Altria Group Reports Q3 Beats, but Sales Slow

"Altria Group met adjusted earnings expectations in Q3 while delivering a revenue beat that caught investors' attention. The stock traded near $62.19 at the 9:00 AM ET filing, having drifted lower in recent weeks from its mid-$60s peak. Management raised the lower end of full-year guidance and expanded its buyback program, signaling confidence in the business despite ongoing headwinds in traditional tobacco."

"Altria reported $6.07 billion in quarterly revenue, crushing the $5.31 billion consensus estimate by 14.4% but representing a 3% year-over-year decline. Yet this headline strength deserves scrutiny. The company's reported gross profit and operating income surged dramatically year over year, but this reflects accounting adjustments related to the Horizon subsidiary rather than underlying operational momentum. Core segment performance tells a different story."

"Adjusted diluted EPS came in at $1.45, matching consensus expectations exactly. On a year-over-year basis, this represented 3.6% growth from $1.38 in Q3 2024. The modest increase reflects two tailwinds. First, the Optimize and Accelerate cost-savings initiative is delivering results, supporting profitability even as volumes decline. Second, aggressive share repurchases reduce the share count, lifting per-share metrics mechanically. The company expanded its buyback authorization from $1 billion to $2 billion, with the program expiring December 31, 2026."

Altria reported $6.07 billion in quarterly revenue, beating consensus but showing a 3% year-over-year decline. Reported gross profit and operating income rose substantially due to accounting adjustments tied to the Horizon subsidiary rather than organic volume gains. Smokeable products and oral tobacco revenue both contracted, with domestic smokeable shipments down 8.2% and oral products falling 4.6% to $689 million. Adjusted diluted EPS was $1.45, up 3.6% year over year, supported by cost-savings from the Optimize and Accelerate program and aggressive share repurchases. The company increased its buyback authorization to $2 billion and raised the dividend by 3.9 percent.

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