VALUATION HIGHLIGHTS

1. Smokeable Products constitute 77% of the Trefis price estimate for Altria Group, Inc.'s stock.
2. Smokeless Products constitute 16% of the Trefis price estimate for Altria Group, Inc.'s stock.

WHAT HAS CHANGED?

Latest Earnings: Q4 and Full-Year FY2025

Altria Group reported full-year 2025 net revenue of $24.2 billion, a 1.2% decrease compared to the prior year, primarily driven by declining cigarette shipment volumes. Despite the top-line pressure, adjusted diluted EPS grew 3.5% to $5.12, supported by robust pricing power and aggressive share repurchases. The company successfully navigated a challenging macroeconomic environment characterized by persistent inflation affecting adult tobacco consumer disposable income.

Note: Altria Group, Inc.'s FY'25 ended on December 31, 2025.

Expansion of NJOY and Smoke-Free Portfolio

Altria continued its aggressive pivot toward a smoke-free future by expanding the retail footprint of NJOY ACE to over 100,000 stores. The company also filed Premarket Tobacco Product Applications (PMTAs) for several new oral nicotine pouch variants under the on! PLUS brand. This strategic shift is designed to offset the secular decline in combustible tobacco by capturing market share in the rapidly growing e-vapor and modern oral nicotine categories.

POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of Altria Group, Inc.'s value that present opportunities for upside or downside to the current Trefis price estimate:

Smokeable Products Segment

• Pricing Power vs. Volume Decline: Altria maintains significant margins by implementing regular price increases to offset the industry-wide decline in cigarette shipment volumes, which fell approximately 9% this year. If the rate of volume decline accelerates beyond Trefis estimates due to illicit disposable e-vapor competition, there is a downside risk to operating income.
• Marlboro Market Leadership: Marlboro remains the dominant premium brand with a retail share of approximately 42%. Sustaining this share is critical; any meaningful trade-down to discount brands by price-sensitive consumers could compress margins and lower the Trefis valuation.

For additional details, select a division from the interactive Trefis split for Altria Group, Inc. at the top of the page.

BUSINESS SUMMARY

Altria Group is a leading producer and marketer of tobacco products in the United States, anchored by its flagship Marlboro brand and a growing portfolio of smoke-free alternatives including NJOY e-vapor and on! oral nicotine pouches. The company also holds a significant minority investment in Anheuser-Busch InBev, which provides a layer of diversified asset value and dividend income.

SOURCES OF VALUE

Altria derives the vast majority of its cash flow and valuation from its dominant position in the premium domestic cigarette market.

Unrivaled Premium Brand Equity

The Marlboro brand is the cornerstone of Altria's value, commanding a retail share larger than the next ten brands combined. This dominance allows for high degree of price inelasticity, ensuring stable cash flows even as the total number of smokers in the U.S. gradually decreases.

High-Margin Oral Nicotine Growth

The on! brand family represents a high-margin growth engine with lower capital expenditure requirements than traditional tobacco manufacturing. As consumers migrate toward discreet, smoke-free options, this segment acts as a vital hedge against combustible volume erosion.

KEY TRENDS

Acceleration of the Smoke-Free Transition

The U.S. tobacco market is undergoing a structural shift as adult smokers increasingly adopt reduced-risk products. Altria is repositioning its entire business model to meet this "Moving Beyond Smoking" goal, focusing R&D and marketing spend on FDA-authorized e-vapor and oral nicotine products to ensure long-term relevance.

Aggressive Capital Allocation and Shareholder Returns

Altria remains committed to a high dividend payout ratio (targeting mid-single-digit annual growth) and consistent share buybacks. In 2025, the company utilized proceeds from the partial sale of its ABI investment to further reduce share count, a strategy intended to bolster EPS growth in a low-revenue-growth environment.