Segment Reporting

3 Months Ended

Mar. 31, 2025

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

At March 31, 2025, our reportable segments were (i) smokeable products, consisting of combustible cigarettes and machine-made large cigars; and (ii) oral tobacco products, consisting of MST products and oral nicotine pouches.

Our all other category included (i) NJOY; (ii) Horizon; (iii) Helix International; and (iv) other business activities, which primarily consists of research and development (“R&D”) expense related to certain new product platforms and technologies.

Altria’s Chief Executive Officer is our chief operating decision maker (“CODM”). Our measure of segment profitability is segment operating companies income (loss) (“OCI”), which is defined as operating income before general corporate expenses and amortization of intangibles. Our CODM uses OCI for planning, forecasting and evaluating business and financial performance of the segments, including allocating capital and other resources to our segments and evaluating results relative to employee compensation targets. Interest and other debt expense, net, along with net periodic benefit income, excluding service cost, and provision for income taxes are centrally managed at the corporate level and, accordingly, such items are not presented by segment since they are excluded from the measure of segment profitability reviewed by our CODM. We do not disclose information about total assets by segment because such information is not reported to or used by our CODM. Segment goodwill and other intangible assets, net, are disclosed in Note 4. Goodwill and Other Intangible Assets, net.

Segment data were as follows:

	For the Three Months Ended March 31,
(in millions)	2025		2024
Net revenues:
Smokeable products	$	4,622	$	4,906
Oral tobacco products	654		651
All other	(17)		19
Net revenues	$	5,259	$	5,576
Earnings before income taxes:
OCI:
Smokeable products	$	2,469	$	2,439
Oral tobacco products	433		435
All other	(1,014)		(61)
Amortization of intangibles	(37)		(27)
General corporate expenses	(63)		(112)
Operating income	1,788		2,674
Interest and other debt expense, net	262		254
Net periodic benefit income, excluding service cost	(14)		(24)
(Income) losses from investments in equity securities	(143)		(295)
Earnings before income taxes	$	1,683	$	2,739

Smokeable products segment OCI consisted of the following, including expenses under the significant expense principle in accordance with GAAP:

	For the Three Months Ended March 31,
(in millions)	2025		2024
Net revenues	$	4,622	$	4,906
Settlement charges (1)	(687)		(855)
Excise taxes on products sold	(715)		(834)
Other segment items (2)	(751)		(778)
Operating companies income	$	2,469	$	2,439

(1) Represents charges related to State Settlement Agreements included in cost of sales. For additional information, see Health Care Cost Recovery Litigation in Note 14. Contingencies.

(2) Other segment items includes manufacturing, marketing, administration and research costs, FDA user fees and other costs.

For the oral tobacco products segment, we did not identify any expenses under the significant expense principle in accordance with GAAP. Other segment items for our oral tobacco products segment include manufacturing, marketing, administration and research costs, excise taxes on products sold and other costs. Total oral tobacco products other segment items were $221 million and $216 million for the three months ended March 31, 2025 and 2024, respectively. The CODM reviews total oral tobacco products segment expenses in the aggregate in conjunction with the review of budget-to-actual OCI variances to manage segment operations.

Details of our depreciation expense and capital expenditures were as follows:

	For the Three Months Ended March 31,
(in millions)	2025		2024
Depreciation expense:
Smokeable products	$	15	$	19
Oral tobacco products	10		9
General corporate and other	9		10
Total depreciation expense	$	34	$	38
Capital expenditures:
Smokeable products	$	18	$	18
Oral tobacco products	13		9
General corporate and other	7		8
Total capital expenditures	$	38	$	35

The comparability of OCI for our reportable segments was affected by the following:

▪Tobacco and Health and Certain Other Litigation Items: We recorded pre-tax charges related to tobacco and health and certain other litigation items as follows:

	For the Three Months Ended March 31,
(in millions)	2025		2024
Smokeable products segment	$	36	$	18
General corporate expenses	—		6
Interest and other debt expense, net	4		—
Total	$	40	$	24

We recorded the amounts shown in the table above in our smokeable products segment and general corporate expenses in marketing, administration and research costs in our condensed consolidated statements of earnings. For further discussion, see Note 14. Contingencies.