Our value chain transformation
Our ambition starts with researching, developing, and commercializing less harmful alternatives to cigarettes for those adults who would otherwise continue to smoke, ultimately allowing us to phase out cigarettes and become an entirely smoke-free business. With an eye on the longer term, we are also laying down the foundation for a strong wellness and healthcare business.
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SOURCING
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Transitioning from a mainly agricultural supply chain to an increasingly diversified one, including electronics sourcing
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OPERATIONS
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Reallocating R&D expenditure toward smoke-free product innovation and scientific capabilities, while reorienting manufacturing toward smoke-free products
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COMMERCIALIZATION
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Moving from B2B to a B2C consumer-centric model to commercialize smoke-free products
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CONSUMERS & REVENUES
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Shifting revenue source from majority cigarettes to majority smoke-free products while addressing post-consumer waste
Notes: Unless otherwise stated, all applicable business transformation metrics include Swedish Match related data as of November 11, 2022 (acquisition date), as well as wellness and healthcare business.
For definitions of the KPIs please refer to PMI’s Sustainability KPI Protocol 2024.
1 Direct spend focuses on materials used in the manufacture of our products; it includes tobacco leaf, direct materials, and electronic devices
and accessories. Data excludes Swedish Match.
2 Data reflect the number of factories operated and owned by PMI at the end of the year. “Smoke-free products factories” is defined as manufacturing facilities producing heated tobacco units and oral nicotine products.
The number of factories reported is based on location, i.e., if a facility is one location, but has several physical areas (plants) the facility is counted as one.
3 For definition of available for sale, see Glossary.
4 Excluding PMI Global Travel Retail. World Bank report issued in 2021 is used on a comparative basis for income level classification. For definition of low- and middle-income markets, see Glossary.
5 For definition of net revenues related to smoke-free, see Glossary.
6 See PMI’s Sustainability KPI Protocol 2024 for further details
This online content about our Integrated Report should be read in conjunction with PMI’s Integrated Report 2024. 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 2024 or reflect the status as of December 31, 2024. 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 and healthcare business, 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 "This report at a glance" on page 2 of the PMI’s Integrated Report 2024 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 206. In PMI’s Integrated Report 2024 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.