Shares of Philip Morris International was trending lower Wednesday after the tobacco company issued guidance below Wall Street expectations, seemingly offsetting better-than-expected second-quarter earnings and a rebound in shipments of its Zyn smoke-free business.

The tobacco company posted adjusted earnings of $2.20 a share, from $1.91 a year ago and above Wall Street's expectation of $2.03. However, that number fell to $2.17 after excluding foreign-exchange impacts.

Revenue grew 10% to $11.2 billion, beating the analyst consensus call for $10.6 billion, according to FactSet.

However Philip Morris lowered its full-year profit guidance. The company expects adjusted earnings between $8.26 and $8.41, down from its previous forecast of $8.36 to $8.51. The analyst consensus calls for full-year profit of $8.36, according to FactSet.

The tobacco giant continues to expect organic revenue growth of 5% to 7%.

For the third quarter, Philip Morris expects adjusted earnings of $2.20 to $2.25, well below Wall Street's forecast of $2.42.

Philip Morris International stock fell 2% to $184.29 in premarket trading on Wednesday after ending Tuesday down 2.4%. Shares of the tobacco giant have risen 17% this year, outpacing the S&P 500's 9.7% gain. The stock has been finding support at its 50-day moving average -- around the $182 level -- over the past two months.

Philip Morris International was a Barron's stock pick last month.

While investors appeared to be responding to the company's guidance, there were other bright spots in the earnings report.

The company's international smoke-free business saw shipment volumes grow 8% in the second quarter. In the U.S., where Zyn nicotine pouches are the company's main production, Zyn shipments increased 1.8% to 2.9 billion pouches. That marks a big improvement from the first quarter when Zyn shipments declined more than 23% to 2.3 billion pouches.

At the end of June, the Food & Drug Administration said Zyn pouches can be marketed with a modified risk claim that says "using ZYN instead of cigarettes puts you at a lower risk of mouth cancer, heart disease, lung cancer, stroke, emphysema, and chronic bronchitis."

Analysts see the regulatory move as a potential boost to Philip Morris' nicotine pouch business and that it could reaccelerate growth.

Write to Kit Norton at kit.norton@barrons.com

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July 22, 2026 08:27 ET (12:27 GMT)

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