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Benefit Plans:
 12 Months Ended
Dec. 31, 2025
Retirement Benefits [Abstract]  
Benefit Plans:
Benefit Plans:
Pension coverage for employees of PMI’s subsidiaries is provided, to the extent deemed appropriate, through separate plans, many of which are governed by local statutory requirements. In addition, PMI provides health care and other benefits to certain U.S. retired employees and certain non-U.S. retired employees. In general, health care benefits for non-U.S. retired employees are covered through local government plans.

Pension and other employee benefit costs per the consolidated statements of earnings consisted of the following for December 31, 2025, 2024 and 2023:

(in millions)202520242023
Net pension costs (income)$(88)$(76)$(84)
Net postemployment costs118 123 117 
Net postretirement costs16 13 12 
Total pension and other employee benefit costs$46 $60 $45 
Pension and Postretirement Benefit Plans

Obligations and Funded Status

The projected benefit obligations, plan assets and funded status of PMI’s pension plans, and the accumulated benefit obligation, plan assets and net amount accrued for PMI's postretirement health care plans, at December 31, 2025 and 2024, were as follows:
Pension(1)
Postretirement
(in millions)
2025202420252024
Benefit obligation at January 1$10,456 $10,567 $248 $246 
Service cost
240 218 4 3 
Interest cost
209 234 12 13 
Benefits paid
(567)(434)(13)(14)
 Employee contributions168 157 — — 
 Settlement, curtailment and plan amendment
(32)(12)— (1)
Actuarial losses (gains)
(640)460 11 2 
Currency
1,317 (708)4 5 
Other
(17)(26)(3)(6)
Benefit obligation at December 31,
11,134 10,456 263 248 
Fair value of plan assets at January 1,
9,030 8,851 3 3 
Actual return on plan assets
882 973 — — 
Employer contributions, net of refunds
139 110 13 14 
Employee contributions
168 157 — — 
Benefits paid
(567)(434)(13)(14)
 Settlement
(18)(10)— (1)
Currency
1,182 (600)— 1 
Other— (17)— — 
Fair value of plan assets at December 31,
10,816 9,030 3 3 
Net pension and postretirement liability recognized at December 31,
$(318)$(1,426)$(260)$(245)
(1) Primarily non-U.S. based defined benefit retirement plans.

At December 31, 2025, actuarial losses (gains) consisted primarily of gains for assumption changes related to higher discount rates year-over-year for the Swiss, German and Dutch plans. At December 31, 2024, actuarial losses (gains) consisted primarily of losses for assumption changes related to lower discount rates year-over-year for the Swiss plan.

At December 31, 2025 and 2024, the Swiss pension plan represented 71% and 69% of the benefit obligation, respectively, and approximately 65% and 63% of the fair value of plan assets at December 31, 2025 and 2024, respectively. At December 31, 2025 and 2024, the U.S. pension plans represented 5% and 6% of the benefit obligation, respectively, and approximately 5% and 6% of the fair value of plan assets at December 31, 2025 and 2024, respectively.

At December 31, 2025 and 2024, the amounts recognized on PMI's consolidated balance sheets for the pension and postretirement plans were as follows:
PensionPostretirement
(in millions)
2025202420252024
Other assets
$926 $490 
Accrued liabilities — employment costs
(29)(33)$(16)$(14)
Long-term employment costs
(1,215)(1,883)(244)(231)
$(318)$(1,426)$(260)$(245)

The accumulated benefit obligation, which represents benefits earned to date, for the pension plans was $10.6 billion and $9.9 billion at December 31, 2025 and 2024, respectively.
For pension plans with accumulated benefit obligations in excess of plan assets, the accumulated benefit obligation and fair value of plan assets were $8.4 billion and $7.6 billion, respectively, as of December 31, 2025. The accumulated benefit obligation and fair value of plan assets were $7.7 billion and $6.2 billion, respectively, as of December 31, 2024.

For pension plans with projected benefit obligations in excess of plan assets, the projected benefit obligation and fair value of plan assets were $8.8 billion and $7.6 billion, respectively, as of December 31, 2025. The projected benefit obligation and fair value of plan assets were $8.2 billion and $6.2 billion, respectively, as of December 31, 2024.

The following weighted-average assumptions were used to determine PMI’s pension and postretirement benefit obligations at December 31:
PensionPostretirement
2025202420252024
Discount rate
2.42 %2.07 %5.56 %5.35 %
Rate of compensation increase
1.85 1.89 
Interest crediting rate
3.16 3.05 
Health care cost trend rate assumed for next year
6.67 6.82 
Ultimate trend rate
4.60 4.71 
Year that rate reaches the ultimate trend rate
20502048

The discount rate for the largest pension plans is based on a yield curve constructed from a portfolio of high quality corporate bonds that produces a cash flow pattern equivalent to each plan’s expected benefit payments. The discount rate for the remaining plans is developed from local bond indices that match local benefit obligations as closely as possible.

Components of Net Periodic Benefit Cost

Net periodic pension and postretirement health care costs consisted of the following for the years ended December 31, 2025, 2024 and 2023:
PensionPostretirement
(in millions)
202520242023202520242023
Service cost
$240 $218 $174 $4 $3 $4 
Interest cost
209 234 258 12 13 12 
Expected return on plan assets
(437)(403)(365)— — — 
Amortization:
Net losses
145 93 18 3 (1)(1)
Prior service cost (credit)
(2)(2)(2)— — — 
Settlement and curtailment
(3)2 7 1 1 1 
Net periodic pension and postretirement costs$152 $142 $90 $20 $16 $16 

Settlement and curtailment charges were due primarily to employee severance and early retirement programs.

All of the amounts in the table above, other than service cost, are recognized in pension and other employee benefit costs in the consolidated statement of earnings.
The following weighted-average assumptions were used to determine PMI’s net pension and postretirement health care costs:
PensionPostretirement
202520242023202520242023
Discount rate - service cost
2.39 %2.68 %3.27 %5.35 %5.19 %5.89 %
Discount rate - interest cost
1.97 2.34 3.03 5.35 5.19 5.89 
Expected rate of return on plan assets
4.65 4.63 4.42 
Rate of compensation increase
1.89 2.05 1.98 
Interest crediting rate
3.05 2.99 2.97 
Health care cost trend rate
6.82 6.54 6.14 

PMI’s expected rate of return on pension plan assets is determined by the plan assets’ historical long-term investment performance, current asset allocation and estimates of future long-term returns by asset class.

PMI and certain of its subsidiaries sponsor defined contribution plans. Amounts charged to expense for defined contribution plans totaled $158 million, $123 million and $111 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Plan Assets

PMI’s investment strategy for pension plans is based on an expectation that equity securities will outperform debt securities over the long term. Accordingly, the target allocation of PMI’s plan assets is broadly characterized as approximately 55% in equity securities and approximately 45% in debt securities and other assets. The strategy primarily utilizes indexed U.S. equity securities, international equity securities and investment-grade debt securities. PMI attempts to mitigate investment risk by rebalancing between equity and debt asset classes once a year or as PMI’s contributions and benefit payments are made.

The fair value of PMI’s pension plan assets at December 31, 2025 and 2024, by asset category was as follows:
Asset Category
(in millions)		At December 31, 2025
Quoted Prices
In Active
Markets for
Identical
Assets/Liabilities
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Cash and cash equivalents
$10 $10 
Equity securities:
U.S. securities
155 155 
International securities
632 632 
Investment funds(a)
8,876 6,407 $2,469 
Government bonds
293 207 86 
Corporate bonds
501 501 
Other
72 — 4 68 
(c)
Total assets in the fair value hierarchy
$10,539 $7,912 $2,559 $68 
Investment funds measured at net asset value(b)
277 
Total assets
$10,816 
(a) Investment funds whose objective seeks to replicate the returns and characteristics of specified market indices (primarily MSCI - Europe, Switzerland, North America, Asia Pacific, Japan, Emerging Markets and Small Cap for equities / Bloomberg Core Euro Government Bonds Long Duration, FTSE Non-EGBI EuroBIG, Bloomberg Global Aggr. Corp. ex-CHF and JP Morgan EMBI for bonds / SXI Real Estate and KGAST for real estate), primarily consist of mutual funds, common trust funds and commingled funds. Of these funds, 59% were invested in U.S. and international equities; 11% were invested in U.S. and international government bonds; 14% were invested in corporate bonds and 16% were invested in real estate.
(b) In accordance with FASB ASC Subtopic 820-10, certain investments measured at fair value using the net asset value per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position.
(c) Amount relates to annuity policies of which the fair value is calculated using an actuarial model.
Asset Category
(in millions)		At December 31, 2024
Quoted Prices
In Active
Markets for
Identical
Assets/Liabilities
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)		Significant
Unobservable
Inputs
(Level 3)
Cash and cash equivalents
$83 $83 
Equity securities:
U.S. securities
144 144 
International securities
525 525 
Investment funds(a)
7,317 5,245 $2,072 
Government bonds
238 166 72 
Corporate bonds
409 409 
Other
31 — 3 28 
(c)
Total assets in the fair value hierarchy
$8,747 $6,572 $2,147 $28 
Investment funds measured at net asset value(b)
283 
Total assets
$9,030 
(a) Investment funds whose objective seeks to replicate the returns and characteristics of specified market indices (primarily MSCI — Europe, Switzerland, North America, Asia Pacific, Japan, Emerging Markets and Small Cap for equities / FTSE EMU, FTSE Non-EGBI EuroBIG, SBI AAA-BBB and JP Morgan EMBI for bonds / SXI Real Estate and KGAST for real estate), primarily consist of mutual funds, common trust funds and commingled funds. Of these funds, 57% were invested in U.S. and international equities; 13% were invested in U.S. and international government bonds; 14% were invested in corporate bonds, and 16% were invested in real estate.
(b) In accordance with FASB ASC Subtopic 820-10, certain investments measured at fair value using the net asset value per share practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position.
(c) Amount relates to annuity policies of which the fair value is calculated using an actuarial model.

For a description of the fair value hierarchy and the three levels of inputs used to measure fair values, see Note 2. Summary of Significant Accounting Policies.

PMI makes, and plans to make, contributions, to the extent that they are tax deductible and meet specific funding requirements of its funded pension plans. Currently, PMI anticipates making contributions of approximately $164 million in 2026 to its pension plans, based on current tax and benefit laws. However, this estimate is subject to change as a result of changes in tax and other benefit laws, as well as asset performance significantly above or below the assumed long-term rate of return on pension assets, or changes in interest and currency rates.

The estimated future benefit payments from PMI pension plans at December 31, 2025, are as follows:
(in millions)
2026$496 
2027522 
2028531 
2029531 
2030562 
2031 - 20352,967 
PMI's expected future annual benefit payments for its postretirement health care plans are estimated to be not material through 2035.
Postemployment Benefit Plans

PMI and certain of its subsidiaries sponsor postemployment benefit plans covering certain designated salaried and hourly employees. The cost of these plans is charged to expense over the working life of the covered employees. Net postemployment costs were $250 million, $238 million and $213 million for the years ended December 31, 2025, 2024 and 2023, respectively.

The amounts recognized in accrued postemployment costs net of plan assets on PMI's consolidated balance sheets at December 31, 2025 and 2024, were $1,036 million and $929 million, respectively.

The accrued postemployment costs were determined using a weighted-average discount rate of 4.9% in 2025 and 2024; an assumed ultimate annual weighted-average turnover rate of 2.9% in 2025 and 2024; assumed compensation cost increases of 2.2% in 2025 and 2.3% in 2024, and assumed benefits as defined in the respective plans. In accordance with local regulations, certain postemployment plans are funded. As a result, the accrued postemployment costs disclosed above are presented net of the related assets of $30 million at December 31, 2025 and 2024. Postemployment costs arising from actions that offer employees benefits in excess of those specified in the respective plans are charged to expense when incurred.

Comprehensive Earnings (Losses)

The amounts recorded in accumulated other comprehensive losses at December 31, 2025, consisted of the following:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Net (losses) gains
$(888)$(43)$(757)$(1,688)
Prior service (cost) credit
68 1 (21)48 
Net transition (obligation) asset
(3)— — (3)
Deferred income taxes
36 21 181 238 
Losses to be amortized
$(787)$(21)$(597)$(1,405)

The amounts recorded in accumulated other comprehensive losses at December 31, 2024, consisted of the following:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Net (losses) gains
$(2,122)$(36)$(815)$(2,973)
Prior service (cost) credit
75 1 (21)55 
Net transition (obligation) asset
(3)— — (3)
Deferred income taxes
246 19 195 460 
Losses to be amortized
$(1,804)$(16)$(641)$(2,461)

The amounts recorded in accumulated other comprehensive losses at December 31, 2023, consisted of the following:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Net (losses) gains
$(2,325)$(36)$(770)$(3,131)
Prior service (cost) credit
77 1 (21)57 
Net transition (obligation) asset
(3)— — (3)
Deferred income taxes
283 19 186 488 
Losses to be amortized
$(1,968)$(16)$(605)$(2,589)
The movements in other comprehensive earnings (losses) during the year ended December 31, 2025, were as follows:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Amounts transferred to earnings:
Amortization:
Net losses (gains)
$145 $3 $79 $227 
Prior service cost (credit)
(6)— — (6)
Other income/expense:
Net losses (gains)
2 1 (1)2 
    Prior service cost (credit)
(2)— — (2)
Deferred income taxes
(26)(1)(19)(46)
113 3 59 175 
Other movements during the year:
Net (losses) gains
1,087 (11)(20)1,056 
Prior service (cost) credit
1 — — 1 
Deferred income taxes
(184)3 5 (176)
904 (8)(15)881 
Total movements in other comprehensive earnings (losses)
$1,017 $(5)$44 $1,056 
The movements in other comprehensive earnings (losses) during the year ended December 31, 2024, were as follows:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Amounts transferred to earnings:
Amortization:
Net losses (gains)
$88 $1 $86 $175 
Prior service cost (credit)
(6)— — (6)
Other income/expense:
Net losses (gains)
1 1 — 2 
Deferred income taxes
(13)(2)(21)(36)
70 — 65 135 
Other movements during the year:
Net (losses) gains
114 (2)(131)(19)
Prior service (cost) credit
4 — — 4 
Deferred income taxes(24)2 30 8 
94 — (101)(7)
Total movements in other comprehensive earnings (losses)
$164 $— $(36)$128 

The movements in other comprehensive earnings (losses) during the year ended December 31, 2023, were as follows:
(in millions)
PensionPost-
retirement		Post-
employment		Total
Amounts transferred to earnings:
Amortization:
Net losses (gains)
$19 $1 $76 $96 
Prior service cost (credit)
7 — — 7 
Other income/expense:
Net losses (gains)
11 1 — 12 
Deferred income taxes(9)(1)(18)(28)
28 1 58 87 
Other movements during the year:
Net (losses) gains
(918)(24)(93)(1,035)
Deferred income taxes154 6 21 181 
(764)(18)(72)(854)
Total movements in other comprehensive earnings (losses)
$(736)$(17)$(14)$(767)