Equibles

8-K

Philip Morris International Inc. (PM)

8-K 2024-04-23 For: 2024-04-23
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Added on April 02, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 23, 2024

Philip Morris International Inc.

(Exact name of registrant as specified in its charter)

Virginia 1-33708 13-3435103
(State or other jurisdiction<br><br>of incorporation) (Commission File Number) (I.R.S. Employer<br><br>Identification No.)
677 Washington Blvd, Ste. 1100 Stamford Connecticut 06901
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(Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (203) 905-2410

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, no par value PM New York Stock Exchange 2.875% Notes due 2024 PM24 New York Stock Exchange
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2.875% Notes due 2024 PM24C New York Stock Exchange
0.625% Notes due 2024 PM24B New York Stock Exchange
3.250% Notes due 2024 PM24A New York Stock Exchange
2.750% Notes due 2025 PM25 New York Stock Exchange
3.375% Notes due 2025 PM25A New York Stock Exchange
2.750% Notes due 2026 PM26A New York Stock Exchange
2.875% Notes due 2026 PM26 New York Stock Exchange
0.125% Notes due 2026 PM26B New York Stock Exchange
3.125% Notes due 2027 PM27 New York Stock Exchange
3.125% Notes due 2028 PM28 New York Stock Exchange
2.875% Notes due 2029 PM29 New York Stock Exchange
3.375% Notes due 2029 PM29A New York Stock Exchange
0.800% Notes due 2031 PM31 New York Stock Exchange
3.125% Notes due 2033 PM33 New York Stock Exchange
2.000% Notes due 2036 PM36 New York Stock Exchange
1.875% Notes due 2037 PM37A New York Stock Exchange
6.375% Notes due 2038 PM38 New York Stock Exchange
1.450% Notes due 2039 PM39 New York Stock Exchange
4.375% Notes due 2041 PM41 New York Stock Exchange
4.500% Notes due 2042 PM42 New York Stock Exchange
3.875% Notes due 2042 PM42A New York Stock Exchange
4.125% Notes due 2043 PM43 New York Stock Exchange
4.875% Notes due 2043 PM43A New York Stock Exchange
4.250% Notes due 2044 PM44 New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Emerging growth company ☐
--- --- If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Item 2.02. Results of Operations and Financial Condition.
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On April 23, 2024, Philip Morris International Inc. (the “Company”) issued a press release announcing its financial results for the quarter ended March 31, 2024, as well as the accompanying glossary of key terms, definitions, explanatory notes, select financial information and reconciliations of non-GAAP financial measures. The earnings release is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated by reference to this Item 2.02. The glossary of key terms, definitions, explanatory notes, select financial information and reconciliations of non-GAAP financial measures is attached as Exhibit 99.2 to this Current Report on Form 8-K and incorporated by reference to this Item 2.02.

In accordance with General Instruction B.2 of Form 8-K, the information in Item 2.02 of this Current Report on Form 8-K, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information in Item 2.02 of this Current Report on Form 8-K shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as may be expressly set forth by specific reference in such filing or document.

Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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99.1 Philip Morris International Inc. Press Release, dated April 23, 2024 (furnished pursuant to Item 2.02).
--- --- 99.2 Glossary of Key Terms, Definitions, Explanatory Notes, Select Financial Information and Reconciliations of Non-GAAP Financial Measures (furnished pursuant to Item 2.02).
--- --- 104 Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document and contained in Exhibit 101).
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

PHILIP MORRIS INTERNATIONAL INC.
By: /s/ DARLENE QUASHIE HENRY
Name: Darlene Quashie Henry
Title: Vice President, Associate General Counsel & Corporate Secretary

Date: April 23, 2024

Document

Exhibit 99.1

PRESS RELEASE

Philip Morris International Reports First-Quarter 2024 Results and Updates Full Year Guidance

Reported Diluted EPS Grew 7.8% to $1.38

Adjusted Diluted EPS Grew 8.7% to $1.50; and by 23.2% excluding currency

STAMFORD, CT, April 23, 2024 – Philip Morris International Inc. (PMI) (NYSE: PM) today announces its 2024 first-quarter results1.

"The strength of our first-quarter results with excellent top-line growth and significant margin expansion gives us the confidence to raise our 2024 currency-neutral guidance,” said Jacek Olczak, Chief Executive Officer.

"Strong smoke-free momentum continues with rapid underlying volume progression and accelerating organic net revenue and gross profit growth, fueled by the operating leverage of IQOS and the best-in-class economics of ZYN.”

“We are executing efficiently and effectively in a dynamic operating environment of geopolitical and economic tensions that accentuate currency volatility. We are doing our utmost to mitigate these challenges and deliver robust growth and value creation.”

Highlights

•Smoke-free business (SFB): The smoke-free business accounted for 39% of our total net revenues. The path to achieving our ambition of becoming a smoke-free company is shown by the EA, AU & PMI DF region, where SFB accounted for almost two-thirds of revenue, led by Japan and Korea.

Our SFB continues to deliver superior top-line growth, with net revenues increasing by 21.1% (24.8% organically) as well as a 31.8% (37.5% organic) increase in gross profit.

•Inhalable smoke-free products (SFP): IQOS continues to strengthen its position as the second largest nicotine ‘brand’ in markets where present, including the #1 position in 11 markets. HTU adjusted in-market sales (IMS) volume, which excludes the net impact of estimated distributor and wholesaler inventory movements, was up by an estimated 12.5%.

•In Europe, IQOS HTU market share exceeded 10% for the first time with adjusted IMS growth of 9.4%, which was influenced, as expected, by the impact from the EU characterizing flavor ban.

•In Japan, IQOS HTU market share increased by more than 3 percentage points to over 29%, with adjusted IMS growth of 13.3%. Notably, the heat-not-burn category surpassed combustible cigarettes in Tokyo, a demonstration of the vast potential of IQOS around the world. To celebrate the 10-year anniversary of the IQOS launch in Japan, we introduced IQOS ILUMA i, our most innovative offering to-date, with very positive initial consumer feedback.

In the vaping category, our focused strategy for VEEV is showing promising early results on both consumer traction and profitability.

1 Explanation of PMI's use of non-GAAP measures cited in this document and reconciliations to the most directly comparable U.S. GAAP measures can be found in the “Non-GAAP Measures, Glossary and Explanatory Notes” section of this release, in Exhibit 99.2 to the company's Form 8-K dated April 23, 2024, and at www.pmi.com/2024Q1earnings.

•Oral SFP2: Shipment volume increased by 40.0% in cans (35.8% in pouches or pouch equivalents), fueled by ZYN nicotine pouch growth in the U.S., where shipment volume reached 131.6 million cans, representing growth of 79.7% versus prior year. Our share of the category in the U.S. increased for the fourth consecutive quarter to over 74%, up 1.3 percentage points sequentially.

•Combustibles: Net revenues grew by 3.5% (organically by 3.7%), fueled by another quarter of strong pricing across markets. Our category share increased by 0.3 percentage points with Marlboro gaining 0.4 percentage points.

•Dividend: Declared regular quarterly dividend of $1.30 per share, or an annualized rate of $5.20 per share.

| Operating Review | | --- || | Total | HTU | Oral SFP | Cigarettes | | --- | --- | --- | --- | --- | | Shipment Volume (units bn) | 180.5 | 33.1 | 4.2 | 143.2 | | vs. Q1 2023 | 3.6% | 20.9% | 35.8% | (0.4)% | | | PMI | Combustibles | | --- | --- | --- | | Net Revenues ($ bn) | 8.8 | $5.4 | | reported vs. Q1 2023 | 9.7% | 3.5% | | organic vs. Q1 2023 | 11.0% | 3.7% | | Gross Profit ($ bn) | 5.6 | $3.5 | | reported vs. Q1 2023 | 12.4% | 3.0% | | organic vs. Q1 2023 | 13.7% | 2.3% | | Operating Income ($ bn) | 3.0 | | | reported vs. Q1 2023 | 11.5% | | | organic vs. Q1 2023 | 22.2% | |

All values are in US Dollars.

Reported<br>Diluted<br>EPS Adjusting<br><br>Items1 Adjusted<br>Diluted<br>EPS Currency<br>Impact Adjusted<br>Diluted<br>EPS ex. Currency
EPS $1.38 $(0.12) $1.50 $(0.20) $1.70
vs. Q1 2023 7.8% 8.7% 23.2%
(1) For a list of adjusting items refer to page 8

The $0.20 unfavorable currency variance in the first quarter includes a $0.09 impact from the devaluation of the Egyptian pound (EGP), including a transactional impact of approximately $0.06 primarily related to the balance sheet remeasurement of foreign currency payables. Our proactive pricing decisions and accelerated cost initiatives allowed us to mitigate this incremental currency headwind in the quarter.

2 Oral smoke-free product volume excludes snuff, snuff leaf and U.S. chew

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Full-Year Forecast
Full-Year
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2024<br>Forecast 2023
Reported Diluted EPS $5.70 - $5.82 5.02
Adjustments:
Asset impairment and exit costs(1) 0.09 0.06
Termination of distribution arrangement in the Middle East — 0.04
Impairment of goodwill and other intangibles 0.01 0.44
Amortization of intangibles(2) 0.43 0.25
Charges related to the war in Ukraine — 0.03
Swedish Match AB acquisition accounting related items — 0.01
Income tax impact associated with Swedish Match AB financing 0.07 (0.11)
South Korea indirect tax charge — 0.11
Termination of agreement with Foundation for a Smoke-Free World — 0.07
Fair value adjustment for equity security investments (0.08) (0.02)
Tax items (0.03) 0.11
Total Adjustments 0.49 0.99
Adjusted Diluted EPS $6.19 - $6.31 6.01
Less: Currency (0.36)
Adjusted Diluted EPS, excluding currency $6.55 - $6.67 6.01 - 11.0%
(1) See Impairment and Exit Costs section for details
(2) See forecast assumptions for details

All values are in US Dollars.

Reported diluted EPS is forecast to be in a range of $5.70 to $5.82, at prevailing exchange rates, versus reported diluted EPS of $5.02 in 2023. Excluding a total 2024 adjustment of $0.49 per share and an adverse currency impact of $0.36, at prevailing exchange rates, this forecast represents a projected increase of 9.0% to 11.0% versus adjusted diluted EPS of $6.01 in 2023, as outlined in the above table.

2024 Full-Year Forecast Assumptions

This forecast assumes:

•An estimated total international industry volume decline for cigarettes and HTUs, excluding China and the U.S., of -2% to flat;

•Total cigarette, HTU and oral smoke-free product shipment volume growth for PMI of flat to +1% driven by smoke-free products;

•14% to 16% adjusted in-market sales volume growth for HTUs, including an approximate 2 billion units adverse impact for the full year from consumer adjustment to the EU characterizing flavor ban, resulting in HTU shipment volumes of more than 140 billion units;

•Nicotine pouch shipment volume in the U.S. of approximately 560 million cans;

•Net revenue growth of 7% to 8.5% on an organic basis;

•Organic operating income growth of 10% to 12%;

•An acceleration in organic smoke-free net revenue and gross profit growth compared to 2023;

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•Broadly unchanged net revenue and adjusted operating loss in Wellness and Healthcare segment;

•No earnings impact from any potential favorable court ruling related to the legality of a supplemental tax surcharge on HTUs in Germany, which went into effect in 2022 (see PMI's first-quarter 2023 press release from April 20, 2023, for additional detail).

•Full-year amortization of acquired intangibles of $0.43 per share, which includes an estimate of amortization of IQOS commercialization rights in the U.S. following the closing of the agreement to end our commercial relationship with Altria Group, Inc. covering IQOS in the U.S. effective May 1, 2024. We currently estimate that the increase in amortization expense in 2024, as a result of this transaction, will be approximately $370 million on a pre-tax basis for the remaining 8 months of the year. For full year 2025 through 2028, we currently estimate an annual impact of approximately $555 million on a pre-tax basis;

•Net financing costs of approximately $1.3 to $1.4 billion;

•An effective tax rate, excluding discrete tax events, of approximately 21% to 22%;

•Operating cash flow of $10 to $11 billion at prevailing exchange rates, subject to year-end working capital requirements;

•Capital expenditures of approximately $1.2 billion, partly reflecting investments in ZYN capacity in the U.S.;

•Net debt to adjusted EBITDA ratio improvement of 0.3x to 0.5x at prevailing exchange rates as we continue to target a ratio of around 2x by the end of 2026;

•No share repurchases in 2024; and

•A strong first-half performance, with second quarter adjusted diluted EPS of $1.50 to $1.55, including an estimated adverse currency impact of 14 cents at prevailing exchange rates.

Factors described in the Forward-Looking and Cautionary Statements section of this release represent continuing risks to these projections.

New Segment Structure

Following the combination and the progress in 2023 to integrate the Swedish Match business into the existing PMI regional segment structure, PMI updated its segment reporting to include Swedish Match results in the four existing geographical regions. PMI's 2024 first-quarter financial results reflect the new segment structure. Historical financial information for the 2021 to 2023 period reflecting the above mentioned change was provided in a Form 8-K dated February 27, 2024.

Impairment and Exit Costs

On February 2, 2024, PMI announced that it reached a global settlement with British American Tobacco p.l.c. The settlement led to the rescission of International Trade Commission orders prohibiting the importation of IQOS products to the U.S. As a result, PMI has restructured the sourcing of IQOS products to be commercialized in the U.S., and recorded pre-tax asset impairment and exit costs of $121 million related to this restructuring during the first quarter of 2024.

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.

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Conference Call

A conference call hosted by Emmanuel Babeau, Chief Financial Officer and Jennifer Motles, Chief Sustainability Officer, will be webcast at 9:00 a.m., Eastern Time, on April 23, 2024. Access the webcast at www.pmi.com/2024Q1earnings.

Investor Relations: Media:
Stamford, CT: +1 (203) 905 2413 Lausanne: +41 (0)58 242 4500
Lausanne, Switzerland: +41 582 424 666 Email: David.Fraser@pmi.com
Email: InvestorRelations@pmi.com
Financial Review
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TOTAL MARKET, CONSOLIDATED SHIPMENT VOLUME & MARKET SHARE

Total Market Volume

First-quarter estimated international industry volume (excluding China and the U.S.) for cigarettes and HTUs increased by 0.3%, reflecting increases in the SSEA, CIS & MEA Region and the EA, AU & PMI DF Region, partly offset by a decrease in the Americas Region and the Europe Region, as described in the Regional sections.

Consolidated Shipment Volume

PMI Cigarettes and HTUs First-Quarter
(million units) 2024 2023 Change
Cigarettes 143,191 143,708 (0.4) %
Heated Tobacco Units 33,134 27,396 20.9 %
Total Cigarettes and HTUs 176,325 171,104 3.1 %
PMI Oral SFP(1) First-Quarter
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(million cans) 2024 2023 Change
Nicotine Pouches 145.7 81.3 79.3 %
Snus 61.4 55.6 10.5 %
Moist Snuff 34.4 35.2 (2.3) %
Other Oral SFP 1.0 1.3 (16.6) %
Total Oral SFP 242.6 173.3 40.0 %
(1) Excluding snuff, snuff leaf and U.S. chew
Note: Sum may not foot due to roundings.

PMI's total cigarette and HTU shipment volume increased by 3.1%, reflecting a 20.9% increase in HTU shipments across all regions, partly offset by a 0.4% decline in cigarette shipments, with declines across all regions except the SSEA, CIS & MEA Region. Cigarette shipment volume for Marlboro increased by 1.7% to 56.9 billion units.

PMI’s total oral product shipment volume in cans increased by 40.0%, primarily reflecting growth in nicotine pouches (primarily in the U.S.) and snus (mainly in Scandinavia).

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Adjusted in-market sales for HTUs increased by 12.5%, including growth in Japan of 13.3% and Europe of 9.4%. A net favorable impact of estimated distributor inventory movements for HTUs shipments was driven most significantly by additional shipments to Japan in light of disruption to Red Sea shipping routes.

International Share of Market - Cigarettes and HTUs

First-Quarter
2024 2023 Change (pp)
Total International Market Share(1) 28.0 % 27.2 % 0.8
Cigarettes 22.9 % 22.7 % 0.2
HTU 5.2 % 4.5 % 0.7
Cigarette over Cigarette Market Share(2) 24.5 % 24.2 % 0.3
(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 roundings.
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CONSOLIDATED FINANCIAL SUMMARY

Financial Summary - Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 8,793 8,019 9.7% 12.1% 774 (194) — 449 464 55
Termination of distribution arrangement in the Middle East — (80) +100% +100% 80 — — — — 80
Adjusted Net Revenues 8,793 8,099 8.6% 11.0% 694 (194) — 449 464 (25)
Net Revenues 8,793 8,019 9.7% 12.1% 774 (194) — 449 464 55
Cost of Sales(1) (3,195) (3,038) (5.2)% (5.4)% (157) 8 — — (169) 4
Marketing, Administration and Research Costs(2) (2,553) (2,250) (13.5)% (7.2)% (303) (142) — — — (161)
Operating Income 3,045 2,731 11.5% 23.5% 314 (328) — 449 295 (102)
Asset Impairment & Exit Costs (168) (109) (54.1)% (54.1)% (59) — — — — (59)
Termination of distribution arrangement in the Middle East(3) — (80) +100% +100% 80 — — — — 80
Impairment of Other Intangibles (27) — —% —% (27) — — — — (27)
Amortization of Intangibles (120) (81) (48.1)% (48.1)% (39) — — — — (39)
Swedish Match AB acquisition accounting related items — (18) +100% +100% 18 — — — — 18
Adjusted Operating Income 3,360 3,019 11.3% 22.2% 341 (328) — 449 295 (75)
Adjusted Operating Income Margin 38.2 % 37.3 0.9pp 3.7pp
(1) Includes 16 million in 2024 and 40 million in 2023 related to the special items below.
(2) Includes 299 million in 2024 and 168 million in 2023 related to the special items below.
(3) Included in net revenues above.

All values are in US Dollars.

Adjusted net revenues increased by 11.0% on an organic basis, mainly reflecting: a favorable pricing variance, primarily driven by higher combustible tobacco pricing; and favorable volume/mix, mainly driven by higher HTU and ZYN volume, partially offset by lower cigarette volume.

Adjusted operating income increased by 22.2% on an organic basis, mainly reflecting: the favorable pricing variance; and favorable volume/mix, mainly driven by higher HTU and ZYN volume, partly offset by lower cigarette volume and unfavorable cigarette mix; partially offset by higher marketing, administration and research costs (primarily due to inflationary impacts, notably related to wages) as well as higher manufacturing costs.

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First-Quarter
2024 2023 % Change
Reported Diluted EPS $ 1.38 $ 1.28 7.8 %
Asset impairment and exit costs 0.09 0.06
Termination of distribution arrangement in the Middle East — 0.04
Impairment of other intangibles 0.01 —
Amortization of intangibles 0.06 0.04
Swedish Match AB acquisition accounting related items — 0.01
Income tax impact associated with Swedish Match AB financing 0.07 (0.05)
Fair value adjustment for equity security investments (0.08) —
Tax items (0.03) —
Adjusted Diluted EPS $ 1.50 $ 1.38 8.7 %
Less: Currency (0.20)
Adjusted Diluted EPS, excluding Currency $ 1.70 $ 1.38 23.2 %
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EUROPE REGION

Total Market, PMI Shipment & Market Share Commentaries

The estimated total market for cigarettes and HTUs in the Region decreased by 0.4% to 124.5 billion units, reflecting a 2.1% decline for cigarettes, largely offset by an increase for HTUs. The decrease in the estimated total market was predominantly due to France (down by 16.1%) and the UK (down by 11.1%), largely offset by Poland (up by 4.7%) and Bulgaria (up by 9.7%).

Europe Key Data First-Quarter
Change
2024 2023 % / pp
PMI Shipment Volume (million units)
Cigarettes 37,089 39,157 (5.3) %
Heated Tobacco Units 11,340 10,099 12.3 %
Total Europe 48,429 49,256 (1.7) %
PMI Market Share
Cigarettes 29.9 % 30.3 % (0.4)
Heated Tobacco Units 10.1 % 9.0 % 1.1
Total Europe 40.0 % 39.3 % 0.7
Note: Sum may not foot due to roundings.

PMI's total cigarette and HTU shipment volume in the Region decreased by 1.7% to 48.4 billion units. Total cigarette and HTU shipment volume decreased notably in France (down by 31.7%) and Italy (down by 10.4%) driven by cigarettes, and increased notably in Poland (up by 10.0%) and Germany (up by 4.8%).

PMI's estimated HTU adjusted in-market sales volume in the Region increased by 9.4% in the quarter, reflecting continued growth momentum for IQOS, partly offset by the impact from the EU characterizing flavor ban.

PMI's HTU share of the total cigarette and HTU market in the Region increased by 1.1 points, or by 0.9 points on an adjusted basis.

Europe Oral SFP First-Quarter
Change
2024 2023 %
PMI Shipment Volume (million cans)
Nicotine Pouches 12.3 7.9 55.9 %
Snus 60.7 54.4 11.6 %
Other Oral SFP(1) 1.0 1.3 (16.6) %
Total Europe 74.0 63.5 16.5 %
(1) Includes chew bags and tobacco bits
Note: Sum may not foot due to roundings.

Oral SFP shipments increased by 16.5% with growth of snus (up by 11.6%) and nicotine pouches (up by 55.9%), benefiting from timing of shipments and underlying category growth in the Nordics.

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Financial Summary

Financial Summary - <br>Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
2024 Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 3,365 3,068 9.7% 7.1% 297 78 — 163 56 —
Operating Income 1,456 1,215 19.8% 18.7% 241 14 — 163 64 —
Adjustments (1) (41) (75) 45.8% 45.8% 34 — — — — 34
Adjusted Operating Income 1,496 1,290 16.0% 14.9% 206 14 — 163 64 (34)
Adjusted Operating Income Margin 44.5 % 42.0 2.5pp 3.1pp
(1) See Schedule 8 in Exhibit 99.2 to the Form 8-K dated April 23, 2024, for additional detail.

All values are in US Dollars.

Net revenues increased by 7.1% on an organic basis, 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 lower cigarettes volume.

Adjusted operating income increased by 14.9% on an organic basis, reflecting: a favorable pricing variance, mainly driven by higher combustible tobacco pricing; and favorable volume/mix, primarily driven by higher HTU volume and favorable HTU mix, partly offset by lower cigarette volume, as well as unfavorable cigarette mix; partly offset by higher manufacturing costs, including the impact of the EU single-use plastics directive.

SSEA, CIS & MEA REGION

Total Market, PMI Shipment & Market Share Commentaries

The estimated total market for cigarettes and HTUs in the Region increased by approximately 1% to 371.0 billion units. The increase in the estimated total market was mainly due to Indonesia (up by 6.4%) and Turkey (up by 14.8%), partly offset by Egypt (down by 14.2%) and Pakistan (down by 20.7%).

PMI Shipment Volume First-Quarter
(million units) 2024 2023 Change
Cigarettes 80,191 76,531 4.8 %
Heated Tobacco Units 6,078 5,447 11.6 %
Total SSEA, CIS & MEA 86,269 81,978 5.2 %

PMI's total cigarette and HTU shipment volume in the Region increased by 5.2% to 86.3 billion units, mainly driven by Turkey (up by 25.0%), partly offset by the Philippines (down by 18.1%). PMI's estimated HTU adjusted in-market sales volume increased by 14.6%, with 11.6% HTU shipment volume growth.

  • 10 -

Financial Summary

Financial Summary - <br>Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
2024 Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 2,658 2,477 7.3% 15.1% 181 (194) — 155 144 76
Adjustment (1) — (80) +100% +100% 80 — — — — 80
Adjusted Net Revenues 2,658 2,557 3.9% 11.5% 101 (194) — 155 144 (4)
Net Revenues 2,658 2,477 7.3% 15.1% 181 (194) — 155 144 76
Operating Income 772 734 5.2% 38.0% 38 (241) — 155 46 78
Adjustments (2) (5) (117) 95.7% 95.7% 112 — — — — 112
Adjusted Operating Income 777 851 (8.7)% 19.6% (74) (241) — 155 46 (34)
Adjusted Operating Income Margin 29.2 % 33.3 (4.1)pp 2.4pp
(1) Distribution arrangement termination (Middle East).
(2) See Schedule 8 in Exhibit 99.2 to the Form 8-K dated April 23, 2024, for additional detail.

All values are in US Dollars.

Adjusted net revenues increased by 11.5% on an organic basis, primarily reflecting: a favorable pricing variance, mainly driven by higher combustible tobacco pricing; and favorable volume/mix, driven by higher HTU and cigarettes volume as well as favorable HTU and cigarettes mix.

Adjusted operating income increased by 19.6% on an organic basis, primarily reflecting: a favorable pricing variance, mainly driven by higher combustible tobacco pricing; and favorable volume/mix, driven by higher HTU volume, favorable HTU mix and higher cigarette volume, partly offset by unfavorable cigarette mix; partly offset by higher manufacturing costs (primarily due to inflationary impacts).

EA, AU AND PMI DF REGION

Total Market, PMI Shipment & Market Share Commentaries

The estimated total market for cigarettes and HTUs in the Region, excluding China, increased by around 1% to 75.9 billion units, with growth for HTUs partly offset by a decline for cigarettes. The increase in the estimated total market was mainly driven by International Duty Free (up by 17.6%) and Taiwan (up by 15.0%).

PMI Shipment Volume First-Quarter
(million units) 2024 2023 Change
Cigarettes 11,568 13,110 (11.8) %
Heated Tobacco Units 15,599 11,748 32.8 %
Total EA, AU & PMI DF 27,167 24,858 9.3 %

PMI's total cigarette and HTU shipment volume in the Region increased by 9.3% to 27.2 billion units, driven by Japan (up by 21.1%).

PMI's estimated HTU adjusted in-market sales volume in the Region increased by 14.6% in the quarter, including growth in Japan of 13.3%.

  • 11 -

Financial Summary

Financial Summary - Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
2024 Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 1,684 1,520 10.8% 18.0% 164 (109) — 130 143 —
Operating Income 763 637 19.8% 39.4% 126 (125) — 130 72 49
Adjustments (1) (1) (20) 96.2% 96.2% 19 — — — — 19
Adjusted Operating Income 764 657 16.3% 35.3% 107 (125) — 130 72 30
Adjusted Operating Income Margin 45.4 % 43.2 2.2pp 6.4pp
(1) See Schedule 8 in Exhibit 99.2 to the Form 8-K dated April 23, 2024, for additional detail.

All values are in US Dollars.

Net revenues increased by 18.0% on an organic basis, reflecting: favorable pricing variance and favorable volume/mix, mainly driven by higher HTU volume.

Adjusted operating income increased by 35.3% on an organic basis driven by the same factors as for net revenues as well as lower shipping costs.

AMERICAS REGION

Total Market, PMI Shipment & Market Share Commentaries

The estimated total market for cigarettes and HTUs in the Region, excluding the U.S., decreased by around 3% to 44.7 billion units, primarily reflecting a decline for cigarettes. The decrease in the estimated total market was mainly due to Argentina (down by 7.8%) and Canada (down by 13.1%), partly offset by Brazil (up by 3.5%) and Mexico (up by 1.8%).

PMI Shipment Volume First-Quarter
(million units) 2024 2023 Change
Cigarettes 14,343 14,910 (3.8) %
Heated Tobacco Units 117 102 14.7 %
Total Americas 14,460 15,012 (3.7) %
Note: Sum may not foot due to roundings.

PMI's total cigarette and HTU shipment volume in the Region decreased by 3.7% to 14.5 billion units, mainly due to Argentina (down by 9.8%).

Cigar shipment volume declined by 23% versus a tough comparison due to prior year trade inventory movements. Underlying (excluding impact of accounting reclassifications performed in third quarter of 2023) cigar revenue was broadly flat due to strong pricing.

  • 12 -
Americas Oral SFP1 First-Quarter
Change
2024 2023 %
PMI Shipment Volume (million cans)
Nicotine Pouches 131.6 73.2 79.7 %
Moist Snuff 34.4 35.2 (2.3) %
Snus 0.7 1.2 (39.5) %
Total Americas 166.7 109.6 52.1 %
(1) Excluding U.S. chew<br>Note: Sum may not foot due to roundings.

Oral products shipments increased by 52.1%, driven by ZYN nicotine pouches (up by 79.7%) in the U.S., partly offset by moist snuff (down by 2.3%) driven by a declining category and pricing.

Financial Summary

Financial Summary - <br>Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
2024 Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 996 868 14.7% 11.4% 128 29 — (1) 121 (21)
Operating Income 99 183 (45.9)% (57.9)% (84) 22 — (1) 113 (218)
Adjustments (1) (227) (62) -(100)% -(100)% (165) — — — — (165)
Adjusted Operating Income 326 245 33.1% 24.1% 81 22 — (1) 113 (53)
Adjusted Operating Income Margin 32.7 % 28.2 4.5pp 3.2pp
(1) See Schedule 8 in Exhibit 99.2 to the Form 8-K dated April 23, 2024, for additional detail.

All values are in US Dollars.

Net revenues increased by 11.4% on an organic basis, primarily reflecting: favorable volume/mix, mainly due to growth of ZYN nicotine pouches in the U.S., partly offset by lower cigarette volume and unfavorable cigarette mix outside of the U.S.

Adjusted operating income increased by 24.1% on an organic basis, mainly reflecting: favorable volume/mix, mainly due to the same factors as for net revenues; partly offset by higher marketing and administration costs, including incremental investment in the U.S.

  • 13 -

WELLNESS AND HEALTHCARE

The operating results of PMI’s Vectura Fertin Pharma business are reported in the Wellness and Healthcare segment.

Financial Summary

Financial Summary - <br>Quarters Ended March 31, Change<br>Fav./(Unfav.) Variance<br>Fav./(Unfav.)
2024 Total Excl.<br>Curr. & Acquis. Total Cur-<br>rency Acqui-sitions Price Vol/<br>Mix Cost/<br>Other
(in millions)
Net Revenues 90 86 4.7 % 2.3 % 4 2 — 2 — —
Operating Income / (Loss) (45) (38) (18.4) % (23.7) % (7) 2 — 2 — (11)
Adjustments (1) (41) (14) -(100)% -(100)% (27) — — — — (27)
Adjusted Operating Income / (Loss) (3) (24) 87.5 % 79.2 % 21 2 — 2 — 16
Adjusted Operating Income / (Loss) Margin (3.3) % (27.9) 24.6pp 22.2pp
(1) See Schedule 8 in Exhibit 99.2 to the Form 8-K dated April 23, 2024, for additional detail.

All values are in US Dollars.

Net revenues increased by 2.3% on an organic basis. The adjusted operating loss of $3 million was primarily due to R&D and administration costs.

Philip Morris International: Delivering a Smoke-Free Future

Philip Morris International (PMI) is a leading international tobacco company, actively delivering a smoke-free future and evolving its portfolio for the long term to include products outside of the tobacco and nicotine sector. The company’s current product portfolio primarily consists of cigarettes and smoke-free products. Since 2008, PMI has 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 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 2022, PMI acquired Swedish Match – a leader in oral nicotine delivery – creating a global smoke-free champion led by the companies’ IQOS and ZYN brands. The U.S. Food and Drug Administration has authorized versions of PMI’s IQOS devices and consumables and Swedish Match’s General snus as Modified Risk Tobacco Products. As of December 31, 2023, PMI's smoke-free products were available for sale in 84 markets, and PMI estimates that approximately 33 million adults around the world use PMI's smoke-free products. Smoke-free business accounted for approximately 37% of PMI’s total full-year 2023 net revenues. With a strong foundation and significant expertise in life sciences, PMI announced in February 2021 its ambition to expand into wellness and healthcare areas and, through its Vectura Fertin Pharma business, aims to enhance life through the delivery of seamless health experiences. For more information, please visit www.pmi.com and www.pmiscience.com.

Forward-Looking and Cautionary Statements

This press release contains projections of future results and goals and other forward-looking statements, including statements regarding expected financial or operational performance; capital allocation plans;

  • 14 -

investment strategies; regulatory outcomes; market expectations; and business plans and strategies. Achievement of future results is subject to risks, uncertainties and inaccurate assumptions. In the event that risks or uncertainties materialize, or underlying assumptions prove inaccurate, actual results could vary materially from those contained in such forward-looking statements. Pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, PMI is 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 PMI.

PMI's business risks include: excise tax increases and discriminatory tax structures; increasing marketing and regulatory restrictions that could reduce our competitiveness, eliminate our ability to communicate with adult consumers, or ban certain of our products in certain markets or countries; health concerns relating to the use of tobacco and other nicotine-containing products and exposure to environmental tobacco smoke; litigation related to tobacco and/or nicotine use and intellectual property; intense competition; the effects of global and individual country economic, regulatory and political developments, natural disasters and conflicts; the impact and consequences of Russia's invasion of Ukraine; changes in adult smoker behavior; the impact of natural disasters and pandemics on PMI's business; lost revenues as a result of counterfeiting, contraband and cross-border purchases; governmental investigations; unfavorable currency exchange rates and currency devaluations, and limitations on the ability to repatriate funds; adverse changes in applicable corporate tax laws; adverse changes in the cost, availability, and quality of tobacco and other agricultural products and raw materials, as well as components and materials for our electronic devices; and the integrity of its information systems and effectiveness of its data privacy policies. PMI's future profitability may also be adversely affected should it be unsuccessful in its attempts to introduce, commercialize, and grow smoke-free products or if regulation or taxation do not differentiate between such products and cigarettes; if it is unable to successfully introduce new products, promote brand equity, enter new markets or improve its margins through increased prices and productivity gains; if it is unable to expand its brand portfolio internally or through acquisitions and the development of strategic business relationships; if it is unable to attract and retain the best global talent, including women or diverse candidates; or if it is unable to successfully integrate and realize the expected benefits from recent transactions and acquisitions. Future results are also subject to the lower predictability of our smoke-free products performance.

PMI is further subject to other risks detailed from time to time in its publicly filed documents, including PMI's Annual Report on Form 10-K for the fourth quarter and year ended December 31, 2023, and the Quarterly Report on Form 10-Q for the first quarter ended March 31, 2024, which will be filed in the coming days. PMI cautions that the foregoing list of important factors is not a complete discussion of all potential risks and uncertainties. PMI does not undertake to update any forward-looking statement that it may make from time to time, except in the normal course of its public disclosure obligations.

Non-GAAP Measures, Glossary and Explanatory Notes

Reconciliations of non-GAAP measures in this release to the most directly comparable U.S. GAAP measures can be found in Exhibit 99.2 to the Form 8-K dated April 23, 2024, and at www.pmi.com/2024Q1earnings. A glossary of key terms, definitions and explanatory notes is available in the aforementioned Exhibit 99.2 and on the same webpage, where additional financial schedules, as well as adjustments and other calculations have also been made available.

  • 15 -

Management reviews net revenues, gross profit, operating income, operating income margin, operating cash flow and earnings per share, or "EPS," on an adjusted basis, which may exclude the impact of currency and other items such as acquisitions, asset impairment and exit costs, tax items and other special items. Additionally, starting in 2022 and on a comparative basis, for these measures other than net revenues and operating cash flow, PMI includes adjustments to add back amortization expense on acquisition related intangible assets that are recorded as part of purchase accounting and contribute to PMI’s revenue generation, as well as impairment of intangible assets, if any. While amortization expense on acquisition related intangible assets is excluded in these adjusted measures, the net revenues generated from these acquired intangible assets are included in the company's adjusted measures, unless otherwise stated. Currency-neutral and organic growth rates reflect the way management views underlying performance for these measures. PMI believes that such measures provide useful insight into underlying business trends and results. Management reviews these measures because they exclude changes in currency exchange rates and other factors that may distort underlying business trends, thereby improving the comparability of PMI’s business performance between reporting periods. Furthermore, PMI uses several of these measures in its management compensation program to promote internal fairness and a disciplined assessment of performance against company targets. PMI discloses these measures to enable investors to view the business through the eyes of management.

Non-GAAP measures used in this release should neither be considered in isolation nor as a substitute for the financial measures prepared in accordance with U.S. GAAP.

  • 16 -
Appendix 1
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Key Market Data
Quarters Ended March 31,
Market Total Market,<br><br>bio units PMI Shipments, bio units PMI Market Share(2), %
Total Cigarette HTU Total HTU
2024 2023 % Change 2024 2023 % Change 2024 2023 % Change 2024 2023 % Change 2024 2023 pp Change 2024 2023 pp Change
Total(1)(2) 616.1 614.2 0.3 176.3 171.1 3.1 143.2 143.7 (0.4) 33.1 27.4 20.9 28.0 27.2 0.8 5.2 4.5 0.7
Europe
France 6.3 7.5 (16.1) 2.6 3.8 (31.7) 2.5 3.7 (31.7) — 0.1 (29.3) 40.2 42.3 (2.1) 0.6 0.8 (0.2)
Germany(3) 16.1 15.9 1.3 6.3 6.0 4.8 5.3 5.5 (3.2) 1.0 0.5 85.9 39.9 39.4 0.5 6.3 5.4 0.9
Italy(3) 17.5 17.2 1.6 8.0 8.9 (10.4) 5.7 6.9 (17.3) 2.2 2.0 13.9 52.5 53.8 (1.3) 17.7 16.8 0.9
Poland(3) 14.1 13.4 4.7 6.1 5.5 10.0 4.8 4.3 11.6 1.3 1.2 4.2 42.9 40.9 2.0 9.0 9.4 (0.4)
Spain 9.7 9.9 (1.9) 2.8 2.9 (2.4) 2.6 2.7 (4.9) 0.2 0.2 34.8 28.9 29.1 (0.2) 2.7 2.1 0.6
SSEA, CIS & MEA
Egypt 19.3 22.5 (14.2) 5.3 5.8 (8.0) 5.0 5.6 (10.7) 0.3 0.2 89.8 27.1 25.6 1.5 1.9 1.2 0.7
Indonesia 73.6 69.2 6.4 20.2 19.8 2.3 20.0 19.7 1.6 0.2 0.1 +100 27.5 28.6 (1.1) 0.3 0.1 0.2
Philippines 10.2 11.5 (11.2) 5.5 6.7 (18.1) 5.4 6.6 (18.4) 0.1 0.1 23.9 53.2 57.7 (4.5) 0.7 0.5 0.2
Russia 46.7 44.9 4.2 15.5 14.7 5.4 11.5 10.9 4.9 4.0 3.8 6.8 32.4 31.2 1.2 9.5 8.3 1.2
Turkey 30.1 26.2 14.8 16.0 12.8 25.0 16.0 12.8 25.0 — — — 53.3 48.9 4.4 — — —
EA, AU & PMI DF
Australia 1.4 1.9 (29.6) 0.5 0.7 (26.1) 0.5 0.7 (26.1) — — — 37.6 35.8 1.8 — — —
Japan(2) 35.7 35.3 1.0 17.9 14.8 21.1 4.3 4.7 (8.4) 13.6 10.1 34.8 41.1 39.5 1.6 29.4 26.3 3.1
South Korea 16.5 16.9 (2.4) 3.4 3.3 2.6 2.0 2.1 (5.3) 1.4 1.2 17.1 20.4 19.6 0.8 8.2 6.8 1.4
Americas
Argentina 7.1 7.7 (7.8) 4.4 4.9 (9.8) 4.4 4.9 (9.8) — — — 61.5 62.9 (1.4) — — —
Mexico 6.2 6.1 1.8 3.7 3.7 0.6 3.7 3.7 0.1 — — — 59.8 60.5 (0.7) 0.8 0.5 0.3
(1) Market share estimates are calculated using IMS data, unless otherwise stated
(2) Total market and market share estimates include cigarillos in Japan
(3) PMI market share reflects estimated adjusted IMS volume share, with historical total/HTU results: Italy Q2 53.6%/17.1%, Q3 53.4%/16.0%, Q4 53.7%/17.2%; Poland Q2 41.1%/8.6%, Q3 42.0%/8.4%, Q4 43.8%/9.9%
Note: % change for Total Market and PMI shipments is computed based on millions of units. "-" indicates volume below 50 million units and market share below 0.1%

Document

Exhibit 99.2

Philip Morris International Inc.

Glossary of Key Terms, Definitions

and Explanatory Notes; and

Select Financial Information and Reconciliations of

Non-GAAP Financial Measures

2024 First-Quarter Results

April 23, 2024

Glossary of Key Terms, Definitions

and Explanatory Notes

General

•"PMI" refers to Philip Morris International Inc. and its subsidiaries. Trademarks and service marks that are the registered property of, or licensed by, the subsidiaries of PMI, are italicized.

•Comparisons are made to the same prior-year period unless otherwise stated.

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

•As of the first quarter of 2022, 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.

•References to total international market, defined as worldwide cigarette and heated tobacco unit volume excluding the U.S., total industry (or total market) and market shares are PMI 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 the People's Republic of China and/or PMI's duty free business.

•"Combustible tobacco products" is the term PMI uses to refer to cigarettes and other tobacco products that are combusted.

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

•"Total shipment volume" is defined as the combined total of cigarette shipment volume and heated tobacco unit shipment volume, unless otherwise stated.

•"SSEA, CIS & MEA" stands for South & Southeast Asia, Commonwealth of Independent States, and Middle East & Africa.

•"EA, AU & PMI DF" stands for East Asia, Australia and PMI Duty Free.

•"Americas" refers to the former Latin America & Canada segment, which was renamed as the Americas segment as of the third quarter of 2021. References to "Americas" may, in defined instances, exclude the U.S.

•In the third quarter of 2021, PMI acquired Fertin Pharma A/S, Vectura Group plc. and OtiTopic, Inc. On March 31, 2022, PMI launched a new Wellness and Healthcare business consolidating these entities, Vectura Fertin Pharma. The operating results of this new business are reported in the Wellness and Healthcare segment. The business operations of PMI's Wellness and Healthcare segment are managed and evaluated separately from the geographical segments.

•Following the combination and the progress in 2023 toward integration of the Swedish Match business into the existing PMI regional segment structure, PMI updated in January 2024 its segment reporting by including Swedish Match results in the four existing geographical regions. As of the first quarter of 2024, PMI began reporting on this basis.

•Following the deconsolidation of PMI's Canadian subsidiary, Rothmans, Benson & Hedges, Inc. (RBH) on March 22, 2019, PMI continues to report the volume and corresponding royalty revenues of brands sold by RBH for which other PMI subsidiaries are the trademark owner. These include HEETS, Next, Philip Morris and Rooftop. The volume and corresponding royalty revenues for these brands sold by RBH were not material to PMI for all periods presented.

•From time to time, PMI’s shipment volumes are subject to the impact of distributor inventory movements (or wholesaler inventory movements in certain markets where PMI does not sell to distributors), and estimated total industry/market volumes are subject to the impact of inventory movements in various trade channels that include estimated trade inventory movements of PMI’s competitors arising from market-specific factors that significantly distort reported volume disclosures. Such factors may include changes to the manufacturing supply chain, shipment methods, consumer demand, timing of excise tax increases or other influences that may affect the timing of sales to customers. In such instances, in addition to reviewing PMI shipment volumes and certain estimated total industry/market volumes

on a reported basis, management reviews these measures on an adjusted basis that excludes the impact of distributor and/or estimated trade inventory movements. Management also believes that disclosing PMI shipment volumes and estimated total industry/market volumes in such circumstances on a basis that excludes the impact of distributor and/or estimated trade inventory movements, such as on an IMS basis, improves the comparability of performance and trends for these measures over different reporting periods.

•Within the tables and schedules presented throughout this earnings release, certain columns and rows may not add due to the use of rounded numbers for disclosure purposes.

Financial

•Adjusted net revenues exclude the impact related to the termination of a distribution arrangement in the Middle East in 2023.

•"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.

•"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.

•"Cost/Other" in the Consolidated Financial Summary table of total PMI and the five segments of this release reflects the currency-neutral variances of: cost of sales (excluding the volume/mix cost component); marketing, administration and research costs (including asset impairment and exit costs); and amortization and impairment of intangibles. “Cost/Other” also includes the currency-neutral net revenue variance, unrelated to volume/mix and price components, attributable to: fees for certain distribution rights billed to customers in certain markets in the SSEA, CIS & MEA Region and the revenue adjustment for the termination of a distribution arrangement in the Middle East.

•"Adjusted Operating Income Margin" is calculated as adjusted operating income, divided by adjusted net revenues.

•"Adjusted EBITDA" is defined as earnings before interest, taxes, depreciation, amortization and equity (income)/loss in unconsolidated subsidiaries, excluding asset impairment and exit costs, impairment of intangibles, and unusual items.

•"Net debt" is defined as total debt, less cash and cash equivalents.

•Growth rates presented on an organic basis reflect adjusted results, excluding currency, acquisitions and disposals.

•Management reviews net revenues, gross profit, operating income, operating income margin, operating cash flow and earnings per share, or "EPS," on an adjusted basis, which may exclude the impact of currency and other items such as acquisitions, asset impairment and exit costs, tax items and other special items. Additionally, starting in 2022 and on a comparative basis, for these measures other than net revenues and operating cash flow, PMI includes adjustments to add back amortization expense on acquisition related intangible assets that are recorded as part of purchase accounting and contribute to PMI’s revenue generation, as well as impairment of intangible assets, if any. While amortization expense on acquisition related intangible assets is excluded in these adjusted measures, the net revenues generated from these acquired intangible assets are included in the company's adjusted measures, unless otherwise stated. Currency-neutral and organic growth rates reflect the way management views underlying performance for these measures. PMI believes that such measures provide useful insight into underlying business trends and results. Management reviews these measures because they exclude changes in currency exchange rates and other factors that may distort underlying business trends, thereby improving the comparability of PMI’s business performance between reporting periods. Furthermore, PMI uses several of these

measures in its management compensation program to promote internal fairness and a disciplined assessment of performance against company targets. PMI discloses these measures to enable investors to view the business through the eyes of management.

•When PMI provides its expectation for adjusted net revenues, adjusted operating income and margin, adjusted earnings per share and adjusted operating cash flow on a forward-looking basis, a reconciliation of the differences between the non-GAAP expectations and the corresponding GAAP measures, as described above, generally is not available without unreasonable effort due to potentially high variability, complexity, and low visibility as to the items that would be excluded from the GAAP measure in the relevant future period, such as asset impairment and exit costs, amortization and impairment of acquired intangibles and other special items, changes in currency exchange rates, the impact and timing of potential acquisitions and divestitures, and other structural changes or their probable significance. The variability of the excluded items may have a significant, and potentially unpredictable, impact on our future GAAP results.

•Non-GAAP measures used by PMI should neither be considered in isolation nor as a substitute for the financial measures prepared in accordance with U.S. GAAP. For a reconciliation of non-GAAP measures to the most directly comparable U.S. GAAP measures, see the "Select Financial Information and Reconciliations of Non-GAAP Financial Measures" section of this document.

•U.S. GAAP Treatment of a country as a Highly Inflationary Economy: following the categorization of a country by the International Practices Task Force of the Center for Audit Quality as having a three-year cumulative inflation rate greater than 100%, the country is considered highly inflationary in accordance with U.S. GAAP. For such countries, PMI accounts for the operations of its local affiliates as highly inflationary, and to treat the U.S. dollar as the functional currency of the affiliates. Such treatment was effective July 1, 2018, for Argentina, and April 1, 2022, for Turkey.

•"Fair value adjustment for equity security investments" reflects the adjustment resulting from share price movements in passive investments for publicly traded entities that are not controlled or influenced by PMI. Under U.S. GAAP, such adjustments are required, since January 1, 2018, to be reflected directly in the income statement. Adjustments reflect share price movements in PMI's investments in India and Sri Lanka.

•"Swedish Match AB acquisition accounting related items" refers to expenses associated with fair-value adjustments on Swedish Match inventories. In the fourth quarter of 2022, PMI recorded a total fair value step-up adjustment for inventories of $146 million related to the acquisition, of which $125 million was recognized in cost of sales in the fourth quarter of 2022, with the remaining amount recognized in the first quarter of 2023.

•"Income tax impact associated with Swedish Match AB financing" reflects a deferred tax benefit (cost) for unrealized foreign currency losses (gains) on intercompany loans related to the Swedish Match acquisition financing reflected in PMI's consolidated statements of earnings. The underlying pre-tax foreign currency movements fully offset in the consolidated statements of earnings and were reflected as currency translation adjustments in PMI's consolidated statements of stockholders' (deficit) equity.

•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, PMI recorded a pre-tax charge of $140 million in the quarter, commensurate with the early termination of this pledge agreement.

•Russia tax item: In the third quarter of 2023, PMI recorded a tax charge associated with 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 government on August 8, 2023, with respect to certain payments including dividends.

Smoke-Free

•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 ("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.

•Reduced-risk products ("RRPs”) is the term we use to refer to Smoke-Free Products that are scientifically demonstrated to likely present, or present, less risk of harm versus continued smoking based on the totality of the scientific evidence.

•Wellness and Healthcare products primarily refer to products associated with inhaled therapeutics and oral and intra-oral delivery systems that are included in the operating results of PMI's new Wellness and Healthcare business, Vectura Fertin Pharma.

•"Heated tobacco units" or "HTU" is the term PMI uses 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). HTU's also include zero tobacco heat-not-burn consumables (LEVIA).

•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. For Japan, total estimated industry sales volume also includes cigarillos.

•Unless otherwise stated, all references to IQOS are to PMI's Platform 1 IQOS devices and heated tobacco consumables.

•IQOS heat-not-burn devices are precisely controlled heating devices into which a specially designed and proprietary tobacco units are inserted and heated to generate an aerosol.

•"PMI heat-not-burn products" include licensed KT&G heat-not-burn products.

•"PMI HTUs" include licensed KT&G HTUs.

•“Total IQOS users” is defined as the estimated number of Legal Age (minimum 18 years) users of PMI heat-not-burn products, for which PMI HTUs represented at least a portion of their daily tobacco consumption over the past seven days.

The estimated number of adults who have "switched to IQOS and stopped smoking" reflects:

•for markets where there are no heat-not-burn products other than PMI heat-not-burn products: daily individual consumption of PMI HTUs represents the totality of their daily tobacco consumption in the past seven days;

•for markets where PMI heat-not-burn products are among other heat-not-burn products: daily individual consumption of HTUs represents the totality of their daily tobacco consumption in the past seven days, of which at least 70% is PMI HTUs.

Note: The above IQOS user metrics reflect PMI estimates, which are based on consumer claims and sample-based statistical assessments with an average margin of error of +/-5% at a 95% Confidence Interval in key volume markets. The accuracy and reliability of IQOS user metrics may vary based on individual market maturity and availability of information.

As of December 2020, PMI heat-not-burn products and HTUs include licensed KT&G heat-not-burn products and HTUs, respectively.

•Nicotine pouch products reflect 15 pouches per can in the U.S. and 21 pouches per can outside the U.S.

•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.

Select Financial Information and Reconciliations of Non-GAAP Financial Measures
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Diluted Earnings Per Share (EPS)
( in millions, except per share data) / (Unaudited)
Quarters Ended
March 31,
(1) Basic and diluted EPS were calculated using the following (in millions):
Quarters Ended
March 31,
2024
2,148
6
2,142
1,553
2
1,555
(2) Includes the impact of shares outstanding and share-based payments
(3) Including rounding adjustment

All values are in US Dollars.

Schedule 2
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Diluted EPS to Reported Diluted EPS, excluding Currency,
and Reconciliation of Reported Diluted EPS to Adjusted Diluted EPS, excluding Currency
(Unaudited)
Quarters Ended March 31,
2024 2023 % Change
Reported Diluted EPS $ 1.38 $ 1.28 7.8 %
Less: Currency (0.20)
Reported Diluted EPS, excluding Currency $ 1.58 $ 1.28 23.4 %
Quarters Ended March 31, Year Ended
2024 2023 % Change 2023
Reported Diluted EPS $ 1.38 $ 1.28 7.8 % $ 5.02
Asset impairment and exit costs 0.09 0.06 0.06
Termination of distribution arrangement in the Middle East — 0.04 0.04
Impairment of goodwill and other intangibles 0.01 — 0.44
Amortization of intangibles 0.06 0.04 0.25
Charges related to the war in Ukraine — — 0.03
Swedish Match AB acquisition accounting related items — 0.01 0.01
Income tax impact associated with Swedish Match AB financing 0.07 (0.05) (0.11)
South Korea indirect tax charge — — 0.11
Termination of agreement with Foundation for a Smoke-Free World — — 0.07
Fair value adjustment for equity security investments (0.08) — (0.02)
Tax items (0.03) — 0.11
Adjusted Diluted EPS $ 1.50 $ 1.38 8.7 % $ 6.01
Less: Currency (0.20)
Adjusted Diluted EPS, excluding Currency $ 1.70 $ 1.38 23.2 %
Schedule 3
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PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Net Revenues by Product Category and Adjustments of Net Revenues for the Impact of Currency and Acquisitions
( in millions) / (Unaudited)
NetRevenues Net<br>Revenues<br>excluding Currency Acqui-<br>sitions Net<br>Revenues excl. Currency & <br>Acquisitions Quarters Ended<br>March 31, NetRevenues Total Excluding Currency Excluding Currency & Acquisitions
2024 Combustible Tobacco 2023 % Change
1,931 $ 1,886 $ — $ 1,886 Europe 1,815 6.4 % 3.9 % 3.9 %
2,346 2,484 — 2,484 SSEA, CIS & MEA 2,154 8.9 % 15.4 % 15.4 %
597 621 — 621 EA, AU & PMI DF 689 (13.4) % (9.8) % (9.8) %
534 506 — 506 Americas 566 (5.6) % (10.6) % (10.6) %
5,407 $ 5,498 $ — $ 5,498 Total Combustible Tobacco 5,223 3.5 % 5.3 % 5.3 %
2024 Smoke-free excl. W&H 2023 % Change
1,434 $ 1,401 $ — $ 1,401 Europe 1,253 14.4 % 11.8 % 11.8 %
312 368 — 368 SSEA, CIS & MEA 323 (3.5) % 13.7 % 13.7 %
1,087 1,172 — 1,172 EA, AU & PMI DF 831 30.8 % 41.0 % 41.0 %
462 461 — 461 Americas 302 52.9 % 52.5 % 52.5 %
3,296 $ 3,401 $ — $ 3,401 Total Smoke-free excl. W&H 2,710 21.6 % 25.5 % 25.5 %
2024 Wellness and Healthcare 2023 % Change
90 $ 88 $ — $ 88 Wellness and Healthcare 86 4.7 % 2.3 % 2.3 %
2024 Smoke-free incl. W&H 2023 % Change
3,386 $ 3,489 $ — $ 3,489 Smoke-free incl. W&H 2,796 21.1 % 24.8 % 24.8 %
2024 PMI 2023 % Change
3,365 $ 3,287 $ — $ 3,287 Europe 3,068 9.7 % 7.1 % 7.1 %
2,658 2,852 — 2,852 SSEA, CIS & MEA 2,477 7.3 % 15.1 % 15.1 %
1,684 1,793 — 1,793 EA, AU & PMI DF 1,520 10.8 % 18.0 % 18.0 %
996 967 — 967 Americas 868 14.7 % 11.4 % 11.4 %
90 88 — 88 Wellness and Healthcare 86 4.7 % 2.3 % 2.3 %
8,793 $ 8,987 $— $ 8,987 Total PMI 8,019 9.7 % 12.1 % 12.1 %
(1) Includes a reduction in net revenues of 80 million related to the termination of distribution arrangement in the Middle East
Note: Sum of product categories or Regions might not foot to Total PMI due to roundings. "-" indicates amounts between -0.5 million and +0.5 million

All values are in US Dollars.

Schedule 4
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Net Revenues to Adjusted Net Revenues, excluding Currency and Acquisitions
( in millions) / (Unaudited)
NetRevenues Adjusted Net<br>Revenues Currency Adjusted Net<br>Revenues excluding Currency Acqui-<br>sitions Adjusted NetRevenues excluding Currency & Acqui-sitions Net<br>Revenues Special Items (1) Adjusted Net<br>Revenues Total Excluding Currency Excluding Currency<br>& Acqui-<br>sitions
2024 2023 % Change
3,365 $ 3,365 $ 78 $ 3,287 $ — 3,287 Europe $ 3,068 $ — $ 3,068 9.7 % 7.1 % 7.1 %
2,658 2,658 (194) 2,852 — 2,852 SSEA, CIS & MEA 2,477 (80) 2,557 3.9 % 11.5 % 11.5 %
1,684 1,684 (109) 1,793 — 1,793 EA, AU & PMI DF 1,520 — 1,520 10.8 % 18.0 % 18.0 %
996 996 29 967 — 967 Americas 868 — 868 14.7 % 11.4 % 11.4 %
90 90 2 88 — 88 Wellness and Healthcare 86 — 86 4.7 % 2.3 % 2.3 %
8,793 $ 8,793 $ (194) $ 8,987 $ — 8,987 Total PMI $ 8,019 $ (80) $ 8,099 8.6 % 11.0 % 11.0 %
(1) Reflects a reduction in net revenues of 80 million related to the termination of distribution arrangement in the Middle East

All values are in US Dollars.

Schedule 5
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Gross Profit by Product Category to Adjusted Gross Profit, excluding Currency and Acquisitions
( in millions) / (Unaudited)
GrossProfit Adjusted<br>Gross<br>Profit Currency Adjusted Gross Profit<br>excluding Currency Acqui-<br>sitions Adjusted Gross Profit excl. Currency & <br>Acquisitions Quarters Ended<br>March 31, Gross<br>Profit Special<br>Items (1) Adjusted<br>Gross<br>Profit Total Excluding Currency Excluding Currency & Acquisitions
2024 2023 % Change
5,598 $ 5,614 $ (186) $ 5,800 $ — $ 5,800 Total PMI $ 4,981 $ (120) $ 5,101 10.1 % 13.7 % 13.7 %
2024 2023 % Change
3,452 $ 3,452 $ (80) $ 3,531 $ — $ 3,531 Total Combustible Tobacco $ 3,353 $ (98) $ 3,451 — % 2.3 % 2.3 %
2024 2023 % Change
2,146 $ 2,163 $ (106) $ 2,269 $ — $ 2,269 Total Smoke-free incl. W&H $ 1,628 $ (22) $ 1,650 31.1 % 37.5 % 37.5 %
(1) 2024 first-quarter reflects amortization of intangibles in Smoke-free incl. W&H, all amounts are related to cost of goods sold2023 first-quarter includes termination of distribution arrangement in the Middle East (80 million in Combustible Tobacco, reflected as a reduction to net revenues), Swedish Match AB acquisition accounting related items (18 million in Combustible Tobacco, reflected in cost of good sold) and amortization of intangibles (22 million in Smoke-free incl. W&H, reflected in cost of goods sold)
Note: Sum of product categories and special items might not foot due to roundings.

All values are in US Dollars.

Schedule 6
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Adjustments of Operating Income for the Impact of Currency and Acquisitions
( in millions) / (Unaudited)
Operating Income Operating Income excluding Currency Acqui-sitions Operating Income excluding Currency & <br>Acquisitions Operating Income Excluding Currency Excluding Currency & <br>Acquisitions
2024 2023
1,456 $ 14 $ 1,442 $ — 1,442 Europe 1,215 19.8 % 18.7 % 18.7 %
772 (241) 1,013 — 1,013 SSEA, CIS & MEA 734 5.2 % 38.0 % 38.0 %
763 (125) 888 — 888 EA, AU & PMI DF 637 19.8 % 39.4 % 39.4 %
99 22 77 — 77 Americas 183 (45.9) % (57.9) % (57.9) %
(45) 2 (47) — (47) Wellness and Healthcare (38) (18.4) % (23.7) % (23.7) %
3,045 $ (328) $ 3,373 $ — 3,373 Total PMI 2,731 11.5 % 23.5 % 23.5 %

All values are in US Dollars.

Schedule 7
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Operating Income to Adjusted Operating Income, excluding Currency and Acquisitions
( in millions) / (Unaudited)
Operating Income Currency Adjusted Operating Income excluding Currency Acqui-<br>sitions Adjusted Operating Income excluding Currency <br>& Acqui-<br>sitions Operating Income Special<br>Items (1) Adjusted Operating Income Total Excluding Currency <br>& Acqui-<br>sitions
2024 Quarters Ended<br>March 31, 2023 % Change
1,456 $ 1,496 $ 14 $ 1,482 $ — $ 1,482 Europe $ 1,215 $ (75) 1,290 16.0 % 14.9 % 14.9 %
772 777 (241) 1,018 — 1,018 SSEA, CIS & MEA 734 (117) 851 (8.7) % 19.6 % 19.6 %
763 764 (125) 889 — 889 EA, AU & PMI DF 637 (20) 657 16.3 % 35.3 % 35.3 %
99 326 22 304 — 304 Americas 183 (62) 245 33.1 % 24.1 % 24.1 %
(45) (3) 2 (5) — (5) Wellness and Healthcare (38) (14) (24) 87.5 % 79.2 % 79.2 %
3,045 $ 3,360 $ (328) $ 3,688 $ — $ 3,688 Total PMI $ 2,731 $ (288) 3,019 11.3 % 22.2 % 22.2 %
(1) See Schedule 8 for Special Items details
Note: Sum of regions and special items might not foot due to roundings.

All values are in US Dollars.

Schedule 8 (1/2)
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Operating Income to Adjusted Operating Income
( in millions) / (Unaudited)
Change Fav./(Unfav.) Variance Fav./(Unfav.)
PMI 2023 Total Excl. Curr. & Acquisitions Total Currency Acquisitions Price Vol/Mix Cost/Other
Reported Operating Income $ 2,731 11.5 % 23.5 % $ 314 $ (328) $ — $ 449 $ 295 $ (102)
Asset Impairment & Exit Costs (109) (54.1) % (54.1) % (59) — — — — (59)
Termination of distribution arrangement in the Middle East (80) 100.0 % 100.0 % 80 — — — — 80
Impairment of other intangibles — — % — % (27) — — — — (27)
Amortization of intangibles (81) (48.1) % (48.1) % (39) — — — — (39)
Swedish Match AB acquisition accounting related items (18) 100.0 % 100.0 % 18 — — — — 18
Adjusted Operating Income $ 3,019 11.3 % 22.2 % $ 341 $ (328) $ — $ 449 $ 295 $ (75)
Europe
Reported Operating Income $ 1,215 19.8 % 18.7 % $ 241 $ 14 $ — $ 163 $ 64 $ —
Asset Impairment & Exit Costs (47) 100.0 % 100.0 % 47 — — — — 47
Amortization of intangibles (28) (44.8) % (44.8) % (13) — — — — (13)
Adjusted Operating Income $ 1,290 16.0 % 14.9 % $ 206 $ 14 $ — $ 163 $ 64 $ (34)
SSEA, CIS & MEA
Reported Operating Income $ 734 5.2 % 38.0 % $ 38 $ (241) $ — $ 155 $ 46 $ 78
Asset Impairment & Exit Costs (32) 100.0 % 100.0 % 32 — — — — 32
Termination of distribution arrangement in the Middle East (80) 100.0 % 100.0 % 80 — — — — 80
Amortization of intangibles (5) 1.2 % 1.2 % — — — — — —
Adjusted Operating Income $ 851 (8.7) % 19.6 % $ (74) $ (241) $ — $ 155 $ 46 $ (34)

All values are in US Dollars.

Schedule 8 (2/2)
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Reported Operating Income to Adjusted Operating Income
( in millions) / (Unaudited)
Change Fav./(Unfav.) Variance Fav./(Unfav.)
EA, AU & PMI DF 2023 Total Excl. Curr. & Acquisitions Total Currency Acqui-sitions Price Vol/Mix Cost/Other
Reported Operating Income $ 637 19.8 % 39.4 % $ 126 $ (125) $ — $ 130 $ 72 $ 49
Asset Impairment & Exit Costs (19) 100.0 % 100.0 % 19 — — — — 19
Amortization of intangibles (1) 28.7 % 28.7 % — — — — — —
Adjusted Operating Income $ 657 16.3 % 35.3 % $ 107 $ (125) $ — $ 130 $ 72 $ 30
Americas
Reported Operating Income $ 183 (45.9) % (57.9) % $ (84) $ 22 $ — $ (1) $ 113 $ (218)
Asset Impairment & Exit Costs (11) -(100)% -(100)% (157) — — — — (157)
Amortization of intangibles (33) (80.5) % (80.5) % (27) — — — — (27)
Swedish Match AB acquisition accounting related items (18) 100.0 % 100.0 % 18 — — — — 18
Adjusted Operating Income $ 245 33.1 % 24.1 % $ 81 $ 22 $ — $ (1) $ 113 $ (53)
Wellness & Healthcare
Reported Operating Income / (Loss) $ (38) (18.4) % (23.7) % $ (7) $ 2 $ — $ 2 $ — $ (11)
Impairment of other intangibles — — % — % (26) — — — — (26)
Amortization of intangibles (14) (6.7) % (6.7) % (1) — — — — (1)
Adjusted Operating Income / (Loss) $ (24) 87.5 % 79.2 % $ 21 $ 2 $ — $ 2 $ — $ 16
Note: Sum of special items might not foot due to rounding. Special items between -0.5 million and +0.5 million are not displayed by segment.

All values are in US Dollars.

Schedule 9
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Adjusted Operating Income Margin, excluding Currency and Acquisitions
( in millions) / (Unaudited)
Adjusted Operating Income(1) Adjusted Operating Income<br>Margin Adjusted Operating Income<br>excluding Currency<br>(1) Adjusted<br>Net Revenues excluding Currency<br>(2) Adjusted Operating Income Margin excluding Currency Adjusted Operating Income excluding Currency <br>& Acqui-<br>sitions<br>(1) Adjusted<br>Net Revenues excluding Currency <br>& Acqui-<br>sitions<br>(2) Adjusted Operating Income Margin excluding Currency <br>& Acqui-<br>sitions Adjusted Operating Income<br>(1) Adjusted<br>Net Revenues<br>(2) Adjusted Operating Income<br>Margin Adjusted Operating Income<br>Margin Adjusted Operating Income Margin excluding Currency Adjusted Operating Income Margin excluding Currency <br>& Acqui-<br>sitions
2024 Quarters Ended<br>March 31, 2023 % Points Change
1,496 44.5 % $ 1,482 $ 3,287 45.1 % $ 1,482 $ 3,287 45.1 % Europe $ 1,290 $ 3,068 42.0 % 2.5 3.1 3.1
777 29.2 % 1,018 2,852 35.7 % 1,018 2,852 35.7 % SSEA, CIS & MEA 851 2,557 33.3 % (4.1) 2.4 2.4
764 45.4 % 889 1,793 49.6 % 889 1,793 49.6 % EA, AU & PMI DF 657 1,520 43.2 % 2.2 6.4 6.4
326 32.7 % 304 967 31.4 % 304 967 31.4 % Americas 245 868 28.2 % 4.5 3.2 3.2
(3) (3.3) % (5) 88 (5.7) % (5) 88 (5.7) % Wellness and Healthcare (24) 86 (27.9) % 24.6 22.2 22.2
3,360 38.2 % $ 3,688 $ 8,987 41.0 % $ 3,688 $ 8,987 41.0 % Total PMI $ 3,019 $ 8,099 37.3 % 0.9 3.7 3.7
(1) For the calculation of Adjusted Operating Income and Adjusted Operating Income excluding currency and acquisitions refer to Schedule 7
(2) For the calculation of Adjusted Net Revenues excluding currency and acquisitions refer to Schedule 4

All values are in US Dollars.

Schedule 10
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Condensed Statements of Earnings
( in millions, except per share data) / (Unaudited)
Quarters Ended March 31,
2024 2023 Change<br>Fav./(Unfav.)
8,793 8,019 9.7 %
3,195 3,038 (5.2) %
5,598 4,981 12.4 %
2,553 2,250 (13.5) %
3,045 2,731 11.5 %
299 230 (30.0) %
15 22 31.8 %
2,731 2,479 10.2 %
676 428 (57.9) %
(191) (51) +100%
2,246 2,102 6.9 %
98 107 8.4 %
$ 2,148 $ 1,995 7.7 %
$ 1.38 $ 1.28 7.8 %
$ 1.38 $ 1.28 7.8 %
(1) Net Earnings and weighted-average shares used in the basic and diluted Earnings Per Share computations for the quarters ended March 31, 2024 and 2023 are shown on Schedule 1, Footnote 1

All values are in US Dollars.

Schedule 11
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Condensed Balance Sheets
( in millions) / (Unaudited)
December 31,
2023
Assets
Cash and cash equivalents $ 3,968 $ 3,060
All other current assets 16,906 16,695
Property, plant and equipment, net 7,201 7,516
Goodwill 16,458 16,779
Other intangible assets, net 9,448 9,864
Equity investments 4,918 4,929
Other assets 6,416 6,461
Total assets $ 65,315 $ 65,304
Liabilities and Stockholders' (Deficit) Equity
Short-term borrowings $ 279 $ 1,968
Current portion of long-term debt 5,425 4,698
All other current liabilities 16,464 19,717
Long-term debt 44,683 41,243
Deferred income taxes 2,664 2,335
Other long-term liabilities 4,363 4,789
Total liabilities 73,878 74,750
Total PMI stockholders' deficit (10,309) (11,225)
Noncontrolling interests 1,746 1,779
Total stockholders' (deficit) equity (8,563) (9,446)
Total liabilities and stockholders' (deficit) equity $ 65,315 $ 65,304

All values are in US Dollars.

Schedule 12
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Calculation of Total Debt to Adjusted EBITDA and Net Debt to Adjusted EBITDA Ratios
( in millions, except ratios) / (Unaudited)
Year Ended December 31, 2023
January ~ March 12 months
2024 rolling
Net Earnings $ 6,166 $ 2,246 $ 8,412 $ 8,268
Equity investments and securities (income)/loss, net (106) (191) (297) (157)
Provision for income taxes 1,911 676 2,587 2,339
Interest expense, net 831 299 1,130 1,061
Depreciation, amortization and impairment of goodwill and other intangibles 1,779 394 2,173 2,078
Asset impairment and exit costs and Others (1) 397 168 565 604
Adjusted EBITDA $ 10,978 $ 3,592 $ 14,570 $ 14,193
March 31, December 31,
2024 2023
Short-term borrowings $ 279 $ 1,968
Current portion of long-term debt 5,425 4,698
Long-term debt 44,683 41,243
Total Debt $ 50,387 $ 47,909
Cash and cash equivalents 3,968 3,060
Net Debt $ 46,419 $ 44,849
Ratios:
Total Debt to Adjusted EBITDA 3.46 3.38
Net Debt to Adjusted EBITDA 3.19 3.16
(1) For the period April 2023 to December 2023 "Others" includes 204 million for South Korea indirect tax charge, 140 million related to Termination of agreement with Foundation for a Smoke-Free World and 53 million of charges related to the war in Ukraine.For the period January 2024 to March 2024 the impact is fully from asset impairment and exit costs

All values are in US Dollars.

Schedule 13
PHILIP MORRIS INTERNATIONAL INC. and Subsidiaries
Reconciliation of Non-GAAP Measures
Reconciliation of Operating Cash Flow to Operating Cash Flow, excluding Currency
( in millions) / (Unaudited)
Quarters Ended March 31,
2024 2023 % Change
$ 241 $ (955) +100%
(364)
$ 605 $ (955) +100%
(1) Operating cash flow

All values are in US Dollars.

21

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