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Investments in Equity Securities
 12 Months Ended
Dec. 31, 2025
Equity Method Investments and Joint Ventures [Abstract]  
Investments in Equity Securities Investments in Equity Securities
The carrying amount of our investments consisted of the following at December 31:
(in millions)20252024
ABI
$8,303 $7,880 
Cronos314 315 
Total
$8,617 $8,195 
(Income) losses from our current and former investments in equity securities consisted of the following:
For the Years Ended December 31,
(in millions)202520242023
ABI (1)
$(498)$(673)(2)$(539)
Cronos (1)
(12)21 46  
(Income) losses from investments under equity method of accounting(510)(652)(493)
JUUL— — 250 (3)
(Income) losses from investments in equity securities$(510)$(652)$(243)
(1) Includes our share of amounts recorded by our investees and additional adjustments, if required, related to (i) the conversion from international financial reporting standards to GAAP and (ii) adjustments to our investments required under the equity method of accounting.
(2) Includes $165 million of the total pre-tax gain on the ABI Transaction discussed below.
(3) Represents a non-cash, pre-tax loss on the disposition of our JUUL equity securities discussed below.
Investees’ summarized financial data for our equity method investments that we report using a one-quarter lag was as follows:
For the Twelve Months Ended September 30,
202520242023
(in millions)ABICronosABICronosABICronos
Net revenues$58,986 $132 $60,103 $111 $59,841 $87 
Gross profit$32,841 $57 $32,974 $17 $32,371 $9 
Earnings (losses) from continuing operations$8,134 $42 $8,108 $(48)$7,956 $(105)
Net earnings (losses)$8,134 $42 $8,108 $(49)$7,956 $(108)
Net earnings (losses) attributable to equity investments$6,411 $36 $6,501 $(47)$6,284 $(108)
At September 30,
20252024
(in millions)ABICronosABICronos
Current assets$23,034 $922 $22,525 $959 
Long-term assets$187,082 $256 $185,318 $225 
Current liabilities$35,025 $41 $31,182 $40 
Long-term liabilities$86,915 $5 $92,377 $13 
Noncontrolling interests
$10,675 $50 $10,831 $50 
Investment in ABI    
At December 31, 2025, we had an approximate 8.2% ownership interest in ABI, consisting of approximately 125 million restricted shares of ABI (“Restricted Shares”) and approximately 34 million ordinary shares of ABI. Our Restricted Shares:
▪are unlisted and not admitted to trading on any stock exchange;
▪are convertible by us into ordinary shares of ABI on a one-for-one basis;
▪rank equally with ordinary shares of ABI with regards to dividends and voting rights; and
▪have director nomination rights with respect to ABI.
We account for our investment in ABI under the equity method of accounting because we have active representation on ABI’s board of directors and certain ABI board committees. Through this representation, we believe we have the ability to exercise significant influence over the operating and financial policies of ABI and participate in ABI’s policy making processes.
We report our share of ABI’s results using a one-quarter lag because ABI’s results are not available in time for us to record them in the concurrent period.
The fair value of our investment in ABI is based on (i) unadjusted quoted prices in active markets for ABI’s ordinary shares and is classified in Level 1 of the fair value hierarchy and (ii) observable inputs other than Level 1 prices, such as quoted prices for similar assets for the Restricted Shares and is classified in Level 2 of the fair value hierarchy. Because we can convert our Restricted Shares into ordinary shares at our discretion, the fair value of each Restricted Share is based on the value of an ordinary share.
At December 31, 2025, the fair value of our investment in ABI was $10.3 billion, which exceeded its carrying value of $8.3 billion by approximately 24%. At December 31, 2024, the fair value of our investment in ABI approximated its carrying value of $7.9 billion.
At December 31, 2025, the carrying value of our investment in ABI exceeded our share of ABI’s net assets attributable to equity holders of ABI as of September 30, 2025 by approximately $2.0 billion. Substantially all of this difference is comprised of goodwill and other indefinite-lived intangible assets (consisting primarily of trademarks).
2024 ABI Transaction
In the first quarter of 2024, we converted 60 million of our Restricted Shares into ordinary shares of ABI and completed the sale of a portion of our investment in ABI (“ABI Transaction”), which consisted of the following:
▪We sold 35 million of our ABI ordinary shares in a global secondary offering for gross proceeds of approximately $2.2 billion.
▪We sold $200 million of our ABI ordinary shares (approximately 3.3 million ordinary shares) to ABI in a private transaction.
As a result of the ABI Transaction, in the first quarter of 2024, we received pre-tax cash proceeds totaling approximately $2.4 billion and incurred transaction costs of approximately $62 million. In conjunction with the ABI Transaction, we entered into accelerated share repurchase (“ASR”) transactions under two separate agreements with bank counterparties (collectively, “ASR Agreements”) to repurchase shares of our common stock. For further discussion of the ASR Agreements, see Note 10. Capital Stock.
As a result of the ABI Transaction, we recorded the following pre-tax amounts in our consolidated statement of earnings:
(in millions)For the Year Ended December 31, 2024
Gain on partial sale of our investment$165 
Transaction costs(62)
Total pre-tax gain on ABI Transaction$103 
▪The pre-tax gain on the partial sale of our investment was recorded in (income) losses from investments in equity securities and includes a $408 million gain representing the excess of the selling price of the ABI shares sold over the carrying value of those shares, partially offset by a $243 million reclassification of the proportionate share of our pre-tax accumulated other comprehensive losses directly attributable to ABI and our designated net investment hedges related to our investment in ABI (see Note 7. Financial Instruments and Note 13. Other Comprehensive Earnings/Losses).
▪The pre-tax transaction costs were approximately $62 million ($59 million in marketing, administration and research costs and $3 million in interest and other debt expense, net), substantially all of which were underwriter fees.
In addition, in conjunction with the ABI Transaction, we recorded an income tax benefit from the partial release of a valuation allowance of approximately $94 million in provision for income taxes in our consolidated statement of earnings for the year ended December 31, 2024. Subsequently, for the year ended December 31, 2025, we recorded an additional $77 million increase to this valuation allowance. For further discussion of the valuation allowance, see Note 14. Income Taxes.
Investment in Cronos
At December 31, 2025, we had an approximate 41.0% ownership interest in Cronos, consisting of approximately 157 million shares, which we account for under the equity method of accounting. We report our share of Cronos’s results using a one-quarter lag because Cronos’s results are not available in time for us to record them in the concurrent period.
The fair value of our investment in Cronos is based on unadjusted quoted prices in active markets for Cronos’s common shares and is classified in Level 1 of the fair value hierarchy.
At December 31, 2025, the fair value of our investment in Cronos exceeded its carrying value by $97 million, or approximately 31%. At December 31, 2024, the fair value of our investment in Cronos approximated its carrying value of $315 million
Former Investment in JUUL Labs, Inc. (“JUUL”)
As of December 31, 2022, we had an investment in JUUL of $250 million, representing a 35% economic interest in JUUL. We accounted for this investment as an investment in an equity security as we determined that we had no ability to exercise significant influence over the operating and financial policies of JUUL as a result of our loss of certain rights due to our exercise of our option to be released from our JUUL non-competition obligations in the third quarter of 2022. Our consolidated statements of earnings included any changes in the estimated fair value of our former investment, which were calculated quarterly. We used an income approach to estimate the fair value of our former investment in JUUL. The income approach reflected the discounting of future cash flows for the U.S. and international markets at a rate of return that incorporated the risk-free rate for the use of those funds, the expected rate of inflation and the risks associated with realizing future cash flows.
In March 2023, we entered into a stock purchase agreement with JUUL (“Stock Transfer Agreement”) pursuant to which we transferred to JUUL all of our beneficially owned JUUL equity securities and, in exchange, received a non-exclusive, irrevocable global license to certain of JUUL’s heated tobacco intellectual property (“JUUL Heated Tobacco IP”). For the year ended December 31, 2023, we recorded a non-cash, pre-tax loss on the disposition of our JUUL equity securities of $250 million as a result of entering into the Stock Transfer Agreement. Additionally, we considered specific facts and circumstances around the nature of the JUUL Heated Tobacco IP and determined that the fair value of such intellectual property was not material to our consolidated financial statements as of the date of the transaction. As a result, we did not record an asset associated with this intellectual property on our consolidated balance sheet. The primary drivers of this conclusion were (i) our rights to the JUUL Heated Tobacco IP being non-exclusive, (ii) there being no product or technology transferred to us associated with the JUUL Heated Tobacco IP and (iii) there being no connection between the JUUL Heated Tobacco IP and our current product development plans.