Since 2016, our Business Transformation Metrics (BTMs) have provided stakeholders with clear, comparable indicators of our progress toward a smoke-free future. These metrics go beyond traditional reporting frameworks to capture aspects unique to our transformation—the decline in cigarette volumes, the growth of smoke-free alternatives, geographic expansion into new markets, and the financial performance of our smoke-free business. BTMs exist to demonstrate intentionality. They show that our transformation is not rhetoric but a measured, strategic commitment backed by capital allocation, commercial focus, and executive accountability.
In 2025, we reviewed our BTMs and updated them to more accurately reflect the current phase of our transformation. As our smoke-free business matures and external expectations shift, we refined these metrics to enhance their clarity, relevance, and alignment with stakeholder priorities. We retired certain indicators that no longer reflect our strategic focus, evolved others to capture progress more precisely, and introduced new metrics where gaps existed. The result is a leaner, more focused set of core BTMs that provide meaningful transparency about our transformation journey while acknowledging the changing landscape and external factors that influence our business transformation
This evolution was essential to ensure that our metrics continue to provide meaningful and transparent insights, capturing not only our progress but also the areas where our control is the strongest; where we retain significant, though sometimes partial, control; and where our influence is more limited or shared—evaluating the broader outcomes and impacts on society and stakeholders, highlighting shifts that occur beyond our direct sphere of control.
In 2025, All 20 Business Transformation Metrics were subject to external assurance by our independent auditor, PwC, confirming that our transformation is both measurable and verifiable (read PwC’s limited assurance report).
* The 2025 data are subject to PwC’s Limited Assurance Report, available here.
Note: Unless otherwise stated, all business transformation metrics include Swedish Match related data as of November 11, 2022 (acquisition date), as well as Wellness business.
1 Excludes PMI’s Tech and other Capital expenditures that are not allocated to smoke-free nor combustible tobacco products.
2 For definition of available for sale, see Glossary.
3 Categories refer to heated tobacco, e-vapor and oral smoke-free products.
4 Includes heated tobacco units, e-vapor unit equivalents and oral smoke-free products in pouch or pouch equivalents, excluding snuff, snuff leaf and U.S. chewing tobacco.
5 Excludes snuff, snuff leaf and U.S. chewing tobacco.
6 For definition of net revenues related to smoke-free, see Glossary.
7 Data excludes the combustibles net revenues impact related to termination of distribution arrangement in the Middle East in 2023.
8 Based on number of markets where PMI's smoke-free products have been available for sale at the end of each respective year presented.
9 Total PMI smoke-free users is defined as the sum of total IQOS users, total oral smokeless users, and total e-vapor users of PMI products and considering poly-users across PMI’s smoke-free product categories. For definitions, see Glossary.
10 Combustible tobacco products volume includes cigarettes and other tobacco products expressed in cigarette equivalent units. The indicator is calculated based on millions of units.
11 Worldwide, including the U.S., excluding China. For definition of industry, see Glossary. The industry estimates are calculated at the market and product level based on a methodology that includes the list of sources (such as third-party information from market research firms). The figures are reported on a monthly basis, governed by an internal standard. The 2015 baseline for each value is respectively 3.4 (a), 2.7 (b) and 0.8 (c) in billion equivalent units and was used as the basis for computing 2025 metrics.
2025 progress
Our investments in R&D, capital expenditure, and commercial spending remained fundamentally focused on advancing our smoke-free strategy. In 2025, we achieved a significant milestone: our smoke-free products became available in more than 100 markets worldwide, with more than 50 percent of these classified as low- and middle-income countries (excluding PMI Global Travel Retail)—successfully meeting our aspirations for 2025. This expansion reflects tangible momentum in our transition away from combustible products, with measurable positive outcomes in both consumer adoption and health objectives.
Outlook
Looking ahead to 2030, we continue to aspire to be a substantially smoke-free business, with smoke-free-related net revenues representing over two-thirds of our total annual net revenues globally. Moreover, also by 2030, we aim for around 60 of our markets to have smoke-free net revenues making up over 50 percent of their total net revenues. Of these markets, we aspire for around 40 to derive more than 75 percent of their net revenues from smoke-free.
These aspirations form the backbone of our Business Transformation-Linked Financing Framework issued in 2024 and they are integral components of our VALUE Index, which links performance across our strategic priorities to long-term variable executive compensation.
This online content about our Value Report should be read in conjunction with PMI’s Value Report 2025. This report includes metrics that are subject to uncertainties due to inherent limitations in the nature and methods for data collection and measurement. The precision of different collection and measurement techniques may also vary. This report includes data or information obtained from external sources or third parties. Unless otherwise indicated, the data contained herein cover our operations worldwide for the full calendar year 2025 or reflect the status as of December 31, 2025. Where not specified, data comes from PMI financials, nonfinancials, or estimates.
Unless explicitly stated, the data, information, and aspirations in this report do not incorporate PMI’s Wellness unit, Aspeya. Regarding the Swedish Match acquisition, completed late 2022, unless otherwise indicated, this report includes information pertaining to its sustainability performance. Please also refer to "About this report" on page 3 of the PMI’s Value Report 2025 for more information. Aspirational targets and goals do not constitute financial projections, and achievement of future results is subject to risks, uncertainties and inaccurate assumptions, as outlined in our forward-looking and cautionary statements on page 142. In PMI’s Value Report 2025 and in related communications, the terms “materiality,” “material,” and similar terms are defined in the referenced sustainability standards and are not meant to correspond to the concept of materiality under the U.S. securities laws and/or disclosures required by the U.S. Securities and Exchange Commission.
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