Altria Group, Inc. (MO) is sharpening focus on the booming nicotine pouch category and its on! brand is leading the charge. In the second quarter of 2025, shipments rose 26.5% year over year to 52.1 million cans, lifting on!’s retail share of the U.S. oral tobacco market to 8.7%. The U.S. nicotine pouch category itself grew 52% of the total U.S. oral tobacco category, reflecting a rapid shift in consumer preferences. Within this segment, on! captured 16.7% share in the second quarter and 17.3% in the first half, underscoring its growing momentum.
Altria has leaned heavily into brand-building to capture this momentum. Through event activations at NASCAR races, music festivals and premier golf tournaments, along with a digital campaign generating 190 million impressions, on! reached more than 170,000 adult tobacco consumers in the first half of 2025. These efforts lifted brand awareness by 7 percentage points, signaling growing traction.
Beyond shipment gains, on!’s strength showed up in earnings. The oral tobacco segment delivered a 10.9% increase in adjusted operating companies income (“OCI”) year over year, with margins expanding to 68.7% from 65.6% in the prior-year quarter.
Still, competition in the pouch category is intensifying, with rivals pressing hard to capture share. The key question is whether Altria’s combination of scale, marketing strength and retail reach can sustain the brand’s momentum. If on! maintains the current pace of growth, it could become one of the company’s most important offsets to declining cigarette volumes.
Altria Competes With PM and TPB in Pouches
Philip Morris International Inc. (PM) continues to strengthen its U.S. and global nicotine pouch position through ZYN, which saw U.S. offtake growth of 26% in the second quarter of 2025. Globally, Philip Morris’ ZYN volumes surged 43%, supported by expansion into 44 markets. Philip Morris’ multi-category smoke-free strategy, which includes IQOS and VEEV, underpins double-digit smoke-free revenue growth, helping offset declines in combustible products and reinforcing ZYN’s role as a long-term growth engine in the oral tobacco category.
Turning Point Brands, Inc. (TPB) is rapidly scaling in the white nicotine pouch category, Modern Oral sales up nearly eightfold year over year to $30.1 million in the second quarter of 2025. Aided by a growing sales force and expanded chain distribution, Turning Point Brands' FRE and ALP are gaining traction through both direct-to-consumer and retail channels. This momentum underscores Turning Point Brands’ emergence as a fast-growing challenger to larger players in the evolving oral nicotine market.
MO’s Price Performance, Valuation & Estimates
Shares of Altria have gained 8.5% in the past month compared with the industry’s growth of 3.9%.
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From a valuation standpoint, MO trades at a forward price-to-earnings ratio of 12.2X, down from the industry’s average of 15.35X.
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The Zacks Consensus Estimate for MO’s 2025 and 2026 earnings per share has inched up a cent each in the past 30 days to $5.39 and $5.55, respectively.
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Altria currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
