Philip Morris International Inc. (NYSE:PM)

Net revenues demonstrate a consistent upward trajectory over the five-year period, increasing from US$31,405 million in 2021 to US$40,648 million in 2025. While the cost of sales also increased, it grew at a slower rate than net revenues, resulting in fluctuating gross profit. Gross profit initially declined from US$21,375 million in 2021 to US$20,360 million in 2022, before recovering and increasing to US$27,282 million in 2025. Marketing, administration, and research costs exhibited a steady increase throughout the period, potentially impacting operating income.

Profitability

Operating income experienced volatility. It decreased from US$12,975 million in 2021 to US$11,556 million in 2023, then rebounded to US$14,892 million in 2025. This fluctuation is influenced by both gross profit trends and the rising marketing, administration, and research expenses. Net earnings attributable to PMI followed a similar pattern, declining from US$9,109 million in 2021 to US$7,057 million in 2024, before a substantial increase to US$11,348 million in 2025. The presence of impairment charges in 2023 and 2025, specifically related to goodwill and the RBH equity investment respectively, negatively impacted net earnings in those years.

Interest expense increased significantly from 2021 to 2023, peaking at US$1,526 million, before decreasing slightly in 2024 and 2025. Conversely, interest income showed a consistent increase, partially offsetting the rising interest expense. The net effect of interest resulted in a growing net interest expense until 2024, when it began to decline. Pension and other employee benefit costs remained relatively stable, with a slight downward trend.

Tax Impact

The provision for income taxes generally tracked net earnings, increasing from US$2,671 million in 2021 to US$3,017 million in 2024, and then decreasing to US$2,737 million in 2025. The effective tax rate appears to have remained relatively consistent throughout the period, though a more detailed calculation would be required for confirmation.

Equity investments and securities income, net, showed a notable increase in 2024 and 2025, contributing to the overall improvement in net earnings during those years. The presence of noncontrolling interests resulted in a consistent deduction from net earnings, with a slight increase in this deduction over the period.

Overall Trend

Despite some volatility, the financial performance demonstrates a positive trend overall, particularly in the later years of the period. Revenue growth, coupled with increased income from equity investments, contributed to a significant improvement in net earnings attributable to PMI in 2025. However, rising operating expenses and the impact of impairment charges represent potential areas of concern that warrant further investigation.