Philip Morris International Inc. (NYSE:PM) stock fell 0.16% (As on April 24, 11:20:14 AM UTC-4, Source: Google Finance) after the company posted strong results in its first-quarter earnings report, driven by growth in its IQOS heated tobacco sticks. IQOS, its heated tobacco stick product leading its transition to its smoke-free future, reported better than 10% market share in Europe for the first time, and IQOS’s market share gained more than 3 percentage points of share in Japan to reach 29%. The company has reported 20.9% in heated tobacco unit shipment volume to 33.1 billion, while cigarettes were down just 0.4% to 143.2 billion. Total shipment volume, including oral products, was up 3.6% to 180.5 billion, a bullish sign for future growth.

PM in the first quarter of FY 24 has reported the adjusted earnings per share of $1.50, beating the analysts’ estimates for the adjusted earnings per share of $1.47. The company had reported the adjusted revenue growth of 9.7 percent to $8.8 billion in the first quarter of FY 24, beating the analysts’ estimates for revenue of $8.47 billion.

Moreover, the smoke-free business (SFB) accounted for 39% of the total net revenues. 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. Combustibles net revenues grew by 3.5% (organically by 3.7%), fueled by another quarter of strong pricing across markets. The category share increased by 0.3 percentage points with Marlboro gaining 0.4 percentage points.

Additionally, the company has declared regular quarterly dividend of $1.30 per share, or an annualized rate of $5.20 per share.

Looking ahead, management continued to expect strong growth in the heated tobacco category, forecasting 14%-16% growth and overall organic revenue growth of 7%-8.5%. On the bottom line, the company called for adjusted EPS of $6.55-$6.67, excluding currency, up 9%-11% and ahead of the consensus at $6.37. In Fiscal 2024, an estimated total international industry volume is expected to decline for cigarettes and HTUs, excluding China and the U.S., of -2% to flat and total cigarette, HTU and oral smoke-free product shipment volume growth for PMI is expected to be of flat to +1% driven by smoke-free products and Nicotine pouch shipment volume in the U.S. to be of approximately 560 million cans.

Further, for fiscal 2024, Operating cash flow to be in the range of $10 to $11 billion at prevailing exchange rates, subject to year-end working capital requirements; Capital expenditures to be 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; and no share repurchases in 2024