Philip Morris International (NYSE:PM) shares edged lower in premarket trading on Tuesday after the tobacco group reduced its full-year adjusted earnings guidance, reflecting the impact of an expected impairment charge and currency-related headwinds.
The stock slipped around 1% before the opening bell as investors assessed the updated outlook.
Earnings Forecast Narrowed Lower
Philip Morris revised its adjusted earnings-per-share forecast for fiscal 2026 to a range of $8.31 to $8.46.
The updated guidance compares with the company’s previous projection of $8.36 to $8.51 per share and sits broadly in line with the Bloomberg consensus estimate of $8.41.
The adjustment reflects several factors affecting the company’s earnings expectations, including a significant non-cash charge related to its investment in Rothmans, Benson & Hedges (RBH).
Impairment Charge Expected in Second Quarter
The company said it anticipates recording a non-cash impairment charge of approximately $500 million during the second quarter of 2026 related to RBH.
The charge is expected to reduce diluted earnings per share by approximately 33 cents.
Philip Morris noted that RBH remains deconsolidated from the group’s financial statements and that the remaining carrying value of the investment is expected to fall below $100 million following the impairment.
Reported EPS Guidance Updated
To account for the expected impairment and foreign-exchange effects, the company also revised its full-year reported diluted earnings-per-share forecast.
Philip Morris now expects reported diluted EPS for 2026 to be between $7.18 and $7.33.
The updated outlook incorporates both the anticipated RBH impairment and the impact of currency movements on earnings.
Currency Headwinds Affect Quarterly Outlook
The company additionally adjusted its second-quarter adjusted diluted EPS forecast to reflect exchange-rate developments.
Philip Morris now expects second-quarter adjusted diluted EPS to range between $1.97 and $2.02.
Management said the forecast includes an estimated unfavorable currency impact of approximately three cents per share based on prevailing foreign-exchange rates.
Underlying Growth Expectations Remain Strong
Despite lowering its headline earnings guidance, Philip Morris emphasized that its underlying growth outlook remains positive.
Excluding total projected adjustments of $1.13 per share for 2026, the company’s adjusted diluted EPS forecast implies growth of between 10.2% and 12.2% compared with adjusted earnings of $7.54 per share recorded in 2025.
The outlook suggests that, while accounting charges and currency fluctuations are affecting reported results, management continues to expect solid operational performance across the business.
Investors will now be watching future updates for additional insight into the company’s earnings trajectory, the impact of foreign-exchange movements and the performance of its expanding portfolio of smoke-free products.