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Philip Morris Ekes Out Third-Quarter Earnings Beat

Philip Morris posts a third-quarter earnings beat as sales of its smokeless non-tobacco products continue strong, though cautions on supply chain impact.

Philip Morris (PM) - Get Philip Morris International Inc. Report on Tuesday posted third-quarter earnings that were better than analysts’ forecasts as sales of its smokeless non-tobacco products continued strong though cautioned that supply chain issues could affect IQOS sales next year.

The New York-based maker of Marlboro cigarettes said it earned $2.43 billion, or $1.58 an adjusted share, vs. $2.31 billion, or $1.42 a share, in the comparable year-ago period. Analysts polled by FactSet had been expecting earnings of $1.56 a share.

Revenue came in at $8.12 billion, up from $7.44 billion a year ago and above the $7.9 billion expected by analysts polled by FactSet.

Cigarette and heated tobacco unit shipment volume was up 2.1%, reflecting a 0.4% drop in cigarette shipment volumes, Philip Morris said, while non-heated shipment volume was up by 23.8%, driven mostly by the company's smokeless IQOS product.

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"The continued excellent performance of IQOS drove total shipment volume and organic net revenue growth of 2.1% and 7.6%, respectively, and was complemented by further sequential share gains for our combustible products,"CEO Jacek Olczak said in a statement.

Philip Morris said total IQOS users at quarter-end were approximately 20.4 million, of which approximately 14.9 million have switched to IQOS and stopped smoking.

At the same time, constrained IQOS device supply due to the ongoing global semiconductor shortage with reduced device assortment and availability could impact sales in the second half of next year, the company said.

Separately, Philip Morris confirmed its full-year earnings guidance, noting that it expects to report per-share earnings of between $5.77 and $5.82. The company also boosted its quarterly dividend by 4.2% to a $5 a share.

At last check, shares of Philip Morris were shown 1.05% at $96.43.