Philip Morris International Inc. (NYSE:PM)

Gross Profit Margin

The gross profit margin exhibited a gradual decline from 68.14% in December 2020 to 62.58% in June 2023. Subsequently, a moderate recovery is observed, with the margin increasing from 63.12% in September 2023 to 65.68% by March 2025. This indicates a temporary weakening in cost efficiency or pricing power followed by improvement towards the latest periods.

Operating Profit Margin

The operating profit margin followed a similar downward trend, starting at 42.07% in December 2020 and declining steadily to a low of 32.85% by March 2023. Following this low point, there is a gradual increase, reaching 36.21% by March 2025. This suggests challenges in operating expense control or revenue generation that have partially abated in recent periods.

Net Profit Margin

The net profit margin showed considerable volatility. From 29.25% in December 2020, it gradually decreased to a trough of 22.16% by December 2023. After this decline, there is a notable rebound to 26.42% by September 2024, but it then sharply decreases again to 18.63% in December 2024 before slightly recovering to 19.8% in March 2025. This pattern indicates fluctuating profitability possibly influenced by varying non-operating factors or tax effects in addition to operational performance.

Return on Assets (ROA)

The ROA remained relatively stable above 21% from March 2021 through September 2022, indicating solid asset utilization during this period. However, a significant decline is seen starting in December 2022, falling to 12.74% by December 2023. A modest recovery occurs afterward, reaching 14.7% by September 2024 before dropping again to 11.42% in December 2024 and recovering to 11.68% by March 2025. This suggests a weakening in asset efficiency in the more recent periods with some signs of stabilization.

General Observations

Overall, profitability margins and return on assets experienced a downward trend beginning around late 2020 or early 2021 through mid-2023, followed by varying degrees of recovery in the subsequent quarters. The gross and operating margins' improvements suggest some operational stabilization, while the net margin and ROA show greater volatility, indicating impacts from external factors or changes in capital structure. The recent trends point towards cautious optimism but with underlying risks still evident in profitability and asset utilization metrics by early 2025.

The financial data over the periods analyzed reveals several distinct trends and patterns regarding profitability and revenue generation.

Net Revenues

The net revenues display an overall upward trajectory from March 31, 2020, to March 31, 2025. Starting at 7,153 million USD in March 2020, revenues experienced fluctuations but generally increased, reaching a peak near 9,911 million USD in September 2024 before a slight decline to 9,301 million USD by March 2025. Periods with notable revenue increases include mid-2021 to late 2023, suggesting growing market demand or successful operational initiatives during this interval.

Gross Profit

Gross profit shows variability but reveals an increasing trend over the extended timeline. It initially rose from 4,751 million USD in March 2020 to reach as high as 5,976 million USD in September 2023. Thereafter, it experienced moderate declines and fluctuations but remained elevated compared to the earlier periods, closing at 6,261 million USD by March 2025. This pattern indicates an improvement in the company’s ability to convert revenues into profit, despite some periods of volatility.

Gross Profit Margin

The gross profit margin data, beginning effectively in the first quarter of 2021, depicts a slight but consistent decline from 66.65% to 62.58% through early 2023, representing some compression in profitability relative to revenues during that time. However, from mid-2023 onwards, the margin gradually recovered and showed an uptrend, reaching 65.68% by March 2025. This suggests efforts to improve cost efficiency or product mix have positively impacted profitability ratios in recent quarters.

In summary, the company experienced growth in net revenues and gross profits over the analyzed quarters, indicating effective revenue enhancement and cost management strategies. While there was a period of margin compression in early 2021 to 2023, recent quarters display margin recovery, highlighting improving profitability dynamics. The overall financial performance trend is positive, yet the observed fluctuations caution ongoing monitoring of cost structures and market conditions.

The financial performance over the analyzed quarters exhibits several noteworthy trends. Net revenues show a generally upward trajectory from March 2020 through March 2025, with fluctuations reflecting seasonality and external market factors. Starting at approximately $7.15 billion in the first quarter of 2020, revenues increase to a peak near $9.9 billion by September 2024, before a slight decrease to about $9.3 billion by March 2025.

Operating income follows a more volatile path within the same timeframe. Initial values hover around $2.7 to $3.2 billion in 2020, with a clear increase through 2021 and 2022 but then displaying periods of decline and recovery. Notably, operating income reaches highs near $3.65 billion in the last quarter of 2024, with intermittent dips that suggest fluctuating operational efficiency or changing cost structures.

The operating profit margin percentage, available from March 2021 onwards, shows a gradual decline over time. This margin starts at just over 42% and decreases to around 33% by mid-2023, before stabilizing in the mid-30% range through early 2025. This downward trend in margin despite rising net revenues may indicate increasing costs, pricing pressures, or shifts in product mix impacting profitability.

Net Revenues

Displayed consistent growth with occasional seasonal declines; increasing from roughly $7.15 billion to almost $9.9 billion over five years, followed by a modest decline near the end of the period.

Operating Income

Experienced variability with peaks and troughs, rising overall but with periods of contraction, reaching maxima approaching $3.65 billion by late 2024.

Operating Profit Margin

Shows a discernible downward trend from above 42% to stabilizing around 33-36%, indicating margin compression despite revenue growth.

In summary, the data suggests the company has been successful in growing its revenue base over the period analyzed. However, declining operating margins point to challenges in controlling costs or sustaining pricing power. The fluctuation in operating income further supports the view of variable operational efficiency. Going forward, attention to margin management will be critical to complement continued revenue growth and ensure profitability gains.

Net Earnings Attributable to PMI

The net earnings show significant fluctuations over the observed periods. Starting at 1,826 million USD in March 2020, the earnings generally increased till September 2020, peaking at 2,307 million USD, followed by a moderate decline by the end of 2020. Throughout 2021 and into early 2022, the earnings show a somewhat cyclical pattern with values oscillating around 2,000 to 2,400 million USD. However, from mid-2023, the earnings exhibit increased volatility, dropping noticeably to 1,568 million USD in June 2023 before recovering again. A significant surge occurs in September 2024 reaching 3,082 million USD, which is the highest in the dataset, followed by a sharp decline to -579 million USD in December 2024, indicating an unusual loss. The final recorded period in March 2025 shows recovery back to 2,690 million USD.

Net Revenues

Net revenues demonstrate a generally upward trend from March 2020 through the observation period despite minor fluctuations. Beginning at 7,153 million USD in early 2020, revenues dipped in June 2020 but rebounded and progressively increased to reach peaks above 9,000 million USD in 2023 and 2024. Peak revenues were recorded at 9,911 million USD in September 2024. The pattern suggests overall strengthening sales performance with some short-term variations but sustained growth through the examined timeline. The last data point in March 2025 shows a slight decline to 9,301 million USD.

Net Profit Margin

Starting from the earliest available margin of 28.08% in March 2021, the net profit margin fluctuated mildly within a range predominantly between 22% and 29% for most of the period. Margins gradually declined from the high 28-29% range in 2021 and early 2022 down to low 22-23% levels in parts of 2023 and 2024. Thereafter, margins improved moderately, rising up to 26.42% in September 2024 before decreasing again to 18.63% in December 2024, which coincides with the observed net earnings loss for the same period. The March 2025 margin increases slightly to 19.8%, indicating a gradual recovery from the preceding quarter's margin contraction.

Overall Trends and Insights

The data reveals a company experiencing general revenue growth over the observed quarters with some cyclical seasonal fluctuations. Despite rising revenues, net earnings and profit margins are more volatile, showing periodic declines that indicate potential challenges in cost management or extraordinary items impacting profitability. The dramatic swing in net earnings and margin in late 2024 suggests a significant one-off event or operational disruption. Following this, the partial recovery in early 2025 points to a possible stabilization. The divergence between steadily increasing revenues and fluctuating profits highlights a complex financial performance influenced by factors beyond sales volume, warranting further examination into costs, non-operational expenses, or market conditions.

The net earnings attributable to the company display considerable volatility across the observed quarterly periods. From March 31, 2020, to December 31, 2021, earnings generally fluctuate between approximately 1,800 million and 2,400 million US dollars, with some quarters showing peaks and other quarters experiencing declines, such as the dip in December 2020. In 2022, net earnings appear to stabilize somewhat, fluctuating around the 2,000 to 2,400 million dollar range. Notably, there is a significant decline in net earnings in June 2023, dropping to 1,568 million, followed by recovery and subsequent growth, culminating in a peak of 3,082 million in September 2024. However, an anomalous negative earnings value (loss) of -579 million appears in December 2024, which is immediately followed by a rebound to 2,690 million in March 2025. This negative value warrants further investigation as it deviates sharply from the overall positive earnings trend.

The total stockholders’ deficit shows a persistent negative value over the entire period, indicating that the company has maintained a stockholders’ deficit position. Despite the deficit status, a general trend of improvement is observable from March 31, 2020 (-12,944 million) through much of 2022, with the deficit narrowing to approximately -8,957 million by December 31, 2022. This suggests a reduction in negative equity over these periods. However, from early 2023 onward, the stockholders’ deficit again deteriorates, fluctuating around -9,000 to -11,000 million, peaking in March 2024 at -11,750 million, before showing a slight recovery to -10,901 million by March 31, 2025. These fluctuations indicate instability in equity position, with periods of both deleveraging and deepening deficit.

The return on equity (ROE) data is missing, which limits the ability to assess profitability relative to equity. Given the persistent negative equity, typical ROE calculations may not be meaningful or could result in distorted values.

The analysis of the quarterly financial data reveals several notable trends concerning net earnings attributable to the company, total assets, and return on assets (ROA) over the presented periods.

Net Earnings Attributable

The net earnings show a fluctuating pattern across the quarters. Initially, from March 2020 to December 2021, earnings generally oscillate around the 1800 to 2400 million US$ range, with some quarters peaking near 2400 million US$. A noticeable dip occurs in the quarter ending June 2023, where earnings decline to 1568 million US$. This is followed by a recovery and subsequent peaks, particularly at the quarter ending September 2024, reaching 3082 million US$, which is the highest value observed. However, an anomaly is evident in the quarter ending December 2024 where earnings fall sharply to -579 million US$, indicating a significant loss. By March 2025, earnings rebound to 2690 million US$.

Total Assets

Total assets exhibit a general upward trend through the period. Starting near 37,494 million US$ in March 2020, assets increased moderately until December 2021, where a significant jump is noted moving from approximately 41,690 million US$ to 61,681 million US$. This sharp increase suggests a major asset acquisition or revaluation event during this period. Following this spike, total assets maintain a relatively steady level around 61,000 to nearly 67,000 million US$, with minor fluctuations through to March 2025, ending at 65,079 million US$.

Return on Assets (ROA)

Return on assets is reported starting from the quarter ending March 2021 and shows a gradual declining trend over time. Initially, ROA is relatively high, ranging from approximately 18% to 22%, suggesting efficient utilization of assets to generate earnings. From around March 2022 onwards, there is a steady decrease in ROA, falling to levels near 11-14% in the final observed quarters. This downward trajectory reflects a reduced efficiency in asset use to produce net earnings, which corresponds with the increase in asset base and variability in earnings.

Overall, while total assets have grown substantially, especially with a marked increase toward the end of 2021, the return on assets has declined, indicating decreasing efficiency. The net earnings show volatility with a significant loss in one quarter, suggesting possible operational challenges or extraordinary expenses affecting profitability. The interplay between these indicators points to a complex financial landscape with periods of growth and setbacks influencing overall financial performance.