Altria Group Inc. reported its second-quarter earnings. Although revenue beat Wall Street expectations, adjusted earnings fell short. The Company attributes this to the decline of cigarette sales, as e-cigarettes grow in popularity.
Altria sells Marlboro, the largest U.S. cigarette brand, but declines in cigarette sales puts the Company in a rough spot, forcing them to look for growth in other areas, such as e-cigarettes, oral nicotine pouches and cannabis products.
Shares of the market fell 1% in premarket trading. According to Refinitiv analysts, the Company reported earnings per share of USD 1.10, adjusted vs. earnings per share of USD 1.11, expected and a revenue of USD 5.19 Billion vs. an estimated revenue of USD 5.09 Billion.
Altria also bought 3.7 million of its shares, completing a USD 2 Billion buyback. The cigarette giant also said that its board of directors authorized a new USD 1 Billion buyback. The Company expects cigarette sales to fall around 5-6% this year because of users switching over to e-cigarettes. Cigarette sales were essentially flat this year, and Marlboro held its share at 43%, Altria said.
Gordon Wang – Financial Buzz – August 2, 2019.