Philip Morris International Inc. (NYSE:PM)

Current Ratio

The current ratio exhibits a downward trend from the first quarter of 2021 through the end of 2022, declining from 1.18 to a low of 0.72 in December 2022. This indicates a decrease in the company's short-term liquidity over this period. Beginning in 2023, the ratio shows some recovery with fluctuations, ranging mostly between 0.75 and 0.94 through the end of 2024. However, into 2025 the ratio declines again slightly, ending near 0.85, which still suggests liquidity below one, potentially signaling challenges in covering current liabilities.

Quick Ratio

The quick ratio also follows a generally declining path from early 2021 to late 2022, dropping from 0.53 to a low of 0.29 in December 2022. This suggests a reducing ability to meet short-term obligations without relying on inventory sales. From 2023 onward, there is a minor rebound but the ratio remains under 0.5 throughout all quarters, indicating a consistent constraint in liquid asset availability relative to current liabilities. Fluctuations between 0.28 and 0.44 suggest some variability but no substantial long-term improvement.

Cash Ratio

The cash ratio similarly decreases from 0.26 in March 2021 to 0.12 in December 2022, reflecting a decline in the most liquid assets available to cover short-term liabilities. Although there is a mild upward adjustment in early 2023, the ratio remains fairly low through 2024, fluctuating mostly between 0.12 and 0.21. Into 2025, the ratio stabilizes around 0.15 to 0.18 but does not show meaningful recovery to previous higher levels. Overall, this trend points to tightened cash reserves relative to current liabilities.

Summary of Trends

Across all three liquidity measures, a clear pattern emerges of decreasing short-term liquidity from 2021 through the end of 2022, with partial and inconsistent recoveries thereafter. The company consistently shows current, quick, and cash ratios below or near 1, signifying limited buffer to cover immediate obligations. While small positive movements occur in some quarters, the prevailing condition is one of constrained liquidity, which could warrant attention to working capital management and cash flow optimization.

The analysis of the quarterly financial data over multiple periods reveals notable trends in the company's liquidity position as reflected by current assets, current liabilities, and the current ratio.

Current Assets

Current assets exhibit an overall upward trend from the beginning of the period to the latest quarter analyzed. Starting at approximately 17,910 million USD, the value rises steadily with occasional minor fluctuations, reaching a peak of about 23,364 million USD before a slight decline to 22,665 million USD in the most recent quarter. This indicates a general growth in assets that are expected to be converted into cash within a year.

Current Liabilities

Current liabilities display a more volatile pattern with a marked increase in certain periods. The liabilities begin at roughly 15,215 million USD, experience gradual growth until reaching a significant spike at the end of 2022 with 27,336 million USD. Despite some decreases in subsequent quarters, the liabilities remain elevated compared to the early periods, hovering around 26,719 million USD in the final quarter reported.

Current Ratio

The current ratio demonstrates a declining trend over the time frame. Initially recorded at around 1.18, it progressively falls to below 1.00 within the first year, hitting a low point near 0.72 in the last quarter of 2022. While there is some recovery evident in the following quarters, the ratio consistently remains below 1.00, ending near 0.85. This downward trajectory suggests increasing pressure on short-term liquidity, with current liabilities growing more rapidly than current assets in most periods.

In summary, despite strengthening current assets, the company's current liabilities have increased at a faster pace, adversely impacting the current ratio. The ratio values below 1.00 in several quarters indicate potential short-term liquidity challenges, implying that the company may face difficulties in meeting its short-term obligations without relying on additional financing or asset liquidation. This financial pattern signals a need for close monitoring of working capital management to ensure sustainable liquidity levels going forward.

The analysis of the financial data reveals several important trends regarding liquidity and current liabilities over the observed periods.

Total Quick Assets

The total quick assets demonstrated variability throughout the periods. Initially, there was an upward movement from $7,989 million to a peak of $9,979 million by September 2022, indicating an improvement in highly liquid assets. Subsequently, a decline is observed at the end of 2022, followed by fluctuating values in 2023 and 2024, with some recovery toward the end of the period. By September 2025, quick assets stand at $9,860 million, slightly below the earlier peak but significantly higher than the initial values.

Current Liabilities

Current liabilities generally exhibited a steady increase from $15,215 million in March 2021 to a peak of $28,148 million in June 2025. Notably, a sharp rise occurred in late 2022, reaching $27,336 million, which was maintained at elevated levels through subsequent quarters. This persistent increase in short-term obligations suggests growing pressure on the company’s liquidity management and potential challenges in meeting immediate financial commitments.

Quick Ratio

The quick ratio reflects the company’s ability to cover its current liabilities with its most liquid assets. The ratio started at 0.53 in the first quarter of 2021 and showed a declining trend reaching a low of 0.28 in December 2023, indicating a weakening liquidity position. Thereafter, there was a moderate recovery in 2024, with ratios fluctuating between 0.36 and 0.44, but it remained below 0.5, which implies that quick assets consistently fell short of covering current liabilities. By September 2025, the ratio remained low at 0.37, suggesting ongoing constraints in liquidity.

Overall, the data indicates a challenging liquidity environment with increasing current liabilities outpacing quick assets. Despite occasional recoveries in quick assets, the quick ratio’s persistent sub-0.5 levels highlight a need for improved short-term financial management to ensure the company can meet its immediate financial obligations efficiently. The substantial rise in current liabilities in late 2022 and sustained high levels thereafter warrant attention to potential impacts on operational flexibility and risk exposure.

Total Cash Assets

Total cash assets display a fluctuating pattern over the analyzed quarters. Initially, there was a rise from 3,902 million US dollars in March 2021 to a peak of 5,368 million in September 2022. This peak was followed by a significant decline to 3,207 million by December 2022. Subsequently, cash assets declined further to 2,428 million by March 2023 but then experienced a partial recovery, rising to 4,807 million by June 2024. After this recovery, total cash assets again showed some volatility with values ranging between approximately 4,200 and 4,400 million through to the last reported period in September 2025. Overall, the trend demonstrates considerable variability with multiple peaks and troughs, but no clear long-term upward or downward trajectory can be firmly established.

Current Liabilities

Current liabilities exhibit a general upward trend throughout the period. Starting at 15,215 million US dollars in March 2021, liabilities increased steadily to a notable spike at 27,336 million in December 2022. Following this spike, liabilities experienced periods of minor decreases and increases but remained elevated, fluctuating around the 22,000 to 28,000 million range. By the last reported quarter, September 2025, current liabilities stood at 26,719 million. This increase in current liabilities indicates growing short-term obligations over time, with a pronounced jump towards the end of 2022.

Cash Ratio

The cash ratio indicates the liquidity position relative to current liabilities and has been generally low and volatile. From an initial ratio of 0.26 in March 2021, it experienced a decline to values around 0.12 to 0.15 between December 2022 and March 2023, coinciding with the period of increased current liabilities and decreased cash assets. There was a minor recovery peaking at 0.21 in June 2024, but the ratio decreased again into the 0.15 to 0.16 range by late 2025. The consistently low cash ratio suggests limited immediate liquidity relative to current liabilities, highlighting potential short-term liquidity constraints within the company over the observed timeframe.