On November 7, 2022, PMI also delivered notices of borrowing for advances totaling €5.5 billion under the term loan facility, of which €3.0 billion will become due on November 9, 2025 and €2.5 billion will become due on June 23, 2027 unless prepaid pursuant to the terms of the credit agreement. As of September 30, 2024 and December 31, 2023, the €5.5 billion (approximately $6 billion) term loan facility was fully drawn and remained outstanding. 

The proceeds under the bridge facility and the term loan facility were used, directly or indirectly, to finance the acquisition, including, the payment of related fees and expenses.

Debt Issuances
PMI's debt issuances in the first nine months of 2024 were as follows:
(in millions)
TypeFace Value Interest RateIssuanceMaturity
U.S. dollar notes
(a)
$7504.750%February 2024February 2027
U.S. dollar notes
(a)
$1,0004.875%February 2024February 2029
U.S. dollar notes
(a)
$1,2505.125%February 2024February 2031
U.S. dollar notes
(a)
$1,7505.250%February 2024February 2034
Euro notes(b) (c)
€500 (approximately $543)
3.750%June 2024January 2031
(a) Interest is payable semi-annually, commencing in August 2024
(b) Interest is payable annually, commencing in January 2025
(c) USD equivalents for foreign currency notes were calculated based on exchange rates on the date of issuance.

The net proceeds from the sale of the securities listed in the table above have been or will be used for general corporate purposes, including working capital requirements, repayment of commercial paper and to refinance certain of our outstanding notes due in 2024.
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Revolving Credit Facilities:
At September 30, 2024, PMI's total committed revolving credit facilities were as follows:

(in billions)


Type
Committed
Revolving Credit
Facilities
364-day revolving credit, expiring January 28, 2025
$1.7 
Multi-year revolving credit, expiring February 10, 2026 (1)
2.0 
Multi-year revolving credit, expiring September 29, 2026 (2) (3)
2.5 
Total facilities
$6.2 
(1) On January 28, 2022, PMI entered into an agreement, effective February 10, 2022, to amend and extend the term of its $2.0 billion multi-year revolving credit facility, for an additional year covering the period February 11, 2026 to February 10, 2027, in the amount of $1.9 billion.
(2) Includes pricing adjustments that may result in the reduction or increase in both the interest rate and commitment fee under the credit agreement if PMI achieves, or fails to achieve, certain specified targets.
(3) On September 20, 2022, PMI entered into an agreement, effective September 29, 2022, to amend and extend the term of its $2.5 billion multi-year revolving credit facility, for an additional year covering the period September 30, 2026 to September 29, 2027, in the amount of $2.3 billion. On September 20, 2023, PMI entered into an agreement, effective September 29, 2023, to amend and further extend the term to September 29, 2028.

At September 30, 2024, there were no borrowings under these committed revolving credit facilities, and the entire committed amounts were available for borrowing.

In addition to the committed revolving credit facilities discussed above, PMI maintains certain short-term credit arrangements, including uncommitted credit lines, to primarily meet working capital needs. These credit arrangements amounted to approximately $2.2 billion at September 30, 2024, and approximately $2.7 billion at December 31, 2023. Borrowings under these arrangements and other bank loans amounted to $152 million at September 30, 2024, and $283 million at December 31, 2023.


Note 11. Accumulated Other Comprehensive Losses:
PMI’s accumulated other comprehensive losses, net of taxes, consisted of the following:
(Losses) EarningsAtAtAt
(in millions)September 30, 2024December 31, 2023September 30, 2023
Currency translation adjustments$(9,636)$(9,467)$(8,475)
Pension and other benefits(2,486)(2,589)(1,757)
Derivatives accounted for as hedges230 241 415 
Total accumulated other comprehensive losses$(11,892)$(11,815)$(9,817)

Reclassifications from Other Comprehensive Earnings
The movements in accumulated other comprehensive losses and the related tax impact, for each of the components above, that are due to current period activity and reclassifications to the income statement, are shown on the condensed consolidated statements of comprehensive earnings for the nine months and three months ended September 30, 2024 and 2023. For additional information, see Note 3. Benefit Plans for disclosures related to PMI's pension and other benefits, Note 5. Financial Instruments for disclosures related to derivative financial instruments, as well as Note 15. Asset Impairment and Exit Costs and
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Note 18. Acquisitions and Divestitures for disclosures related to the reclassification of accumulated foreign currency translation losses from other comprehensive losses.

Note 12. Related Parties - Equity Investments and Other:

Equity Method Investments:

At September 30, 2024 and December 31, 2023, PMI had total equity method investments of $1,203 million and $1,309 million, respectively. Equity method investments are initially recorded at cost. Under the equity method of accounting, the investment is adjusted for PMI's proportionate share of earnings or losses, dividends, capital contributions, changes in ownership interests and movements in currency translation adjustments. The carrying value of our equity method investments at September 30, 2024 and December 31, 2023, exceeded our share of the investees' book value by $1,121 million and $907 million, respectively. The difference between the investment carrying value and the amount of underlying equity in net assets is mainly attributable to equity method goodwill, convertible debt instruments, and definite-lived intangible assets and other assets. The difference related to the definite-lived intangibles and other assets at September 30, 2024 and December 31, 2023 of $152 million and $31 million, respectively, is amortized on a straight-line basis and is included in Equity investments and securities (income)/loss, net on the condensed consolidated statements of earnings. At September 30, 2024, PMI received no year-to-date dividends from equity method investees. At December 31, 2023, PMI received year-to-date dividends from equity method investees of $57 million.

PMI holds a 23% equity interest in Megapolis Distribution B.V. ("MDBV"), the holding company of JSC TK Megapolis (formerly CJSC TK Megapolis), pursuant to Dutch law, PMI's distributor in Russia (SSEA, CIS & MEA segment), which as of September 30, 2024 had a carrying value of $408 million. Additionally, there was approximately $573 million of cumulative foreign currency translation losses associated with MDBV reflected in accumulated other comprehensive losses in the condensed consolidated statement of stockholders’ equity as of September 30, 2024. In June 2024, the Russian government included JSC TK Megapolis in the list of economically significant organizations that may be subject to forced localization under applicable Russian law, which refers to the mandatory removal of a foreign holding company from the shareholding structure. On August 8, 2024, the Arbitrazh Court of the Moscow Region granted the forced localization of MDBV as requested by the Ministry of Industry and Trade on July 18, 2024. As a result, MDBV’s shares in JSC TK Megapolis were transferred to JSC TK Megapolis and we currently expect they will be subsequently transferred to its indirect shareholders or their designees during the fourth quarter of 2024. While as of September 30, 2024, there was no other-than-temporary impairment identified, there are still risks related to this investment and our associated economic and ownership rights as the fair value of these assets with their associated rights is difficult to predict due to the current economic, political, regulatory, legal and social conditions as well as the foreign currency volatility.

PMI holds a 49% equity interest in United Arab Emirates-based Emirati Investors-TA (FZC) (“EITA”). PMI holds an approximate 25% economic interest in Société des Tabacs Algéro-Emiratie (“STAEM”), an Algerian joint venture that is 51% owned by EITA and 49% by the Algerian state-owned enterprise Management et Développement des Actifs et des Ressources Holding ("MADAR Holding"), which manufactures and distributes under license some of PMI’s brands (SSEA, CIS & MEA segment).

In April 2023, PMI acquired an approximate economic interest of 25% in United Tobacco Company ("UTC"). UTC is an entity incorporated in Egypt which manufactures products under license for PMI’s Egyptian subsidiary. On May 16, 2024, PMI acquired a controlling interest in UTC. For further details, see Note 18. Acquisitions and Divestitures.

In May 2024, PMI acquired an indirect economic interest of 14.7% in Eastern Company (“Eastern"), Egypt’s largest cigarette manufacturer which also includes cigars and pipe tobacco, among others, in its portfolio. PMI accounted for its investment in Eastern under the equity method of accounting as it has the indirect ability to participate in Eastern's policy making processes. In relation to the acquisition, PMI subsequently entered into an agreement in August 2024 to guarantee certain credit facilities and repayment of certain bank loan liabilities. The maximum amount of these guarantee obligations is $385 million and they will be in effect until 2034. As of September 30, 2024, PMI has not finalized the basis difference allocation resulting from the investment.

The initial investments in Megapolis Distribution BV, EITA, Eastern and UTC (up to the acquisition of controlling interest in UTC on May 16, 2024) have been recorded at cost and are included in equity investments on the consolidated balance sheets.
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Notes to Condensed Consolidated Financial Statements
(Unaudited)
Transactions between these equity method investees and PMI subsidiaries are considered to be related-party transactions and are included in the tables below.

Equity securities:

On March 22, 2019, PMI’s wholly owned subsidiary in Canada, Rothmans, Benson & Hedges Inc. (“RBH”) obtained an initial order from the Ontario Superior Court of Justice granting it protection under the Companies’ Creditors Arrangement Act ("CCAA"), which is a Canadian federal law that permits a Canadian business to restructure its affairs while carrying on its business in the ordinary course with minimal disruption to its customers, suppliers and employees. The administration of the CCAA process, principally relating to the powers provided to the court under the CCAA and the oversight provided by the court appointed monitor, removes certain elements of control of the business from both PMI and RBH. As a result, PMI determined that it no longer had a controlling financial interest over RBH as defined in ASC 810 (Consolidation), and deconsolidated RBH as of the date of the CCAA filing.

Since the deconsolidation of RBH on March 22, 2019, PMI has accounted for its continuing investment in RBH in accordance with ASC 321 (Investments-Equity Securities) as an equity security, without readily determinable fair value, and recorded its continuing investment in RBH at fair value of $3,280 million, which included the estimated settlement amount at the date of deconsolidation, within equity investments.

On October 17, 2024, the court-appointed mediator and monitor in the CCAA proceedings filed a proposed plan of compromise and arrangement (“Proposed Plan”) setting forth, among other things, certain terms of a proposed comprehensive resolution of Canadian tobacco claims and related litigation. Under the resolution contemplated by the Proposed Plan, RBH, ITL and JTIM would pay an aggregate global settlement amount of CAD 32.5 billion (approximately $23.5 billion). Further developments in the CCAA process, including with respect to the issue of allocation of CAD 32.5 billion aggregate settlement amount among RBH, ITL, and JTIM may have a material adverse impact on the fair value of PMI’s continuing investment in RBH and may result in impairment charges. Transactions between PMI and RBH are considered to be related-party transactions from the date of deconsolidation and are included in the tables below. For further details, see Note 8. Contingencies.

The fair value of PMI’s other equity securities, which have been classified within Level 1, was $1,174 million at September 30, 2024. Unrealized pre-tax gain (loss) of $799 million ($614 million net of tax) on these equity securities was recorded in equity investments and securities (income)/loss, net on the condensed consolidated statements of earnings for the nine months ended September 30, 2024.

Other related parties:

United Arab Emirates-based Trans-Emirates Trading and Investments (FZC) ("TTI") holds a 33% non-controlling interest in Philip Morris Misr LLC ("PMM"), an entity incorporated in Egypt which is consolidated in PMI’s financial statements in the SSEA, CIS & MEA segment. PMM sells, under license, PMI brands in Egypt through an exclusive distribution agreement with a local entity that is also controlled by TTI.

Godfrey Phillips India Ltd ("GPI") is one of the non-controlling interest holders in IPM India, which is a 56.3% owned PMI consolidated subsidiary in the SSEA, CIS & MEA segment. GPI also acts as contract manufacturer and distributor for IPM India.

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Notes to Condensed Consolidated Financial Statements
(Unaudited)
Financial activity with the above related parties:

PMI’s net revenues and expenses with the above related parties were as follows:
For the Nine Months Ended September 30,For the Three Months Ended September 30,
(in millions)2024202320242023
Net revenues:
Megapolis Group$1,756 $1,714 $660 $530 
Other1,110 917 385 327 
Net revenues (a)
$2,866 $2,631 $1,045 $857 
Expenses:
Other$90 $180 $17 $67 
Expenses$90 $180 $17 $67 
(a) Net revenues exclude excise taxes and VAT billed to customers.

PMI’s balance sheet activity with the above related parties was as follows:
(in millions)At September 30, 2024
At December 31, 2023
Receivables:
Megapolis Group$457 $474 
Other311 236 
Receivables$768 $710 
Payables:
Other$65 $18 
Payables$65 $18 
The activities with the above related parties are in the ordinary course of business, and are primarily for distribution, service fees, contract manufacturing and license agreements. PMI eliminated its respective share of all significant intercompany transactions with the equity method investees.

Note 13. Sale of Accounts Receivable:
To mitigate risk and enhance cash and liquidity management, PMI sells trade receivables to unaffiliated financial institutions. These arrangements allow PMI to sell, on an ongoing basis, certain trade receivables without recourse. The trade receivables sold are generally short-term in nature and are removed from the condensed consolidated balance sheets. PMI sells trade receivables under two types of arrangements, servicing and non-servicing. For servicing arrangements, PMI continues to service the sold trade receivables on an administrative basis and does not act on behalf of the unaffiliated financial institutions. When applicable, a servicing liability is recorded for the estimated fair value of the servicing. The amounts associated with the servicing liability were not material as of September 30, 2024 and September 30, 2023. Under the non-servicing arrangements, PMI does not provide any administrative support or servicing after the trade receivables have been sold to the unaffiliated financial institutions.

Cumulative trade receivables sold, including excise taxes, for the nine months ended September 30, 2024 and 2023, were $8.8 billion and $9.4 billion, respectively. PMI’s operating cash flows were positively impacted by the amount of the trade receivables sold and derecognized from the condensed consolidated balance sheets, which remained outstanding with the unaffiliated financial institutions. The trade receivables sold that remained outstanding under these arrangements as of September 30, 2024 and September 30, 2023, were $0.6 billion and $0.7 billion, respectively. The net proceeds received are included in cash provided by operating activities in the condensed consolidated statements of cash flows. The difference
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Notes to Condensed Consolidated Financial Statements
(Unaudited)
between the carrying amount of the trade receivables sold and the sum of the cash received is recorded as a loss on sale of trade receivables within marketing, administration and research costs in the condensed consolidated statements of earnings.

The loss on sale of trade receivables was as follows:
(in millions)For the Nine Months Ended September 30,For the Three Months Ended September 30,
2024$33 $11 
2023$37 $13 


Note 14. Product Warranty:

PMI's heat-not-burn devices and e-vapor products are subject to standard product warranties generally for a period of 12 months from the date of purchase or such other periods as required by law. PMI generally provides in cost of sales for the estimated cost of warranty in the period the related revenue is recognized. PMI assesses the adequacy of its accrued product warranties and adjusts the amounts as necessary based on actual experience and changes in future estimates. Factors that affect product warranties may vary across markets but typically include device version mix, product failure rates, logistics and service delivery costs, and warranty policies. PMI accounts for its product warranties within other accrued liabilities. At September 30, 2024 and December 31, 2023, these amounts were as follows:
(in millions)As of and For the Nine Months Ended September 30, 2024As of and For the Year Ended December 31, 2023
Balance at beginning of period$80 $104 
Changes due to:
   Warranties issued50 60 
    Settlements (58)(83)
    Currency/Other— (1)
Balance at end of period$72 $80 

Note 15. Asset Impairment and Exit Costs:
For the nine months ended September 30, 2024 and 2023, PMI recorded total pre-tax asset impairment and exit costs of $168 million and $109 million, respectively, related to restructuring activities. These 2024 and 2023 pre-tax charges were included in marketing, administration and research costs in the condensed consolidated statements of earnings. For the three months ended September 30, 2024 and 2023, PMI did not record any charges for asset impairment and exit costs related to restructuring activities.

For the nine months ended September 30, 2024, PMI recorded a pre-tax impairment charge of other intangibles of $27 million within the Wellness and Healthcare segment. For the nine months and the three months ended September 30, 2024, PMI recorded an impairment charge of $198 million related to Vectura's classification as held for sale. For the nine months ended September 30, 2023, PMI recorded a pre-tax impairment charge of goodwill and other intangibles of $680 million within the Wellness and Healthcare segment. For further details on these impairment charges, see Note 4. Goodwill and Other Intangible Assets, net and Note 18. Acquisitions and Divestitures.

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Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Platform 1 (IQOS) products sourcing for the U.S. market

On February 1, 2024, a subsidiary of PMI entered into a settlement agreement (the “Settlement Agreement”) with Nicoventures Trading Limited (“NTV”), an affiliate of British American Tobacco p.l.c. (“BAT”). In accordance with its terms, the parties to the Settlement Agreement filed a joint motion to rescind the limited exclusion order and the cease-and-desist order issued by the International Trade Commission (“ITC”) on September 29, 2021, which was granted on March 11, 2024. Prior to their rescission, the orders prohibited the importation and sales of imported Platform 1 products to the United States of America (for further details of the Settlement Agreement, ITC order and its rescission, see Note 8. Contingencies). As a result, PMI has initiated a project in the first quarter of 2024 to restructure the sourcing of Platform 1 products to commercialize IQOS in the United States. For further details on IQOS commercialization in the U.S. and the related agreement with Altria Group, Inc (“Altria”), see Note 18. Acquisitions and Divestitures.

In the first quarter of 2024, PMI recorded pre-tax asset impairment and exit costs of $121 million related to this restructuring activity. This amount included contract termination costs with suppliers of $61 million, including prepaid commitments of $20 million. The amount also included asset impairment costs of $60 million, primarily related to machinery and equipment and other assets, which were non-cash charges.

Venezuela

In the first quarter of 2024, PMI ceased its operations in Venezuela and as a result, recorded pre-tax asset impairment and exit costs of $47 million. The amount primarily included non-cash charges related to the reclassification of accumulated foreign currency translation losses from other comprehensive losses of $38 million and asset impairment charge of $5 million related to land and buildings. This amount also included contract termination, severance and other related costs of $4 million, which were paid in cash.

For details on the income tax impact of the transaction, see Note 9. Income Taxes.

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Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
e-Vapor Products Manufacturing Optimization

In the first quarter of 2023, PMI initiated a project to fully outsource and restructure the manufacturing of e-vapor devices and consumables. As a result, PMI recorded pre-tax asset impairment and exit costs of $109 million. This amount included contract termination costs for suppliers of $78 million, including $21 million of embedded finance lease terminations, payable in cash. This amount also included asset impairment costs of $31 million, primarily related to machinery and equipment, which were non-cash charges.

Asset Impairment and Exit Costs by Segment

PMI recorded the following pre-tax asset impairment and exit costs by segment:

(in millions)For the Nine Months Ended September 30,
 20242023
Reclassification of accumulated foreign currency translation losses from other comprehensive losses:
Americas$38 $— 
Total reclassification of accumulated foreign currency translation losses from other comprehensive losses38 — 
Contract termination charges:
Europe— 34 
SSEA, CIS & MEA— 23 
EA, AU & PMI DF— 14 
Americas65 7 
Total contract termination charges65 78 
Asset impairment charges:
Europe— 13 
SSEA, CIS & MEA— 9 
EA, AU & PMI DF— 5 
Americas65 4 
Total asset impairment charges65 31 
Asset impairment and exit costs$168 $109 

Movement in Exit Cost Liabilities

The movement in exit cost liabilities for the nine months ended September 30, 2024 was as follows:
(in millions) 
Liability balance, January 1, 2024$29 
Charges, net65 
Cash spent(34)
Prepaid commitments(20)
Currency/other2 
Liability balance, September 30, 2024$42 

Future cash payments for exit costs incurred to date are anticipated to be substantially paid by the end of 2025, with approximately $31 million expected to be paid in the remainder of 2024.

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Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Note 16. Leases:

The components of PMI’s lease cost were as follows for the nine months and three months ended September 30, 2024 and 2023:
For the Nine Months Ended September 30,For the Three Months Ended September 30,
(in millions)2024202320242023
Operating lease cost$210 $199 $72 $66 
Finance lease cost:
Amortization of right-of-use assets55 37 18 9 
Interest on lease liabilities
1 1 — 1 
Short-term lease cost48 44 16 15 
Variable lease cost21 20 8 6 
Total lease cost$335 $301 $114 $97 

                                                                            
Note 17. Supply Chain Financing:

PMI has engaged with unaffiliated global financial institutions that offer a voluntary supply chain financing ("SCF") program to some of our suppliers. Under the SCF program, the suppliers may elect, at their sole discretion, to sell PMI's payment obligations to these financial institutions. The suppliers independently negotiate the sale arrangements directly with these financial institutions. PMI does not participate in these negotiations, nor does it have any economic interest in these agreements, or in the designated suppliers’ voluntary decision to sell PMI's payment obligations to these financial institutions. No guarantees or securities are provided by PMI or any of its subsidiaries under the SCF programs. PMI's obligations to its suppliers, including amounts due and scheduled payment terms are not impacted by the suppliers’ decision to sell amounts under the SCF program. The payment terms of PMI’s suppliers generally do not exceed 120 days. All outstanding payable amounts related to suppliers that are participating in the SCF program are recorded in accounts payable in PMI's condensed consolidated balance sheets. The associated payments are included in cash flows from operating activities within PMI's condensed consolidated statement of cash flows. As of September 30, 2024 and December 31, 2023, the total amount due to suppliers participating in the SCF program was approximately $0.9 billion.


Note 18. Acquisitions and Divestitures:

Transactions With Noncontrolling Interests - Turkey
In the first quarter of 2022, PMI acquired the remaining 25% stake of its holding in Philip Morris Tütün Mamulleri Sanayi ve Ticaret A.Ş. ("PMTM") (formerly Philsa Philip Morris Sabanci Sigara ve Tütüncülük Sanayi ve Ticaret A.Ş.) and 24.75% stake in Philip Morris Pazarlama ve Satiş A.Ş. ("PMPS") (formerly Philip Morris SA, Philip Morris Sabanci Pazarlama ve Satiş A.Ş.) from its Turkish partners, Sabanci Holding for a total acquisition price including transaction costs and remaining dividend entitlements of approximately $223 million. As a result of this acquisition, PMI owned 100% of these Turkish subsidiaries as of December 31, 2022. The purchase of the remaining stakes in these holdings resulted in a decrease to PMI's additional paid-in capital of $30 million and an increase to accumulated other comprehensive losses of $171 million primarily following the reclassification of accumulated currency translation losses from noncontrolling interests to PMI’s accumulated other comprehensive losses during the first quarter of 2022.

In January 2023, PMI sold the acquired stakes of its holdings in PMTM and PMPS to Pioneers Tutun Yatirim Anonim Sirketi (“Pioneers”) for a consideration of approximately $258 million, including transaction costs and dividend entitlements. The sale resulted in an increase to PMI's additional paid-in capital of $36 million and a decrease to accumulated other comprehensive losses of $179 million, following the reclassification of accumulated other comprehensive losses from PMI’s accumulated other comprehensive losses to noncontrolling interests.

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Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Altria Group, Inc. Agreement

On October 20, 2022, PMI announced that it had reached an agreement with Altria Group, Inc. ("Altria") to end the companies' relationship regarding the IQOS commercialization rights in the U.S. as of April 30, 2024. As a result of PMI reacquiring these rights, effective May 1, 2024 ("acquisition date"), PMI holds the full rights to commercialize IQOS in the U.S. As part of the agreement, PMI agreed to pay a total cash consideration of approximately $2.8 billion, including interest, of which $1.0 billion was paid at the inception of the agreement and the remaining $1.8 billion was paid on July 14, 2023. The cash consideration paid was accounted for within Other assets in PMI's condensed consolidated balance sheets as of December 31, 2023.

On the acquisition date and as of September 30, 2024, the reacquired rights were classified as Other intangible assets, net in PMI's condensed consolidated balance sheets, and will be amortized over their useful life of 5 years.

United Tobacco Company

In April 2023, PMI acquired 66.73% of Egyptian Investment Holding (“EIH”), a United Arab Emirates based company and as a result, acquired an approximate economic interest of 25% in United Tobacco Company ("UTC"), which was accounted for using the equity method of accounting. In May 2024, PMI increased its indirect economic interest and acquired a controlling interest of 54.25% in UTC. UTC is an entity incorporated in Egypt and manufactures products under license for Philip Morris Misr LLC (“PMM”), PMI’s Egyptian subsidiary. The acquisition builds on PMI’s existing investments in Egypt and increases the manufacturing synergies between PMM and UTC.

As a result of PMI obtaining control over UTC, PMI’s previously held 25% economic interest in UTC was remeasured to its fair value by applying the guideline transaction method adjusted for a discount for lack of control. The difference between the book value of $312 million, including related cumulative translation losses balance of $112 million, which was reclassified from accumulated other comprehensive losses and the fair value of PMI’s previously held interest in UTC was not material.

The total purchase price for the incremental equity interest of $315 million included cash consideration of $30 million, contingent consideration of $22 million and $263 million of assumed bank loan liabilities. During the third quarter of 2024, PMI paid the contingent consideration of $22 million and $240 million of assumed bank loans.


The following table summarizes the preliminary purchase price allocation for the fair value of assets acquired and liabilities assumed as of the date of the acquisition, which includes previously held interest:

(in millions)
Cash and cash equivalent$74 
Current assets, including receivables and inventories11 
Other intangible assets - Tobacco manufacturing license211 
Other non-current assets, including property, plant and equipment16 
Current liabilities(8)
Identifiable net assets acquired304 
Noncontrolling interest(159)
Goodwill510 
Acquisition fair value$655 

Goodwill is primarily attributable to future growth opportunities, anticipated synergies in the manufacturing processes and intangible assets that did not qualify for separate recognition. The fair value of the noncontrolling interest was estimated based on the enterprise value of UTC, adjusted for a discount for lack of control. The manufacturing license, which relates to the manufacturing of both smoke-free and combustible tobacco products, was valued using the multi-period excess earnings method and has been determined to have an indefinite life.

The purchase price allocation is preliminary and continues to be subject to refinement. PMI is evaluating the deductibility of goodwill for income tax purposes. UTC's results of operations from May 16, 2024, through September 30, 2024, were included
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Notes to Condensed Consolidated Financial Statements
(Unaudited)
in PMI's consolidated statements of earnings and were not material. Pro forma results of operations for the business combination have not been presented as the aggregate impact is not material to PMI's consolidated statements of earnings.

Agreement to sell Vectura Group Ltd.

On September 17, 2024, PMI announced the execution of a definitive agreement pursuant to which PMI’s direct, wholly-owned subsidiary, Vectura Fertin Pharma Inc., agreed to sell Vectura Group Ltd. to Molex Asia Holdings Ltd. Vectura's results are included in the Wellness and Healthcare segment. The transaction price is GBP 150 million (approximately $201 million), with additional deferred payments of up to GBP 148 million (approximately $198 million), contingent on achievement of certain milestones over periods up to and through 2039. The transaction is expected to close during the fourth quarter of 2024, subject to customary regulatory approvals and other closing conditions.

In connection with the expected transaction, Vectura’s net assets including $333 million of assets and $191 million of liabilities have been classified as held-for-sale and included within other current assets and other accrued liabilities, respectively, in PMI’s condensed consolidated balance sheet as of September 30, 2024. Carrying value of Vectura’s net assets held for sale exceeded their fair value less costs to sell, resulting in an impairment charge of $198 million, which has been recorded in marketing, administration and research costs in PMI’s condensed consolidated statements of earnings during the nine months and the three months ended September 30, 2024. The estimated fair value of the disposal group less costs to sell was determined using a market approach, based upon the expected net sales proceeds of the disposal group.

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Philip Morris International Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Note 19. New Accounting Standards:

Improvements to Reportable Segment Disclosures
On November 27, 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ASU 2023-07, “Improvements to Reportable Segment Disclosures” (“ASU 2023-07”), which improves reportable segment disclosures, primarily through enhanced disclosures about significant segment expenses that impact segment profit and loss, regularly provided to the chief operating decision maker.

The amendments are effective for fiscal years beginning after December 15, 2023, and for interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis, with early adoption permitted. PMI will adopt the additional disclosure requirements on the specified effective date within its annual reporting for the year ending December 31, 2024, and its interim reporting starting for the quarter ending March 31, 2025.

Improvements to Income Tax Disclosures
On December 14, 2023, the FASB issued Accounting Standards Update ASU 2023-09, “Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 enhances the transparency of income tax disclosures, primarily by requiring public business entities to disclose specific categories in the rate reconciliation tabular presentation, as well as by providing additional information for reconciling items that meet a quantitative threshold. The ASU also requires disaggregated disclosures of federal, state and foreign income taxes paid.

ASU 2023-09 is effective for annual periods beginning after December 15, 2024, and early adoption is permitted. The amendments are applicable on a prospective basis, although retrospective basis is also permitted. PMI is currently evaluating the impact of ASU 2023-09 on its disclosures.
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Item 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Description of Our Company

We are a leading international tobacco company, actively delivering a smoke-free future. We are evolving our portfolio for the long term to include products outside of the tobacco and nicotine sector. Our current product portfolio primarily consists of cigarettes and smoke-free products. Since 2008, we have invested over $12.5 billion to develop, scientifically substantiate and commercialize innovative smoke-free products for adults who would otherwise continue to smoke, with the goal of completely ending the sale of cigarettes. This investment includes the building of world-class scientific assessment capabilities, notably in the areas of pre-clinical systems toxicology, clinical and behavioral research, as well as post-market studies. In November 2022, we acquired Swedish Match AB ("Swedish Match") – a leader in oral nicotine delivery – creating a global smoke-free combination led by the companies’ IQOS and ZYN brands. The U.S. Food and Drug Administration (the "FDA") has authorized versions of our IQOS devices and consumables and Swedish Match's General snus as Modified Risk Tobacco Products ("MRTPs") and renewal applications for these products are presently pending before the FDA. We describe the MRTP orders in more detail in the "Business Environment" section of this Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A").

Following the combination and the progress in 2023 toward the integration of the Swedish Match business into PMI's existing regional structure, PMI updated in January 2024 its segment reporting by including the former Swedish Match segment results into the four existing geographical segments. Our four geographical segments are as follows:
•Europe Region;
•South and Southeast Asia, Commonwealth of Independent States, Middle East and Africa Region ("SSEA, CIS & MEA");
•East Asia, Australia, and PMI Duty Free Region ("EA, AU & PMI DF"); and
•Americas Region.

The Wellness and Healthcare segment ("W&H"), which includes the operating results of our Vectura Fertin Pharma business, remains unchanged.

Our cigarettes are sold in approximately 175 markets, and in many of these markets they hold the number one or number two market share position. We have a wide range of premium, mid-price and low-price brands. Our portfolio comprises both international and local brands.

Smoke-Free Business ("SFB”) is the term PMI uses to refer to all of its smoke-free products. SFB also includes wellness and healthcare products, as well as consumer accessories, such as lighters and matches.

Smoke-free products (also referred to herein as "SFPs") is the term PMI uses to refer to all of its products that provide nicotine without combusting tobacco, such as heat-not-burn, e-vapor, and oral smokeless, and that therefore generate far lower levels of harmful chemicals. As such, these products have the potential to present less risk of harm versus continued smoking.

IQOS and ZYN are the leading brands in our SFPs portfolio. As of September 30, 2024, our smoke-free products were available for sale in 92 markets.

Our Wellness and Healthcare business strategy focuses on developing and commercializing oral and inhaled consumer health and wellness offerings and inhaled prescription products for therapy areas that include pain management and cardiovascular emergencies. This includes medical and pharmaceutical cannabinoids, and non-recreational cannabinoid products (including CBD), in line with applicable regulatory requirements, though any revenue related to cannabinoids is expected to be negligible in the near to medium term.

In 2022, we acquired Swedish Match AB, a market leader in oral nicotine delivery with a significant presence in the United States market. The Swedish Match acquisition is a key milestone in PMI’s transformation to becoming a smoke-free company. Swedish Match has a leading nicotine pouch franchise in the U.S. under the ZYN brand name. The Swedish Match product portfolio is complementary to our existing portfolio, permitting us to bring together a leading oral nicotine product with the leading heat-not-burn product. By joining forces with Swedish Match, we expect to accelerate the achievement of our joint
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smoke-free ambitions, switching more adults who would otherwise continue to smoke cigarettes to better alternatives faster than either company could achieve separately.

In 2022, we also completed an agreement with Altria Group, Inc. to end our commercial relationship in the U.S. covering IQOS as of April 30, 2024. PMI now holds the full rights to commercialize IQOS in the U.S. For further details, see Note 18. Acquisitions and Divestitures.

We use the term net revenues to refer to our operating revenues from the sale of our products, including shipping and handling charges billed to customers, net of sales and promotion incentives, and excise taxes. Our net revenues and operating income are affected by various factors, including the volume of products we sell, the price of our products, changes in currency exchange rates and the mix of products we sell. Mix is a term used to refer to the proportionate value of premium-price brands to mid-price or low-price brands in any given market (product mix). Mix can also refer to the proportion of shipment volume in more profitable markets versus shipment volume in less profitable markets (geographic mix).

Our cost of sales consists principally of: tobacco leaf, non-tobacco raw materials, labor and manufacturing costs; shipping and handling costs; and the cost of devices produced by third-party electronics manufacturing service providers. Estimated costs associated with device warranty programs are generally provided for in cost of sales in the period the related revenues are recognized.

Our marketing, administration and research costs include the costs of marketing and selling our products, other costs generally not related to the manufacture of our products (including general corporate expenses), and costs incurred to develop new products. The most significant components of our marketing, administration and research costs are marketing and sales expenses and general and administrative expenses.

Philip Morris International Inc. is a legal entity separate and distinct from its direct and indirect subsidiaries. Accordingly, our right, and thus the right of our creditors and stockholders, to participate in any distribution of the assets or earnings of any subsidiary is subject to the prior rights of creditors of such subsidiary, except to the extent that claims of our company itself as a creditor may be recognized. As a holding company, our principal sources of funds, including funds to make payment on our debt securities, are from the receipt of dividends and repayment of debt from our subsidiaries. Our principal wholly owned and majority-owned subsidiaries currently are not limited by long-term debt or other agreements in their ability to pay cash dividends or to make other distributions that are otherwise compliant with law.


Executive Summary

The following executive summary provides the business update and significant highlights from the "Discussion and Analysis" that follows.

Sale of Vectura Group

In September 2024, PMI announced the sale of its subsidiary, Vectura Group Ltd. (formerly, Vectura Group plc, and hereinafter referred to as “Vectura” or "Vectura Group"), to Molex Asia Holdings Ltd., and the establishment of master service agreements to develop Vectura Fertin Pharma’s inhaled therapeutics proprietary pipeline. The transaction is expected to close by the end of 2024, subject to regulatory approval, which may impact the timing, and other customary closing conditions. In the third quarter of 2024, PMI recorded an impairment charge of $198 million related to Vectura's classification as held for sale. For further details, see Note 18. Acquisitions and Divestitures.

The remaining units of Vectura Fertin Pharma will continue to operate as a separate company under PMI’s ownership and will be given a new corporate identity. This business will focus on developing and commercializing oral consumer health and wellness offerings and inhaled prescription products for therapy areas that include pain management and cardiovascular emergencies.

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9 月 30 日期 9 ヶ月間の連結業績 2024

•純利益 - 2024 年 9 月 30 日までの 9 ヶ月間の純売上高は 282億ドルで、同 2023 年の売上高から 20億ドル （ 7.8% ） 増加しました。 同等の 2023 年からの純利益の変更は、以下の要因によるものです （ 前年決算との変動はスケールされません ） 。

294
2024 年 9 月 30 日までの 9 ヶ月間の純売上高は 7.8% 増加しました。為替および買収を除く純売上高は 1 1.0% 増加しました。これは主に可燃性タバコ価格の上昇による好ましい価格変動を反映しています。高い無煙製品のボリュームによって駆動され、部分的に不利なタバコのミックスによって相殺され、2023 年第 1 四半期の「その他」に示されている中東での流通契約終了後の 8000万ドルの費用を反映し、 2023 年との比較が好ましい。「中東における流通契約の終了については、以下に詳述します。1 株当たり希釈利益」の議論。

2024 年 9 月 30 日および 2023 年 9 ヶ月間の製品カテゴリー別純売上高は以下のとおりです。

1022        1025

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•1 株当たり希釈利益 - 2024 年 9 月 30 日に終了した 9 ヶ月間の希釈済み 1 株当たり利益 （ 「希釈済み EPS 」 ） の変更は、 2023 年同期と比較して以下の通りです。
希釈 EPS% 変更
2023 年 9 月 30 日までの 9 ヶ月間$3.61 
2023 年ウクライナ戦争関連の告発0.01 
2023 年資産減価償却 · 退出コスト0.06 
2023 韓国間接税0.11 
2023 年の禁煙世界財団との契約の終了0.07 
2023 年株式担保投資の公正価値調整(0.02)
2023 無形資産の償却0.18 
2023 善意その他の無形資産の減損0.44 
2023 年中東での流通契約の終了0.04 
2023 スウェーデンマッチ Ab 買収会計関連項目0.01 
2023 スウェーデンマッチ Ab ファイナンスに関連する所得税の影響0.03 
2023 税目0.11 
2023 件の小計1.04 
2024 資産減価償却および出口コスト(0.09)
2024 その他の無形資産の減損(0.01)
2024 無形資産の償却(0.29)
2024 年株式担保投資の公正価値調整0.39 
2024 年ベクトゥラグループの売却予想に伴う減損(0.13)
2024 エジプトの消費税課金(0.03)
2024 スウェーデンの Match Ab ファイナンスに関連する所得税の影響0.01 
2024 税目 0.03 
2024 項目の小計(0.12)
通貨(0.44)
利子— 
税率の変更(0.03)
オペレーション0.83 
2024 年 9 月 30 日までの 9 ヶ月間について$4.89 35.5 %

Charges related to the war in Ukraine – During the nine months ended September 30, 2023, we recorded a pre-tax charge of $19 million (representing $15 million net of income tax and a diluted EPS charge of $0.01 per share), related to circumstances driven by the war, including the cost of PMI’s humanitarian efforts.

Asset impairment and exit costs – During the nine months ended September 30, 2023, we recorded pre-tax asset impairment and exit costs of $109 million, representing $96 million net of income tax and a diluted EPS charge of $0.06 per share, related to a project to fully outsource and restructure the manufacturing of e-vapor devices and consumables. During the nine months ended September 30, 2024, we recorded pre-tax asset impairment and exit costs of $168 million, representing $141 million net of income tax and a diluted EPS charge of $0.09 per share, related to the restructuring of the sourcing of IQOS products to be commercialized in the U.S., and the cessation of our operations in Venezuela. For further details, see Note 15. Asset Impairment and Exit Costs.

South Korea indirect tax charge – On July 13, 2023, our South Korean subsidiary, PM Korea, received an adverse ruling from the Supreme Court of South Korea related to cases alleging underpayment of excise taxes in connection with a 2015 excise tax increase and subsequent audit by the South Korean Board of Audit and Inspection. The Supreme Court ruling reversed previous decisions that were in PM Korea’s favor at the trial and appellate levels. As a result of the ruling, we concluded that an adverse outcome was probable. Consequently, we recorded a non-cash pre-tax charge of $204 million (representing $174 million net of
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income tax or $0.11 per share decrease in diluted EPS) in the second quarter results of 2023, reflecting the full amount previously paid by PM Korea.

Termination of agreement with Foundation for a Smoke-Free World – On September 29, 2023, PMI and the Foundation for a Smoke-Free World (the "Foundation") entered into the Final Grant Agreement and Termination of the Second Amended and Restated Pledge Agreement ("Agreement"). Under the terms of the Agreement, PMI paid $140 million in the third quarter of 2023 in return for the termination of the pledge agreement between the parties. As a result, in the third quarter of 2023, PMI recorded a pre-tax charge of $140 million (representing $111 million net of income tax or $0.07 per share decrease in diluted EPS) commensurate with the early termination of the pledge agreement. The pre-tax charge was recorded in marketing, administration and research costs in the condensed consolidated statements of earnings during the nine months ended September 30, 2023. For further details, see "Other Developments" within the Business Environment section of this MD&A.

Fair value adjustment for equity security investments – During the nine months ended September 30, 2023, we recorded a favorable fair value adjustment for our equity security investments in India and Sri Lanka of $41 million after tax (or $0.02 per share increase in diluted EPS). During the nine months ended September 30, 2024, we recorded a favorable fair value adjustment for our equity security investments in India and Sri Lanka of $614 million after tax (or $0.39 per share increase in diluted EPS). For further details, see Note 12. Related Parties - Equity Investments and Other.

Amortization of intangibles – During the nine months ended September 30, 2023 and 2024, we recorded amortization of intangible expense of $368 million (representing $285 million net of income tax or $0.18 per share decrease in diluted EPS) and $588 million (representing $459 million net of income tax or $0.29 per share decrease in diluted EPS), respectively. The higher 2024 amount includes the reacquired rights recorded as other intangible assets, net following the reacquisition of IQOS commercialization rights in the U.S. from Altria Group, Inc. For further details, see Note 4. Goodwill and Other Intangible Assets, net.

Impairment of goodwill and other intangibles – During the second quarter of 2023, as a result of the completion of our annual review of goodwill and non-amortizable intangible assets for potential impairment, it was determined that the estimated fair value of the Wellness and Healthcare reporting unit was lower than its carrying value. Consequently, we recorded a total non-cash impairment charge of $680 million (representing a $0.44 per share decrease in diluted EPS) consisting of a goodwill impairment charge of $665 million and a non-amortizable intangible asset pre-tax impairment charge of $15 million for an in-process research and development project related to one of our 2021 acquisitions. The impairment charge was recorded in impairment of goodwill ($665 million) and marketing, administration and research costs ($15 million) in the condensed consolidated statements of earnings during the nine months ended September 30, 2023 and was included in the Wellness and Healthcare segment results. During the first quarter of 2024, we recorded an impairment charge of $27 million (representing $20 million net of income tax or $0.01 per share decrease in diluted EPS), primarily reflecting the impairment of non-amortizable intangible assets related to an in-process research and development project in the Wellness and Healthcare segment. The impairment charge of $27 million was recorded in marketing, administration and research costs in the condensed consolidated statements of earnings during the nine months ended September 30, 2024. For further details, see Note 4. Goodwill and Other Intangible Assets, net.

Termination of distribution arrangement in the Middle East – Following the termination of a distribution arrangement in the Middle East, we recorded a pre-tax charge of $80 million in the first quarter of 2023 (representing $70 million net of income tax and a diluted EPS charge of $0.04 per share). The pre-tax charge was recorded as a reduction of net revenues in the condensed consolidated statements of earnings and was included in the SSEA, CIS & MEA segment results.

Swedish Match AB acquisition accounting related items – During the first quarter of 2023, we recorded pre-tax purchase accounting adjustments of $18 million related to the sale of acquired inventories stepped up to fair value (representing $13 million net of income tax and a diluted EPS charge of $0.01 per share). These pre-tax adjustments were recorded in cost of sales in the condensed consolidated statements of earnings for the nine months ended September 30, 2023.

Impairment related to Vectura Group's expected sale – In September 2024, we announced the execution of a definitive agreement to sell Vectura to Molex Asia Holdings Ltd. As a result, we recorded in the third quarter of 2024 an impairment charge of $198 million (representing a diluted EPS charge of $0.13 per share) related to Vectura's classification as held for sale. The impairment charge was recorded in marketing, administration and research costs in PMI’s condensed consolidated statements of earnings for the nine months ended September 30, 2024, and was included in the Wellness and Healthcare segment results. For further details, see Note 18. Acquisitions and Divestitures.

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エジプトの消費税課税 – 2024 年第 3 四半期には、エジプト高等行政裁判所の判決とその後の利用可能な救済策の評価に続き、悪結果の可能性があると結論付け税引前費用 4500 万ドルを計上しました（ 所得税を控除した 3900 万ドルと 1 株当たり 0.0 3 ドルの希釈済 EPS 費用を表す ）2014 年から 2016 年の輸入カットフィラーに対する一般消費税控除の税金評価に関連して。この税引前費用は、 2024 年 9 月 30 日に終了した 9 ヶ月間の連結決算表のマーケティング、管理、研究費用に計上され、 SSEA 、 CIS & MEA セグメントの業績に含まれています。

所得税 — 上記の表では、 2023 年の希釈済益が 1 株当たり 0.0 3 ドル減少し、 2024 年の希釈済益が 1 株当たり 0.0 1 ドル増加したスウェーデン · マッチの買収資金調達に伴う所得税の影響は、精算連結決算書に反映されたスウェーデン · マッチの買収資金調達に関連する会社間借入に対する未実現外貨損益の繰延税の影響によるものです。税引前為替変動は、連結決算書に完全に相殺され、株主資本 （ 赤字 ） 連結決算書に通貨換算調整として反映されました。

上記表の 2023 年度の希釈 EPS を 1 株当たり 0.1 1 ドル減少させた 2023 年の税項目は、 2023 年 8 月 8 日にロシア当局による配当を含む特定の支払いに関する特定のロシアの二重課税条約の一方的な停止により、 PMI のロシア子会社の未払い利益に関連する繰延税金負債が増加したことによるものです。上記表の 2024 年の希釈済 EPS を 1 株当たり 0.03 ドル増加させた 2024 年の税項は、 PMI の C. A. への投資に関連した内国歳入法第 165 条 （ g ） に基づく無価値株式控除に対する米国税金優遇によるものです。タバカルレラ · ナショナル — ベネズエラで設立された完全外国人企業。

上表の希釈済 EPS を 1 株当たり 0.0 3 ドル減少させた税率の変更は、主に米国州の税金費用の増加、送還コスト差異、および課税管轄区域による収益ミックスの変化によるものです。

通貨 — 報告期間中の 1 株当たり 0.44 ドルの悪影響は、主に米ドル、特にエジプトポンド、日本円、ロシア · ルーブルに対する変動によるものです。この不利な為替変動は、プライマリ収益市場と現地通貨コストベースでの収益性に影響を与えました。

オペレーション — 上表の事業における希釈利益 0.83 ドルの増加は、主に以下のセグメントによるものです。

•SSEA 、 CIS 、 MEA ： 有利な価格と有利なボリューム / ミックス、部分的に高い製造コストによって相殺される。
•欧州 ： 有利な価格と有利なボリューム / ミックスが、マーケティング、管理、研究コスト、製造コストの高騰によって一部相殺されます。
•EA 、 AU 、 PMI DF ： 有利な価格と有利な量 / ミックス；
•米州 ： 有利なボリューム / ミックスと有利な価格が、マーケティング、管理、研究コストの高騰によって一部相殺されます。

9 月 30 日期 3 ヶ月間の連結業績 2024

•純利益 - 2024 年 9 月 30 日までの 3 ヶ月間の純売上高は 99億ドルで、同 2023 年の売上高から 8億ドル、すなわち 8.4% 増加しました。2023 年同期からの純利益の変更は、以下の要因によるものです （ 四半期決算との差異は拡大しません ） 。
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290
第四半期の純利益は 8.4% 増加しました。為替および買収を除く純売上高は 1 1.6% 増加しました。これは、主に可燃性タバコ価格の上昇による好ましい価格変動と、主に無煙製品の高騰による好ましいボリューム / ミックスによるものです。

2024 年 9 月 30 日と 2023 年 9 月 30 日までの 3 ヶ月間の製品カテゴリー別純売上高は以下のとおりです。

632        635

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•1 株当たり希釈利益 - 2024 年 9 月 30 日に終了した 3 ヶ月間の希釈済み EPS の変更は、 2023 年の同等金額と比較して以下のとおりです。
希釈 EPS% 変更
2023 年 9 月 30 日までの 3 ヶ月間$1.32 
2023 年ウクライナ戦争関連の告発0.01 
2023 年株式担保投資の公正価値調整(0.03)
2023 無形資産の償却0.10 
2023 年の禁煙世界財団との契約の終了0.07 
2023 スウェーデンマッチ Ab ファイナンスに関連する所得税の影響0.09 
2023 税目0.11 
2023 件の小計0.35 
2024 無形資産の償却(0.12)
2024 年株式担保投資の公正価値調整0.24 
2024 年ベクトゥラグループの売却予想に伴う減損(0.13)
2024 エジプトの消費税課金(0.03)
2024 スウェーデンの Match Ab ファイナンスに関連する所得税の影響0.10 
2024 税目 — 
2024 項目の小計0.06 
通貨(0.06)
利子0.04 
税率の変更0.04 
オペレーション0.22 
2024 年 9 月 30 日までの 3 ヶ月間$1.97 49.2 %

ウクライナ戦争に関連した告発 — 2023 年の第 3 四半期には、 PMI の人道支援活動に対する費用を含む戦争による状況に関連した税引前費用 1900万ドル （ 所得税を差し引いた 1500万ドルと 1 株当たり 0.01 ドルの希釈済 EPS 費用を表す ） を計上しました。

株式担保投資の公正価値調整 2023 年第 3 四半期には、インドとスリランカにおける株式担保投資の税引後 5100万ドル （ 希釈済み EPS の 1 株当たり 0.0 3 ドル増加 ） の公正価値調整を好意に計上しました。2024 年第 3 四半期には、インドとスリランカにおける株式担保投資の公正価値調整が税引後 3 億 7200 万ドル （ 希釈済み EPS 1 株当たり 0.24 ドル増加 ） と好調な結果となりました。 詳細は、注釈 12 を参照。 関連会社 — 株式投資その他.

無形の償却 – 2023 年第 3 四半期と 2024 年の第 3 四半期には、無形費用の償却額はそれぞれ 2 億 5，500 万ドル （ 所得税引換 1 億 5，700 万ドルまたは希釈済み EPS 1 株当たり 0.10 ドル減少 ） と 2 億 5，600 万ドル （ 所得税引換 1 億 9，900 万ドルまたは希釈済み EPS 1 株当たり 0.12 ドル減少 ） を計上しました。2024 年の増額には、その他の無形資産として計上された再取得権を含みます。 IQOS について Altria Group ， Inc. から米国における商業化権を取得。 詳細は注釈 4 を参照。 商誉その他の無形資産、純.

禁煙世界財団との契約終了について — 2023 年 9 月 29 日、 PMI と喫煙フリー · ワールド財団 （ 以下「財団」といいます ） は、最終助成金契約および第 2 回改訂 · 再定質疑契約の終了 （ 以下「契約」といいます ） を締結しました。 本契約の条件に基づき、 PMI は 2023 年第 3 四半期に、当事者間の質疑契約の終了と引き換えに 14000万ドルを支払いました。その結果、 2023 年第 3 四半期に PMI は、質疑契約の早期終了に見合った税引前費用 14000 万ドル （ 所得税を控除した 11100万ドルまたは希釈済 EPS の 1 株当たり 0.0 7 ドルの減少 ） を計上しました。税引前費用は、 2023 年 9 月 30 日に終了した 3 ヶ月間の連結決算書において、マーケティング、管理および研究費用に計上されました。詳しくは、 「その他の展開」 この MD & A のビジネス環境セクション内です。

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ベクトゥラグループの予想売却に伴う減損 — 2024 年 9 月に、 Vectura を Molex Asia Holdings Ltd. に売却する最終契約の締結を発表しました。その結果、 2024 年第 3 四半期に、 Vectura の売却予定の分類に関連した 1 億 9800 万ドルの減損費用 （ 1 株当たり 0.13 ドルの希釈済 EPS 費用 ） を計上しました。減価償却費用は、 PMI の 2024 年 9 月 30 日に終了した 3 ヶ月間の連結決算書のマーケティング、管理および研究費用に計上され、ウェルネスおよびヘルスケアセグメントの業績に含まれています。 詳細は、注釈 18 を参照。 買収 · 売却.

エジプトの消費税課税 – 2024 年第 3 四半期には、エジプト高等行政裁判所の判決とその後の利用可能な救済策の評価に続き、悪結果の可能性があると結論付け税引前費用 4500 万ドルを計上しました（ 所得税を控除した 3900 万ドルと 1 株当たり 0.0 3 ドルの希釈済 EPS 費用を表す ）2014 年から 2016 年の輸入カットフィラーに対する一般消費税控除の税金評価に関連して。この税引前費用は、 2024 年 9 月 30 日を末日とする 3 ヶ月間の連結決算表のマーケティング、管理、研究費用に計上され、 SSEA 、 CIS & MEA セグメントの業績に含まれています。

所得税 — 上記の表では、 2023 年の希釈済益が 1 株当たり 0.0 9 ドル減少し、 2024 年の希釈済益が 1 株当たり 0.10 ドル増加したスウェーデン · マッチの買収資金調達に伴う所得税の影響は、精算連結決算書に反映されたスウェーデン · マッチの買収資金調達に関連する会社間借入に対する未実現外貨損益の繰延税の影響によるものです。税引前為替変動は、連結決算書に完全に相殺され、株主資本 （ 赤字 ） 連結決算書に通貨換算調整として反映されました。

上記表の 2023 年度の希釈 EPS を 1 株当たり 0.1 1 ドル減少させた 2023 年の税項目は、 2023 年 8 月 8 日にロシア当局による配当を含む特定の支払いに関する特定のロシアの二重課税条約の一方的な停止により、 PMI のロシア子会社の未払い利益に関連する繰延税金負債が増加したことによるものです。

上表の希釈済み EPS を 1 株当たり 0.0 4 ドル増加させた税率の変更は、主に課税管轄区域による利益ミックスの変化によるものです。

通貨 — 報告期間中の 1 株当たり 0.06 ドルの悪影響は、主に米ドル、特にエジプトポンドに対する変動によるものです。この不利な為替変動は、プライマリ収益市場と現地通貨コストベースでの収益性に影響を与えました。

利子 — 上表の利子による 1 株当たり 0.04 ドルの好ましい影響は、主にデリバティブ金融商品に関連する好ましい市場相場調整によるものです。

オペレーション — 上表の事業からの希釈利益 0.22 ドルの増加は、主に以下のセグメントによるものです。

•SSEA 、 CIS 、 MEA ： 有利な価格と有利なボリューム / ミックス、部分的に高い製造コストによって相殺される。
•欧州 ： 有利な価格と有利なボリューム / ミックスが、マーケティング、管理、研究コストの高騰によって一部相殺されます。
•米州 ： 有利なボリューム / ミックスと有利な価格が、マーケティング、管理、研究コストの増加によって一部相殺されます。
•EA 、 AU 、 PMI DF ： 有利な価格設定が、不利なボリューム / ミックスとマーケティング、管理、研究コストの高騰によって一部相殺されます。
詳細は、 「連結業績」 そして 「事業セグメント別営業成果」 以下のセクション 「議論と分析」。

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Discussion and Analysis
Critical Accounting Estimates
For information on our critical accounting estimates, see "Critical Accounting Estimates" in the MD&A included in Item 7 of the Annual Report on Form 10-K for the fiscal year ended December 31, 2023.
Consolidated Operating Results
See pages 103 - 116 for a discussion of our "Cautionary Factors That May Affect Future Results." Our net revenues and operating income by segment are shown in the table below:
(in millions)For the Nine Months Ended September 30,For the Three Months Ended September 30,
2024202320242023
Net revenues:
Europe$11,301 $10,465 $4,121 $3,823 
SSEA, CIS & MEA
8,393 7,922 2,964 2,777 
EA, AU & PMI DF
4,959 4,771 1,602 1,571 
Americas3,273 2,732 1,148 895 
Wellness and Healthcare246 237 76 75 
Net revenues$28,172 $26,127 $9,911 $9,141 
Operating income (loss):
Europe$5,136 $4,551 $2,020 $1,717 
SSEA, CIS & MEA
2,623 2,437 960 823 
EA, AU & PMI DF
2,304 1,963 788 769 
Americas419 524 137 98 
Wellness and Healthcare(339)(808)(251)(37)
Operating income$10,143 $8,667 $3,654 $3,370 
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製品カテゴリー別の純収益は以下の表に示されています。
製品カテゴリー別 PMI 純売上高
(in数百万 ）9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
20242023変化20242023変化
可燃性タバコ ：
ヨーロッパ$6,467 $6,084 6.3 %$2,322 $2,160 7.5 %
SSEA 、 CIS & MEA
7,390 6,988 5.7 %2,612 2,485 5.1 %
EA 、 AU & PMI DF
1,889 2,091 (9.6)%673 678 (0.8)%
アメリカ合衆国1,653 1,682 (1.7)%527 509 3.4 %
可燃性タバコ総量17,399 16,845 3.3 %6,134 5,832 5.2 %
禁煙：
ウェルネス · ヘルスケアを除く禁煙 ：
ヨーロッパ4,834 4,381 10.4 %1,799 1,663 8.2 %
SSEA 、 CIS 、 MEA
1,003 934 7.4 %352 292 20.3 %
EA 、 AU 、 PMI DF
3,070 2,680 14.5 %929 893 4.1 %
アメリカ合衆国1,620 1,050 54.3 %621 386 61.1 %
ウェルネス · ヘルスケアを除く全面禁煙10,527 9,045 16.4 %3,701 3,234 14.5 %
ウェルネス · ヘルスケア2462373.8 %76751.3 %
完全禁煙10,773 9,282 16.1 %3,777 3,309 14.2 %
PMI 総純利益$28,172 $26,127 7.8 %$9,911 $9,141 8.4 %
注 ： 製品カテゴリーや地域の合計は四捨五入により PMI 合計にならない場合があります。

営業結果の比較可能性に影響を与える項目は以下のとおりです。
•エジプトの消費税課税 – 2024 年第 3 四半期、エジプト高等行政裁判所の判決とその後の利用可能な救済策の評価に続き、 PMI は悪結果の可能性があると結論付け、 2014 年から 2016 年の輸入カットフィルラーに対して控除された一般消費税の税金評価に関連して 4500 万ドルの税前課金を記録しました。この税引前費用は、 2024 年 9 月 30 日を末日とする 9 ヶ月間および 3 ヶ月間の連結決算表のマーケティング、管理および研究費用に計上され、 SSEA 、 CIS & MEA セグメントの業績に含まれています。
•ベクトゥラグループの売却予想に伴う減損について – 2024 年 9 月、 PMI は Vectura を Molex Asia Holdings Ltd. に売却する最終契約の履行を発表しました。その結果、 PMI は 2024 年第 3 四半期に、 Vectura の売却予定の分類に関連する 1 億 9800 万ドルの減損費用を計上しました。この税引前費用は、 2024 年 9 月 30 日に終了した 9 ヶ月間および 3 ヶ月間の連結決算表のマーケティング、管理および研究費用に計上され、ウェルネスおよびヘルスケアセグメントの業績に含まれています。詳細は、注釈 18 を参照。 買収 · 売却.
•資産減価償却 · 退出コスト – 注記 15 を参照。 資産減価償却 · 退出コスト 2024 年 9 月 30 日と 2023 年 9 ヶ月間のセグメント別コスト内訳はこちら
•中東における流通体制の終了 – 第 1 四半期に 2023 年、 PMI は中東での流通契約の終了に伴い、税引前 8000万ドルの費用を計上しました。この税引前費用は、連結決算書において純利益の減少として計上され、 2023 年 9 月 30 日までの 9 ヶ月間の SSEA 、 CIS & MEA セグメントの決算に含まれています。

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•善意その他の無形資産の損耗 – 2023 年 9 月 30 日に終了した 9 ヶ月間、 PMI はウェルネス · ヘルスケアセグメントに含まれる 6 億 8000 万ドルの善意および償却不可無形資産減損費用を計上しました。 詳細は注釈 4 を参照。 商誉その他の無形資産、純.
•韓国間接税 – 2023 年 7 月 13 日、 PMI の韓国子会社である Pm Korea は、 2015 年の消費税増税とその後の韓国監査委員会による監査に関連して、消費税の納入不足を申し立てた事件に関連して、韓国最高裁判所から不利な判決を受けました。最高裁の判決は、裁判と控訴のレベルで北朝鮮に有利であった以前の判決を覆した。判決の結果、悪結果の可能性が高いと結論付けました。その結果、 2023 年 9 月 30 日に終了した 9 ヶ月間の EA 、 AU 、 PMI DF セグメントに含まれていた Pm Korea が以前に支払った全額を反映した、連結決算書に、マーケティング、管理および研究費用の非現金税引前費用 20400万ドルを計上しました。
•禁煙世界財団との契約終了について – 2023 年 9 月 29 日、 PMI と喫煙フリー世界財団 （ 以下、「財団」といいます。 ） は、最終助成契約及び第 2 回改定プレッジ契約の終了 （ 以下、「本契約」といいます。 契約の条件の下で、 PMI は当事者間の質疑契約の終了と引き換えに、 2023 年第 3 四半期に 14000万ドルを支払いました。 その結果、 2023 年第 3 四半期に PMI は、質疑契約の早期終了に見合った税引前費用 14000 万ドルを計上しました。税引前費用は、 2023 年 9 月 30 日を末日とする 9 ヶ月間および 3 ヶ月間の連結決算書において、マーケティング、管理、研究費用に計上され、欧州 （ 6000万ドル ） 、 SSEA 、 CIS & MEA （ 4100万ドル ） 、 EA 、 AU & PMI DF （ 2400万ドル ） の営業結果に含まれています。アメリカ合衆国 （ 1500万ドル ） に。
可燃性たばこ関連の純収益とは、これらの製品の販売から生じる営業収益 （ 顧客に請求される配送 · 取扱手数料、販売 · 販促インセンティブ、消費税を除いた ） を指します。 これらの純収益は、タバコやその他の燃焼されたたばこ製品の販売で構成されています。その他のたばこ製品には、主にロールオーバーおよびメイクオーバーのタバコ、パイプタバコ、葉巻およびシガリョが含まれ、無煙製品を含まない。

禁煙関連純収益 （ ウェルネス · ヘルスケアを除く ） は、これらの製品の販売から生じる営業収益 （ 顧客に請求される配送 · 取扱手数料、販売 · 販促インセンティブ、消費税 （ 該当する場合 ） を差し引いたもの ） です。 これらの純売上高は、熱不燃、電子蒸気、経口製品などの可燃性タバコ製品以外の製品、およびコンシューマーアクセサリーの販売で構成されています。

ウェルネス · ヘルスケア関連の純収益は、主に吸入療法に関連する製品、およびウェルネス · ヘルスケア事業であるベクトゥラ · フェルティン · ファーマの営業結果に含まれる経口および経口内デリバリーシステムの販売から生じる営業収益で構成されています。

PMI の熱不燃製品には、 KT & G のライセンス熱不燃製品が含まれます。

連結財務要約表における PMI 総額および 5 つのセグメントの「コスト / その他」への参照 「討論と分析」 売上原価 （ ボリューム / ミックスコストを除く ） 、マーケティング、管理および研究コスト （ 資産減損および出口コストを含む ） 、無形資産の償却および減損の通貨および買収中立的な分散を反映しています。「コスト / その他」には、貨幣および買収中立の純収益の差異も含まれます。これは、数量 / ミックスおよび価格の構成要素とは無関係で、 SSEA 、 CIS および MEA 地域の特定の市場における顧客に請求された特定の流通権に対する手数料および中東での流通契約の終了による収益調整に起因します。

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連結出荷量は以下の表に示されています。
連結出荷量
9 月 30 日までの 9 ヶ月間、9 月 30 日までの 3 ヶ月間、
たばこ · 加熱たばこ単位 （ 百万単位 ）20242023変化20242023変化
タバコ464,047 461,855 0.5 %163,238 161,137 1.3 %
加熱タバコユニット104,025 91,291 13.9 %35,347 32,471 8.9 %
タバコと加熱たばこユニットの合計568,072 553,146 2.7 %198,585 193,608 2.6 %
経口 SFP ボリューム （ 百万缶 ） (1)
ニコチン袋460.2 295.4 55.8 %164.6 114.6 43.6 %
スヌス181.5 178.5 1.7 %61.3 60.3 1.6 %
モーストスナフ102.6 102.5 0.1 %34.1 33.2 2.6 %
その他の口頭 SFP (2)
2.7 3.3 (17.9)%0.7 0.9 (20.9)%
トータルオーラルプロダクト747.0 579.8 28.9 %260.7 209.0 24.7 %
(1) スナフ、スナフリーフ、アメリカンチューを除く。
(2) チューバッグとタバコビットを含む
Note: Sum may not foot due to rounding

Following the deconsolidation of our Canadian subsidiary, we continue to report the volume and corresponding royalty revenues of brands sold by RBH for which other PMI subsidiaries are the trademark owners. These include HEETS, Next, Philip Morris and Rooftop. The volume and corresponding royalty revenues of these brands sold by RBH were not material to PMI for all periods presented.

Heated tobacco units ("HTUs") is the term we use to refer to heated tobacco consumables, which include our BLENDS, DELIA, HEETS, HEETS Creations, HEETS Dimensions (defined collectively as HEETS), SENTIA, TEREA, TEREA CRAFTED and TEREA Dimensions, as well as the KT&G-licensed brands, Fiit and Miix (outside of South Korea). HTUs also include zero tobacco heat-not-burn consumables (LEVIA).

Oral smoke-free product volume excludes snuff, snuff leaf and U.S. chew and is measured in cans or, for the purposes of total shipment volumes, in pouches or pouch equivalents.

Oral smoke-free products conversion: (i) nicotine pouches: 15 pouches per can in the U.S. and weighted average 21 pouches per can outside the U.S.; (ii) snus products: weighted average 21 pouches equivalent per can; (iii) moist snuff products: weighted average 17 pouches equivalent per can; (iv) tobacco bits products: weighted average 30 pouches equivalent per can; (v) chew bags products: weighted average 20 pouches per can.

Unless otherwise stated, market share for HTUs is defined as the in-market sales volume for HTUs as a percentage of the total estimated industry sales volume for cigarettes and HTUs.

References to total industry (or total market), our shipment volume and our market share performance reflect cigarettes and heated tobacco units, unless otherwise stated.

Total industry volume, PMI in-market sales volume and PMI market share for the following geographies include the cigarillo category in Japan: the total international market, EA, AU & PMI DF Region, and Japanese domestic market.

In-market sales ("IMS") is defined as sales to the retail channel, depending on the market and distribution model.

Adjusted market share for HTUs is defined as the total in-market sales volume for PMI HTUs as a percentage of the total estimated sales volume for cigarettes and HTUs, excluding the impact of estimated distributor and wholesaler inventory movements.

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References to total international market, defined as worldwide cigarette and heated tobacco unit volume excluding the United States, total industry (or total market) and market shares throughout this "Discussion and Analysis" are our estimates for tax-paid products based on the latest available data from a number of internal and external sources and may, in defined instances, exclude China and/or our duty free business.

PMIの出荷量は時々流通業者の在庫変動(あるいはPMIが流通業者に販売しないある市場の卸売業者の在庫変動)の影響を受けるが、推定された業界/市場総量は様々な貿易チャネルの在庫変動の影響を受け、その中にはPMIのライバルが市場特定要因による推定貿易在庫変動を含み、これらの要因が報告の数量開示を深刻に歪ませている。これらの要因には、製造サプライチェーンの変化、出荷方法、消費者需要、消費税引き上げの時間、または顧客への販売時間に影響を与える可能性がある他の影響が含まれる可能性がある。この場合、経営陣は、報告に基づいて調達取扱者指数出荷量および特定の推定業種/市場総量を検討するほか、販売店および/または推定貿易在庫変動の影響を排除するために、これらの措置を調整して検討している。経営陣はまた、ディーラー及び/又は推定貿易在庫変動の影響を排除した上で、調達マネージャー指数出荷量とこの場合の推定業界/市場総量を開示することで、これらの指標の異なる報告期間における業績や傾向の比較性を向上させることができると考えている。

タバコおよび加熱たばこユニットの市場規模、出荷量、市場シェアに関する主要な市場データは以下の表に示されています。
9 月 30 日までの 9 ヶ月間、
PMI 出荷量 （ 十億単位 ）
PMI の市場シェア (2), (%)
市場市場総額
（ 億単位 ） 		トータルタバコ加熱タバコユニットトータル加熱タバコユニット
202420232024202320242023202420232024202320242023
トータル (1) (2)
1,952.01,929.4568.1553.1464.0461.9104.091.328.728.35.24.6
ヨーロッパ
フランス19.822.78.310.28.210.00.10.240.942.30.60.7
ドイツ (3)
53.053.020.119.817.017.73.12.238.839.06.15.2
イタリア (3)
55.755.129.029.120.920.88.18.453.753.617.016.6
ポーランド (3)
44.543.719.418.115.414.34.03.843.541.38.98.8
スペイン33.333.09.99.99.09.20.90.829.229.42.72.2
SSEA 、 CIS & MEA
エジプト59.954.818.518.117.417.41.10.730.633.31.91.6
インドネシア221.4219.560.563.559.763.10.80.427.328.90.40.2
フィリピン30.432.215.818.015.617.80.20.252.056.00.70.5
ロシア160.7151.051.948.338.936.513.011.832.331.98.57.9
トルコ111.7101.257.850.357.850.3——51.749.7——
EA 、 AU & PMI DF
オーストリア4.05.61.42.01.42.0——35.835.4——
日本 (2)
112.2111.151.147.012.613.938.533.041.139.529.626.4
韓国52.954.310.610.66.36.84.33.820.019.58.07.0
アメリカ合衆国
アルゼンチン19.121.611.813.411.813.4——61.962.0——
メキシコ21.021.312.913.212.813.10.20.161.662.10.80.5
(1)市場シェアの推計は、特に明記がない限り、 IMS データを使用して計算されます。
(2)総市場と市場占有率の推計は日本のシガリョを含みます
(3)PMI の市場シェアは修正 IMS のボリュームシェアを反映しています。総市場は報告された IMS に基づいています。
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目次表

9 月 30 日までの 3 ヶ月間、
PMI 出荷量 （ 十億単位 ）
PMI の市場シェア (2), (%)
市場総市場 （ 億単位 ）トータルタバコ加熱タバコユニットトータル加熱タバコユニット
202420232024202320242023202420232024202320242023
トータル (1) (2)
676.7667.8198.6193.6163.2161.135.332.529.528.95.34.6
ヨーロッパ
フランス6.87.62.42.72.42.6——41.042.20.60.7
ドイツ (3)
19.719.37.06.95.96.01.10.937.938.45.94.9
イタリア (3)
20.119.410.510.47.26.83.33.654.953.516.616.0
ポーランド (3)
15.415.26.96.55.55.21.31.344.042.08.68.4
スペイン12.311.93.63.53.23.10.40.329.629.92.72.3
SSEA 、 CIS & MEA
エジプト21.516.26.56.46.06.10.50.230.440.21.92.0
インドネシア75.578.120.722.720.322.50.30.227.429.00.40.2
フィリピン10.410.55.35.75.25.60.10.150.754.50.70.5
ロシア58.854.319.017.114.512.94.64.232.931.88.17.7
トルコ41.237.721.418.921.418.9——52.050.3——
EA 、 AU & PMI DF
オーストリア1.31.80.50.70.50.7——37.238.1——
日本 (2)
38.638.215.715.54.24.311.511.241.439.530.026.5
韓国18.218.83.73.72.22.41.51.319.919.68.27.1
アメリカ合衆国
アルゼンチン6.16.63.94.03.94.0——62.761.4——
メキシコ7.37.74.64.94.54.80.1—62.762.70.70.5
(1)市場シェアの推計は、特に明記がない限り、 IMS データを使用して計算されます。
(2)総市場と市場占有率の推計は日本のシガリョを含みます
(3)PMI の市場シェアは修正 IMS のボリュームシェアを反映しています。総市場は報告された IMS に基づいています。

Consolidated Operating Results for the Nine Months Ended September 30, 2024

The following discussion compares our consolidated operating results for the nine months ended September 30, 2024, with the nine months ended September 30, 2023.

Total Market

Estimated international industry volume (excluding China and the U.S.) for cigarettes and HTUs increased by 1.2%, reflecting an increase in the SSEA, CIS & MEA Region, partly offset by a decrease in the Americas Region, and broad stability in the EA, AU & PMI DF and Europe Regions, as described in the Regional sections of this MD&A.

For the full year 2024, we currently expect an estimated total international industry volume growth of up to 1% for cigarettes and HTUs, excluding China and the U.S.

Shipment Volume
Our total cigarette and HTU shipment volume increased by 2.7% (HTU shipments increased by 13.9%, while cigarette shipments were broadly stable).

Our total oral product shipment volume in cans increased by 28.9%, primarily reflecting growth in nicotine pouches.
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For the full year 2024, we currently expect the total cigarette, HTU and oral smoke-free product shipment volume growth for PMI of 2% to 3% driven by smoke-free products.

For the full year 2024, we also expect nicotine pouch shipment volume in the U.S. of 570 to 580 million cans.

Adjusted in-market sales for HTUs increased by 12.6%, including growth in Japan of 13.4% and Europe of 9.2%.
International Share of Market - Cigarette and HTUs (Excluding China and the United States)
Nine Months Year-to-Date
20242023Change (pp)
Total International Market Share (1)
28.7 %28.3 %0.4 
Cigarettes23.6 %23.7 %(0.1)
HTU5.2 %4.6 %0.6 
Cigarette over Cigarette Market Share (2)
25.3 %25.2 %0.1 
(1) Defined as PMI's cigarette and heated tobacco unit in-market sales volume as a percentage of total industry cigarette and heated tobacco unit sales volume, excluding China and the U.S., including cigarillos in Japan
(2) Defined as PMI's cigarette in-market sales volume as a percentage of total industry cigarette sales volume, excluding China and the U.S., including cigarillos in Japan
Note: Sum of share of market by product categories might not foot to total due to rounding
Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues (1)
$ 28,172 $ 26,127 7.8 %11.0 %$2,045 $(841)$— $1,721 $1,089 $76 
Cost of Sales(9,906)(9,431)(5.0)%(6.8)%(475)134 33 — (473)(169)
Marketing, Administration and Research Costs (2)
(8,123)(7,364)(10.3)%(9.4)%(759)(70)— — — (689)
Impairment of Goodwill (3)
— (665)+100%+100%665 — — — — 665 
Operating Income$ 10,143 $ 8,667 17.0 %25.6 %$1,476 $(777)$33 $1,721 $616 $(117)
(1) Cost/Other variance includes charges in 2023 of $80 million following the termination of a distribution arrangement in the Middle East.
(2) Cost/Other variance includes charges in 2024 of $168 million related to asset impairment and exit costs, $27 million related to impairment of other intangibles, $542 million related to amortization of intangibles, $198 million related to impairment of Vectura Group's expect sale and $45 million related to the Egypt sales tax charge, partly offset by charges in 2023 of $109 million related to asset impairment and exit costs, $204 million related to the South Korea indirect tax charge, $140 million related to the termination of a pledge agreement with the Foundation for a Smoke-Free World, $325 million related to amortization of intangibles and $15 million related to the impairment of other intangibles. For more details, see Note 4. Goodwill and Other Intangible Assets, net, Note 7. Segment Reporting, Note 15. Asset Impairment and Exit Costs and Note 18. Acquisitions and Divestitures.
(3) For details on the impairment of goodwill recorded in the second quarter of 2023, see Note 4. Goodwill and Other Intangible Assets, net.

For the nine months ended September 30, 2024, net revenues increased by 7.8%. Net revenues, excluding currency and acquisitions, increased by 11.0%, mainly reflecting: a favorable pricing variance, primarily driven by higher combustible tobacco pricing; and favorable volume/mix, driven by higher smoke-free products volume, partly offset by unfavorable cigarette mix; as well as a favorable comparison to 2023 reflecting a charge in the first quarter of 2023 of $80 million (recognized as a reduction of net revenues in 2023) following the termination of a distribution arrangement in the Middle East,
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shown in "Other."

The unfavorable currency impact in net revenues was due primarily to the Egyptian pound, Indonesian rupiah, Japanese yen and Russian ruble.

Net revenues include $10.8 billion in 2024 and $9.3 billion in 2023 related to smoke-free.

Operating income increased by 17.0%. Operating income, excluding currency and acquisitions, increased by 25.6%, mainly reflecting: the same factors as for net revenues, as well as a favorable comparison to 2023 reflecting the impairment of goodwill recorded in the second quarter of 2023, the South Korea indirect tax charge of $204 million in 2023 and the termination of a pledge agreement with the Foundation for a Smoke-Free World of $140 million. The increase was partly offset by higher amortization of intangibles in 2024, higher asset impairment and exit costs in 2024, a charge of $198 million related to impairment of Vectura Group's expect sale in 2024 and the Egypt sales tax charge of $45 million in 2024, as well as higher marketing, administration and research costs (primarily due to inflationary impacts, notably related to wages, and higher commercial investments), and higher manufacturing costs (notably related to tobacco leaf and the impact of the EU single-use plastics directive, partly offset by productivity).

Amortization expense on a pre-tax basis for each of the next five years is estimated to be approximately $1.0 billion or less, assuming no additional transactions occur that require the amortization of intangible assets. This amount includes the reacquired rights recorded as other intangible assets, net, in May 2024 following the reacquisition of IQOS commercialization rights in the U.S. from Altria Group, Inc. (see Note 4. Goodwill and Other Intangible Assets, net, Note 18. Acquisitions and Divestitures and the "Business Environment" section of this MD&A for details).

Interest expense, net, of $817 million increased by $29 million or 3.7%.

Our effective tax rate decreased by 2.6 percentage points to 23.1%. For further details, see Note 9. Income Taxes. PMI estimates that its full-year 2024 effective tax rate will be approximately 21% to 22%, excluding discrete tax events. Changes in currency exchange rates, earnings mix by taxing jurisdiction or future legislative or regulatory developments may have an impact on the effective tax rates, which PMI monitors each quarter. Significant judgment is required in determining income tax provisions and in evaluating tax positions.

Income from equity investments and securities, net, increased by $721 million or over 100%, primarily driven by a favorable fair value adjustment for our equity security investments in India and Sri Lanka. For further details, see Note 12. Related Parties - Equity Investments and Other.

Net earnings attributable to PMI of $7.6 billion increased by $2.0 billion or 35.9%. This increase was due primarily to higher operating income and higher income from equity investments and securities, as discussed above. Basic and diluted EPS of $4.90 and $4.89 increased by 35.7% and 35.5%, respectively. Excluding an unfavorable currency impact of $0.44, diluted EPS increased by 47.6%.

We continue to expect our 2024 performance to be favorably impacted by total volume growth and pricing despite currency headwinds in the first nine months of 2024. This reflects the strong outlook for ZYN, despite short-term supply constraints; and the increasing profitability of IQOS due to operating leverage, manufacturing efficiencies, as well as a robust combustibles performance.


Consolidated Operating Results for the Three Months Ended September 30, 2024
The following discussion compares our consolidated operating results for the three months ended September 30, 2024, with the three months ended September 30, 2023.

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Total Market

During the quarter, estimated international industry volume (excluding China and the U.S.) for cigarettes and HTUs increased by 1.3%, reflecting increases in the SSEA, CIS & MEA and Europe Regions, partly offset by decreases in the EA, AU & PMI DF and Americas Regions, as described in the Regional sections of this MD&A.

Shipment Volume

Our total cigarette and HTU shipment volume increased by 2.6% (HTU shipments increased by 8.9%, and cigarette shipments increased by 1.3%), with increases across all regions except the Americas Region.

Our total oral product shipment volume in cans increased by 24.7%, predominantly reflecting growth in nicotine pouches.

Adjusted in-market sales for HTUs increased by 14.8%, including growth in Japan of 14.3% and Europe of 11.3%.

International Share of Market - Cigarette and HTUs (Excluding China and the United States)
Third-Quarter
20242023Change (pp)
Total International Market Share (1)
29.5 %28.9 %0.6 
Cigarettes24.2 %24.3 %(0.1)
HTU5.3 %4.6 %0.7 
Cigarette over Cigarette Market Share (2)
26.0 %25.9 %0.1 
(1) Defined as PMI's cigarette and heated tobacco unit in-market sales volume as a percentage of total industry cigarette and heated tobacco unit sales volume, excluding China and the U.S., including cigarillos in Japan
(2) Defined as PMI's cigarette in-market sales volume as a percentage of total industry cigarette sales volume, excluding China and the U.S., including cigarillos in Japan
Note: Sum of share of market by product categories might not foot to total due to rounding

Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues
$ 9,911 $ 9,141 8.4 %11.6 %$770 $(289)$— $689 $322 $48 
Cost of Sales(3,366)(3,165)(6.4)%(9.0)%(201)63 21 — (159)(126)
Marketing, Administration and Research Costs (1)
(2,891)(2,606)(10.9)%(15.1)%(285)108 — — — (393)
Operating Income$ 3,654 $ 3,370 8.4 %11.3 %$284 $(118)$21 $689 $163 $(471)
(1) Cost/Other variance includes charges in 2024 of $242 million related to amortization of intangibles, $198 million related to impairment of Vectura Group's expect sale and $45 million related to the Egypt sales tax charge, partly offset by charges in 2023 of $206 million related to amortization of intangibles and $140 million related to the termination of a pledge agreement with the Foundation for a Smoke-Free World. For more details, see Note 7. Segment Reporting and Note 18. Acquisitions and Divestitures.

During the quarter, net revenues increased by 8.4%. Net revenues, excluding currency and acquisitions, increased by 11.6%, mainly reflecting: a favorable pricing variance, primarily due to higher combustible tobacco pricing; and favorable volume/mix, mainly driven by higher smoke-free products volume.

The unfavorable currency impact in net revenues was due primarily to the Egyptian pound, Indonesian rupiah and Japanese yen.
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Net revenues include $3.8 billion in 2024 and $3.3 billion in 2023 related to smoke-free.

Operating income increased by 8.4%. Operating income, excluding currency and acquisitions, increased by 11.3%, mainly reflecting: the same factors as for net revenues, notwithstanding unfavorable cigarette mix, as well as a favorable comparison to 2023 reflecting the termination of a pledge agreement with the Foundation for a Smoke-Free World of $140 million. The increase was partly offset by higher amortization of intangibles in 2024, a charge of $198 million related to impairment of Vectura Group's expect sale in 2024 and the Egypt sales tax charge of $45 million in 2024, as well as higher manufacturing costs, notably related to tobacco leaf, and higher marketing, administration and research costs.

Interest expense, net, of $189 million decreased by $72 million or 27.6%, primarily due to a favorable mark-to-market adjustment related to derivative financial instruments.

Our effective tax rate decreased by 11.9 percentage points to 21.3%. The effective tax rate for the three months ended September 30, 2023 was unfavorably impacted by an increase in deferred tax liabilities related to the unremitted earnings of PMI's Russian subsidiaries ($173 million) and a deferred tax cost for unrealized foreign currency gains on intercompany loans related to the Swedish Match acquisition financing reflected in the condensed consolidated statements of earnings ($138 million). For further details, see Note 9. Income Taxes.

Income from equity investments and securities, net, increased by $399 million or over 100%, primarily driven by a favorable fair value adjustment for our equity security investments in India and Sri Lanka. For further details, see Note 12. Related Parties - Equity Investments and Other.

Net earnings attributable to PMI of $3.1 billion increased by $1.0 billion or 50.0%. This increase was due primarily to higher operating income, a lower effective tax rate, higher income from equity investments and securities, net, and lower interest expense, net, as discussed above. Basic and diluted EPS of $1.98 and $1.97 increased by 50.0% and 49.2%, respectively. Excluding an unfavorable currency impact of $0.06, diluted EPS increased by 53.8%.


Operating Results by Business Segment
Business Environment
Taxes, Legislation, Regulation and Other Matters Regarding the Manufacture, Marketing, Sale and Use of Tobacco and Non-Tobacco Products
The tobacco industry and our company face a number of challenges that may adversely affect our business, product sales volume, results of operations, cash flows and financial position. These challenges, which are discussed below and in Part II, Item 1A. Risk Factors — Cautionary Factors That May Affect Future Results in this report include:

•regulatory restrictions on our products, including restrictions on the packaging, marketing, and sale of tobacco or other nicotine-containing products or related devices that could reduce our competitiveness, eliminate our ability to communicate with adult consumers, or even ban certain of our products;
•fiscal challenges, such as excessive excise tax increases and discriminatory tax structures;
•illicit trade in cigarettes and other tobacco and nicotine-containing products, including counterfeit, contraband and other non-compliant or otherwise illicit products;
•intense competition, including unfair competition from non-tax paid volume by certain manufacturers;
•pending and threatened litigation as discussed in Part I, Item 1. Financial Statements — Note 8. Contingencies in this report; and
•governmental investigations.

Regulatory Restrictions: The tobacco industry operates in a highly regulated environment. The well-known risks of smoking have led regulators to impose significant restrictions and high excise taxes on cigarettes.

Much of the regulation that shapes the business environment in which we operate is driven by the World Health Organization's (the "WHO") Framework Convention on Tobacco Control (the "FCTC"), which entered into force in 2005. The main objective of the FCTC is to establish a global agenda for tobacco regulation, with the purpose of reducing tobacco use. To date, 182
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countries and the European Union ("EU") are Parties to the FCTC. The treaty requires Parties to have in place various tobacco control measures and recommends others. The FCTC governing body, the Conference of the Parties (“CoP”), has also adopted non-binding guidelines and policy recommendations related to certain articles of the FCTC that go beyond the text of the treaty. In October 2018, the CoP recognized the need for more scientific assessment and improved reporting to define policy on heated tobacco products. Similar to its previous policy recommendations on e-cigarettes, the CoP invited countries to regulate, restrict or prohibit heated tobacco products, as appropriate under their national laws.

The Tenth Session of the CoP to the FCTC took place in February 2024. According to reports and decisions published, neither new decisions nor new policy recommendations on novel and emerging tobacco products were adopted. Specific Guidelines were adopted to address cross-border Tobacco Advertising, Promotion, and Sponsorship (“TAPS”) and the depiction of tobacco in entertainment media. The Eleventh session of the CoP is currently scheduled to take place in November 2025. The WHO’s reports and other FCTC guidelines or recommendations are not binding on the WHO Member States or on parties to the FCTC.

We believe that when better alternatives to cigarettes exist, the discussion should not be whether these alternatives should be made available to the more than one billion people who smoke cigarettes today, but how fast, and within what regulatory framework to maximize their adoption while minimizing unintended use. Therefore, we advocate for regulatory frameworks that are based on a continuum of risk where non-combustible products fall below combustible cigarettes. Product regulation should include measures that encourage and accelerate switching to non-combustible products, for example, by allowing adult consumers who would not otherwise quit smoking cigarettes to receive truthful and non-misleading information about such alternatives to enable them to make informed decisions and by applying uniform product standards to enable manufacturers to demonstrate the reduction in harmful and potentially harmful constituents, as well as the absence of combustion. Regulation should also include specific rules for ingredients, labeling and consumer communication, and should ensure that the public is informed about the health risks of all combustible and non-combustible tobacco and nicotine-containing products. Importantly, regulation must include measures designed to prevent initiation by youth and non-smokers. We support mandated health warnings, minimum age laws, restrictions on advertising, and smoking restrictions in public spaces. We also support regulatory measures that help reduce illicit trade. At the same time, we oppose excessive or prohibitive regulations that may prevent adult smokers, who would otherwise continue smoking, from accessing and switching to SFPs or trigger unintended consequences such as illicit trade.

Certain measures are discussed in more detail below and in the Smoke-Free Products (SFPs) section.

Fiscal Challenges: Excessive and disruptive excise, sales and other tax increases and discriminatory tax structures are expected to continue to have an adverse impact on our profitability, due to lower consumption and consumer down-trading to non-premium, discount, other low-price or low-taxed combustible tobacco products such as fine cut tobacco, illicit cigarettes or illicit SFPs. In addition, in certain jurisdictions, some of our combustible tobacco products are subject to tax structures that discriminate against premium-price products and manufactured cigarettes. We believe that such tax policies undermine public health by encouraging consumers to turn to illicit trade, and ultimately undercut government revenue objectives, disrupt the competitive environment, and encourage criminal activity. Other jurisdictions have imposed, or are seeking to impose, levies or other taxes specifically on tobacco companies, such as taxes on revenues and/or profits.

EU Tobacco Products Directive ("TPD"): In April 2014, the EU adopted a significantly revised TPD, which came into force in May 2016. All EU Member States have adopted laws transposing the TPD.  The TPD sets forth a comprehensive set of regulatory requirements for tobacco products, including:

•health warnings covering 65% of the front and back panels of cigarette packs, with an option for Member States to further standardize tobacco packaging, including the introduction of plain packaging;
•a ban on characterizing flavors in some tobacco products, with a transition period for menthol that expired in May 2020;
•security features and tracking and tracing measures that became effective in May 2019; and
•a framework for the regulation of novel tobacco products and e-cigarettes, including requirements for health warnings and information leaflets, a prohibition on product packaging text related to reduced risk, and the introduction of notification requirements or authorization procedures in advance of commercialization.

In May 2021, the European Commission published its first report on the application of the TPD. The report identifies significant progress made due to the implementation of the TPD and where there is still room for improvement. Most notably, it finds that the EU legislation has enhanced tobacco control, which contributed to protecting the health of EU citizens by providing Member States with strong rules to address the use of tobacco products in the EU. The TPD reportedly achieved the
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2% reduction target of the impact assessment with decreased smoking prevalence among youth. The report also concludes that there is scope for improvement in certain areas, such as enforcement at national level, assessment of ingredients, and a better consideration for novel and emerging products.

In February 2024, the European Commission published an updated implementation roadmap to Europe's Beating Cancer Plan (the "Plan"). According to the updated Plan, the evaluation of the current TPD is expected to be finalized in 2024.

In May 2024, the EU-wide systems of traceability and security features for tobacco products were extended to include tobacco products other than cigarettes. As such, all tobacco products are covered by the traceability system.

EU Tobacco Excise Directive ("TED"): The EU Commission is preparing a legislative proposal for the revision of the 2011 EU Tobacco Excise Directive that may include definitions and tax treatment for novel tobacco and nicotine-containing products, including heated tobacco products, e-cigarettes and nicotine pouches. The timeline for the revision has not been announced. Any final amendments to TED require unanimous agreement by all EU Member States, followed by transposition of TED into national legislation. A potential enforcement date for any changes to TED, after the transposition in Member States' national legislation, could be 2027.

Plain Packaging and Other Packaging Restrictions: Plain packaging legislation bans the use of branding, logos and colors on packaging other than the brand name and variant that may be printed only in specified locations and in a uniform font. To date, plain packaging laws have been adopted in certain markets in all of our operating segments, including the key markets of Australia, France, Saudi Arabia and Turkey. Some countries, such as Canada, Denmark and Israel, adopted plain packaging regulations that apply to all tobacco products, including SFPs. Other countries are also considering plain packaging legislation.

Some countries have adopted, or are considering adopting, packaging restrictions that could have an impact similar to plain packaging. Examples of such restrictions include standardizing the shape and size of packages, prohibiting certain colors or the use of certain descriptive phrases on packaging, and requiring very large graphic health warnings that leave little space for branding.

Restrictions and Bans on the Use of Ingredients: The WHO and others in the public health community have recommended restrictions or total bans on the use of some or all ingredients in tobacco products, including menthol. Broad restrictions and ingredient bans would require us to reformulate our American blend tobacco products and could reduce our ability to differentiate these products in the market in the long term. In many countries, menthol bans would eliminate the entire category of mentholated tobacco products. The EU banned cigarettes and roll-your-own tobacco products with characterizing flavors. Other tobacco products, are currently exempted under EU TPD from this characterizing flavor ban. This was also the case for heated tobacco products until November 23, 2022, when the EU Commission published a delegated directive that eliminates this exemption. All EU Member States were required to apply the delegated directive as of October 23, 2023, which bans the use of characterizing flavors in heated tobacco products, impacting a significant proportion of our SFP products currently sold in the EU. Currently a majority of EU Member States have transposed this directive, or are in the final stages of transposing it, withdrawing the heated tobacco product exemption from the characterizing flavor ban into national law. Based on high consumer switching to non-flavored products in reaction to past bans on flavors in other categories and markets, we anticipated that, while short-term volatility would be possible, the ban’s impact on our shipment volumes in the EU would be relatively limited in the near term. To date, our experience is consistent with this expectation. There has been some short-term volatility in countries that have implemented the ban, but the impact has generally been limited in time and magnitude. Nevertheless, it remains possible that the impact in countries that have yet to implement the ban could be more significant in duration or magnitude. But our fundamental view remains that we do not expect a meaningful change in the structural growth of the category. We will continue to actively monitor relevant developments in the EU market, including from an illicit trade standpoint. Other countries may follow the EU’s approach toward tobacco product ingredients. Turkey banned menthol as of May 2020. Broader ingredient bans have been adopted by Brazil and Canada.

Bans on Display of Tobacco Products at Retail: In a number of our markets, including, but not limited to, Australia and Russia, governments have banned the display of tobacco products at the point of sale. Other countries are considering similar bans.

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Bans and Restrictions on Advertising, Marketing, Promotions and Sponsorships: For many years, the FCTC has called for, and countries have imposed, partial or total bans on tobacco advertising, marketing, promotions and sponsorships, including bans and restrictions on advertising on radio and television, in print and on the Internet. The FCTC's non-binding guidelines recommend that governments prohibit all forms of communication with adult smokers.

Restrictions on Product Design: Some members of the public health community are calling for the further standardization of tobacco products by requiring, for example, that cigarettes have a certain minimum diameter, which would result in a ban on slim cigarettes, or requiring the use of standardized filter and cigarette paper designs. In addition, at its meeting in November 2016, the CoP adopted non-binding guidelines recommending that countries regulate product design features that increase the attractiveness of tobacco products, such as the diameter of cigarettes and the use of flavor capsules. In March 2024, the EU Commission, in line with the procedure established by TPD, approved a decree banning disposable e-cigarettes, limited to the jurisdiction of Belgium. Few other countries are also considering bans of disposable e-cigarettes.

Restrictions on Public Smoking and Use of Nicotine-Containing Products in Public: The pace and scope of restrictions on the use of our products have increased significantly in most of our markets. Many countries around the world have adopted, or are likely to adopt, regulations that restrict or ban smoking and use of nicotine-containing products in public and/or work places, restaurants, bars and nightclubs. Some public health groups have called for, and some countries, regional governments and municipalities have adopted or proposed, bans on smoking in outdoor places, as well as bans on smoking in cars (typically, when minors are present) and private homes.

Other Regulatory Issues: Some regulators are considering, or in some cases have adopted, regulatory measures designed to reduce the supply of tobacco products. These include regulations intended to reduce the number of retailers selling tobacco products by, for example, reducing the overall number of tobacco retail licenses available or banning the sale of tobacco products within specified distances of certain public facilities. Other regulators are also considering generation sales bans, which prohibit the sale of certain tobacco or nicotine products to people born after a certain year.

On December 13, 2022, the New Zealand parliament passed a bill introducing regulatory measures restricting the sale and supply of smoked tobacco products, including reducing the number of retail outlets licensed to sell smoked tobacco products, imposing a maximum limit of nicotine content for smoked tobacco products and prohibiting the sale of smoked tobacco products to anyone born on or after January 1, 2009. These measures are limited to smoked tobacco products and do not apply to heated tobacco products and e-cigarettes. On February 28, 2024, the New Zealand parliament passed a law repealing the three above-mentioned measures. On June 27, 2024, the New Zealand government published the Excise and Excise-equivalent Duties Table (Reductions for Specified Tobacco Products) Amendment Order 2024, reducing the excise on HTPs by 50%. The changes took effect on July 1, 2024.

In Mexico, since February 2020, the federal government has issued a series of decrees banning the importation and commercialization of HTPs, vaping devices and consumables. In June 2022, the Senate approved an amendment to the Imports and Exports Tax Law, aligning its content with the existing bans. Despite these restrictions, PMI has been able to import and commercialize SFPs in Mexico due to injunctive relief and favorable court decisions, including findings of unconstitutionality regarding the bans. Specifically, in October 2021, the Mexican Supreme Court found that the interpretation of Article 16-VI of the tobacco control law, which was interpreted to restrict the commercialization of SFPs, was unconstitutional.

On December 16, 2022, the Mexican Federal Government enacted an implementation regulation for the tobacco control law, which included (i) a point-of-sale display ban of tobacco products; (ii) restrictions on where tobacco products can be consumed; and (iii) prohibition to communicate corporate social responsibility programs funded by the tobacco industry. In a legal proceeding initiated by our local affiliate, the Federal Court of Appeals of Mexico City found that these restrictions are unconstitutional. 

On January 1, 2023, a law regulating the marketing of nicotine pouches went into effect in Slovakia. The regulatory framework contains a minimum legal age (18 years) to purchase, a nicotine limit, and a labelling requirement. In Belgium, a Royal Decree banning nicotine pouches entered into force on July 1, 2023, with a sell-off period from retail to consumer as of October 1, 2023.

On March 22, 2023, a bill amending the Tobacco Hazards Prevention and Control Act in Taiwan went into effect. It regulates heated tobacco products and bans e-cigarettes. The amendment particularly specifies that designated tobacco products (including heated tobacco products) that are not cigarettes, cut tobacco, cigars, snuff nor chewing tobacco, must undergo a health risk assessment as part of an authorization system. We have filed an authorization request to commercialize IQOS in Taiwan pursuant to this Act, but this authorization is currently still pending approval by the Ministry of Health of Taiwan.

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On March 28, 2023, the Argentinian Ministry of Health prohibited the import, distribution, commercialization and advertisement of heated tobacco products, including related devices. The country had previously banned the use of e-cigarettes in 2011.

In a limited number of markets, most notably Japan, we are dependent on governmental approvals that may limit our pricing flexibility.

The EU Single-Use Plastics Directive, which will require tobacco manufacturers and importers to cover the costs of public collection systems for tobacco product filters, under Extended Producer Responsibility ("EPR") schemes, came into force on July 2, 2019. To date, some member states transposed the Directive into national legislation. By the end of 2024, most EU Member States are expected to bring into force national legislation for mandatory EPR schemes and related EPR costs for tobacco manufacturers and importers. We currently expect further adoption of similar laws in other jurisdictions, and we are monitoring developments in this area. We do not estimate a material impact to our business in the EU as a result of compliance with these mandatory EPR schemes.

On March 14, 2024 the Court of Justice of the European Union (the "CJEU") ruled that the German fiscal regulation imposing an additional excise tax on HTPs does not contravene EU law. Fiscal Court in Dusseldorf (the "FCD") had previously referred that question to the CJEU. On May 21, 2024, the FCD delivered its judgement and dismissed our local affiliate's, f6 Cigarettenfabrik GmbH & Co.KG, ("PM Germany") claim. PM Germany filed a notice of appeal to the Federal Fiscal Court on June 19, 2024.

On April 16, 2024, Brazil’s Health Control Agency enacted Resolution 855, imposing strict regulations on electronic smoking devices, including heat-not-burn devices and vaping devices (“ESDs”). The resolution prohibits their manufacture, importation, sale, distribution, storage, transportation, advertising, and use in enclosed public spaces. Travelers are also forbidden from bringing ESDs into the country.

On August 28, 2024, the Ministry of Health in Canada approved a ban on all flavors of nicotine pouches except mint and menthol. They also imposed new restrictions on where nicotine pouches can be sold, allowing sales only behind pharmacy counters by pharmacists (no prescription required).

In some countries, including in the EU, cigarettes are subject to testing, disclosure and mandatory emissions limits for tar, nicotine, carbon monoxide and other smoke constituents. In the Netherlands, several public health organizations have requested that the Dutch enforcement body enforce the requirements for maximum tar, nicotine, and carbon monoxide ("TNCO") emissions levels for cigarettes using a test method other than the method currently set forth in the EU TPD and transposed into national legislation. This request followed publication of a report by the Dutch State Institute for Public Health & Environment, which found that all cigarette brands sold in the Netherlands exceeded the maximum TNCO levels when measured under an alternative method. The Dutch enforcement body declined the request, and the applicants have challenged such decision in pending legal proceedings. The case is currently pending before the Court of Justice of the European Union following a referral from the Trade and Industry Appeals Tribunal in the Netherlands. While we cannot predict the outcome, a decision to enforce the existing TNCO ceilings using the alternative test method could impact a significant portion of the manufactured cigarettes available on the market in the Netherlands and could lead to similar actions in other EU countries.
Illicit Trade: Illicit trade creates a cheap and unregulated supply of tobacco and nicotine-containing products, undermines efforts to reduce smoking prevalence, especially among youth, damages legitimate businesses and intellectual property rights, stimulates organized crime, increases corruption and reduces government tax revenue. We generally estimate that, excluding China and the U.S., illicit trade may account for as much as 14% of global cigarette consumption; this includes counterfeit, contraband and the persistent problem of “illicit whites,” which are cigarettes legally purchased in one jurisdiction for the sole purpose of being exported and illegally sold in another jurisdiction where they have no legitimate market. Currently, we estimate that illicit trade in the EU accounted for approximately 8% of total cigarette consumption in 2023. Illicit trade also increasingly targets SFPs.

We devote substantial resources to help prevent illicit trade in combustible tobacco products and SFPs. We engage with governments, our business partners and other stakeholders to implement effective measures to combat illicit trade. Where effective and appropriate, we pursue legal remedies to protect our intellectual property rights from counterfeiting or to counter the illicit diversion of our products. We also cooperate with governmental authorities to combat fraudulent imports of non-compliant or unauthorized tobacco and nicotine-containing products.

As an example, the recent commercial success of the nicotine pouch category makes it more prone to be affected by illicit trade. Our ongoing anti-illicit initiatives for nicotine pouches include PMI’s ‘know-your-customer’ and ‘anti-diversion’ governance
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and other measures, such as volume monitoring, tracking and tracing, product security, as well as internal and external awareness training and communications. We are also expanding our market monitoring -both online and offline- and illicit trade research program to nicotine pouches. PMI affiliates and Swedish Match affiliates, are taking appropriate actions to address the illicit resale of certain of our oral products including nicotine pouches outside their initial intended market of retail, such as Scandinavia, the U.S. and other markets. Such actions include awareness communications to trade partners, cease-and-desist letters to those involved in illicit trade of products bearing our brands and limiting and/or terminating sales to certain customers in both the online and traditional trade.

A number of jurisdictions are considering actions to prevent illicit trade. In November 2012, the FCTC adopted the Protocol to Eliminate Illicit Trade in Tobacco Products (the “Protocol”), which includes supply chain control measures, such as licensing of manufacturers and distributors, enforcement of these control measures in free trade zones, controls on duty free and Internet channels and the implementation of tracking and tracing technologies. To date, 68 Parties, including the EU, have ratified it. The Protocol came into force in September 2018. Since then, implementation in national legislations has been ongoing. In February 2024, the third Meeting of the Parties to the Protocol took place. No additional restrictive measures were adopted, and a mandate to conduct further work will be considered at the next session, currently scheduled to take place in November 2025.

The tracking and tracing regulations for cigarettes and roll-your-own products manufactured or destined for the EU were extended to include tobacco products other than cigarettes, including some of our SFPs, as of May 20, 2024.

Smoke-Free Products (SFPs)    

Our Approach to SFPs: We recognize that smoking cigarettes causes serious diseases and that the best way to avoid the harm of smoking is to never start or to quit. Nevertheless, it is predicted that by 2025, the number of smokers will remain largely unchanged from the current estimate of over one billion, despite considerable efforts to discourage smoking.

Cigarettes burn tobacco, which produces smoke. As a result of the combustion process, the smoker inhales various toxic substances. In contrast, SFPs do not burn tobacco and therefore contain significantly lower levels of harmful and potentially harmful constituents ("HPHCs") than found in cigarette smoke.

Our SFPs and commercial activities for these products are designed for, and directed toward, current adult smokers and users of nicotine-containing products. We put significant effort to restrict access to our products from non-smokers and youth.

For adult smokers who would otherwise continue to smoke cigarettes, we believe that SFPs, while not risk-free, offer a much better choice. Accordingly, our key strategic priorities are to: (i) continue developing and commercializing products that have the potential to present less risk of harm to adult smokers who switch to such products versus continued cigarette smoking; and (ii) educate and encourage current adult smokers who would otherwise continue to smoke cigarettes to switch to those products.

We recognize that this transformation from cigarettes to SFPs will take time and that the rate of transformation will depend in part upon factors beyond our control, such as the willingness of governments, regulators and other policy groups to embrace SFPs as a desirable alternative to continued cigarette smoking. As a leading international cigarette manufacturer, we will continue to accelerate this transformation by using our extensive commercial and distribution infrastructure as an effective platform for the commercialization of our SFPs and communication with adult smokers and trade partners about the substantiated benefits of switching to our SFPs. As long as a significant number of adult smokers continue to smoke cigarettes, responsible leadership of the category is critical. We aim to maintain our competitive position in the cigarette market through selective investment. We are judiciously reallocating resources from cigarettes to SFPs and are streamlining our cigarette portfolio.

We have a range of SFPs in various stages of development, scientific assessment, and commercialization. We are committed to conducting rigorous scientific assessments of our SFP platforms to substantiate that they reduce exposure to HPHCs and, ultimately, that these products present, are likely to present, or have the potential to present less risk of harm to adult smokers who switch to SFPs versus continued cigarette smoking. We draw upon a team of expert scientists and engineers from a broad spectrum of scientific disciplines and our extensive learnings of adult consumer preferences to further develop and assess our SFPs. Our efforts are guided by the following key objectives:
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•to develop SFPs that adult smokers who would otherwise continue to smoke cigarettes find to be satisfying alternatives to smoking;
•for those adult smokers, our goal is to offer SFPs with a scientifically substantiated risk-reduction profile that approaches as closely as possible the risk-reduction profile associated with smoking cessation;
•to substantiate the reduction of risk for the individual adult smoker and the reduction of harm to the population as a whole, based on scientific evidence of the highest standard that is made available for scrutiny and review by external independent scientists and relevant regulatory bodies; and
•to advocate for the development of science-based regulatory frameworks for the development and commercialization of SFPs, including the communication of scientifically substantiated information to enable adult smokers to make better choices.

Our SFP Platforms: Our product development is based on the elimination of combustion via tobacco heating and other innovative systems, as well as through oral tobacco and nicotine products, which we believe are the most promising paths to providing a better consumer choice for those who would otherwise continue to smoke cigarettes. We recognize that no single product will appeal to all adult smokers. Therefore, we are developing a portfolio of products intended to appeal to a variety of distinct adult consumer preferences and achieve population harm reduction.

Five PMI-developed or improved SFP platforms are in various stages of development and commercialization readiness:

        Platform 1 uses a precisely controlled heating device incorporating our IQOS HeatControl technology, into which a specially designed and proprietary tobacco unit is inserted in a holder and heated to generate an aerosol. We have conducted a series of clinical studies for this platform, the results of which were included in our submissions to the U.S. Food and Drug Administration (“FDA”). In addition to the original version of Platform 1 which relies on a heating technology using a blade, a newer version of Platform 1 is now available using induction. Most of the studies referenced above were conducted with the blade version of Platform 1 and additional research was conducted with the induction technology. We believe that there is full comparability between the bladed versions of IQOS and the subsequent induction versions of IQOS, and that the data from the studies conducted with the blade version of Platform 1 remain valid and applicable to the newer and adjacent versions of Platform 1. In 2022, we also began the initial launch of a heated tobacco product, which utilizes external resistive heating technology and is commercialized under the BONDS by IQOS brand.

    Platform 2 used a pressed carbon heat source which, when ignited, generated a nicotine-containing aerosol by heating tobacco. As a result of consumer testing feedback, the design of our current Platform 2 technology has been discontinued. We are assessing alternative designs for this consumer segment.

    Platform 3 uses a nicotine salt and is composed of two parts: (1) a consumable that contains a highly soluble encapsulated nicotine salt powder and (2) a non-electric device that activates it. Once a consumable is inserted into the mechanical device, the nicotine salt powder is aerosolized upon inhalation. The results of our pharmacokinetic and pharmacodynamic studies related to this version indicate that, subject to a period of adaptation to the product, the product has potential as an acceptable alternative to continued cigarette smoking in terms of product satisfaction. We are working on product modifications to enable adult smokers, who are looking for better alternatives to cigarettes, to switch to a Platform 3 product.

    Platform 4 covers e-vapor products, which are battery-powered devices that produce an aerosol by vaporizing a tobacco-free liquid solution. We developed new e-liquids for our e-vapor products to deliver an authentic tobacco taste. Using patented technology, flavors and nicotine are extracted directly from the tobacco leaves and captured in a tobacco-free liquid solution, without having to add flavoring ingredients.

We entered into a licensing agreement with Kaival Brands International, LLC, in June 2022 to distribute an e-vapor product, known in the U.S. as the BIDI® Stick. The agreement grants PMI certain intellectual property rights relating to the premium e-vapor devices and, potentially, other newly developed devices, to permit PMI to manufacture, promote, sell, and distribute the e-vapor device and, to the extent included, other newly developed devices in international markets outside of the U.S.

Platform 5 covers snus and modern oral nicotine pouches. Snus refers to (a) dried loose tobacco, or snuff, which is consumed by sniffing the product through the nose; (b) moist loose tobacco which is put in the mouth between the lower or upper lip and gum; and (c) snus pouches which contain ground tobacco, water, salt and flavors. Modern oral nicotine pouches consist of white pre-conditioned pouches containing nicotine derived from tobacco, and they primarily contain nicotine, flavors,
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and cellulose substrate. Users place a pouch between the upper lip and gum and leave it there while the nicotine and flavor are being released. Nicotine pouches are inherently smoke-free as they are consumed orally, and no combustion process occurs during use. The pouches contain pharmaceutical-grade tobacco-derived nicotine like the nicotine used in medicinal products, such as nicotine-containing gums and inhalers, and flavors approved for use in food in accordance with the product quality standards for nicotine pouches developed by the Swedish Institute for Standards and the British Standards Institute. In 2021, PMI acquired AG Snus Aktieselskab ("AG Snus"), as well as Fertin Pharma A/S, two companies manufacturing and/or marketing nicotine pouches. In 2022, we significantly expanded our Platform 5 products portfolio with the acquisition of Swedish Match. The acquisition also represents an expansion of our SFP presence in the U.S. market, where Swedish Match's ZYN brand is the leading nicotine pouch franchise.

We aim to expand our brand portfolio and market positions with additional SFPs. In addition, we continue to use our expertise, technology and capabilities to explore new growth opportunities beyond our current business, including products that do not contain nicotine or tobacco.

Commercialization of SFPs: We are continuing to develop a multiplatform approach and tailoring our commercialization strategy to the characteristics of each specific market. We focus our commercialization efforts on consumer retail experience, guided consumer trials and customer care, and increasingly, digital communication programs and e-commerce.  In order to accelerate switching to our Platform 1 products, our initial market introductions typically entail one-on-one consumer engagement (in person or by digital means) and device discounts.  These initial commercialization efforts require substantial investment, which we believe will moderate over time and further benefit from the increased use of digital engagement capabilities. PMI has, and continues to, invest in digital consumer engagement.

In 2014, we introduced our Platform 1 product in pilot city launches in Nagoya, Japan, and in Milan, Italy. Since then, we have continuously expanded our commercialization activities.

As of September 30, 2024, PMI's smoke-free products were available for sale in 92 markets.

Data show that only a very small percentage of adult smokers who convert to IQOS switch back to cigarettes.

We have integrated the production of our heated tobacco units into several of our existing manufacturing facilities, are progressing with our plans to build manufacturing capacity for our other SFP platforms, and continue to optimize our manufacturing infrastructure and expand our commercialization activities for new products and markets. We discuss certain risks related to the commercialization and supply of our SFP portfolio in Part II, Item 1A. Risk Factors—Cautionary Factors That May Affect Future Results in this report.

We discuss product warranties in more detail in Part I, Item 1, Financial Statements—Note 14. Product Warranty in this report. The significance of warranty claims depends on a number of factors, including device version mix, product failure rates, logistics and service delivery costs, and warranty policies, and may increase with the number of devices sold.

On October 20, 2022, PMI announced that it had reached an agreement with Altria Group, Inc., ("Altria") to end the companies' commercial relationship as of April 30, 2024 with respect to Platform 1 in the U.S. (the “Altria Agreement”). Under the Altria Agreement, PMI now holds the full rights to commercialize Platform 1 in the United States - the world’s largest smoke-free market. The Altria Agreement provides a clear path to expanding Platform 1's international success in a market where approximately 30 million adults continue to smoke cigarettes.

Our commercialization efforts for the other PMI-developed SFP platforms are as follows:

•In late 2022, we began commercializing our BONDS product in the Philippines and Colombia.

•Since August 2020, we have launched and expanded our portfolio of vaping products (branded VEEV) in 42 markets.

•Following our acquisition of Swedish Match, we have access to a strong portfolio of Swedish Match brands in both the snus and nicotine pouch categories. Nicotine pouches are currently available in 32 markets.


SFP Regulation and Taxation: SFPs contain nicotine and are addictive and not risk-free. As we describe in more detail above, we support science-based regulation and taxation of SFPs, and believe that regulation and taxation should differentiate between cigarettes and products that present, are likely to present, or have the potential to present less risk of harm to adult smokers who switch to these products versus continued smoking and should recognize a continuum of risk with respect to tobacco and other
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nicotine-containing products. Regulation, as well as industry practices, should reflect the fact that youth should not consume nicotine in any form.

Some governments have banned, are seeking to ban, or severely restrict emerging tobacco and nicotine-containing products such as our SFPs, and communication of truthful and non-misleading information about such products. These regulations might foreclose or unreasonably restrict adult consumer access to products that might be a better consumer choice than continuing to smoke cigarettes.

We oppose blanket bans and unreasonable restrictions of products that have the potential to present less risk of harm compared to continued cigarette smoking. By contrast, we support regulation that sets clear standards for all SFP categories and propels innovation to benefit adult smokers who would otherwise continue to smoke cigarettes.

In the United States, an established regulatory framework for assessing “Modified Risk Tobacco Products” ("MRTP") and “New Tobacco Products” exists under the jurisdiction of the FDA. We submitted to the FDA a Modified Risk Tobacco Product Application (“MRTPA”) for our Platform 1 product in December 2016, and a Premarket Tobacco Product Application (“PMTA”) for our Platform 1 product in March 2017.

On April 30, 2019, the FDA determined that a version of our Platform 1 product, namely, IQOS 2.4 and three related consumables, is appropriate for the protection of public health and authorized it for sale in the United States. The FDA’s decision followed its comprehensive assessment of our PMTA. On December 7, 2020, the FDA reached the same determination for the IQOS 3 device and authorized that version of our Platform 1 product for sale in the United States.

On July 7, 2020, the FDA determined that the available scientific evidence demonstrates that the issuance of an exposure modification order would be appropriate for the promotion of public health and authorized the marketing of a version of our Platform 1 product, namely IQOS 2.4 and three related consumables, as an MRTP. The FDA authorized the marketing of this product in the U.S. with the following information:

"AVAILABLE EVIDENCE TO DATE:

•the IQOS system heats tobacco but does not burn it.
•this significantly reduces the production of harmful and potentially harmful chemicals.
•scientific studies have shown that switching completely from conventional cigarettes to the IQOS system significantly reduces your body’s exposure to harmful or potentially harmful chemicals."

The FDA may issue two types of MRTP orders: a “risk modification” order or an “exposure modification” order. We had requested both types of orders for IQOS 2.4 and an initial selection of three related consumables' variants. After review, the FDA determined that the evidence did not support issuing a "risk modification" order at that time, but that it did support issuing an "exposure modification" order for the product. This determination included a finding that issuance of the exposure modification order is expected to benefit the health of the population as a whole. We also received an exposure modification order for IQOS 3. We look forward to working with the FDA to provide any additional information they may require to market Platform 1 products with reduced risk claims.

The FDA’s PMTA and MRTP orders do not mean that the agency “approved” our Platform 1 product. These authorizations are subject to strict marketing, reporting, and other requirements, and are not a guarantee that the product will remain authorized, particularly if there is a significant uptake in youth or non-smoker initiation. The FDA will monitor the marketing of the product.

On March 18, 2021, we submitted to the FDA a supplemental MRTPA ("sMRTPA") for IQOS 3 requesting authorization to market this version of the device as a MRTP with reduced exposure information like IQOS 2.4. In June 2021, the FDA formally accepted and filed our sMRTPA for substantive scientific review, following a period for the public to provide comments on our application. The FDA authorized our sMRTPA for IQOS 3 by issuing a Modified Risk Granted Order – Exposure Modification on March 11, 2022.

On January 26, 2023, the FDA authorized the marketing of two new tobacco-flavored consumables (Marlboro Sienna HeatSticks and Marlboro Bronze HeatSticks) and a modified version of the authorized Marlboro Amber HeatSticks. These products are line extensions and/or modified versions of the tobacco-flavored consumables for which the FDA had previously issued a marketing granted order. In its assessment, the FDA determined that the three variants of HeatSticks were comparable to the previously authorized tobacco-flavored consumables.
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On July 5, 2023, we submitted renewal applications to the FDA requesting re-authorization to continue to market those IQOS products that previously received an exposure modification order with a modified exposure claim in the United States. These renewal requests were received by the FDA 360 days prior to the stated July 2024 expiration date of the original exposure modification orders, as requested by the FDA in the original orders. On May 9, 2024, the FDA filed for scientific review of our MRTP renewal applications for IQOS products and posted materials from these applications. As our applications proceed through the review process, the FDA may request additional information or conduct subsequent inspections to verify the information we submitted. The FDA did not issue a decision on our MRTP renewal applications prior to the stated July 7, 2024 expiration date of the original exposure modification orders. The MRTP renewal applications were timely filed in accordance with FDA direction, and we believe that we should be permitted to continue to use the modified exposure claim with respect to those products that received exposure modification orders until the FDA decides on our MRTP renewal applications.

On October 20, 2023, we submitted bundled PMTAs for our IQOS ILUMA THS products together with MRTPAs requesting authorization of the exposure reduction marketing order previously granted for IQOS blade versions. We submitted these applications at the same time in order for the FDA to evaluate the PMTAs and MRTPAs concurrently. In March 2024, the FDA formally accepted our bundled PMTAs and MRTPAs. As our applications proceed through the review process, the FDA may request additional information or conduct subsequent inspections to verify the information we submitted.

On January 19, 2024, the FDA completed its review of our Requests for Exemption from Substantial Equivalence (the “EX REQs”) for the five submitted IQOS consumables and determined that these tobacco products were exempt from the requirements outlined for substantial equivalence (a regulatory pathway that can be used to introduce new tobacco products which have the same characteristics as a product previously authorized by the FDA). These submissions were made in November 2022 (for the three initial IQOS consumables) and February 2023 (for the two new IQOS consumables) to enable domestic manufacturing of IQOS consumables utilizing materials purchased from vendors operating in the United States.

On July 17, 2023, Swedish Match USA, Inc. submitted a renewal application to the FDA requesting re-authorization to continue to market its eight snus smokeless tobacco products (sold under the General snus brand name) with a modified risk claim. General snus products received modified risk orders on October 22, 2019. Swedish Match USA, Inc. was authorized to market these products with the claim, “Using General snus instead of cigarettes puts you at a lower risk of mouth cancer, heart disease, lung cancer, stroke, emphysema, and chronic bronchitis.” This renewal request was received by the FDA 360 days prior to the stated October 22, 2024 expiration date of the original modified risk claim orders, as requested by the FDA in the original orders. On November 30, 2023, the FDA filed for scientific review of the MRTP renewal applications for General snus products and posted materials from these applications. The FDA held a Tobacco Products Scientific Advisory Committee meeting to discuss the MRTP renewal applications on June 26, 2024. On July 3, 2024, the FDA extended the comment period on the MRTP renewal applications to provide time for the public to review application materials that were recently made available. Subsequently, on July 15, 2024, the FDA reposted application documents related to the MRTP renewal and announced a deadline for public comments. Public comments on these applications were due by August 14, 2024, and comments are no longer being accepted by the FDA. The FDA did not issue a decision on the MRTP renewal applications prior to the stated October 22, 2024 expiration date of the original modified risk orders. The MRTP renewal applications were timely filed in accordance with FDA direction, and we believe that we should be permitted to continue to use the modified risk claim with respect to those products that received modified risk orders until the FDA decides on the MRTP renewal applications.

Premarket tobacco applications for certain ZYN products, which are currently marketed in the U.S., were submitted in March 2020. In the same month, these applications were filed for scientific review and in July 2020 the FDA issued a deficiency letter which Swedish Match USA, Inc. addressed in September 2020. The FDA has not completed its review of such applications but, consistent with its practice concerning products with respect to which applications were filed prior to a September 9, 2020 deadline, the FDA has not taken enforcement action to prevent these ZYN products from being marketed or indicated that it intends to do so. After the September 9, 2020 deadline, we also submitted additional applications for authorization to market other ZYN products. We are unable to market these products until the FDA authorizes such applications. In April 2024, we submitted MRTPAs for ZYN products currently marketed in the U.S. and requested authorization of the modified risk claim. As these applications proceed through the review process, the FDA may request additional information or conduct subsequent inspections to verify the submitted information.

On April 29, 2024, we submitted the Annual Report for the IQOS Tobacco Heating System ("THS") to the FDA. The report included a systematic review of the literature covering publications related to the IQOS THS between March 1, 2023 and February 29, 2024. The report included publications in various scientific fields including aerosol chemistry and physics, standard and systems toxicology, clinical studies on exposure reduction to HPHCs, and observational studies. Overall, the review continues to support the finding that IQOS THS is "appropriate for the promotion of public health."
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Some states and municipalities in the U.S. have introduced stringent restrictions on the sale of certain SFPs, including those authorized by the FDA. We believe that many of those restrictions on FDA-authorized products are unlikely to advance public health and instead are likely to limit adult consumer access to products that are shown to be a better alternative to continued cigarette smoking.

In March 2020, the FDA issued a final rule to require new text and graphic health warnings on cigarette packs and advertisements. HTPs are technically covered by this rule; however, the FDA stated that it would make product-specific decisions about health warnings when issuing or revising individual product or marketing orders. This approach would be consistent with the original marketing order granted for Heatsticks where the FDA required us to remove the Surgeon General’s health warning for carbon monoxide from our packaging and advertising, and to use a nicotine addiction health warning instead. We are committed to providing adult consumers with complete, accurate, and non-misleading information about possible health risks associated with our products. We shared our views with the FDA on the application of the new warnings to our HTPs. The final rule is the subject of litigation in the U.S. and was previously vacated nationwide by a federal court in December 2022. In March 2024, the decision to vacate was reversed by a U.S. appellate court and the lower court was directed to consider additional issues. Proceedings remain ongoing. We are not a party to this litigation.

On March 8, 2023, the FDA proposed new requirements for tobacco product manufacturers regarding the manufacture, design, packing and storage of their products. The FDA stated that these proposed requirements would help protect public health by, among other things, minimizing or preventing contamination and limiting additional risks by ensuring product consistency. The FDA held a public hearing on April 12, 2023, to gather additional comments from stakeholders, including the industry, the scientific community, advocacy groups, and the public. The proposed rule was also made available for public comment for 180 days. The FDA will review all comments as part of the rulemaking process for this rule. PMI welcomes the FDA’s rule under section 906(e) of the Federal Food, Drug, and Cosmetic Act and shared its views with the FDA in September 2023 on this important foundational rule.

In April 2022, the FDA issued two proposed product standards that would (a) prohibit menthol as a characterizing flavor in cigarettes; and (b) prohibit characterizing flavors in cigars.  In doing so, the FDA specifically requested comments as to whether the rule addressing menthol in cigarettes should contain an exemption process for certain tobacco products, including heated tobacco products, that meet the definition of cigarette and thus fall within the scope of the proposed rule. We submitted comments to the FDA in August 2022, explained why we believe any prohibition should not extend to FDA-authorized smoke-free products, and otherwise advocated for an automatic exemption for smoke-free products authorized through the PMTA or MRTP review pathways. The FDA has not completed rulemaking with respect to either of these two proposed product standards, and it is uncertain whether these product standards will be finalized and, if so, when.  In October 2023, the FDA submitted the proposed product standards to the White House Office of Management and Budget for review.  It is possible that the FDA will not accept our comments to the proposed product standard and that the menthol product standard, if finalized, will encompass menthol heated tobacco consumables.      

FDA actions may influence the regulatory approach of other governments and international regulatory agencies.

Currently, national standards in certain countries set minimum quality and safety requirements for heat-not-burn products with technical heat-not-burn specifications and/or methods for demonstrating the absence of combustion. These standards are mandatory in Armenia, Bahrain, Egypt, Jordan, Lebanon, the Philippines, Saudi Arabia, Tajikistan, Tunisia, the UAE and Uzbekistan, and voluntary in Algeria, Colombia, Costa Rica, Dominican Republic, Indonesia, Kazakhstan, Kyrgyzstan, Morocco, Russia, Vietnam, the U.K. and Ukraine. In Japan, a voluntary standard sets minimum safety requirements for tobacco heating devices.

For e-vapor products (e.g., e-cigarettes), national standards setting minimum quality and safety requirements have been adopted in several markets. These standards are mandatory in Armenia, Bahrain, China, Egypt, Jordan, New Zealand, the Philippines, Russia, United Arab Emirates, and Saudi Arabia and Tajikistan, and voluntary in Azerbaijan, Costa Rica, Dominican Republic, France, Indonesia, Kazakhstan, the Philippines, Russia, the U.K. and Ukraine.

Currently, industry standards setting minimum quality and safety requirements for tobacco-free oral nicotine products (e.g., nicotine pouches) have been adopted in Armenia, Pakistan, Sweden, the U.K., and Ukraine. These standards are voluntary.

We expect other governments to consider similar product standards for all novel tobacco and nicotine-containing products and encourage making them mandatory.

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All EU member states have transposed the EU TPD, including the provisions on novel tobacco products, such as heated tobacco units, and e-cigarettes. Most of the EU member states require a notification submitted six months before the intended placing on the market of such products, while some require pre-market authorizations for the introduction of such products. To date, we have filed a comprehensive dossier summarizing our scientific assessment of our Platform 1 product in over 20 member states.

On March 23, 2023, the Greek Ministry of Health authorized a claim for IQOS with HEETS AMBER to inform Greek IQOS users about reduction in emissions of toxicants when using such product compared to cigarette smoking. The decision authorized the following claim: “The concentration of chemical substances with recognized toxicity produced when using IQOS with HEETS AMBER tobacco sticks is lower compared to conventional smoking. A reduction in the concentration of chemical substances with recognized toxicity does not mean a corresponding reduction in risk for health. The aerosol of this tobacco product contains nicotine and other hazardous chemicals. This tobacco product harms your health and is addictive. The best choice is to quit tobacco and nicotine use altogether.” With this authorization, Greece is the second country officially recognizing the reduction in level of toxicants in the IQOS aerosol compared to cigarette smoke.

On September 12, 2022, Norway rejected a submission for authorization of HEETS as a novel tobacco product. Norway partially transposed the EU TPD under the European Free Trade Association agreement and introduced an authorization system for novel tobacco products following Article 19 of TPD. To date, Norway has not granted authorization of any novel tobacco product, including e-cigarettes and tobacco free nicotine pouches.

To date, several governmental agencies have published their scientific findings that analyze the harm-reduction potential of certain SFPs versus continuing to smoke cigarettes, including:

In December 2017, at the request of the U.K. Department of Health and Public Health England, the U.K. Committee on Toxicity published its assessment of the risk of heat-not-burn products relative to cigarette smoking. This assessment included analysis of scientific data for two heat-not-burn products, one of which was our Platform 1 product. The assessment concluded that, while still harmful to health, compared with the known risks from cigarettes, heat-not-burn products are probably less harmful. Subsequently, in February 2018, Public Health England published a report stating that the available evidence suggests that heat-not-burn products may be considerably less harmful than cigarettes but more harmful than e-cigarettes.

In May 2018, the German Federal Institute for Risk Assessment (“BfR”) published a study on the Platform 1 aerosol relative to cigarette smoke using the Health Canada Intense Smoking Regimen. BfR found reductions in selected HPHCs in a range of 80-99%. This publication indicates that significant reductions in the levels of selected toxicants are likely to reduce toxicant exposure, which BfR stated might be regarded as a discrete benefit compared to combustible cigarettes.

In May 2018, the Dutch National Institute for Public Health and Environment (“RIVM”) published a factsheet on novel tobacco products that heat rather than burn tobacco, focusing on our Platform 1 product. RIVM analyzed the aerosol generated by our Platform 1 product and concluded that the use of this product, while still harmful to health, is probably less harmful than continuing to smoke cigarettes.

In June 2018, the Korean Food and Drug Administration (“KFDA”) issued a statement on products that heat rather than burn tobacco. The KFDA tested three heat-not-burn products, one of which was our Platform 1 product. The KFDA confirmed that the levels of the nine HPHCs tested in the aerosol of these products were on average approximately 90% lower compared to those measured in the cigarette smoke of the top five cigarette brands in South Korea. However, the KFDA stated that it could not establish that the tested heat-not-burn products are less harmful than cigarettes. In October 2018, our Korean subsidiary filed a request with a local court seeking information underlying KFDA’s analysis, conclusions and public statements. In May 2020, the court ordered KFDA to produce certain records. Subsequent to that decision, and after exchanges between the parties, the case was closed.

In August 2018, the Science & Technology Committee of the U.K. House of Commons published a report of its inquiry into e-cigarettes and heat-not-burn products. The report concluded that e-cigarettes are significantly less harmful to health than smoking tobacco. The report also observed that for those smokers who do not accept e-cigarettes, heat-not-burn products may offer a public health benefit despite their relative risk. The report called for a risk-proportionate regulatory environment for both e-cigarettes and heat-not-burn products and noted that e-cigarettes should remain the least taxed, cigarettes the most taxed, with heat-not-burn products falling between the two. The U.K. Committee on Advertising Practice announced the removal of a prohibition of health claims in the advertising of e-cigarettes in the U.K., effective November 2018.

In November 2018, the Eurasian Economic Commission (regulatory body of the Eurasian Union consisting of Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia) published the results of its commissioned study on novel nicotine-containing
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products, including our Platform 1 product. The study confirms significantly lower levels of HPHCs in the aerosol generated by this product compared to cigarette smoke.

In January 2019, scientific media published the results of the study of the China National Tobacco Quality Supervision and Test Centre (“CNTQST”) comparing the aerosol generated by our Platform 1 product with cigarette smoke. The CNTQST found that the former contained fewer, and lower levels of, harmful constituents than the latter and concluded that the lower temperature of heating tobacco in our Platform 1 product contributed to the difference. The CNTQST stated that the reduction in emissions of harmful constituents cannot be interpreted as a harm/risk reduction for cigarette smokers in the same proportion.

In April 2020, the Superior Health Council of Belgium (“SHC”) published results of its inquiry into heat-not-burn products. The SHC concluded that heat-not-burn products, while not safe, have a more favorable toxicity profile than cigarettes. However, in light of the uncertainty of such products’ short and long-term impacts, the toxic effects of the dual use with cigarettes, and the existence of approved smoking cessation tools, the SHC recommended that current regulations for cigarettes should apply to heat-not-burn products.

In June 2022, the SHC published new advice on e-cigarettes in which they confirm that e-cigarettes are substantially less harmful than smoking cigarettes and, therefore, a better alternative for smokers. The SHC underlines that the vast majority of the risks of tobacco smoking are not caused by nicotine, but by the harmful substances that are released by the combustion of tobacco. Based on the cited science, the SHC calls for legislation that makes a clear distinction between cigarettes and e-cigarettes by focusing on better informing smokers about the benefits of the lower-risk (but not risk-free) alternative, as well as on protecting non-smokers and young people.

The foregoing scientific findings of government agencies may not be indicative of the measures that the relevant government authorities could take in regulating our products.

We make our scientific findings publicly available for scrutiny and peer review through several channels, including our websites. From time to time, adult consumers, competitors, members of the scientific community, and others inquire into our scientific methodologies, challenge our scientific conclusions or request further study of certain aspects of our SFPs and their health effects. We are committed to a robust and open scientific debate and believe that such debate should be based on accurate and reliable scientific information. We seek to provide accurate and reliable scientific information about our SFPs; nonetheless, we may not be able to prevent third-party dissemination of false, misleading or unsubstantiated information about these products. The dissemination of scientifically unsubstantiated information or studies with a strong confirmation bias by third parties may cause confusion among adult smokers and affect their decision to switch from continued smoking to better alternatives, such as our SFPs.

To date, we have been largely successful in demonstrating to regulators that our heated tobacco units are not cigarettes due to the absence of combustion, and as such, they are generally taxed either as a separate category or as other tobacco products, which typically yields more favorable tax rates than cigarettes. Although we believe that this is sensible from the public health perspective, we cannot guarantee that regulators will continue this approach.

There can be no assurance that we will succeed in our efforts to replace cigarettes with SFPs or that regulation will allow us to commercialize SFPs in all markets, to communicate about our SFPs, including making scientifically substantiated risk-reduction claims, or to treat SFPs differently from cigarettes.

Legal Challenges to SFPs: We face various administrative and legal challenges related to certain SFP activities, including allegations concerning product classification; advertising, distribution and sales restrictions; corporate communications; product coach activities; scientific substantiation; product liability; and unfair competition.  While we design our programs to comply with relevant regulations, we expect these or similar challenges to continue as we expand our efforts to commercialize SFPs and to communicate with the public. The outcomes of these matters may affect our SFP commercialization and public communication activities and performance in one or more markets.

On June 11, 2024, Swedish Match North America LLC ("SMNA") received a subpoena from the office of the Attorney General of the District of Columbia (“D.C.”). The subpoena requests, among other things, information concerning SMNA’s compliance with D.C.’s licensing regulations, age-verification requirements, and prohibition on the sale of flavored tobacco products, including with respect to ZYN nicotine pouches. SMNA is cooperating with the investigation and is conducting a full review of its sales and supply chain arrangements in D.C. and other U.S. localities where flavor bans may apply.

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As part of its sales and supply chain review, SMNA has discontinued sales through the e-commerce shop associated with ZYN.com and direct sales to dedicated online retailers in the United States indefinitely. U.S. e-commerce has represented a small fraction of sales of SMNA in the United States, and the current network of approximately 170,000 brick-and-mortar retailers will remain SMNA’s focus.

Our SFP Business Development Initiatives: In December 2013, we established a strategic framework with Altria Group, Inc. (“Altria”) setting out terms on how the parties would collaborate to develop and commercialize e-vapor products and commercialize two of our SFPs in the U.S. In late 2018, Altria announced that it will participate in the e-vapor category only through another e-vapor company in which Altria acquired a minority interest. In September 2019, Altria's subsidiary, Philip Morris USA Inc. (“PM USA”), began commercialization of a version of our Platform 1 product in the U.S. Under the agreement, PM USA was required to achieve certain milestones in order to maintain its exclusive distribution right and additional milestones in order to extend the agreement after the initial 5-year term. On October 20, 2022, PMI announced that it had reached an agreement with Altria to terminate the companies' commercial relationship covering IQOS in the U.S. As of April 30, 2024, PMI holds the full rights to commercialize IQOS in the U.S. For more details, see Part I, Item 1. Financial Statements— Note 18. Acquisitions and Divestitures to our condensed consolidated financial statements in this report.

In January 2020, we announced an agreement with KT&G, a leading tobacco and nicotine company in South Korea, for the commercialization of KT&G’s smoke-free products outside of South Korea on an exclusive basis. On January 30, 2023, we announced a renewal and extension of this arrangement. For more information, see Acquisitions, Divestitures and Other Business Arrangements below.

Other Developments: In September 2017, we announced our support of the Foundation for a Smoke-Free World (the "Foundation"). The Foundation is an independent, nonprofit organization dedicated to reducing the health impacts of smoking as set out in its Articles of Incorporation and its Bylaws. In September 2020, our pledge agreement with the Foundation was amended. We contributed $45 million in 2020, $40 million in 2021, $17.5 million in 2022, and had expected to contribute up to $35 million annually from 2023 through 2029, as specified in the amended pledge agreement. In 2023, the Foundation and PMI agreed to terminate the existing pledge agreement and PMI has made final grant payments totaling $140 million, commensurate with the early termination of the pledge agreement.

Governmental Investigations

From time to time, we are subject to governmental investigations on a range of matters, including tax, customs, antitrust, advertising, and labor practices. We describe certain pending matters in Note 8. Contingencies.

In November 2010, a World Trade Organization ("WTO") panel issued its decision in a dispute between the Philippines and Thailand, concerning a series of Thai customs and tax measures affecting cigarettes imported by Philip Morris (Thailand) Limited ("PM Thailand") into Thailand. The decision concluded that Thailand had no basis to find that PM Thailand's declared customs values and taxes paid were too low, as alleged by the Thai government and created obligations for Thailand to revise its laws, regulations, or practices affecting the customs valuation and tax treatment of future cigarette imports. Thailand agreed to fully comply with the decision, but the Philippines asserts that to date Thailand has not fully complied with the WTO panel decision and commenced challenges at the WTO Appellate Body. The WTO Appellate Body is not operational, and the appeals by Thailand are suspended indefinitely. In December 2020, the Philippines and Thailand agreed to pursue facilitator-assisted discussions aimed at progressing and resolving outstanding issues and the countries have since agreed to seek the establishment of a bilateral consultative mechanism, with the goal of reaching a comprehensive settlement of their dispute, consistent with their rights and obligations under the WTO Agreements, as well as the recommendations and rulings of the WTO Dispute Settlement Body.


War in Ukraine

In Ukraine, our main priority remains the safety and security of our employees and their families in the country. We continue commercial activities in select locations where safety allows, in order to provide product availability and service to adult consumers, and supplies the market from production centers outside Ukraine, as well as through a contract manufacturing arrangement. Production at our factory in Kharkiv remains suspended. On June 20, 2023, we announced the investment of $30 million in a new production facility in the Lviv region, in Western Ukraine. Preparatory work for the facility began in July 2023. The new production facility was completed at the end of the first quarter of 2024 and local production commenced in April 2024. As of September 30, 2024, our Ukrainian operations had approximately $0.6 billion in total assets, excluding intercompany balances.

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In Russia, we are continuously assessing the evolving situation in the country. This includes regulatory constraints in the market entailing very complex terms and conditions that must be met for any divestment transaction to be granted approval by the authorities, and restrictions resulting from international regulations. In the event of a divestment, our ability to fully realize the value of the business would likely be subject to material impairment. As of September 30, 2024, our Russian operations had approximately $2.9 billion in total assets, excluding intercompany balances, of which approximately $1.0 billion consisted of cash and cash equivalents held mostly in local currency (Russian rubles).

Additionally, we hold a 23% equity interest in Megapolis Distribution B.V., the holding company of JSC TK Megapolis (formerly CJSC TK Megapolis), pursuant to Dutch law, PMI's distributor in Russia. On July 18, 2024, the Ministry of Industry and Trade filed a petition before the Arbitrazh Court of Moscow seeking the forced localization of JSC TK Megapolis. For further details, see Note 8. Contingencies and Note 12. Related Parties – Equity Investments and Other.

These developments above have and will continue to have a material adverse impact on our business, results of operations, cash flows and financial position, and may result in impairment charges.
For further details, see "Trade Policy" and "Cautionary Factors That May Affect Future Results" sections of this MD&A.


Impact of Inflation on Our Business and Mitigation Efforts

Like many other global companies, we have experienced inflationary pressures in 2022, 2023 and the first nine months of 2024, including: growing pressures on the cost of certain direct materials, wages, energy, transportation, and logistics as well as an increased cost of capital due to interest rate increases driven by the response to increased inflation. For the year ended December 31, 2023, the impact on cost of sales was approximately $580 million and while tobacco leaf costs remain a headwind we expect certain inflationary elements to ease, with a more moderate overall increase in 2024. This impact has been, and we expect it to continue to be, significantly offset by the positive elements of pricing, productivities and the mitigating factors as we progress through the year. The net result of the inflationary impacts and our efforts to mitigate these impacts were not material to PMI during these periods.

Inflationary impacts driven by higher wages have resulted from merit increases that reflect local inflation as we continuously evaluate our compensation and benefit offerings to be competitive with the current market. Increased transportation costs resulted from increased shipping rates for all modes of transportation (air, ocean and inland) due to ocean and air capacity constraints. Increases in cost of sales resulted from higher cost of direct materials due to the pass on of energy, transportation, labor and commodity price increases from suppliers as well as increases in utility costs, including gas and electricity prices, primarily in Europe resulting from the war in Ukraine. Raw materials such as tobacco leaf have longer inventory durations which resulted in insignificant inflationary impacts to our cost of sales in 2022; however tobacco leaf purchases in both 2022 and 2023 were at higher prices due to inflationary impacts on fertilizer prices and labor costs, thus resulting in increases in the cost of inventory with corresponding impacts on our financial results in 2023 and continuation in 2024. In addition, our cash flow from operating activities in 2023 was impacted by the net working capital investment related to the procurement of tobacco leaf inventory and higher cost of direct materials. We expect certain of these inflationary elements to ease in 2024 as noted above.

We have taken several actions to mitigate these inflationary pressures. Mitigation efforts have included (i) indexation clauses related to commodity costs and energy pricing within contracts, (ii) tactical inventory purchases, (iii) identification of new suppliers in different geographical locations for incremental sourcing, (iv) increasing tobacco leaf inventory durations to secure additional volumes at favorable prices, (v) optimizing the mix of tobacco leaf origins and suppliers, (vi) continuous evaluation of shipping routes and methods of shipment, (vii) supplier negotiations, (viii) variable contract durations for energy costs, (ix) hedging strategies, and (x) other pricing, productivity and procurement initiatives.


Asset Impairment and Exit Costs

We discuss asset impairment and exit costs related to restructuring activities in Note 15. Asset Impairment and Exit Costs to our condensed consolidated financial statements.


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U.S. GAAP Treatment of Highly Inflationary Economies

We apply highly inflationary accounting to the results of operations of our subsidiaries in Argentina, Turkey and Lebanon as the cumulative inflation rate in these economies for a three-year period meets or exceeds 100%, in accordance with U.S. GAAP. As a result, monetary assets and liabilities denominated in local currencies are remeasured to the U.S. Dollar at each balance sheet date, with remeasurement gains and losses recognized in consolidated statement of earnings.

This impact of currency fluctuations could negatively impact our financial condition and results of operations. For the nine months ended September 30, 2024 and 2023, exchange gains (losses) recognized resulting from remeasurement adjustments related to highly inflationary accounting, were not material.

Climate Change Laws and Regulations

While, to date, the effect of climate-related laws and regulations on PMI has not been material to our business, results of operations or financial condition, consideration of environmental and climate-related laws and regulations is an integral aspect of PMI’s climate-related risk assessment process. To this end, we actively monitor the existing and potential impact on PMI of significant pending or existing climate change-related legislation, regulations, international accords, reporting frameworks, standards, principles, and other forms of guidance. Examples include, but are not limited to, the EU Emissions Trading System, the 2015 Paris Climate Agreement, the work of the International Financial Reporting Standards Foundation, including the International Sustainability Standards Board proposed climate standard and the recommendations of the Task Force on Climate-related Financial Disclosures, the SEC’s rules regarding climate-related disclosures, the California Climate Corporate Accountability Act, the California Greenhouse Gases: Climate-Related Financial Risk Act, the Task Force on Nature-related Financial Disclosures, the EU Corporate Sustainability Reporting Directive, the EU Taxonomy Regulation, the EU Deforestation Regulation, the EU Corporate Sustainability Due Diligence Directive, CDP, the GHG Protocol, and carbon tax programs in Europe and Canada.

Acquisitions, Divestitures and Other Business Arrangements

We discuss our acquisitions and divestitures in Note 18. Acquisitions and Divestitures to our condensed consolidated financial statements.

KT&G

On January 30, 2023, PMI announced a long-term collaboration with KT&G, South Korea’s leading tobacco and nicotine manufacturer, to continue to commercialize KT&G’s innovative smoke-free devices and consumables on an exclusive, worldwide basis (excluding South Korea).

The agreement covers fifteen years, to January 29, 2038, with performance-review cycles and associated commitments, based on volume, to be confirmed for each three-year period, to allow flexibility for evolving market conditions.

The agreement gives PMI continued exclusive access to KT&G’s smoke-free brands and product-innovation pipeline, including offerings for low- and middle-income markets, that will enhance PMI’s existing portfolio of smoke-free products.

Products sold under the agreement will be subject to assessment to ensure they meet the regulatory requirements in the markets where they are launched, as well as PMI’s high standards of quality and scientific substantiation. PMI and KT&G will seek any necessary regulatory approvals that may be required on a market-by-market basis.

On July 30, 2024, PMI announced a memorandum of understanding with KT&G. This non-binding memorandum establishes the parties’ intent to collaborate on regulatory submissions for those new KT&G heat-not-burn products that PMI selects to commercialize in the U.S. KT&G’s new platform products are expected to be launched first outside the U.S. Thereafter, the partners plan to work on a PMTA submission for review by the U.S. FDA, in accordance with the memorandum.

Equity Investments

We discuss our equity investments in Note 12. Related Parties - Equity Investments and Other to our condensed consolidated financial statements.

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Trade Policy

PMI complies with all applicable trade restrictions and requirements, including sanctions, in the markets in which it operates. We have taken appropriate actions in response to the latest sanctions to ensure full compliance with the relevant restrictions.

We are subject to various trade restrictions imposed by the U.S., the EU, Switzerland, the U.K., and other jurisdictions in which we do business (“Trade Sanctions”), including the trade and economic sanctions administered by the U.S. Department of the Treasury's Office of Foreign Assets Control (“OFAC”) and the U.S. Department of State. It is our policy to comply fully with these Trade Sanctions.

Pursuant to specific exemptions or licenses, or where sanctions do not apply to our business, PMI may make sales in countries subject to Trade Sanctions.

We do not do business or sell products in Iran, North Korea or Syria.

We sell cigarettes in Cuba under a distribution agreement. These sales are permitted by U.S. law under a License Exception for Agricultural Commodities, issued by the U.S. Department of Commerce (Bureau of Industry and Security), and specifically granted to our distributor.

Certain states within the U.S. have enacted legislation permitting or requiring state pension funds to divest or abstain from future investment in stocks of companies that do business with certain countries that are sanctioned by the U.S. Because we do business in certain of these countries, consistent with our policy to fully comply with Trade Sanctions and as described above, these state pension funds may have divested of our stock or may not invest in our stock. We do not believe such legislation has had a material effect on the price of our shares.

On June 24, 2021, the EU introduced sanctions in relation to Belarus aimed at specific sectors of the Belarus economy, including the tobacco sector. Subsequently, seven non-EU countries (Norway, Iceland, Liechtenstein, North Macedonia, Bosnia and Herzegovina, Montenegro, and Albania) announced that they “aligned themselves” with the majority of the EU sanctions. Switzerland and the U.K. have also imposed sanctions similar in scope to the EU sanctions.

On August 9, 2021, the U.S. imposed blocking sanctions on certain Belarusian individuals and entities pursuant to an Executive Order, which expanded the bases for the imposition of sanctions, including, among others, by authorizing the imposition by OFAC of blocking sanctions on persons operating in the tobacco sector of the Belarus economy. From 2021 to 2023, the U.S., the EU, the U.K., Switzerland and several other jurisdictions supplemented their respective sanctions lists by including additional Belarusian sanctions targets.

Following the start of the conflict in Ukraine on February 24, 2022, the U.S., the EU, the U.K., Switzerland, Canada, Australia, New Zealand, Singapore, South Korea, Japan and other countries introduced extensive economic sanctions and export controls in relation to Russia. While the introduced sanctions vary from jurisdiction to jurisdiction, they are largely aligned. The restrictions target, among others, the Russian financial, banking, oil, military, aviation and marine sectors. The U.S. has also introduced a prohibition on new investment in the Russian Federation by a U.S. person, wherever located, and authorized the imposition of blocking sanctions on anyone operating in the Russian manufacturing sector. Among sanctions targets are Russian political figures and military personnel, certain oligarchs and journalists, and companies operating in the above-mentioned sectors. Export to Russia of certain luxury goods, and goods and technology which might contribute to Russia’s technological enhancement was banned. Seven non-EU countries (Norway, Iceland, Liechtenstein, North Macedonia, Bosnia and Herzegovina, Montenegro, and Albania) announced that they “aligned themselves” with the majority of the EU sanctions. The U.S., the EU, Switzerland and Japan introduced additional trade restrictions banning, among many other goods, the export of certain non-tobacco materials used to produce cigarettes and heated tobacco consumables in Russia. The EU, Switzerland and the U.K. also prohibited technical assistance and other services related to restricted goods. The EU, Switzerland and the U.K. prohibited import into their territories of certain goods, including cigarettes, among others, which might generate significant revenues for Russia if they originate in Russia or are exported from Russia. The EU and Switzerland prohibited transfer and licensing of intellectual property rights in relation to restricted goods. Additionally, the EU, the U.S., the U.K., Switzerland, Canada, Australia, New Zealand and Ukraine imposed sanctions on Mr. Igor Kesaev, a non-majority shareholder of Megapolis Distribution B.V.

The U.S., the U.K., Switzerland and the EU banned the export of electric accumulators and static converters to Russia. In addition, the U.S., the EU and the U.K. banned the export of electronic cigarettes and similar personal electric vaporizing devices, including IQOS devices. Certain countries have also banned the delivery of services to Russia, such as information
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technology consultancy services, accounting and business and management consulting services, or require licenses to continue delivering these services to Russian persons or entities. We are working to mitigate any potential impacts from these restrictions.

Russia introduced certain countermeasures aimed at reducing the effect of Western sanctions. Countermeasures include restrictions on export of certain goods from Russia, including tobacco-related production equipment, restrictions on lending to foreign borrowers, repatriation of dividends and transactions with securities and real estate involving companies from “hostile” countries (i.e., those which introduced sanctions in relation to Russia).

PMI continues to monitor the development of new sanctions and ensure full compliance.


Segment Operating Results – Three Months and Nine Months Ended September 30, 2024

The following discussion compares operating results within each of our segments for the three months and nine months ended September 30, 2024, with the three months and nine months ended September 30, 2023.

Europe:

Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 4,121 $ 3,823 7.8 %8.7 %$298 $(35)$— $228 $105 $— 
Operating Income$ 2,020 $ 1,717 17.6 %15.5 %$303 $37 $— $228 $47 $(9)

During the quarter, net revenues increased by 7.8%. Net revenues, excluding currency and acquisitions, increased by 8.7%, reflecting: a favorable pricing variance, mainly driven by higher combustible tobacco pricing; and favorable volume/mix, primarily driven by higher HTU volume, partly offset by adverse cigarette mix.

Operating income increased by 17.6%. Operating income, excluding currency and acquisitions, increased by 15.5%, primarily reflecting: the same factors as for net revenues, as well as a favorable comparison to 2023 reflecting the 2023 charge related to the termination of a pledge agreement with the Foundation for a Smoke-Free World of $60 million; partly offset by higher marketing, administration and research costs.

Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 11,301 $ 10,465 8.0 %7.7 %$836 $34 $— $596 $206 $— 
Operating Income$ 5,136 $ 4,551 12.9 %12.7 %$585 $6 $— $596 $113 $(130)

For the nine months ended September 30, 2024, net revenues increased by 8.0%. Net revenues, excluding currency and acquisitions, increased by 7.7%, primarily driven by the same factors as for the quarter.

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The pricing variance for the full year 2023 and the first nine months of 2024 was negatively impacted by the supplemental tax surcharge on heated tobacco products ("HTPs") in Germany, which went into effect in 2022. On March 14, 2024, the Court of Justice of the European Union (the "CJEU") ruled that the German fiscal regulation imposing an additional excise tax on HTPs does not contravene EU law. On May 15, 2024, following the decision issued by CJEU, the Fiscal Court in Dusseldorf (the "FCD") also ruled that the German fiscal regulation imposing an additional excise tax on HTPs does not contravene EU law. The FCD admitted an appeal to the Federal Tax Court. On June 19, 2024, PMI submitted an appeal. The negative impact will continue, at least until the appeal ruling on the legality of the surcharge is concluded. PMI currently accounts for the surcharge as a reduction in net revenues and in accrued liabilities in its results, with amounts withdrawn before May 15, 2024, currently under a payment suspension. The accrued liability balance of $0.8 billion (excluding interest), existing as of September 30, 2024, may remain until the outcome of the appeal is known. An unfavorable outcome to the appeal would negatively impact PMI’s future cash provided by operating activities. A favorable outcome to the appeal would positively impact future PMI’s operating results.

Operating income increased by 12.9%. Operating income, excluding currency and acquisitions, increased by 12.7%, primarily reflecting: a favorable comparison to 2023 reflecting the 2023 charge related to the termination of a pledge agreement with the Foundation for a Smoke-Free World of $60 million and $47 million related to asset impairment and exit costs in 2023, as well as a favorable pricing variance, mainly driven by higher combustible tobacco pricing; and favorable volume/mix, primarily driven by higher HTU volume, notwithstanding lower cigarette volume; partly offset by higher marketing, administration and research costs, as well as manufacturing costs, including the impact of the EU single-use plastics directive.

Europe - Total Market, PMI Shipment Volume and Market Share Commentaries

第 3 四半期のタバコと HTU の推定総市場は、タバコの 0.6% 増加と HTU の継続的な成長を反映して、 1.8% 増加した 1486億台となりました。推定総市場の増加は、主にウクライナ （ 9.4% 増 ） 、イタリア （ 3.5% 増 ） 、スペイン （ 3.8% 増 ） によるものであり、フランス （ 10.9% 減 ） 、オランダ （ 25.6% 減 ） 、ベルギー （ 16.2% 減 ） によって一部相殺されました。

今年までの 9 ヶ月間、この地域のタバコと HTU の推定総市場は概ね安定しており、タバコの 1.5% の減少が HTU の増加によって大きく相殺されました。推定市場全体の減少は、主にフランス （ 12.8% 減 ） 、英国 （ 11.0% 減 ） 、オランダ （ 18.7% 減 ） によるものであり、ブルガリア （ 7.9% 増 ） 、ギリシャ （ 8.2% 増 ） 、ポーランド （ 1.9% 増 ） によって一部相殺されました。

ヨーロッパキーデータ第 3 四半期9 ヶ月間年次
変化変化
20242023% / pp20242023% / pp
PMI の市場シェア
タバコ30.1 %30.5 %(0.4)30.1 %30.4 %(0.3)
加熱タバコユニット9.5 %8.6 %0.9 9.7 %8.8 %0.9 
トータルヨーロッパ39.6 %39.1 %0.5 39.8 %39.1 %0.7 
Note: Sum may not foot due to rounding.
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3919
In the third quarter, our total cigarette and HTU shipment volume in the Region increased by 2.5% to 57.9 billion units. Total cigarette and HTU shipment volume increased notably in Ukraine (up by 12.3%) and Poland (up by 5.7%), and decreased notably in Belgium (down by 25.8%), as well as the Netherlands (down by 24.9%).

Our estimated HTU adjusted in-market sales volume in the Region increased by 11.3% in the quarter, reflecting continued growth momentum for IQOS.

In the third quarter, our HTU share of the total cigarette and HTU market in the Region increased by 0.8 pp on an adjusted basis.

For the nine months year-to-date, our total cigarette and HTU shipment volume in the Region increased by 1.0% to 162.8 billion units. Total cigarette and HTU shipment volume increased notably in Poland (up by 7.1%) and Ukraine (up by 8.7%), and decreased notably in France (down by 18.4%), as well as the Netherlands (down by 18.2%).

For the nine months year-to-date, our estimated HTU adjusted in-market sales volume in the Region increased by 9.2%, reflecting continued growth momentum for IQOS, partly offset by the impact from the EU characterizing flavor ban.

For the nine months year-to-date, our HTU share of the total cigarette and HTU market in the Region increased by 0.9 pp on an adjusted basis.
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5182
Other Oral SFP includes chew bags and tobacco bits
Note: Sum may not foot due to rounding.

In the third quarter, oral SFP shipments increased by 4.2%, primarily driven by nicotine pouches (up by 23.5%).

For the nine months year-to-date, oral SFP shipments increased by 6.0%, driven by growth of nicotine pouches (up by 34.4%).


SSEA, CIS & MEA:
Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 2,964 $ 2,777 6.7 %12.1 %$187 $(148)$— $296 $39 $— 
Operating Income$ 960 $ 823 16.6 %29.8 %$137 $(129)$21 $296 $21 $(72)
During the quarter, net revenues increased by 6.7%. Net revenues, excluding currency and acquisitions, increased by 12.1%, primarily reflecting: a favorable pricing variance, predominantly driven by higher combustible tobacco pricing; and favorable volume/mix, driven by HTU performance.

Operating income increased by 16.6%. Operating income, excluding currency and acquisitions, increased by 29.8%, primarily reflecting: the same factors as for net revenues, as well as a favorable comparison to 2023 reflecting the 2023 charge related to the termination of a pledge agreement with the Foundation for a Smoke-Free World of $41 million; partly offset by higher manufacturing costs (primarily due to higher cost of tobacco leaf) and the Egypt sales tax charge of $45 million in 2024.

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Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 8,393 $ 7,922 5.9 %13.4 %$471 $(593)$— $680 $306 $78 
Operating Income$ 2,623 $ 2,437 7.6 %30.9 %$186 $(600)$33 $680 $117 $(44)

For the nine months ended September 30, 2024, net revenues increased by 5.9%. Net revenues, excluding currency and acquisitions, increased by 13.4%, primarily reflecting: a favorable pricing variance, predominantly driven by higher combustible tobacco pricing; favorable volume/mix, driven by higher cigarette and HTU volume, as well as favorable mix, and a favorable comparison to 2023 due to the charge of $80 million following the termination of a distribution arrangement in the Middle East (recognized as a reduction of net revenues in 2023).

Operating income increased by 7.6%. Operating income, excluding currency and acquisitions, increased by 30.9%, primarily reflecting: a favorable pricing variance, predominantly driven by higher combustible tobacco pricing; favorable volume/mix, driven by higher cigarette and HTU volume, notwithstanding unfavorable cigarette mix, a favorable comparison to 2023 reflecting a 2023 charge of $80 million following the termination of a distribution arrangement in the Middle East, a 2023 charge related to the termination of a pledge agreement with the Foundation for a Smoke-Free World of $41 million and $32 million related to asset impairment and exit costs in 2023. These increases were partly offset by higher manufacturing costs (primarily due to higher cost of tobacco leaf), and the Egypt sales tax charge of $45 million in 2024.

SSEA, CIS & MEA - Total Market, PMI Shipment Volume and Market Share Commentaries
In the third quarter, the estimated total market for cigarettes and HTUs in the Region increased by 2.0% to 399.4 billion units. The increase in the estimated total market was mainly due to Egypt (up by 32.4%), Russia (up by 8.3%), and Turkey (up by 9.4%), partly offset by Bangladesh (down by 30.8%), Indonesia (down by 3.3%), and Thailand (down by 17.0%).

For the nine months year-to-date, the estimated total market for cigarettes and HTUs in the Region increased by 2.4% to 1,167.0 billion units. The increase in the estimated total market was mainly due to Turkey (up by 10.4%), Russia (up by 6.4%), and Egypt (up by 9.4%), partly offset by Bangladesh (down by 4.9%), Thailand (down by 15.4%), and the Philippines (down by 5.4%).
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8143
In the third quarter, our total cigarette and HTU shipment volume in the Region increased by 3.2% to 98.6 billion units, mainly driven by Turkey (up by 13.1%), partly offset by Indonesia (down by 8.9%). Our estimated HTU adjusted in-market sales volume increased by 20.9%, with 17.1% HTU shipment volume growth.

For the nine months year-to-date, our total cigarette and HTU shipment volume in the Region increased by 4.3% to 279.2 billion units, mainly driven by Turkey (up by 14.9%), partly offset by Indonesia (down by 4.6%). Our estimated HTU adjusted in-market sales volume increased by 15.5%, with 15.8% HTU shipment volume growth.


EA, AU & PMI DF:

Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 1,602$ 1,5712.0 %7.4 %$31 $(85)$— $71 $45 $— 
Operating Income$ 788$ 7692.5 %7.8 %$19 $(41)$— $71 $(21)$10 

During the quarter, net revenues increased by 2.0%. Net revenues, excluding currency and acquisitions, increased by 7.4%, reflecting: a favorable pricing variance and favorable volume/mix, mainly driven by higher HTU volume, partly offset by lower cigarette volume.

Operating income increased by 2.5%. Operating income, excluding currency and acquisitions, increased by 7.8%, primarily reflecting: a favorable pricing variance and a favorable comparison to 2023 for a 2023 charge related to the termination of a pledge agreement with the Foundation for a Smoke-Free World of $24 million. This increase was partly offset by unfavorable volume/mix, driven by cigarettes, and higher marketing, administration and research costs.




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Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 4,959 $ 4,771 3.9 %10.5 %$188 $(314)$— $289 $213 $— 
Operating Income$ 2,304 $ 1,963 17.4 %30.5 %$341 $(257)$— $289 $53 $256 

For the nine months ended September 30, 2024, net revenues increased by 3.9%. Net revenues, excluding currency and acquisitions, increased by 10.5%, reflecting: a favorable pricing variance and favorable volume/mix, mainly driven by higher HTU volume, partly offset by lower cigarette volume.

Operating income increased by 17.4%. Operating income, excluding currency and acquisitions, increased by 30.5%, mainly driven by the same factors as for net revenues, as well as a favorable comparison to 2023 reflecting the South Korea indirect tax charge of $204 million in 2023.

EA, AU & PMI DF - Total Market, PMI Shipment Volume and Market Share Commentaries
In the third quarter, the estimated total market for cigarettes and HTUs in the Region, excluding China, decreased by 1.4% to 82.2 billion units, with a decrease in cigarettes, partly offset by HTU growth. The decrease in the estimated total market was mainly driven by Taiwan (down by 10.0%) and Korea (down by 3.2%), partly offset by International Duty Free (up by 7.2%) and Japan (up by 0.9%).

For the nine months year-to-date, the estimated total market for cigarettes and HTUs in the Region, excluding China was broadly stable, with a decrease in cigarettes, largely offset by HTU growth. The decrease in the estimated total market was mainly driven by Australia (down by 29.0%) and Korea (down by 2.5%), partly offset by International Duty Free (up by 10.9%) and Japan (up by 1.0%).
10724
In the third quarter, our total cigarette and HTU shipment volume in the Region increased by 2.4% to 26.7 billion units, driven by Japan (up by 1.5%), partly offset by Australia (down by 30.0%).

Our estimated HTU adjusted in-market sales volume in the Region increased by 15.5% in the quarter, including growth in Japan of 14.3%.
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For the nine months year-to-date, our total cigarette and HTU shipment volume in the Region increased by 4.1% to 81.2 billion units, driven by Japan (up by 8.9%), partly offset by Australia (down by 28.2%).

For the nine months year-to-date, our estimated HTU adjusted in-market sales volume in the Region increased by 14.7%, including growth in Japan of 13.4%.


Americas:

Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 1,148 $ 895 28.3 %30.5 %$253 $(20)$— $92 $133 $48 
Operating Income$ 137 $ 98 39.8 %20.4 %$39 $19 $— $92 $116 $(188)

During the quarter, net revenues increased by 28.3%. Net revenues, excluding currency and acquisitions, increased by 30.5%, primarily reflecting: a favorable pricing variance and favorable volume/mix, both predominantly driven by nicotine pouches in the U.S., partly offset by lower cigarette volume and unfavorable cigarette mix outside of the U.S.

Operating income increased by 39.8%. Operating income, excluding currency and acquisitions, increased by 20.4%, mainly reflecting: favorable volume/mix and price variance, mainly due to the same factors as for net revenues; partly offset by higher marketing, administration and research costs, including incremental investment in the U.S., as well as higher amortization of intangibles in 2024.

Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 3,273 $ 2,732 19.8 %18.7 %$541 $31 $— $146 $364 $— 
Operating Income$ 419 $ 524 (20.0)%(34.5)%$(105)$76 $— $146 $333 $(660)

For the nine months ended September 30, 2024, net revenues increased by 19.8%. Net revenues, excluding currency and acquisitions, increased by 18.7%, primarily reflecting: favorable volume/mix, mainly due to growth of ZYN nicotine pouches in the U.S., partly offset by cigarette volume declines outside of the U.S.; and favorable cigarette pricing.

Operating income decreased by 20.0%. Operating income, excluding currency and acquisitions, decreased by 34.5%, mainly reflecting: higher marketing, administration and research costs, including incremental investment in the U.S, higher asset impairment and exit costs and higher amortization of intangibles, partly offset by favorable price variance and favorable volume/mix, mainly due to the same factors as for net revenues.

Americas - Total Market, PMI Shipment Volume and Market Share Commentaries

In the third quarter, the estimated total market for cigarettes and HTUs in the Region, excluding the U.S., decreased by 0.7% to 46.5 billion units, primarily reflecting a decline in the cigarette market. The decrease in the estimated total market was mainly due to Canada (down by 15.4%) and Mexico (down by 5.8%), partly offset by Brazil (up by 12.3%).

For the nine months year-to-date, the estimated total market for cigarettes and HTUs in the Region, excluding the U.S., decreased by 2.1% to 136.1 billion units, primarily reflecting a decline for cigarettes. The decrease in the estimated total market was mainly due to Argentina (down by 11.5%) and Canada (down by 13.1%), partly offset by Brazil (up by 8.5%).
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13472
In the third quarter, our total cigarette and HTU shipment volume in the Region decreased by 1.1% to 15.4 billion units, mainly due to Mexico (down by 5.9% ) and Argentina (down by 4.3%), partly offset by Brazil (up by 13.6%).

For the nine months year-to-date, our total cigarette and HTU shipment volume in the Region decreased by 2.8% to 44.9 billion units, mainly due to Argentina (down by 11.6%), partly offset by Brazil (up by 10.8%).

For the nine months year-to-date, our cigar shipment volume decreased by 14.6%, predominantly due to trade inventory movements in the prior-year around the April 2023 price increase.
13991
(1) Excluding U.S. chew
Note: Volumes of other oral SFP introduced in Q3 2024 are not material. Sum may not foot due to rounding.
In the third quarter, oral products shipments increased by 32.3%, predominantly driven by ZYN nicotine pouches in the U.S.

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For the nine months year-to-date, oral products shipments increased by 39.3%, predominantly driven by ZYN nicotine pouches in the U.S.


Wellness and Healthcare:

The results of PMI’s Vectura Fertin Pharma business are reported in the Wellness and Healthcare segment. The business operations of our Wellness and Healthcare segment are evaluated separately from the geographical segments.
Financial Summary
Quarters Ended September 30,Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 76 $ 75 1.3 %2.7 %$1 $(1)$— $2 $— $— 
Operating Income / (Loss)$ (251)$ (37)-(100)%-(100)%$(214)$(4)$— $2 $— $(212)

During the quarter, net revenues increased by 1.3%. Net revenues, excluding currency and acquisitions, increased by 2.7%.

The operating loss of $251 million in 2024 was primarily due to a charge of $198 million related to the impairment of Vectura Group's expected sale in 2024, as well as research and development, and administration costs. For further details, see Note 18. Acquisitions and Divestitures.

Financial Summary

Nine Months Ended September 30,		Change
Fav./(Unfav.)		Variance
Fav./(Unfav.)
20242023TotalExcl.
Curr. & Acquis.		TotalCur-
rency		Acqui-sitionsPriceVol/
Mix		Cost/
Other
(in millions)
Net Revenues$ 246 $ 237 3.8 %3.4 %$9 $1 $— $10 $— $(2)
Operating Income / (Loss)$ (339)$ (808)58.0 %58.3 %$469 $(2)$— $10 $— $461 

For the nine months ended September 30, 2024, net revenues increased by 3.8%. Net revenues, excluding currency and acquisitions, increased by 3.4%.

The operating loss of $339 million in 2024 was primarily due to a charge of $198 million related to the impairment of Vectura Group's expected sale in 2024, as well as research and development, and administration costs. The operating loss in 2023 included an impairment charge of $680 million consisting of a goodwill impairment of $665 million and a non-amortizable intangible asset impairment charge of $15 million. For further details, see Note 4. Goodwill and Other Intangible Assets, net and Note 18. Acquisitions and Divestitures.


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Financial Review

Cash Flow Highlights
495051
For the Nine Months Ended September 30,
(in millions)20242023
Net cash provided by (used in) operating activities$8,215 $5,902 
Net cash provided by (used in) investing activities(1,533)(3,030)
Net cash provided by (used in) financing activities(5,378)(2,685)

Net Cash Provided by (Used in) Operating Activities
During the first nine months of 2024, net cash provided by operating activities was $8.2 billion as compared to $5.9 billion in the first nine months of 2023. Excluding unfavorable currency movements of $1.1 billion, the favorable variance of $3.4 billion was due primarily to lower working capital requirements of $1.5 billion and higher currency-neutral net earnings, excluding non-cash depreciation and amortization expense and impairment charges of goodwill and other intangibles, as well as impairment related to Vectura Group's expected sale.

The unfavorable currency movements primarily related to the currency impact on net earnings and represented the fluctuations of the U.S. dollar, especially against the Egyptian pound, Japanese yen and Russian ruble.

The lower working capital requirements in 2024 as compared with 2023 were primarily due to more cash provided by inventories, coupled with less cash used in accrued liabilities and other current assets, mainly reflecting the timing of excise tax-paid inventory movements primarily related to excise tax increases and the timing of the corresponding excise tax payments and less cash used in accounts payable in 2024 primarily due to comparison with 2023 payment for higher IQOS ILUMA device purchases in the fourth quarter of 2022 to meet the needs of ILUMA launches. The favorable 2024 working capital comparison to 2023 is also impacted by higher 2023 working capital requirements following the higher cost of tobacco leaf and other direct materials due to inflationary pressures (for further details, see “Impact of Inflation on Our Business and Mitigation Efforts” section of this MD&A), as well as tactical stock increases for certain direct materials. These changes in the working capital requirements were partly offset by more cash used in accounts receivable mainly reflecting lower usage of our factoring arrangements to sell trade receivables, as well as the timing of sales and cash collections. For further detail on our factoring arrangements, see Note 13. Sale of Accounts Receivable.

For the full year 2024, we currently expect net cash provided by operating activities of approximately $11 billion at prevailing exchange rates, subject to year-end working capital requirements.
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Net Cash Provided by (Used in) Investing Activities

During the first nine months of 2024, net cash used in investing activities was $1.5 billion as compared to $3.0 billion in the first nine months of 2023. This decrease in net cash used was primarily due to the remaining cash payment (including interest) to Altria Group, Inc. in July 2023 of $1.8 billion for PMI to reacquire the IQOS commercialization rights in the U.S., partially offset by higher capital expenditures.

Capital expenditures of $1.2 billion during the first nine months of 2024 increased by $0.2 billion as compared with the first nine months of 2023. The 2024 capital expenditures were primarily related to our ongoing investments in smoke-free product manufacturing capacity. We expect total capital expenditures in 2024 to be around $1.4 billion, including further investments in ZYN capacity in the U.S.

Net Cash Provided by (Used in) Financing Activities

During the first nine months of 2024, net cash used in financing activities was $5.4 billion as compared to $2.7 billion in the first nine months of 2023. The increase in net cash used was primarily due to lower net borrowings in 2024 reflecting lower long-term debt proceeds and higher repayments on short-term borrowings (primarily commercial paper). The increase was partly offset by favorable comparisons to 2023 mainly reflecting repayment on the bridge facility in 2023 related to the Swedish Match acquisition, and payments in 2023 to acquire the remaining issued and outstanding shares in Swedish Match.

Debt and Liquidity

We define cash and cash equivalents as short-term, highly liquid investments, readily convertible to known amounts of cash that mature within a maximum of three months and have an insignificant risk of change in value due to interest rate or credit risk changes. As a policy, we do not hold any investments in structured or equity-linked products. Our cash and cash equivalents are predominantly held with institutions that have investment-grade long-term credit rating.

In a number of jurisdictions, including Argentina and Russia, we are impacted by various capital controls and/or foreign currency exchange constraints that affect the ability of our subsidiaries in these jurisdictions to settle foreign currency denominated imports of goods and services and/or to pay dividends. These factors increase foreign currency devaluation risks, which may have a negative impact on our financial condition, net assets and results of operations in these jurisdictions.

We utilize long-term and short-term debt financing, including a commercial paper program that is regularly used to finance ongoing liquidity requirements, as part of our overall cash management strategy. Our ability to access the capital and credit markets as well as overall dynamics of these markets may impact borrowing costs. We expect that the combination of our long-term and short-term debt financing, the commercial paper program and the committed credit facilities, coupled with our operating cash flows, will enable us to meet our liquidity requirements.

In August 2021, we published a business transformation-linked financing framework (“Framework”), which integrates PMI's smoke-free transformation into its financing strategy. The Framework outlines the guidelines that we will follow in issuing business transformation-linked financing instruments in the debt capital and loan markets, which may include public notes offerings, private placements, loans, and other relevant financing instruments.

Credit Ratings – The cost and terms of our financing arrangements as well as our access to commercial paper markets may be affected by applicable credit ratings. At September 30, 2024, our credit ratings and outlook by major credit rating agencies were as follows:
   Short-term  Long-term  Outlook
Moody’s  P-1  A2  Stable
Standard & Poor’s  A-2  A-  Stable
Fitch  F1  A  Negative
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Revolving Credit Facilities

At September 30, 2024, our committed revolving credit facilities were as follows:
Type (in billions)Committed
Revolving Credit
Facilities
364-day revolving credit, expiring January 28, 2025$1.7 
Multi-year revolving credit, expiring February 10, 2026 (1)
2.0 
Multi-year revolving credit, expiring September 29, 2026 (2) (3)
2.5 
 
Total facilities 
$6.2 
(1) On January 28, 2022, we entered into an agreement, effective February 10, 2022, to amend and extend the term of our $2.0 billion multi-year revolving credit facility, for an additional year covering the period February 11, 2026 to February 10, 2027, in the amount of $1.9 billion.
(2) Includes business transformation-linked pricing adjustments that may result in the reduction or increase in both the interest rate and commitment fee under the credit agreement if PMI achieves, or fails to achieve, certain specified targets based on its business transformation goals.
(3) On September 20, 2022, we entered into an agreement, effective September 29, 2022, to amend and extend the term of our $2.5 billion multi-year revolving credit facility, for an additional year covering the period September 30, 2026 to September 29, 2027, in the amount of $2.3 billion. On September 20, 2023, we entered into an agreement, effective September 29, 2023, to amend and further extend the term to September 29, 2028.

At September 30, 2024, there were no borrowings under the committed revolving credit facilities, and the entire committed amounts were available for borrowing.

All banks participating in our committed revolving credit facilities have an investment-grade long-term credit rating from the credit rating agencies. We continuously monitor the credit quality of our banking group, and at this time we are not aware of any potential non-performing credit provider.

These committed revolving credit facilities do not include any credit rating triggers, material adverse change clauses or any provisions that could require us to post collateral. We expect to continue to meet our covenants.

In addition to the committed revolving credit facilities discussed above, PMI maintains certain short-term credit arrangements, including uncommitted credit lines, to primarily meet working capital needs. These credit arrangements amounted to approximately $2.2 billion at September 30, 2024, and approximately $2.7 billion at December 31, 2023. Borrowings under these arrangements and other bank loans amounted to $152 million at September 30, 2024, and $283 million at December 31, 2023.

Credit Facilities related to the Financing of the Swedish Match Acquisition

In connection with PMI's all-cash recommended public offer to the shareholders of Swedish Match, on May 11, 2022, PMI entered into a credit agreement relating to a 364-day senior unsecured bridge facility. The facility provided for borrowings up to an aggregate principal amount of $17 billion, expiring 364 days after the occurrence of certain events unless extended. On June 23, 2022, PMI entered into a €5.5 billion (approximately $5.8 billion at the date of signing) senior unsecured term loan credit agreement consisting of a €3.0 billion (approximately $3.2 billion at the date of signing) tranche expiring three years after the occurrence of certain events and a €2.5 billion (approximately $2.6 billion at the date of signing) tranche expiring on June 23, 2027. In connection with the term loan facility, the aggregate principal amount of commitments under the 364-day senior unsecured bridge facility was reduced from $17 billion to $11 billion. On November 11, 2022, PMI acquired a controlling interest of 85.87% of the total issued shares in Swedish Match and acquired 94.81% of its outstanding shares as of December 31, 2022. In accordance with the Swedish Companies Act, PMI subsequently exercised its right to compulsorily redeem the remaining shares for which acceptances were not received and obtained legal title to 100% of the shares in Swedish Match on February 17, 2023.

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PMI borrowed $8.4 billion under the bridge facility by delivering notices of borrowing for advances of $7.9 billion and $0.5 billion on November 7, 2022 and November 10, 2022, respectively. On November 21, 2022 and February 17, 2023, PMI repaid $4.0 billion and $4.4 billion, respectively, under the bridge facility. Effective February 20, 2023, the remaining outstanding commitments under the bridge facility were fully canceled and the bridge facility agreement was terminated in accordance with its terms.

On November 7, 2022, PMI also delivered notices of borrowing for advances totaling €5.5 billion under the term loan facility, of which €3.0 billion will become due on November 9, 2025 and €2.5 billion will become due on June 23, 2027 unless prepaid pursuant to the terms of the credit agreement. As of September 30, 2024 and December 31, 2023, the €5.5 billion (approximately $6 billion) term loan facility was fully drawn and remained outstanding. 

The proceeds under the bridge facility and the term loan facility were used, directly or indirectly, to finance the acquisition, including, the payment of related fees and expenses.

Commercial Paper Program – We continue to have access to liquidity in the commercial paper market through programs in place in the U.S. and in Europe having an aggregate issuance capacity of $8.0 billion. At September 30, 2024, we had no commercial paper outstanding. At December 31, 2023, we had $1.7 billion commercial paper outstanding. The average commercial paper balance outstanding during the first nine months of 2024 was $1.5 billion. The average commercial paper balance outstanding during 2023 was $3.6 billion.

Sale of Accounts Receivable – To mitigate credit risk and enhance cash and liquidity management, we sell trade receivables to unaffiliated financial institutions. For further details, see Note 13. Sale of Accounts Receivable to our condensed consolidated financial statements.

Supply Chain Financing – We engage with unaffiliated global financial institutions that offer a voluntary supply chain financing program to some of our suppliers. For further details, see Note 17. Supply Chain Financing to our condensed consolidated financial statements.

Debt – Our total debt was $49.2 billion at September 30, 2024 and $47.9 billion at December 31, 2023.

On February 10, 2023, we filed a shelf registration statement with the U.S. Securities and Exchange Commission, under which we may from time to time sell debt securities and/or warrants to purchase debt securities over a three-year period.

PMI's debt issuances in the first nine months of 2024 were as follows:
(in millions)
TypeFace Value Interest RateIssuanceMaturity
U.S. dollar notes(a)$7504.750%February 2024February 2027
U.S. dollar notes(a)$1,0004.875%February 2024February 2029
U.S. dollar notes(a)$1,2505.125%February 2024February 2031
U.S. dollar notes(a)$1,7505.250%February 2024February 2034
Euro notes(b) (c)
€500 (approximately $543)
3.750%June 2024January 2031
(a) Interest is payable semi-annually, commencing in August 2024
(b) Interest is payable annually, commencing in January 2025
(c) USD equivalents for foreign currency notes were calculated based on exchange rates on the date of issuance.

The net proceeds from the sale of the securities listed in the table above have been or will be used for general corporate purposes, including working capital requirements, repayment of commercial paper and to refinance certain of our outstanding notes due in 2024.
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Guarantees – At September 30, 2024, we have guarantees of our own performance, which are primarily related to excise taxes on the shipment of our products. There is no liability in the condensed consolidated financial statements associated with these guarantees. These guarantees have not had, and are not expected to have, a significant impact on PMI’s liquidity.

In August 2024, PMI entered into a guarantee agreement for an equity investee. For further details, see Note 12. Related Parties – Equity Investments and Other.

Swedish Match Notes Consent Solicitation and PMI Guarantee

On June 15, 2023, our wholly owned subsidiary, Swedish Match AB ("Swedish Match"), initiated a public consent solicitation of eligible holders of certain outstanding series of its notes to amend certain terms and conditions of these respective notes. The eligible noteholders provided the requisite irrevocable consent instructions voting in favor of the amendments, which were subsequently passed by way of extraordinary resolution at the noteholders’ meeting held on July 28, 2023. As a result of the passage of the extraordinary resolution, Philip Morris International Inc. entered into a guarantee, which guarantees unconditionally and irrevocably to the noteholders the punctual payment when due, whether at stated maturity, by acceleration or otherwise, of the principal, premium, if any, and interest on the notes.

Equity and Dividends

We discuss our stock awards as of September 30, 2024 in Note 2. Stock Plans to our condensed consolidated financial statements.

On June 11, 2021, our Board of Directors authorized a share repurchase program of up to $7 billion, with target spending of $5 billion to $7 billion over a three-year period. On July 22, 2021, we began repurchasing shares under this share repurchase program. On May 11, 2022, we announced the suspension of our three-year share repurchase program following the recommended public offer to acquire the outstanding shares of Swedish Match from its shareholders. We did not make any share repurchases in 2023 and 2024. Our three-year share repurchase program expired on July 21, 2024.

Dividends paid in the first nine months of 2024 were $6.1 billion. During the third quarter of 2024, our Board of Directors approved a 3.8% increase in the quarterly dividend to $1.35 per common share. As a result, the present annualized dividend rate is $5.40 per common share.

Market Risk
Counterparty Risk - We predominantly work with financial institutions with strong short- and long-term credit ratings as assigned by Standard & Poor’s and Moody’s. These banks are also part of a defined group of relationship banks. Non-investment grade institutions are only used in certain emerging markets to the extent required by local business needs. We have a conservative approach when it comes to choosing financial counterparties and financial instruments. As such, we do not invest or hold investments in any structured or equity-linked products. The majority of our cash and cash equivalents is currently invested with maturities of less than 30 days.
We continuously monitor and assess the credit worthiness of all our counterparties.
Derivative Financial Instruments - We operate in markets globally with manufacturing and sales facilities in various locations around the world. Consequently, we use certain financial instruments to manage our foreign currency and interest rate exposure. We use derivative financial instruments principally to reduce our exposure to market risks resulting from fluctuations in foreign exchange and interest rates by creating offsetting exposures. We are not a party to leveraged derivatives and, by policy, do not use derivative financial instruments for speculative purposes.
See Note 5. Financial Instruments to our condensed consolidated financial statements for further details on our derivative financial instruments and the related collateral arrangements.

Contingencies
See Note 8. Contingencies to our condensed consolidated financial statements for a discussion of contingencies.

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Cautionary Factors That May Affect Future Results

Forward-Looking and Cautionary Statements
We may from time to time make written or oral forward-looking statements, including statements contained in filings with the SEC, in reports to stockholders and in press releases and investor webcasts. You can identify these forward-looking statements by use of words such as "strategy," "expects," "continues," "plans," "anticipates," "believes," "will," "aspires," "estimates," "intends," "projects," "aims," "goals," "targets," "forecasts" and other words of similar meaning. You can also identify them by the fact that they do not relate strictly to historical or current facts.
We cannot guarantee that any forward-looking statement will be realized, although we believe we have been prudent in our plans and assumptions. Our SFPs constitute a relatively new product category that is less predictable than our mature cigarette business. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. Investors should bear this in mind as they consider forward-looking statements and whether to invest in or remain invested in our securities. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, we are identifying important factors that, individually or in the aggregate, could cause actual results and outcomes to differ materially from those contained in any forward-looking statements made by us; any such statement is qualified by reference to the following cautionary statements. We elaborate on these and other risks we face throughout this document, particularly in the Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations — Business Environment section in this report. You should understand that it is not possible to predict or identify all risk factors. Consequently, you should not consider the following to be a complete discussion of all potential risks or uncertainties. We do not undertake to update any forward-looking statement that we may make from time to time, except in the normal course of our public disclosure obligations.

Overall Business Risks
We may be unsuccessful in our attempts to introduce, commercialize, and grow smoke-free products in existing and new markets, and regulators may prohibit or significantly restrict the commercialization of these products or the communication of scientifically substantiated information and claims.
Our key strategic priorities are to: (i) continue developing and commercializing products that present less risk of harm to adult smokers who switch to smoke-free products versus continued cigarette smoking; and (ii) encourage and educate current adult smokers who would otherwise continue to smoke cigarettes to switch to those products. For our efforts to be successful, we must:
•develop SFPs that adult smokers who would otherwise continue to smoke cigarettes find to be satisfying alternatives to smoking;
•for those adult smokers, our goal is to offer SFPs with a scientifically substantiated risk-reduction profile that approaches as closely as possible the risk-reduction profile associated with smoking cessation;
•substantiate the reduction of risk for the individual adult smoker and the reduction of harm to the population as a whole, based on scientific evidence of the highest standard that is made available for scrutiny and review by external independent scientists and relevant regulatory bodies; and
•advocate for the development of science-based regulatory frameworks for the development and commercialization of SFPs, including the communication of scientifically substantiated information to enable adult smokers to make better choices.

We might not succeed in our effort to introduce, commercialize, and grow our SFPs in existing and new markets. If we do not succeed, but others do, or if heat-not-burn products are inequitably regulated compared to other SFP categories without regard to the totality of the scientific evidence available for such products, we may be at a competitive disadvantage. In addition, actions of some market participants, such as the inappropriate marketing of e-vapor products to youth, as well as alleged health consequences associated with the use of certain e-vapor products, may unfavorably impact public opinion and/or mischaracterize the health consequences of all e-vapor products or other SFPs to consumers, regulators and policy makers without regard to the totality of scientific evidence available for specific products. This may impede our efforts to advocate for the development of science-based regulatory frameworks for the development and commercialization of SFPs. We cannot predict the extent to which regulators will permit the sale and/or marketing of SFPs. Regulatory restrictions could limit the success of our SFPs.
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The World Health Organization (the "WHO") study group on tobacco product regulation published their ninth report on the scientific basis of tobacco product regulation in August 2023. The report is based on a review of scientific evidence related to novel and emerging nicotine and tobacco products, such as electronic nicotine delivery systems ("ENDS"), electronic non-nicotine delivery systems and HTPs. The report concludes by making a number of policy recommendations on HTPs and ENDS that, if implemented, could restrict both the availability of these products and the access to accurate information about them. In August 2021, the FCTC Secretariat published two reports on novel and emerging tobacco products to the Ninth Session of the CoP of the FCTC, which are not materially different from the WHO study group report. Substantive decisions based on these reports were deferred to the Tenth Session of the CoP ("CoP 10"). CoP 10 to the FCTC took place in February 2024. According to reports and decisions published, neither new decisions nor new policy recommendations on novel and emerging tobacco products were adopted. Specific Guidelines were adopted to address cross-border Tobacco Advertising, Promotion, and Sponsorship ("TAPS") and the depiction of tobacco in entertainment media. The Eleventh Session of the CoP is currently scheduled to take place in 2025.

The WHO’s reports and other FCTC guidelines or recommendations are not binding on the WHO Member States or on parties to the FCTC, and so it is not possible to predict the extent to which any proposals it adopts will be implemented. However, the WHO proposals could lead to restrictions on the availability of certain of our SFPs and access to accurate information about them in one or more of our markets, which could have a material adverse effect on our results of operations.

Additionally, any claims, regardless of merit, challenging our research and clinical data available to date, may impact the development of science-based regulatory frameworks for the commercialization of the SFP category and the commercialization of the SFP category in general.

Our SFPs and commercial activities for these products are designed for, and directed toward, current adult smokers and users of nicotine-containing products. We put significant effort to restrict access of our products from non-smokers and youth. Despite our efforts, technological, operational, regulatory and/or commercial developments might impact the implementation or effectiveness of youth access prevention mechanisms and surrounding infrastructure. If there is significant usage, whether actual or perceived, of our products or competitive products among youth or non-smokers, even in situations over which we have no control, our reputation and credibility may suffer, the regulatory approach to our products may become more restrictive, and our efforts to advocate for the development of science-based regulatory frameworks for the development and commercialization of SFPs may be significantly impacted.

Moreover, the FDA’s premarket tobacco product and modified risk tobacco product authorizations of two versions of our Platform 1 product are subject to strict marketing, reporting and other requirements. Although we have received these authorizations from the FDA, there is no guarantee that the product will remain authorized for sale in the U.S., or that new versions of the product (Platform 1 or other smoke-free platforms) will receive necessary authorizations, particularly if there is a significant uptake in youth or non-smoker initiation.

Premarket tobacco applications for certain ZYN products, which are currently marketed in the U.S., were submitted in March 2020. The FDA has not completed its review of such applications but, consistent with its practice concerning products with respect to which applications were filed prior to a September 9, 2020 deadline, the FDA has not taken enforcement action to prevent these ZYN products from being marketed or indicated that it intends to do so. We also submitted additional premarket tobacco applications for other ZYN products after the deadline, and we are unable to market these products until the FDA authorizes such applications. In April 2024, we submitted MRTPAs for ZYN products currently marketed in the U.S. and requested authorization of the modified risk claim. There is no guarantee that the ZYN products will receive the necessary authorizations from the FDA or that the FDA will allow us to continue to sell the ZYN products currently in the market, pending its review of the applications.

The commercialization of our products in the United States is dependent on successfully managing compliance with federal, state, and local laws, regulations, legal agreements, and related interpretations. Failure to successfully manage compliance and to resolve any disputes that may arise regarding the application of legal and administrative requirements to our products could negatively impact the timing, manner, or success of our SFP commercialization in the United States and could have a material adverse effect on our results of operations, revenues, cash flows, or profitability.

The financial and business performance of our smoke-free products is less predictable than our cigarette business.

Our SFPs are novel products in a relatively new category, and the pace at which adult smokers adopt them may vary, depending on the competitive, regulatory, fiscal and cultural environment, and other factors in a specific market. There may be periods of accelerated growth and periods of slower growth for these products, the timing and drivers of which may be more difficult for
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us to predict versus our mature cigarette business. The impact of this lower predictability on our projected results for a specific period may be significant, due to geopolitical or macroeconomic events that negatively impact SFP availability or adoption, which in turn may have a material adverse effect on our results of operations.

We may be unsuccessful in our efforts to differentiate smoke-free products and cigarettes with respect to taxation.

To date, we have been largely successful in demonstrating to regulators that our SFPs are not cigarettes due to the absence of combustion, and accordingly they are generally taxed either as a separate category or as other tobacco products, which typically yields more favorable tax rates than cigarettes. Nevertheless, we are unable to predict whether regulators will be issuing new regulations under which SFPs will be equally taxed in line with other tobacco products such as conventional cigarettes. If we cease to be successful in these efforts, SFP unit margins may be materially adversely affected, which in turn may have a material adverse effect on our results of operations, revenues, cash flows, and profitability.

Consumption of tax-paid cigarettes continues to decline in many of our markets.

This decline is due to multiple factors, including increased taxes and pricing, governmental actions, the diminishing social acceptance of smoking, health concerns, competition, continuing economic and geopolitical uncertainty, and the continuing prevalence of illicit products. These factors and their potential consequences are discussed more fully below and in Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations — Business Environment section of this report. A continuous decline in the consumption of cigarettes could have a material adverse effect on our revenue, cash flow and profitability, which in turn may have a material adverse effect on our ability to fund our smoke-free transformation.
Cigarettes are subject to substantial taxes. Significant increases in cigarette-related taxes have been proposed or enacted and are likely to continue to be proposed or enacted in numerous jurisdictions. These tax increases may disproportionately affect our profitability and make us less competitive versus certain of our competitors.
Tax regimes, including excise taxes, sales taxes and import duties, can disproportionately affect the retail price of cigarettes versus other combustible tobacco products, or disproportionately affect the relative retail price of our cigarette brands versus cigarette brands manufactured by certain of our competitors. Because our portfolio is weighted toward the premium-price cigarette category, tax regimes based on sales price can place us at a competitive disadvantage in certain markets. Furthermore, our volume and profitability may be adversely affected in these markets.
In addition, increases in cigarette taxes are expected to continue to have an adverse impact on our sales of cigarettes, due to resulting lower consumption levels, a shift in sales from manufactured cigarettes to other combustible tobacco products and from the premium-price to the mid-price or low-price cigarette categories, where we may be under-represented, from local sales to cross-border purchases of lower price products, or to illicit products such as contraband, counterfeit and other non-compliant or otherwise illicit products.
Each of these risks could have a material adverse effect on our business, operations, results of operations, revenues, cash flow and profitability.
Our business faces significant governmental action aimed at increasing regulatory requirements with the goal of reducing or preventing the use of tobacco or nicotine-containing products.
Governmental actions, combined with the diminishing social acceptance of smoking and private actions to restrict smoking, have resulted in reduced industry volumes for our products in many of our markets, and we expect that such factors will continue to reduce consumption levels and will increase down-trading and the risk of counterfeiting, contraband, illicit trade and cross-border purchases. Significant regulatory developments will continue to take place over the next few years in most of our markets, driven principally by the Framework Convention on Tobacco Control (the "FCTC"). Since it came into force in 2005, the FCTC has led to increased efforts by tobacco control advocates and public health organizations to promote increasingly restrictive regulatory measures on the marketing and sale of tobacco and nicotine-containing products to adult nicotine users. Regulatory initiatives that have been proposed, introduced or enacted by governmental authorities in various jurisdictions include:

•restrictions on or licensing of outlets permitted to sell tobacco or nicotine-containing products;
•the levying of substantial and increasing tax and duty charges;
•restrictions or bans on advertising, marketing and sponsorship;
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•the display of larger health warnings, graphic health warnings and other labeling requirements;
•restrictions on packaging design, including the use of colors, and mandating plain packaging;
•restrictions on packaging and cigarette formats and dimensions;
•restrictions or bans on the display of product packaging at the point of sale and restrictions or bans on vending machines;
•generation sales bans, under which the sale of certain tobacco or nicotine-containing products to people born after a certain year would be prohibited;
•requirements regarding testing, disclosure and performance standards for tar, nicotine, carbon monoxide and/or other smoke or product constituents;
•disclosure, restrictions, or bans of tobacco product ingredients, including bans on the flavors of certain tobacco and nicotine-containing products;
•increased restrictions on smoking and use of tobacco and nicotine-containing products in public and work places and, in some instances, in private places and outdoors;
•restrictions or prohibitions of novel tobacco or nicotine-containing products or related devices;
•elimination of duty free sales and duty free allowances for travelers;
•restrictions in terms of importing or exporting our products impacting our logistics activities and ability to ship our products;
•encouraging litigation against tobacco companies; and
•excluding tobacco companies from transparent public dialogue regarding public health and other policy matters.
Our financial results could be materially affected by regulatory initiatives resulting in a significant decrease in demand for our brands. More specifically, requirements that lead to a commoditization of tobacco products or impede adult consumers' ability to convert to our SFPs, as well as any significant increase in the cost of complying with new regulatory requirements could have a material adverse effect on our financial results.

Changes in the earnings mix and changes in tax laws may result in significant variability in our effective tax rates. Our ability to receive payments from foreign subsidiaries or to repatriate royalties and dividends could be restricted by local country currency exchange controls and other regulations.

We are subject to income tax laws in the United States and numerous foreign jurisdictions. Changes in the U.S. tax system, including significant increases in the U.S. corporate income tax rate and the minimum tax rate on certain earnings of foreign subsidiaries could be enacted. Such changes could have a material adverse impact on our effective tax rate thereby reducing our net earnings. Further changes in the tax laws of foreign jurisdictions could arise as a result of the base erosion and profit shifting project undertaken by the Organisation for Economic Co-operation and Development, which recommended changes to numerous long-standing tax principles, and could have a material adverse impact on our effective tax rate thereby reducing our net earnings. Currently, many countries have enacted the OECD’s framework on a global minimum tax (referred to as “Pillar Two”), effective for taxable years beginning after December 31, 2023. While we have determined that Pillar Two should not have a material impact on our 2024 consolidated financial statements, we will continue to evaluate and monitor as additional guidance and clarification becomes available. If implemented, such changes, as well as changes in taxing jurisdictions’ administrative interpretations, decisions, policies, or positions, could also have a material adverse impact on our effective tax rate thereby reducing our net earnings. In future periods, our ability to recover deferred tax assets could be subject to additional uncertainty as a result of such developments. Furthermore, changes in the earnings mix or applicable foreign tax laws may result in significant variability in our effective tax rates. 

As a result of Russia’s invasion of Ukraine, certain taxing jurisdictions, including the U.S., have proposed punitive tax legislation applicable to companies doing business in Russia, which could also have a material adverse impact on our effective tax rate if enacted thereby reducing our net earnings.

Because we are a U.S. holding company, our most significant source of funds is distributions from our non-U.S. subsidiaries. Certain countries in which we operate have adopted or could institute currency exchange controls and other regulations or policies that limit or prohibit our local subsidiaries' ability to convert local currency into U.S. dollars or to make payments outside the country. This could subject us to the risks of local currency devaluation and business disruption.

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Disruptions in the credit markets or changes to our credit ratings may adversely affect our business.

We currently generate significant cash flows from ongoing operations and have access to global credit markets through our various short- and long- term financing activities. Our financial performance, credit ratings, interest rates, the stability of financial institutions with which we partner, geopolitical or national developments, the stability and liquidity of the credit markets and the state of the global economy could affect the availability and cost of financing.

Disruption in the credit markets, limitations on our ability to borrow, slower than anticipated debt deleveraging, or a downgrade of our current credit rating could increase our future borrowing costs which could materially and adversely affect our financial condition and results of operations. In addition, tighter or more volatile credit markets may lead to business disruptions for certain of our suppliers, contract manufacturers or trade customers which could, in turn, adversely impact our business, results of operations, cash flow and financial condition.

We could decide, or be required to, recall products, which could have a material adverse effect on our business, reputation, results of operations, cash flows or financial position.

We could decide - or laws, regulations, or judicial administrative action could require us - to recall products due to the failure, or alleged failure, to meet quality or safety standards or specifications, suspected or confirmed and deliberate or unintentional product contamination, manufacturing defects, or other product safety concerns, adulteration, misbranding or tampering. A product recall or a product liability or other claim (even if unsuccessful or without merit) could generate negative publicity about us and our products, and our Company’s reputation or that of our brands may be adversely affected. In addition, if another company recalls or experiences negative publicity related to a product in a category in which we compete, adult nicotine consumers might reduce their overall consumption of products in that product category. Any of these events could have a material adverse effect on our business, reputation, results of operations, cash flows or financial position.

We may be required to write down assets due to impairment, which could have a material adverse effect on our results of operations or financial position.

We continuously monitor the values of our long-lived assets, reporting units, intangible assets, as well as investments in equity securities, to determine whether events or changes in circumstances indicate that an impairment exists. In particular, developments in connection with the resolution of Canadian tobacco claims and related litigation could have a material adverse impact on the fair value of PMI’s continuing investment in Rothmans, Benson & Hedges ("RBH") and may result in non-cash impairment charges, which could be material to PMI. See Note 12. Related Parties - Equity Investments and Other for additional information concerning the risk of impairment to our RBH investment and our other equity securities and investments. Additionally, we test goodwill and non-amortizable intangible assets for impairment annually. The values of these assets may be affected by several factors, including general macroeconomic and geopolitical conditions; regulatory and legal developments; changes in product volume growth rates; changes in pricing strategies and costs bases; discount rates; success of planned new product expansions; competitive activity; and income and excise taxes. If an impairment is determined to exist, we will incur impairment losses, which could have a material adverse effect on our results of operations or financial position. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 for additional information concerning impairment determination and calculation.

Risks Related to the Impact of the War in Ukraine on our Business

Our business, results of operations, cash flows and financial position may be adversely impacted by the continuation and consequences of the war in Ukraine.

In 2023, Russia accounted for around 9% of our total cigarette and heated tobacco unit shipment volume, and around 6% of our total net revenues. Ukraine accounted for around 2% of our total cigarette and heated tobacco unit shipment volume, and around 1% of our total net revenues. Historically, we also produced finished goods in Ukraine for export and manufactured products in Russia. In 2022, as a result of Russia’s invasion of Ukraine, we suspended planned investments and scaled down our manufacturing operations in Russia.

The full implications of the Russian invasion of Ukraine for our operations in those countries are impossible to predict at this time. The likelihood of retaliatory action by the Russian government against companies, including PMI, as a result of actions and statements made in response to the Russian invasion or otherwise, including the possibility of legal action against us or our employees; the deprivation of rights in, or access to, our Russian or Russia-related assets; or nationalization of foreign businesses or assets (including cash reserves held in Russia and intangible assets such as trademarks), is impossible to predict. We are continuously assessing the evolving situation in Russia, including regulatory constraints in the market entailing very
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complex terms and conditions that must be met for any divestment transaction to be granted approval by the authorities, and restrictions resulting from international regulations. In the event of a divestment, our ability to fully realize the value of the business would likely be subject to material impairment. The deprivation of rights in, or access to, our Russian or Russia-related assets could also result in a material impairment and could cause the deconsolidation of our Russian business. In Ukraine, there is no way to know when and to what extent we will be able to fully normalize our operations or to what extent our workforce, facilities, inventory, and other assets will remain intact. These developments have and will continue to have a material adverse impact on our business, results of operations, cash flows and financial position, and may result in further impairment charges.

The conflict also continues to elevate the likelihood of supply chain disruptions, both in the region and globally, and may inhibit our ability to timely source materials and services needed to make and sell our products. For example, historically we sourced certain finished goods, production materials and components from both Russia and Ukraine, including printed materials and filters, and the invasion has, and may continue to, disrupt the availability of and impact our supply chain for these materials. These disruptions, to the extent we are unable to find alternative sources or otherwise address these supply constraints, may impact the availability and cost of our products in other markets, which would adversely impact our business, results of operations, cash flows and financial position, and may result in impairment charges. Furthermore, the imposition of various restrictions on transactions with parties from certain jurisdictions, the ban on exports of various products, and other economic and financial restrictions may adversely affect certain third parties with which we do business in Russia, such as customers, suppliers, intermediaries, service providers and banks.

The broader consequences of the invasion are also impossible to predict, but could include reputational consequences, further sanctions, financial or currency restrictions, punitive tax law changes, embargoes, regional instability, and geopolitical shifts as well as adverse effects on macroeconomic conditions, security conditions, currency exchange rates, and financial markets. Given the nature of our business and global operations, such geo-political instability and uncertainty could increase the costs of our materials and operations; reduce demand for our products; have a negative impact on our supply chains, manufacturing capabilities, or distribution capabilities; increase our exposure to currency fluctuations; constrain our liquidity or our ability to access capital markets; create staffing or operations difficulties; or subject us to increased cyber-attacks. While we will continue to monitor this fluid situation and develop contingency plans as necessary to address any disruptions to our business operations as they develop, the extent of the conflict’s effect on our business and results of operations as well as the global economy, cannot be predicted.

The conflict may also heighten many other risks disclosed in this report, any of which could adversely affect our business, results of operations, cash flows or financial position. Such risks could affect, without limitation, the achievement of our strategic priorities, including achievement of our smoke-free business growth targets; the availability of third-party manufacturing resources; the availability of attractive acquisition and strategic business opportunities and our ability to fully realize the benefits of these transactions; our ability to attract, motivate, and retain the best global talent; and our loss of revenue from counterfeiting and similar illicit activities.

Risks Related to Sourcing and Distribution of Products, Services and Materials

Use of third-parties may negatively impact the distribution, quality, and availability of our products and services, and we may be required to replace third-party contract distributors, manufacturers or service providers.

We increasingly rely on third-parties and their subcontractors/suppliers, sometimes concentrated in a specific geographic area, for product distribution and to manufacture some of our products and product parts (particularly, the electronic devices and accessories), as well as to provide services, including to support our finance, commercialization and information technology processes. While many of these arrangements improve efficiencies and decrease our operating costs, they also diminish our direct control. Such diminished control may lead to disruption in the distribution of our products and may have a material adverse effect on the quality and availability of products or services, our supply chain, and the speed and flexibility in our response to changing market conditions and adult consumer preferences, all of which may place us at a competitive disadvantage. In addition, we may be unable to renew these agreements on satisfactory terms for numerous reasons, including government regulations, and the distribution of our products may be disrupted in certain markets or our costs may increase significantly if we must replace such third parties with other partners or our own resources.

The effects of climate change, other environmental issues, and related legal or regulatory responses may have a negative impact on our business and results of operations.

While we seek to mitigate our business risks associated with environmental issues, such as climate change, by establishing environmental goals and standards and seeking business partners, including within our supply chain, that are committed to operating in ways that protect the environment or mitigate environmental impacts, we recognize that there are inherent environmental-related risks, including climate change-related risks, wherever business is conducted. Among other potential
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impacts, climate change could influence the quality and volume of the agricultural products we rely on, including tobacco, due to several factors beyond our control, including more frequent variations in weather patterns, extreme weather events causing unexpected downtime and inventory losses, other adverse weather conditions, and governmental restrictions on trade, all of which may lead to disruption of operations at factories, warehouses and other premises.

Furthermore, nature-related risks, including those related to natural ecosystems degradation, decreased agricultural productivity in certain regions of the world, biodiversity loss, water resource depletion and deforestation, which are partially driven or exacerbated by climate change, may negatively impact the resilience of, or otherwise disrupt, our business operations or those of our suppliers and business partners.

There is an increased focus by foreign, federal, state and local regulatory and legislative bodies on environmental policies, including those relating to climate change. New environmental-related legal or regulatory requirements may lead to additional carbon taxation, raw or other materials taxation, energy price increases, new compliance costs, increased distribution and supply chain costs, and other expenses impacting our cost of operations. Moreover, given that the regulatory framework in this regard is highly dynamic, additional uncertainties may be driven by further upcoming regulatory changes on which we might have limited visibility or limited time to implement, which could have an impact on several elements of our business, including elevating the cost or complexity of our operations. Even if we make changes to align ourselves with legal or regulatory requirements, we may still be subject to significant penalties if such laws or regulations are interpreted and applied in a manner inconsistent with our practices.

Government mandated prices, production control programs, and shifts in crops driven by economic conditions may increase the cost or reduce the quality of the tobacco and other agricultural products used to manufacture our products.

As with other agricultural commodities, the price of tobacco leaf and cloves can be influenced by imbalances in supply and demand and the impacts of natural disasters and pandemics such as COVID-19. Tobacco production in certain countries is subject to a variety of controls, including government mandated prices and production control programs. Changes in the patterns of demand for agricultural products could cause farmers to produce less tobacco or cloves. Any significant change in tobacco leaf and clove prices, quality and quantity could affect our profitability and our business.

A prolonged disruption of our production facilities could have a material adverse effect on our business, financial condition and results of operations.

A prolonged disruption at or shut-down of one or more of our production facilities, especially our ZYN production facility in Kentucky, U.S., which currently supplies substantially all of our capacity for ZYN sales in the U.S., due to natural- or man-made disasters or other events outside of our control, such as equipment malfunction or widespread outbreaks of acute illness, including COVID-19, or for any other reason, could limit our capacity to meet customer demands. Such an event could disrupt our operations; delay production, shipments and revenue; and result in significant expense to repair or replace our affected facilities. As a result, we could forgo revenue opportunities and potentially lose market share, which could materially and adversely affect our business, financial condition and results of operations.
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Risks Related to our International Operations

Because we have operations in numerous countries, our results may be adversely impacted by economic, regulatory and political developments, natural disasters, pandemics or conflicts.

Some of the countries in which we operate face the threat of civil unrest and can be subject to regime changes. In others, nationalization, terrorism, conflict and the threats of war or acts of war may have a significant impact on the business environment. Factors beyond our control, such as, without limitation, natural disasters, extreme weather events, pandemics (including COVID-19), economic, political, regulatory, acts of war or threats of war, or other developments could disrupt or increase the expenses related to our supply chain, manufacturing capabilities, distribution capabilities, or the energy and other utility services required to operate our factories, warehouses, and other premises. Our business continuity plans and other safeguards might not always be effective to fully mitigate their impact. For example, the global pandemic outbreak of the COVID-19 virus in 2020 created significant societal and economic disruption and the closure of stores, factories and offices, restrictions on manufacturing, distribution and travel, and supply chain disruptions, among other impacts. Such developments – including the impact of geopolitical disruptions resulting from the conflict in the Middle East and the impact on energy prices and availability in the EU and elsewhere resulting from the invasion of Ukraine by Russia – could cause significant volume declines in our duty-free business and certain other key markets; disrupt or delay our distribution, manufacturing or supply chain; increase currency volatility; increase costs of our materials and operations and lead to loss of property or equipment that are critical to our business in certain markets and difficulty in staffing and managing our operations, all of which could have a material adverse effect on our business, operations, volumes, revenue, cash flows, financial position, net earnings and profitability. We discuss additional risks associated with Russia's invasion of Ukraine and climate change, above.

In certain markets, we are dependent on governmental approvals of various actions such as price changes, and failure to obtain such approvals could impair growth of our profitability.

In addition, despite our high ethical standards and rigorous controls and compliance policies aimed at preventing and detecting unlawful conduct, given the breadth and scope of our international operations, we may not be able to detect all potential improper or unlawful conduct by our employees and partners. Such improper or unlawful conduct (actual or alleged) could lead to litigation and regulatory action, cause damage to our reputation and that of our brands, and result in substantial costs.

Our reported results could be adversely affected by unfavorable currency exchange rates and currency fluctuations could impair our competitiveness. Our results could also be adversely affected by capital controls or by foreign currency exchange constraints or devaluations.

We conduct our business primarily in local currency and, for purposes of financial reporting, the local currency results are translated into U.S. dollars based on average exchange rates prevailing during a reporting period. Foreign currencies may fluctuate significantly against the U.S. dollar, reducing our net revenues, operating income and EPS. Our primary local currency cost bases may be different from our primary currency revenue markets, and U.S. dollar fluctuations against various currencies may have disproportionate negative impact on cash flows and on net revenues as compared to our gross profit and operating income margins.

Capital controls and/or foreign currency exchange constraints may affect the ability of our subsidiaries in impacted jurisdictions to settle foreign currency denominated imports of goods and services and/or to pay dividends and royalties. These factors may also increase foreign currency devaluation risks, which may have a negative impact on our net assets and results of operations in these jurisdictions. All of which could have a material adverse effect on our financial condition, including our leverage ratios, cash flows, net earnings, and profitability.

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A sustained period of elevated inflation across the markets in which we operate could result in higher operating and financing costs and lead to reduced demand for our products.

Increasing inflationary pressures have and may continue to result in significant increases to our expenses, including direct materials, wages, energy, and transportation costs. While we take actions, wherever possible, to reduce the impact of the effects of inflation, in cases of sustained and elevated inflation across several of our major markets, it may be difficult to effectively control the increases to our costs. In recent periods, increased inflation has and may continue to lead to growing pressures on the cost of certain direct materials, wages, energy, transportation, and logistics as well as an increased cost of capital due to interest rate increases driven by the response to increased inflation. Inflationary pressures may also negatively impact consumer purchasing power, which could result in reduced demand for our products. We expect certain inflationary elements to ease, with a moderate increase in 2024. If we are unable to increase our prices sufficiently or take other actions to mitigate the effect of inflationary pressures, our profitability and financial position could be negatively impacted.

Risks Related to Legal Challenges and Investigations

Litigation related to tobacco products and nicotine products could substantially reduce our profitability and could severely impair our liquidity.

There is litigation related to tobacco products and/or nicotine products pending in certain jurisdictions in which we operate. Damages claimed in some tobacco-related litigation are significant and, in certain cases in Canada and Nigeria, range into the billions of U.S. dollars. As of March 2024, we began facing litigation related to our oral nicotine products before certain courts in the United States. We anticipate that new cases will continue to be filed. The FCTC encourages litigation against tobacco product manufacturers. It is possible that our consolidated results of operations, cash flows or financial position could be materially adversely affected in a particular fiscal quarter or fiscal year by an unfavorable outcome or settlement of certain pending litigation. We face various administrative and legal challenges related to certain SFP activities, including allegations concerning product classification, advertising and distribution restrictions, corporate communications, product coach activities, scientific substantiation, product liability, antitrust, and unfair competition.  While we design our programs to comply with relevant regulations, we expect these or similar challenges to continue as we expand our efforts to commercialize SFPs and to communicate with the public. The outcomes of these matters may affect our SFP commercialization and public communication activities and performance in one or more markets. Also, see Note 8. Contingencies to our consolidated financial statements for a discussion of pending litigation.
From time to time, we are subject to governmental investigations on a range of matters.
Investigations include allegations of contraband shipments of cigarettes, allegations of unlawful pricing activities within certain markets, allegations of underpayment of income taxes, customs duties and/or excise taxes, allegations of false and misleading usage of descriptors, allegations of unlawful advertising or distribution, and allegations of unlawful labor practices. We cannot predict the outcome of those investigations or whether additional investigations may be commenced, and it is possible that our business could be materially adversely affected by an unfavorable outcome of pending or future investigations. See Note 8. Contingencies—Other Litigation to our condensed consolidated financial statements and Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations—Operating Results by Business Segment—Business Environment—Governmental Investigations in this report for a description of certain governmental investigations to which we are subject.
We may be unable to adequately protect our intellectual property rights, and disputes relating to intellectual property rights could harm our business.
私たちの知的財産権は貴重な資産であり、それらの保護は私たちの業務に重要であり、この保護は、私たちの製品を運営したり販売したりするすべての国/地域で平等ではないかもしれません。もし、私たちが世界的に私たちの知的財産権を保護するステップが不十分であれば、関連する商標、設計、著作権、特許、商業秘密および他の知的財産権の組み合わせを含め、申請、起訴、保守および実行を含む、あるいは他の人が私たちの知的財産権を侵害したり、流用したりすれば、法的保護があるにもかかわらず、私たちの業務、財務状況、運営結果は悪影響を受ける可能性があります。さらに、私たちの既存および/または未来の知的財産権を管理できなければ、私たちを競争劣勢にさせるかもしれない。第三者の知的財産権は、私たちの製品を1つまたは複数の市場で開発、製造、および/または商業化する能力を制限するかもしれない。競争相手や他の第三者は私たちが彼らの知的財産権を侵害したと主張するかもしれない。いずれにしても、このようなクレームは、コストが高く、破壊的で、時間があり、予測不可能であり、巨大な訴訟コストおよび損害に直面させ、新しいまたは既存のSFPを開発、製造および/または商業化し、私たちの製品の能力を改善することを阻害し、私たちの収入および収益能力に実質的な悪影響を及ぼす可能性がある。さらに私たちが生産できない場合や
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1 つ以上の市場で SFP を販売したり、その品質を向上させたりすると、そのような市場での成人喫煙者を SFP に転換する能力が悪影響を受けます。注釈 8 を参照。 不測の事態 — その他訴訟 特定の知的財産手続の説明のために集約連結財務諸表に
非レクリエーション用カンナビノイド製品の研究、開発、商業化は、当社が法的、規制的、評判およびその他のリスクにさらされます。

当社のウェルネス · ヘルスケア事業である Vectura Fertin Pharma は、医療および医薬品用カンナビノイドおよび非レクリエーション用カンナビノイド製品 （ CBD を含む ） の研究、開発、商業化を探求しています。Vectura Fertin Pharma は現在、米国以外の市場でのこれらの活動を推進する予定です。Vectura Fertin Pharma は、適用されるすべての要件と整合的な方法で活動を行いますが、商業化の成功は、絶えず進化する法的および規制環境の遵守に依存しています。これらの活動により、当社は様々な法的、評判的、規制上のリスクにさらされ、適用法を遵守しなかった場合、刑事、民事または税務上の責任を負う可能性があります。

競争環境に関するリスク

当社は激しい競争に直面しており、効果的に競争できなければ、収益性や業績に大きな悪影響を及ぼす可能性があります。

私たちは業務の様々な面で高度な競争の条件の制約を受けています。私たちの競争は主に製品の品質、ブランド認知度、ブランド忠誠度、センス、研究開発、革新、包装、顧客サービス、マーケティング、広告と小売価格に基づいて、そしてますます多くの成年喫煙者は私たちのSFPに変更したいです。競争環境と私たちの競争地位は、疲弊した経済状況、消費者自信の弱体化、競争相手がより低価格の製品または革新製品を発売すること、その味の特徴のため、商業的により成功する可能性がある新規な製品、より高い製品税、より高い絶対価格と小売価格カテゴリの間のより大きな差、不公平な競争、および製品規制はタバコ製品を区別する能力を弱化させ、成人消費者が私たちSFPに関する真および非誤解的な情報を得ることを制限するか、または私たちの競争相手に比例せずに私たちの製品の商業化に影響を与える可能性がある

私たちの業界の競争相手は英米タバコ、日本タバコ会社、帝国タバコ会社、新しい市場参入者、特に革新製品の面で、いくつかの地域的と地方的なタバコ会社を含み、場合によっては、主にアルジェリア、エジプト、中国、台湾、タイとベトナムの国有タバコ企業である。一部の競争相手の利益、販売量と監督管理目標は異なり、いくつかの国際競争相手はPMIよりも通貨為替レートの変化の影響を受けにくい可能性があり、いくつかの競争相手は私たちの製品と直接競争する適用法規を迂回して製品を販売するかもしれない。非燃焼製品カテゴリのいくつかの新規参入者は、不適切なマーケティング活動、情報伝達、および劣悪な製品満足度を介して、適切な研究開発プロトコルおよび標準に基づく科学的証拠がない場合に、消費者と革新製品との関係を疎遠にする可能性がある。デジタルメディアをますます使用することは、我々SFPに関する不正確かつ誤った情報を伝播する速度および程度を加速させる可能性があり、これらのすべては、私たちの収益性および運営結果に実質的な悪影響を及ぼす可能性がある。第1項を参照ビジネス-競争2023年12月31日までの財政年度のForm 10−k年度報告では，我々の置かれている競争環境が分かった。
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成人の消費者の嗜好の変化を予測できない場合があります。
当社の事業は、現地の経済状況、当社の製品へのアクセシビリティ、および当社の製品に関連する正確な情報の入手可能性の影響を受ける可能性のある大人の消費者の嗜好の変化の影響を受けます。
成功するためには ：
•ブランドエクイティを促進し
•新しい成人消費者のトレンドを予測し対応します
•当社の製品が品質基準を満たすことを保証します
•新製品や市場の開発、ブランドポートフォリオの拡大
•生産性を向上させ
•成人喫煙者に SFP に転換するよう教育し奨励します
•製品特性や SFP の使用に関するコミュニケーションを含む効果的な成人消費者のエンゲージメントを確保する。
•当社の評判およびブランドの評判に損害を与える開発の影響を軽減する。
•優れたカスタマーケアを提供します
•製品の需要を満たすための十分な生産能力を確保します。
•値上げを通じて利益率を保護または向上させることができます
経済不確実な時期には、大人の消費者が低価格ブランドを購入する傾向があり、その結果、プレミアム · ミッド価格ブランドの量や収益性に重大な悪影響を与える可能性があります。このようなダウントレードトレンドは、ブランディング、コミュニケーション、製品の差別化を制限する規制によって強化される。経済の不確実性 （ 不況やインフレを含む ） に加えて、異常な気象事象、グローバルまたはローカルの流行、風土病またはパンデミック （ COVID—19 など ） は、成人消費者の嗜好を変え、当社の製品、特にミッド価格またはプレミアム価格ブランドに対する需要が減少します。

当社の収益性を高める能力は、価格引き上げやブランドや地理的ミックス改善を通じて新製品の導入、新規市場への参入、十分な生産能力を維持、利益率の改善ができないため、制限されています。
新製品の導入や新規市場への参入、生産能力の増強による製品の需要を満たす、価格引き上げ、または利益率の高い製品や利益率の高い地域での販売比率の改善ができない場合、当社の利益成長に重大な悪影響を及ぼす可能性があります。

買収や戦略的ビジネス関係の発展を通じてブランドポートフォリオを拡大できず、投資による期待される利益が実現しない可能性があります。
当社の成長戦略の 1 つの要素は、選択的な買収と戦略的ビジネス関係の発展を通じてブランドポートフォリオと市場ポジションを拡大することです。買収および戦略的事業開発の機会は限られており、効率的かつ効果的な統合、戦略的目標、および / または予想される収益改善およびコスト削減を達成できないリスクがあります。当社は、競合他社に先駆けて魅力的な事業を買収または戦略的ビジネス関係を有利な条件で締結することができ、また、そのような買収または戦略的ビジネス開発関係が収益を増やし、競争力を向上させることを保証しません。また、特定の戦略的投資や関係において支配的地位を有しない場合があります。これは、これらの投資や関係から期待される財務成長やその他の利益が最終的に実現する程度に影響を与える可能性があります。
最高のグローバル人材を引き付け、動機づけ、維持し、組織デザインを変革の目標に効果的に整合させることができなければ、戦略目標を達成する能力が損なわれる可能性があります。
成功するためには、文化と働き方を変え続け、人材と組織デザインをますます複雑化するビジネスニーズに合わせ、革新し、消費者中心のビジネスに変革する必要があります。 デジタル、情報技術、ライフサイエンスなどの比較的新しい分野を含め、社会的に受け入れられているコンシューマー製品、テクノロジー、医薬品などの分野と人材を競っています。その結果、当社の戦略目標を達成するために、適切な多様性、経験、スキルを持つ最高のグローバル人材を引き付け、動機づけ、維持することができない可能性があります。

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違法取引に関連するリスク

当社の収益は、偽造、密輸、国境を越えた購入、違法製品、現地メーカーによる未納税生産量、および当社の禁煙製品の機器および消耗品の偽造の結果として重大な悪影響を受ける可能性があります。

大量の偽造たばこが国際市場で販売されている。私たちは マルボロ 最も模倣された国際的なたばこブランドですが、この活動の結果として損失する収益を定量化することはできません。当社の無煙製品の偽造品は、当社の科学的検証手順の対象ではなく、当社の製品品質基準を満たす可能性は低く、消費者、規制当局、その他のステークホルダーに対する当社の無煙製品の評判に重大な悪影響を及ぼす可能性があります。さらに、当社の収益は、たばこおよび / または禁煙製品の現地メーカーによる偽造、密輸、国境を越えた購入、違法製品および納税されていない生産量によって重大な悪影響を受ける可能性があります。

サイバーセキュリティとデータガバナンスに関するリスク

当社は、当社およびサードパーティの情報技術ネットワークおよびシステムに大きく依存しており、これらのネットワークまたはシステムに対するサイバーセキュリティインシデントまたは攻撃は、当社の事業および業務に悪影響を及ぼす可能性があります。

私たちと私たちのビジネスパートナーは、インターネットに接続されたネットワークおよびシステムを含み、機密、敏感、個人および他のデータの収集、格納、解釈および処理、内部および外部通信、マーケティングおよび電子商取引活動、製品の製造、販売および流通、第三者業務関係の管理、政府当局との相互作用、研究開発による革新、および他の業務運営に必要な活動を含む、インターネットに接続されたネットワークおよびシステムを含む情報技術ネットワークおよびシステムに深刻に依存している。その中のいくつかの情報システムおよびネットワークは、第三者サービスプロバイダによって開発、提供または管理されており、これは、“サプライチェーン”的なネットワーク攻撃を受けやすい可能性がある。我々の情報技術ネットワークおよびシステムは、または第三者サービスプロバイダによって管理されているか、または当社のビジネスパートナーによって所有され、PMIトラフィックを促進するために使用されるネットワークおよびシステムの障害または中断であり、原因は、ネットワークセキュリティ攻撃、アクセスしようとする不正な試み、破損または抽出、セキュリティホール、構成エラー、人為的エラーである。または私たち、第三者、または私たちのビジネスパートナーがネットワークセキュリティ業界のベストプラクティスを遵守できなかったか、または遵守できなかったことは、私たちを競争劣勢にさせ、名声損害をもたらし、私たちの運営に影響を与え、データ漏洩、重大な業務中断、訴訟、規制行動(巨額の罰金または罰金を含む)、財務的影響、収入または資産損失を招く可能性があり、私たちの知的財産権、個人、機密、または敏感なデータを含む。

PMI 、新規買収企業、当社のビジネスパートナー、または当社のサードパーティプロバイダーに影響を与えるサイバー攻撃、セキュリティインシデント、脆弱性は、複雑さと量で動的に進化し続け、セキュリティインシデントの確率、頻度、影響の深刻度を予測することが困難になっています。さらに、デューデリジェンス中、長期間にわたって、または悪用を軽減するのに十分な速さで脆弱性を検出することは本質的に困難です。このようなセキュリティインシデントや脆弱性が将来的に当社に重大な悪影響を及ぼさないことを保証することはできません。PMI は、サイバーセキュリティリスクプログラムおよびサードパーティのサイバーセキュリティリスク管理プログラムを実施することにより、これらのリスクを軽減するために取り組んでいますが、これらのプログラムが包括的または正確にすべてのサイバーセキュリティリスクを特定し、十分に軽減することを保証することはできません。

当社は、業界標準およびベストプラクティスに沿った情報セキュリティ保護を維持するために、管理、技術、物理的保護措置への投資を継続しています。セキュリティインシデントを低減するための予防措置の妥当性を継続的に評価します。

ただし、当社の保護措置は、これらの情報技術ネットワークおよびシステムのサービス中断またはその他の障害の影響を軽減するのに効果的ではない可能性があります。セキュリティインシデントへのタイムリーな対応と緩和を怠ると、広範なビジネス中断につながる可能性があります。このようなセキュリティインシデントは、当社を競争上の不利な立場に置き、財務上の影響、収益、知的財産、個人またはその他の機密データを含む資産の損失、重大な罰金または罰金を含む訴訟および規制措置、当社の事業に影響、当社および当社のブランドの評判に損害を与え、重大な救済およびその他のコストをもたらす可能性があります。 1 C 項を参照。 サイバーセキュリティ 2023 年 12 月 31 日を末日とする会計年度のフォーム 10—k の年次報告書について、サイバーセキュリティリスク管理と戦略とガバナンスを説明します。

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当社または当社のビジネスパートナーのプライバシー、データ、人工知能および情報セキュリティに関する法律を遵守しない場合、または遵守できない場合、ビジネスの中断、評判および消費者の信頼の喪失、訴訟、重大な罰金または罰金を含む規制措置、財務上の影響、および収益、資産または個人、機密、または機密データの損失が生じる可能性があります。

実際または告発されたEUの“一般データ保護条例”、米国の複数の州と連邦法律、およびPMIが所在する司法管轄区域内の他の同様のプライバシーおよび情報セキュリティ法律および法規の下で複雑かつ変化するプライバシー、データ、人工知能および情報セキュリティ法律法規、例えば個人データを保護できない、適切な技術と合理的なセキュリティ措置を実施できなかった；国際移転中の個人データの適切な保障措置の実施と維持、データ主体のプライバシー権の尊重；個人データ処理に十分な詳細な通知を提供する；同意を得て脱退する；規制機関に事件を報告する厳格な時間枠組み要件を満たす；EUの“人工知能法案”を含むが、これらに限定されない人工知能法規、および私たちに重大な悪影響を及ぼす可能性のある他の行為は、巨額の罰金および/または法的挑戦に直面させ、および/または私たちの業務、名声、財務状況、または経営業績を損なう。PMIが所在する司法管轄区域のこのような法律および法規は異なり、法的義務の不一致または相互衝突を招く可能性がある。

買収 · 売却に関するリスク

当社は、戦略的買収、売却、ジョイントベンチャー、または投資からの利益を特定、完了、または実現できない場合があります。

戦略的に我々の業務目標に適合する可能性のある買収対象、合弁企業、または投資を時々評価します。いくつかの評価の結果として、私たちは、将来的に特定の業務(または一部の業務)または資産を買収することが可能になっている。私たちはまた剥離して、時々業務を剥離するかもしれない。これらの活動は、管理層の既存のコア業務に対する関心を移転すること、人員、情報技術、財務および他のシステムを統合または分離することを含む、買収された業務を統合または統合することができないこと、異なる従業員グループにおいて制御環境プロセスを効率的かつ即時に実施することができないこと、既存または買収された顧客およびサプライヤーの業務関係への悪影響、買い手、売り手またはパートナーとの潜在的な紛争、および負債および訴訟のような他の予期しない問題または負債を含む財務、管理および運営リスクをもたらす可能性がある。これらの分野の活動は、米国、EU、イギリス、その他の多くの反独占と競争法によって規制されている。私たちは過去または将来、競争または他の規制機関のこれらの取引の承認を得る必要があるか、またはいくつかの法的要求を満たす必要があるかもしれないが、私たちはそのような承認を得ることができないか、またはそのような要求を満たすことができない可能性があり、それぞれが追加のコスト、遅延、または私たちがそのような取引を達成できない可能性がある。これらの要因のいずれも、私たちがこのような取引を達成するための予想される収益を妨げる可能性があり、および/または、私たちの財務状況および経営業績に実質的な悪影響を及ぼす可能性がある

売却に関連する追加のリスクに直面する可能性があります。例えば、適切な買い手を見つけ、有利な条件で取引を実行し、残りの事業への影響を最小限に抑えて売却された事業を分離し、移行または長期のサービス取り決めを効果的に管理する能力に関連するリスク。さらに、売却活動では減損費用の計上が必要となる場合があります。これらの要因は、財務状況および業績に重大な悪影響を及ぼす可能性があります。

買収に伴う会計調整は、業績に悪影響を及ぼす可能性があります。

買収により取得した資産の性質上、将来の減損を回避できない可能性があり、将来の業績や財務状況にも重大な悪影響を及ぼす可能性があります。

当社は、 Vectura Group Ltd. およびその関連会社 （ 以下「 Vectura Group 」といいます ） を Molex Asia Holdings Ltd. （ 以下「 Vectura 売却」といいます ） に売却することが完了しない場合があり、 Vectura 売却が完了した場合、当社の残りの事業が中断したり、意図した利益を達成できない可能性があります。

2024 年 9 月 17 日、株式会社ベクトゥラ · フェルティン · ファーマがMolex Asia Holdings Ltd. は、 Vectura 売却に関する売買契約を締結しました。この取引は、規制当局の承認を条件として、 2024 年第 4 四半期に完了する予定であり、タイミングに影響を与える可能性があります。ベクトゥラ売却の完了には、以下を含む多くのリスクと課題が生じる可能性があります。


•ベクトゥラ売却に必要な規制当局の承認を取得する能力、およびそのような承認の時期と条件。
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•慣習的なクローズ条件を満たし、ベクトゥラ売却を完了しなかったこと。

•売買契約の終了を引き起こす可能性のある事象、変更またはその他の状況の発生。

さらに、 Vectura の売却により、顧客、従業員、サプライヤーまたはその他の当事者との関係に潜在的な悪影響を及ぼす可能性を含め、当社の残りのウェルネスおよびヘルスケア事業に混乱をもたらす可能性があります。ベクトゥリアの売却が成功した場合でも、残りのウェルネス · ヘルスケア事業の予想される業績を含め、ベクトゥリアの売却から予想される利益の一部または全部を実現しない可能性があります。


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項目 4 。管理と手順。

PMI は、 PMI の最高経営責任者および最高財務責任者を含む PMI の経営陣の参加を得て、本報告書の対象期間終了時点で、 PMI の開示管理および手続 （ 1934 年証券取引法 （ 改正 ） の規則 13a—15 （ e ） に定義されるもの ） の有効性について評価を実施しました。この評価に基づき、 PMI の最高経営責任者および最高財務責任者は、 PMI の開示管理および手続きが有効であると結論付けました。直近四半期における PMI の財務報告に関する内部統制に重大な影響を与えたか、または合理的に重大な影響を与える可能性のある PMI の財務報告に関する内部統制に変更はなかった。



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第 2 部 — その他の情報
 
項目 1 。法的手続。
注釈 8 を参照。 事件があったり フィリップ · モリス · インターナショナル （ 株 ） に対する係争中の訴訟について説明するため、本報告書第 1 部第 1 項に含まれる連結財務諸表の注記について、その子会社。

項目 1A 。 リスク要因。
リスク要因に関する情報は、本フォーム 10—Q の第 1 部第 2 項および第 1 部第 1 項第 1A 項の「 MD & A — 今後の結果に影響を及ぼす可能性のある注意要因」に記載されています。2023 年 12 月 31 日に終了した年次報告書 Form 10—k のリスク要因。
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項目 2 。株式有価証券の未登録販売及び収益の利用
2024 年 9 月 30 日に終了した四半期の株式買戻し活動は、以下のとおりです。
 
期間合計数
株式の
買戻し		平均
価格支払
1株当たり		総数
株式購入
公開の一部
発表予定や
プログラム		おおよそドル
株式の価値
購入可能
Under the Plans または
プログラム
2024 年 7 月 1 日 —
2024 年 7 月 31 日 （ 1 ）		— $— 10,481,359 $6,016,847,275 
2024 年 8 月 1 日 —
2024 年 8 月 31 日 （ 1 ）		— $— — $— 
2024 年 9 月 1 日 —
2024 年 9 月 30 日 （1）		— $— — $— 
公的に
発表予定
or プログラム		— $— 
2024 年 7 月 1 日 —
2024 年 7 月 31 日 （2）		3,964 $102.26 
2024 年 8 月 1 日 —
2024 年 8 月 31 日 （2）		3,818 $113.73 
2024 年 9 月 1 日 —
2024 年 9 月 30 日 （2）		3,913 $122.41 
2024 年 9 月 30 日期11,695 $112.75 
 

(1)2021 年 6 月 11 日、当社の取締役会は、 2021 年 7 月から 3 年間で 50億ドルから 70億ドルの投資目標を設定し、最大 70 億ドルの新規株式買戻しプログラムを承認しました。 これらの株式買戻しは、 70 億ドルのプログラムに従って行われました。2022 年 5 月 11 日、当社は、スウェーデン · マッチの発行済株式を株主から取得するための推奨公募を受け、 3 年間の株式買戻しプログラムを中止することを発表しました。当社の 3 年間の株式買戻しプログラムは 2024 年 7 月 21 日に終了しました。

(2)買戻し株式は、制限付き株式および業績株式単位賞を受賞し、関連税金の全部または一部を支払うために株式を使用した従業員が当社に入札した株式です。

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項目 5 。 その他の情報

2024 年 9 月 30 日に終了した 3 ヶ月間、 PMI の取締役または役員は 採用あるいは…終了しました a 「規則 10b5 — 1 取引取極」または「規則 10b5 — 1 以外の取引取極」は、規制 S—k の項目 408 （a） で定義されています。
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項目 6 。展示会。
31.1
31.2
32.1
32.2
101.INSXBRL インスタンスドキュメント — インスタンスドキュメントは、 XBRL タグがインライン XBRL ドキュメント内に埋め込まれているため、インタラクティブデータファイルには表示されません。
101.SCHXBRL Taxonomy Extension Schema 。
101.CALXBRL Taxonomy Extension Calculation Linkbase 。
101.DEFXBRL Taxonomy Extension Definition リンクベース。
101.LABXBRL Taxonomy Extension Label Linkbase 。
101.PREXBRL Taxonomy Extension Presentation Linkbase 。
104表紙インタラクティブデータファイル （ Inline XBRL 形式で、資料 101 に記載 ）

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サイン

1934 年の証券取引法の要件に従い、登録者は、この報告書に署名された署名者によって、正当に署名されました。

フィリップ · モリス · インターナショナル株式会社
/ s / エマヌエル · バボー
エマヌエル · ベボー
財務最高責任者
2024 年 10 月 24 日
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