Item 1. Financial Statements

178K characters. Original on sec.gov · Markdown

Item 1. Financial Statements

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in millions of dollars)

(Unaudited)

June 30, 2025December 31, 2024
Assets
Cash and cash equivalents$1,287$3,127
Receivables241177
Inventories:
Leaf tobacco475591
Other raw materials200190
Work in process2121
Finished product320278
1,0161,080
Other current assets88129
Total current assets2,6324,513
Property, plant and equipment, at cost4,5304,537
Less accumulated depreciation2,9202,920
1,6101,617
Goodwill6,0726,945
Other intangible assets, net12,90012,973
Investments in equity securities8,1438,195
Other assets975934
Total Assets$32,332$35,177

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Continued)

(in millions of dollars, except share and per share data)

(Unaudited)

________________________________________________

June 30, 2025December 31, 2024
Liabilities
Current portion of long-term debt$1,069$1,527
Accounts payable569700
Accrued liabilities:
Marketing894688
Settlement charges1,0982,354
Other1,4351,780
Dividends payable1,7231,732
Total current liabilities6,7888,781
Long-term debt23,65123,399
Deferred income taxes3,6613,749
Accrued pension costs133136
Accrued postretirement health care costs935935
Other liabilities370365
Total liabilities35,53837,365
Contingencies (Note 14)
Stockholders’ Equity (Deficit)
Common stock, par value $0.33 1/3 per share (2,805,961,317 shares issued)935935
Additional paid-in capital5,8955,905
Earnings reinvested in the business35,52535,516
Accumulated other comprehensive losses(2,831)(2,400)
Cost of repurchased stock (1,125,015,255 shares at June 30, 2025 and 1,115,309,450 shares at December 31, 2024)(42,780)(42,194)
Total stockholders’ equity (deficit) attributable to Altria(3,256)(2,238)
Noncontrolling interest5050
Total stockholders’ equity (deficit)(3,206)(2,188)
Total Liabilities and Stockholders’ Equity (Deficit)$32,332$35,177

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings

(in millions of dollars, except per share data)

(Unaudited)

_____________________________________

For the Six Months Ended June 30,For the Three Months Ended June 30,
2025202420252024
Net revenues$11,361$11,785$6,102$6,209
Cost of sales2,7103,0391,4401,602
Excise taxes on products1,5521,791812932
Gross profit7,0996,9553,8503,675
Marketing, administration and research costs1,2071,394619788
Asset impairment and exit costs13541354
Impairment of goodwill873———
Operating income5,0185,2073,2302,533
Interest and other debt expense, net537515275261
Net periodic benefit income, excluding service cost(29)(49)(15)(25)
(Income) losses from investments in equity securities(291)(414)(148)(119)
Gain on the sale of IQOS System commercialization rights—(2,700)—(2,700)
Earnings before income taxes4,8017,8553,1185,116
Provision for income taxes1,3461,9237401,313
Net earnings$3,455$5,932$2,378$3,803
Per share data:
Basic and diluted earnings per share$2.04$3.41$1.41$2.21

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Earnings

(in millions of dollars)

(Unaudited)

_____________________

For the Six Months Ended June 30,For the Three Months Ended June 30,
2025202420252024
Net earnings$3,455$5,932$2,378$3,803
Other comprehensive earnings (losses), net of deferred income taxes:
Benefit plans3(2)2(1)
ABI(414)394(145)(8)
Currency translation adjustments(20)(2)3(8)
Other comprehensive earnings (losses), net of deferred income taxes(431)390(140)(17)
Comprehensive earnings$3,024$6,322$2,238$3,786

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

for the Six Months Ended June 30, 2025 and 2024

(in millions of dollars, except per share data)

(Unaudited)

_______________________________________

Attributable to Altria
Common StockAdditional Paid-in CapitalEarnings Reinvested in the BusinessAccumulated Other Comprehensive LossesCost of Repurchased StockNon- controlling InterestTotal Stockholders’ Equity (Deficit)
Balances, December 31, 2024$935$5,905$35,516$(2,400)$(42,194)$50$(2,188)
Net earnings——3,455———3,455
Other comprehensive earnings (losses), net of deferred income taxes———(431)——(431)
Stock award activity—(10)——20—10
Cash dividends declared ($2.04 per share)——(3,446)———(3,446)
Repurchases of common stock————(600)—(600)
Other————(6)—(6)
Balances, June 30, 2025$935$5,895$35,525$(2,831)$(42,780)$50$(3,206)
Balances, December 31, 2023$935$5,906$31,094$(2,673)$(38,802)$50$(3,490)
Net earnings——5,932———5,932
Other comprehensive earnings (losses), net of deferred income taxes———390——390
Stock award activity—(12)——23—11
Cash dividends declared ($1.96 per share)——(3,375)———(3,375)
Repurchases of common stock—(18)——(2,392)—(2,410)
Other————(24)—(24)
Balances, June 30, 2024$935$5,876$33,651$(2,283)$(41,195)$50$(2,966)

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

for the Three Months Ended June 30, 2025 and 2024

(in millions of dollars, except per share data)

(Unaudited)

_______________________________________

Attributable to Altria
Common StockAdditional Paid-in CapitalEarnings Reinvested in the BusinessAccumulated Other Comprehensive LossesCost of Repurchased StockNon- controlling InterestTotal Stockholders’ Equity (Deficit)
Balances, March 31, 2025$935$5,883$34,868$(2,691)$(42,505)$50$(3,460)
Net earnings——2,378———2,378
Other comprehensive earnings (losses), net of deferred income taxes———(140)——(140)
Stock award activity—12——2—14
Cash dividends declared ($1.02 per share)——(1,721)———(1,721)
Repurchases of common stock————(274)—(274)
Other————(3)—(3)
Balances, June 30, 2025$935$5,895$35,525$(2,831)$(42,780)$50$(3,206)
Balances, March 31, 2024$935$5,521$31,535$(2,266)$(40,839)$50$(5,064)
Net earnings——3,803———3,803
Other comprehensive earnings (losses), net of deferred income taxes———(17)——(17)
Stock award activity—13————13
Cash dividends declared ($0.98 per share)——(1,687)———(1,687)
Repurchases of common stock—342(1)——(352)—(10)
Other————(4)—(4)
Balances, June 30, 2024$935$5,876$33,651$(2,283)$(41,195)$50$(2,966)

(1) Represents the fair value of the shares received at final settlement of the ASR Agreements that were transferred to cost of repurchased stock. For further discussion, see Note 1. Background and Basis of Presentation.

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in millions of dollars)

(Unaudited)

_____________________

For the Six Months Ended June 30,20252024
Cash Provided by (Used in) Operating Activities
Net earnings$3,455$5,932
Adjustments to reconcile net earnings to operating cash flows:
Depreciation and amortization142139
Deferred income tax provision33444
Unrecognized tax benefit—88
Fair value adjustment for NJOY Transaction contingent payments25140
(Income) losses from investments in equity securities(291)(414)
Gain on the sale of IQOS System commercialization rights—(2,700)
Dividends from ABI181139
Asset impairment and exit costs, net of cash paid(4)354
Impairment of goodwill873—
Cash effects of changes:
Receivables(62)(1)
Inventories2741
Accounts payable(123)(16)
Income taxes267177
Accrued liabilities and other current assets(489)(351)
Accrued settlement charges(1,256)(1,243)
Pension plan contributions(9)(9)
Pension and postretirement, net(37)(50)
Other, net193132
Net cash provided by (used in) operating activities2,9252,802
Cash Provided by (Used in) Investing Activities
Capital expenditures(70)(64)
Proceeds from the ABI Transaction (1)—2,353
Other, net(9)(10)
Net cash provided by (used in) investing activities$(79)$2,279

(1) See Note 6. Investments in Equity Securities.

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Continued)

(in millions of dollars)

(Unaudited)

_____________________

For the Six Months Ended June 30,20252024
Cash Provided by (Used in) Financing Activities
Long-term debt issued$997$—
Long-term debt repaid(1,607)(1,121)
Repurchases of common stock(600)(2,410)
Dividends paid on common stock(3,454)(3,420)
Other, net(29)(15)
Net cash provided by (used in) financing activities(4,693)(6,966)
Cash, cash equivalents and restricted cash:
Increase (decrease)(1,847)(1,885)
Balance at beginning of period3,1583,721
Balance at end of period$1,311$1,836
The following table provides a reconciliation of cash, cash equivalents and restricted cash (1) to the amounts reported on our condensed consolidated balance sheets:
June 30, 2025December 31, 2024
Cash and cash equivalents$1,287$3,127
Restricted cash included in other current assets98
Restricted cash included in other assets1523
Cash, cash equivalents and restricted cash$1,311$3,158

(1) Restricted cash consisted of cash deposits collateralizing appeal bonds posted by PM USA to obtain stays of judgments pending appeals. See Note 14. Contingencies.

See notes to condensed consolidated financial statements.

Altria Group, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1. Background and Basis of Presentation

When used in these notes, the terms “Altria,” “we,” “us” and “our” refer to either (i) Altria Group, Inc. and its consolidated subsidiaries or (ii) Altria Group, Inc. only and not its consolidated subsidiaries, as appropriate in the context.

**▪**Background: At June 30, 2025, our wholly owned subsidiaries included Philip Morris USA Inc. (“PM USA”), which is engaged in the manufacture and sale of cigarettes in the United States; John Middleton Co. (“Middleton”), which is engaged in the manufacture and sale of machine-made large cigars and is a wholly owned subsidiary of PM USA; UST LLC (“UST”), which, through its wholly owned subsidiary U.S. Smokeless Tobacco Company LLC (“USSTC”), is engaged in the manufacture and sale of moist smokeless tobacco (“MST”) products; Helix Innovations LLC (“Helix”), which operates in the United States, and its foreign affiliates (“Helix International”), which operate in certain other countries, are engaged in the manufacture and sale of oral nicotine pouches; and NJOY, LLC (“NJOY”), which is engaged in the manufacture and sale of e-vapor products. Other wholly owned subsidiaries included Altria Group Distribution Company (“AGDC”), which provides sales and distribution services to our domestic operating companies, and Altria Client Services LLC (“ALCS”), which provides various support services to our companies in areas such as legal, regulatory, research and product development, consumer engagement, finance, human resources and external affairs. Our access to the operating cash flows of our subsidiaries consists of cash received from the payment of dividends and distributions, and the payment of interest on intercompany loans. At June 30, 2025, our significant subsidiaries were not limited by contractual obligations in their ability to pay cash dividends or make other distributions with respect to their equity interests.

At June 30, 2025, we owned a 75% economic interest in Horizon Innovations LLC (“Horizon”), a joint venture with JTI (US) Holding, Inc., a subsidiary of Japan Tobacco Inc., which owned the remaining 25% economic interest. Horizon is responsible for the U.S. marketing and commercialization of heated tobacco stick products owned by either party. At June 30, 2025, Horizon had no products in the U.S. marketplace.

At June 30, 2025, we had investments in Anheuser-Busch InBev SA/NV (“ABI”) and Cronos Group Inc. (“Cronos”). For further discussion of our investments, see Note 6. Investments in Equity Securities.

**▪**Share Repurchases: In January 2025, our Board of Directors (“Board of Directors” or “Board”) authorized a new $1.0 billion share repurchase program (“January 2025 share repurchase program”), which we expect to complete by December 31, 2025. At June 30, 2025, we had $400 million remaining under the January 2025 share repurchase program. The timing of share repurchases depends upon marketplace conditions and other factors, and the program remains subject to the discretion of our Board.

In January 2024, our Board authorized a $1.0 billion share repurchase program that it increased to $3.4 billion in March 2024 (as increased, “January 2024 share repurchase program”). We subsequently entered into accelerated share repurchase (“ASR”) transactions under two separate agreements with bank counterparties (collectively, “ASR Agreements”) to repurchase shares of our common stock having an aggregate value of $2.4 billion (“Repurchase Price”). In the first quarter of 2024, we paid the Repurchase Price and received 46.5 million shares of our common stock, which represented an aggregate value of approximately 85% or $2,040 million of the Repurchase Price based on the closing price per share of our common stock on the date we entered into the ASR Agreements. In the second quarter of 2024, we received approximately 7.4 million additional shares of our common stock upon the final settlement of the ASR Agreements. We funded the ASR transactions with proceeds from our sale of a portion of our investment in ABI (“ABI Transaction”). For further information on the ABI Transaction, see Note 6. Investments in Equity Securities. The ASR transactions were accounted for as equity transactions and included in cost of repurchased stock on our condensed consolidated balance sheet when the shares were received. We completed the January 2024 share repurchase program in December 2024.

Our share repurchase activity was as follows:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions, except per share data)20252024(1)20252024(1)
Total number of shares repurchased10.454.14.77.6
Aggregate cost of shares repurchased$600$2,410$274370
Average price per share of shares repurchased$57.71$44.50$58.63$48.36

(1) Includes 53.9 million and 7.4 million shares repurchased under the ASR Agreements at an average price per share of $44.50 and $48.44 for the six and three months ended June 30, 2024, respectively.

Table of Contents

**▪**Basis of Presentation: Our interim condensed consolidated financial statements are unaudited. These interim condensed consolidated financial statements have been prepared in conformity with United States generally accepted accounting principles (“GAAP”) and such principles are applied on a consistent basis. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted. Our management believes that all adjustments necessary for a fair statement of the interim results presented have been reflected in our interim condensed consolidated financial statements. All such adjustments were of a normal recurring nature. Net revenues and net earnings for any interim period are not necessarily indicative of results that may be expected for the entire year.

These condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related notes, which appear in our Annual Report on Form 10-K for the year ended December 31, 2024.

Certain immaterial prior year amounts have been reclassified to conform with the current year’s presentation.

For a description of issued accounting guidance applicable to, but not yet adopted by, us, see Note 15. New Accounting Guidance Not Yet Adopted.

Note 2. Revenues from Contracts with Customers

We disaggregate net revenues based on product type. For further discussion, see Note 11. Segment Reporting.

Substantially all cash discounts in contracts with our customers are based on a percentage of the list price based on agreed-upon payment terms. We record receivables net of the cash discounts on our condensed consolidated balance sheets.

Receivables and deferred revenue associated with contracts with customers were as follows:

(in millions)June 30, 2025December 31, 2024
Receivables$241$177
Deferred revenue213215

At June 30, 2025 and December 31, 2024, we did not expect differences between amounts recorded as receivables and amounts that would be subsequently received; therefore, we did not record an allowance for credit losses against these receivables.

We record deferred revenue when our businesses receive payment in advance of product shipment. These payments are included in other accrued liabilities on our condensed consolidated balance sheets until control of such products is obtained by the customer. When cash is received in advance of product shipment, our companies typically satisfy their performance obligations within three days of receiving payment. At June 30, 2025 and December 31, 2024, there were no differences between amounts recorded as deferred revenue from contracts with customers and amounts subsequently recognized as revenue.

We record an allowance for returned goods, which is included in other accrued liabilities on our condensed consolidated balance sheets. It is USSTC’s policy to accept authorized sales returns from its customers for products that have passed the freshness date printed on product packaging due to the limited shelf life of USSTC’s MST products. We record estimated sales returns, which are based principally on historical volume and return rates, as a reduction to revenues. Actual sales returns will differ from estimated sales returns to the extent actual results differ from estimated assumptions. We reflect differences between actual and estimated sales returns in the period in which the actual amounts become known. These differences, if any, have not had a material impact on our condensed consolidated financial statements. All returned goods are destroyed upon return and not included in inventory. Consequently, we do not record an asset for USSTC’s right to recover goods from customers upon return.

Sales incentives include variable payments related to goods sold by our businesses. We include estimates of variable consideration as a reduction to revenues upon shipment of goods to customers. The sales incentives that require significant estimates and judgments are as follows:

*▪*Price promotion payments- We make price promotion payments, substantially all of which are made to our retail partners to incent the promotion of certain product offerings in select geographic areas.

*▪*Wholesale and retail participation payments- We make payments to our wholesale and retail partners to incent merchandising and sharing of sales data in accordance with our trade agreements.

These estimates primarily include estimated wholesale to retail sales volume and historical acceptance rates. Actual payments will differ from estimated payments to the extent actual results differ from estimated assumptions. Differences between actual and estimated payments are reflected in the period such information becomes available. These differences, if any, have not had a material impact on our condensed consolidated financial statements.

Table of Contents

Note 3. Supplier Financing

We facilitate a voluntary supplier financing program through a third-party intermediary under which participating suppliers may elect to sell receivables due from us to participating third-party financial institutions at the sole discretion of both the suppliers and the financial institutions (“Program”). All outstanding balances under the Program are recorded in accounts payable on our condensed consolidated balance sheets, and the associated payments are included in operating activities within our condensed consolidated statements of cash flows.

At June 30, 2025 and December 31, 2024, confirmed outstanding obligations under the Program were $152 million and $128 million, respectively.

Note 4. Goodwill and Other Intangible Assets, net

Goodwill and other intangible assets, net, were as follows:

June 30, 2025December 31, 2024
(in millions)GoodwillOther Intangible Assets, netGoodwillOther Intangible Assets, net
Smokeable products segment$99$2,924$99$2,936
Oral tobacco products segment5,0788,6635,0788,679
Other (1)8951,3131,7681,358
Total$6,072$12,900$6,945$12,973

(1) Comprised primarily of e-vapor reporting unit goodwill and definite-lived intangible assets related to the acquisition of NJOY in 2023.

Other intangible assets consisted of the following:

June 30, 2025December 31, 2024
(in millions)Gross Carrying AmountAccumulated AmortizationGross Carrying AmountAccumulated Amortization
Indefinite-lived intangible assets$11,089$—$11,089$—
Definite-lived intangible assets2,6228112,621737
Total other intangible assets$13,711$811$13,710$737

At June 30, 2025, substantially all of our indefinite-lived intangible assets consisted of (i) MST trademarks of $8.5 billion, which consists of Copenhagen, Skoal and other MST trademarks of $4.0 billion, $3.6 billion and $0.9 billion, respectively, from our 2009 acquisition of UST, and (ii) cigar trademarks of $2.6 billion from our 2007 acquisition of Middleton. Definite-lived intangible assets, consisting primarily of intellectual property (which includes developed technology), certain cigarette trademarks, e-vapor trademarks and customer relationships, are amortized over a weighted-average period of approximately 19 years. Pre-tax amortization expense for definite-lived intangible assets was $74 million and $64 million for the six months ended June 30, 2025 and 2024, respectively, and $37 million for the three months ended June 30, 2025 and 2024.

In April 2024, we assigned the exclusive U.S. commercialization rights to the IQOS Tobacco Heating System (“IQOS System”) to Philip Morris International Inc. (“PMI”). Upon the assignment of the U.S. commercialization rights to the IQOS System, we recorded a pre-tax gain of $2.7 billion for the six and three months ended June 30, 2024 in our condensed consolidated statements of earnings.

Table of Contents

The changes in goodwill and net carrying amount of intangible assets were as follows:

For the Six Months EndedFor the Year Ended
June 30, 2025December 31, 2024
(in millions)GoodwillOther Intangible Assets, netGoodwillOther Intangible Assets, net
Balance at January 1$6,945$12,973$6,791$13,686
Changes due to:
Acquisitions (1)—1154(220)
Impairments (2)(873)——(354)
Amortization—(74)—(139)
Balance at end of period$6,072$12,900$6,945$12,973

(1) The 2024 amounts represent the measurement period adjustments related to the acquisition of NJOY.

(2) The 2025 amount represents a non-cash impairment of our e-vapor reporting unit goodwill. The 2024 amount represents a non-cash, pre-tax impairment of the Skoal trademark.

We conduct a required annual review of goodwill and indefinite-lived intangible assets for potential impairment, and more frequently if an event occurs or circumstances change that would require us to perform an interim quantitative impairment assessment. There have been no events or changes in circumstances that indicate an interim quantitative impairment assessment was required for the three months ended June 30, 2025. We will perform our annual impairment testing during the fourth quarter of 2025.

Our annual impairment test of goodwill and indefinite-lived intangible assets as of October 1, 2024 resulted in no impairment charges for the fourth quarter of 2024.

At June 30, 2025, accumulated impairment losses related to goodwill were $873 million, which related to the e-vapor reporting unit goodwill impairment recorded for the three months ended March 31, 2025 in the all other category, discussed below. At December 31, 2024, there were no accumulated impairment losses related to goodwill.

First Quarter of 2025 E-vapor Reporting Unit Goodwill Impairment

At December 31, 2024, the estimated fair value of the e-vapor reporting unit exceeded its carrying value by approximately 28% ($0.3 billion). As further discussed in Note 14. Contingencies, Altria and certain of our affiliates, including NJOY, are defendants in lawsuits alleging patent infringement based on the sale of NJOY ACE in the United States. In January 2025, the U.S. International Trade Commission (“ITC”) issued an exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE in the United States, which became effective on March 31, 2025, after the 60-day review period ended without the United States Trade Representative taking action. As a result, in connection with the preparation of our condensed consolidated financial statements for the period ended March 31, 2025, we concluded a triggering event had occurred and performed an interim impairment assessment for the e-vapor reporting unit.

As a result of our interim impairment testing, we determined the estimated fair value of the e-vapor reporting unit as of March 31, 2025, was below its carrying value and recorded a non-cash goodwill impairment of $873 million for the three months ended March 31, 2025 in our condensed consolidated statements of earnings. This impairment was due primarily to (i) lower projected volume and revenue due to NJOY ACE’s removal from the U.S. market and (ii) higher projected costs associated with the commercialization of NJOY’s future e-vapor product portfolio resulting in lower projected operating margins. As of March 31, 2025, after recording the impairment, the carrying value of goodwill within the e-vapor reporting unit was $895 million. In addition, the carrying value of the e-vapor reporting unit’s net assets (including the effect of intercompany debt), which was negative, approximated its estimated fair value.

We used an income approach to estimate the fair value of the e-vapor reporting unit. Our discounted cash flows are based on a range of scenarios that consider certain potential regulatory and market outcomes. The income approach reflects the discounting of expected future cash flows at a rate of return that incorporates the risk-free rate for the use of those funds, the expected rate of inflation and the risks associated with realizing expected future cash flows. In performing the discounted cash flow analysis, we made various judgments, estimates and assumptions, the most significant of which were volume, revenue, income, operating margins, perpetual growth rate and discount rate. All significant inputs used in the valuation are classified in Level 3 of the fair value hierarchy.

As a result of the ITC orders, in connection with the preparation of our condensed consolidated financial statements for the period ended March 31, 2025, we also reviewed the definite-lived intangible assets in the e-vapor reporting unit for impairment and concluded the carrying value was recoverable and no impairment existed.

Table of Contents

Second Quarter of 2024 Skoal Trademark Impairment

In connection with the preparation of our condensed consolidated financial statements for the period ended June 30, 2024, we determined the estimated fair value of our Skoal trademark was below its carrying value and recorded a non-cash, pre-tax impairment of $354 million for the six and three months ended June 30, 2024 in our condensed consolidated statements of earnings. Our carrying value and estimated fair value of the Skoal trademark at June 30, 2024 were $3.6 billion, after recording the impairment.

Note 5. Exit and Implementation Costs

Pre-tax implementation and exit costs consisted of the following:

For the Six Months Ended June 30, 2025For the Three Months Ended June 30, 2025
(in millions)Exit CostsImplementation Costs (1)Exit CostsImplementation Costs (1)
Smokeable products segment$1$25$1$12
Oral tobacco products segment—4—2
Total$1$29$1$14

(1) Recorded in marketing, administration and research costs in our condensed consolidated statement of earnings.

There were no exit or implementation costs for the six months ended June 30, 2024.

In October 2024, we announced a multi-phase Optimize & Accelerate initiative (“Initiative”) designed to modernize our ways of working. Through the Initiative, we plan to increase our organization’s speed, efficiency and effectiveness by centralizing work, outsourcing certain transactional tasks and streamlining, automating and standardizing processes. We expect the design and detailed plans for all phases of the Initiative to be substantially complete in early 2026.

We estimate total pre-tax charges for the Initiative’s currently planned phases to be approximately $125 million. As of June 30, 2025, total pre-tax charges since the inception of the Initiative were $98 million, consisting of employee separation cost of $36 million and implementation costs of $62 million. All of these charges result in cash expenditures and consist of severance payments associated with employee separations, implementation costs for new technology and business advisory services and other costs. Employee separation costs are recorded when probable and reasonably estimable. As we further develop and finalize detailed plans for the additional phases of the Initiative, we will update estimated pre-tax charges for the Initiative. As of June 30, 2025, total cash payments since the inception of the Initiative were $49 million, consisting of $5 million for exit costs and $44 million for implementation costs.

A summary of the Initiative’s charges and cash paid for exit and implementation costs is as follows:

(in millions)Exit CostsImplementation CostsTotal
Balances at December 31, 2023$—$—$—
Charges353368
Cash paid—(11)(11)
Balances at December 31, 2024352257
Charges12930
Cash paid(5)(33)(38)
Balances at June 30, 2025$31(1)$18$49

(1) Restructuring liabilities, all of which were severance liabilities.

Note 6. Investments in Equity Securities

The carrying amount of our investments consisted of the following:

(in millions)June 30, 2025December 31, 2024
ABI$7,837$7,880
Cronos306315
Total$8,143$8,195

Table of Contents

(Income) losses from our investments in equity securities consisted of the following:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
ABI (1)$(273)$(434)(2)$(148)$(121)
Cronos (1)(18)20—2
(Income) losses from investments in equity securities$(291)$(414)$(148)$(119)

(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.

Investment in ABI

At June 30, 2025, we had an approximate 8.1% 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. 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 June 30, 2025, the fair value of our investment in ABI was $10.9 billion, which exceeded its carrying value of $7.8 billion by approximately 39%. At December 31, 2024, the fair value of our investment in ABI approximated its carrying value of $7.9 billion.

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 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 the ASR Agreements to repurchase shares of our common stock. For further discussion of the ASR Agreements, see Note 1. Background and Basis of Presentation.

Table of Contents

As a result of the ABI Transaction, we recorded the following pre-tax amounts in our condensed consolidated statement of earnings:

(in millions)For the Six Months Ended June 30, 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 10. 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 condensed consolidated statement of earnings for the six months ended June 30, 2024. For further discussion, see Note 13. Income Taxes.

Investment in Cronos

At June 30, 2025, we had an approximate 40.8% 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 June 30, 2025, the fair value of our investment in Cronos was less than its carrying value by approximately $6 million or approximately 2%. Based on our evaluation of the duration and magnitude of the fair value decline, our evaluation of Cronos’s financial condition (including its strong cash position) and near-term prospects, and our intent and ability to hold our investment in Cronos until recovery, we concluded that the decline in fair value of our investment in Cronos below its carrying value is temporary and, therefore, no impairment was recorded. At December 31, 2024, the fair value of our investment in Cronos approximated its carrying value of $315 million.

Note 7. Financial Instruments

Our investment in ABI, whose functional currency is the Euro, exposes us to foreign currency exchange risk on the carrying value of our investment. To manage this risk, we may designate Euro denominated unsecured long-term notes (“foreign currency denominated debt”) and certain foreign exchange contracts, including cross-currency swap contracts and forward contracts (collectively, “foreign currency contracts”), as net investment hedges of our investment in ABI. At June 30, 2025 and December 31, 2024, we had no outstanding foreign currency contracts.

The aggregate carrying value and fair value of our total long-term debt were as follows:

(in millions)June 30, 2025December 31, 2024
Carrying value$24,720$24,926
Fair value22,97922,741
Foreign currency denominated debt included in long-term debt:
Carrying value2,6473,100
Fair value2,6293,059

Our estimate of the fair value of our total long-term debt is based on observable market information derived from a third-party pricing source and is classified in Level 2 of the fair value hierarchy.

Net Investment Hedging

We recognize changes in the carrying value of the foreign currency denominated debt due to changes in the Euro to U.S. dollar exchange rate in accumulated other comprehensive losses related to ABI. We recognized pre-tax (gains) losses of our net investment hedges of $403 million and $(98) million for the six months ended June 30, 2025 and 2024, respectively, and $264 million and $(23) million for the three months ended June 30, 2025 and 2024, respectively.

Table of Contents

In addition, as a result of the ABI Transaction, for the six months ended June 30, 2024, we reclassified $42 million of pre-tax gains from our designated net investment hedges included in accumulated other comprehensive losses to (income) losses from investments in equity securities in our condensed consolidated statement of earnings. For further discussion of the ABI Transaction and reclassification of accumulated other comprehensive losses, see Note 6. Investments in Equity Securities and Note 10. Other Comprehensive Earnings/Losses.

Contingent Payments

In 2023, we acquired NJOY Holdings, Inc. (“NJOY Transaction”). The total consideration for the NJOY Transaction included the fair value of up to $500 million in additional cash payments contingent on receipt of U.S. Food and Drug Administration (“FDA”) authorizations with respect to NJOY’s menthol ($250 million), blueberry ($125 million) and watermelon ($125 million) pod products.

The changes in the liability associated with contingent payments were as follows:

For the Six Months Ended June 30, 2025For the Year Ended December 31, 2024
(in millions)
Balance at January 1$20$130
Change in the fair value of contingent payments (1)25(2)140(3)
Payments—(250)(4)
Balance at end of period$45$20

(1) Pre-tax charges were recorded in marketing, administration and research costs in our condensed consolidated statements of earnings.

(2) Recorded in the first quarter of 2025 and relates to blueberry and watermelon pod products.

(3) Recorded in the second quarter of 2024 and relates to menthol pod products.

(4) Payments made during the third quarter of 2024 following FDA authorization of NJOY’s menthol products.

Contingent payments related to the NJOY Transaction were recognized at their estimated fair value as of the acquisition date. Subsequent changes to the fair value of the liability associated with contingent payments are recognized in earnings until the contingency is resolved. In determining the estimated fair value of contingent payments, we made certain judgments, estimates and assumptions, the most significant of which was the likelihood of certain potential regulatory outcomes. Contingent payments are classified in Level 3 of the fair value hierarchy.

Note 8. Benefit Plans

Components of Net Periodic Benefit Cost (Income)

Net periodic benefit cost (income) consisted of the following:

PensionPostretirementPensionPostretirement
For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)20252024202520242025202420252024
Service cost$18$21$6$8$9$12$3$4
Interest cost159161283280811416
Expected return on plan assets(215)(233)(2)(3)(108)(117)(1)(2)
Amortization:
Net loss (gain)2513(6)(2)126(3)(1)
Prior service cost (credit)23(20)(20)12(10)(10)
Net periodic benefit cost (income)$(11)$(35)$6$15$(6)$(16)$3$7

Employer Contributions

We make contributions to our pension plans to the extent that the contributions are tax deductible and pay benefits that relate to plans for salaried employees that cannot be funded under Internal Revenue Service regulations. We made employer contributions of $9 million to our pension plans and did not make any contributions to our postretirement plans during the six months ended June 30, 2025. Currently, we anticipate making additional employer contributions of up to approximately $20 million to our pension plans and contributions of up to approximately $30 million to our postretirement plans in 2025. However, the foregoing estimates of 2025 contributions to our pension and postretirement plans are subject to change as a result of changes in tax and other benefit laws, changes in interest rates and asset performance significantly above or below the assumed long-term rate of return for each respective plan.

Table of Contents

Note 9. Earnings per Share

We calculated basic and diluted earnings per share (“EPS”) using the following:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Net earnings$3,455$5,932$2,378$3,803
Less: Distributed and undistributed earnings attributable to share-based awards(10)(14)(7)(9)
Earnings for basic and diluted EPS$3,445$5,918$2,371$3,794
Weighted-average shares for basic and diluted EPS1,6871,7381,6841,718

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and, therefore, are included in our EPS calculation pursuant to the two-class method.

Note 10. Other Comprehensive Earnings/Losses

Changes in each component of accumulated other comprehensive losses, net of deferred income taxes, attributable to Altria were as follows:

For the Six Months Ended June 30, 2025
(in millions)Benefit PlansABICurrency Translation AdjustmentsAccumulated Other Comprehensive Losses
Balances, December 31, 2024$(1,392)$(1,018)$10$(2,400)
Other comprehensive earnings (losses) before reclassifications—(510)(20)(530)
Deferred income taxes—118—118
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes—(392)(20)(412)
Amounts reclassified to net earnings4(28)—(24)
Deferred income taxes(1)6—5
Amounts reclassified to net earnings, net of deferred income taxes3(22)—(19)
Other comprehensive earnings (losses), net of deferred income taxes3(414)(1)(20)(431)
Balances, June 30, 2025$(1,389)$(1,432)$(10)$(2,831)

Table of Contents

For the Three Months Ended June 30, 2025
(in millions)Benefit PlansABICurrency Translation AdjustmentsAccumulated Other Comprehensive Losses
Balances, March 31, 2025$(1,391)$(1,287)$(13)$(2,691)
Other comprehensive earnings (losses) before reclassifications—(179)3(176)
Deferred income taxes—45—45
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes—(134)3(131)
Amounts reclassified to net earnings2(14)—(12)
Deferred income taxes—3—3
Amounts reclassified to net earnings, net of deferred income taxes2(11)—(9)
Other comprehensive earnings (losses), net of deferred income taxes2(145)(1)3(140)
Balances, June 30, 2025$(1,389)$(1,432)$(10)$(2,831)
For the Six Months Ended June 30, 2024
(in millions)Benefit PlansABICurrency Translation AdjustmentsAccumulated Other Comprehensive Losses
Balances, December 31, 2023$(1,493)$(1,195)$15$(2,673)
Other comprehensive earnings (losses) before reclassifications—243(2)241
Deferred income taxes—(54)—(54)
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes—189(2)187
Amounts reclassified to net earnings(3)257—254
Deferred income taxes1(52)—(51)
Amounts reclassified to net earnings, net of deferred income taxes(2)205—203
Other comprehensive earnings (losses), net of deferred income taxes(2)394(1)(2)390
Balances, June 30, 2024$(1,495)$(801)$13$(2,283)

Table of Contents

For the Three Months Ended June 30, 2024
(in millions)Benefit PlansABICurrency Translation AdjustmentsAccumulated Other Comprehensive Losses
Balances, March 31, 2024$(1,494)$(793)$21$(2,266)
Other comprehensive earnings (losses) before reclassifications—(11)(8)(19)
Deferred income taxes—1—1
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes—(10)(8)(18)
Amounts reclassified to net earnings(1)2—1
Deferred income taxes————
Amounts reclassified to net earnings, net of deferred income taxes(1)2—1
Other comprehensive earnings (losses), net of deferred income taxes(1)(8)(1)(8)(17)
Balances, June 30, 2024$(1,495)$(801)$13$(2,283)

(1) Primarily reflects our share of ABI’s currency translation adjustments and the impact of our designated net investment hedges related to our investment in ABI. For further discussion of designated net investment hedges, see Note 7. Financial Instruments.

Pre-tax amounts by component, reclassified from accumulated other comprehensive losses to net earnings were as follows:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Benefit Plans: (1)
Net loss$22$14$11$7
Prior service credit(18)(17)(9)(8)
4(3)2(1)
ABI (2)(28)257(14)2
Pre-tax amounts reclassified from accumulated other comprehensive losses to net earnings$(24)$254$(12)$1

(1) Amounts are included in net periodic benefit income, excluding service cost. For further details, see Note 8. Benefit Plans.

(2) Amounts are included in (income) losses from investments in equity securities. For the six months ended June 30, 2024, as a result of the ABI Transaction, we reclassified $243 million from our accumulated other comprehensive losses of which $285 million is directly attributable to ABI, partially offset by $42 million from our designated net investment hedges related to our investment in ABI. For further information, see Note 6. Investments in Equity Securities and Note 7. Financial Instruments.

Note 11. Segment Reporting

At June 30, 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.

Table of Contents

Segment data were as follows:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Net revenues:
Smokeable products$9,979$10,401$5,357$5,495
Oral tobacco products1,4071,362753711
All other(25)22(8)3
Net revenues$11,361$11,785$6,102$6,209
Earnings before income taxes:
OCI:
Smokeable products$5,399$5,246$2,930$2,807
Oral tobacco products93153249897
All other(1,122)(172)(108)(111)
Amortization of intangibles(74)(64)(37)(37)
General corporate expenses(116)(335)(53)(223)
Operating income5,0185,2073,2302,533
Interest and other debt expense, net537515275261
Net periodic benefit income, excluding service cost(29)(49)(15)(25)
(Income) losses from investments in equity securities(291)(414)(148)(119)
Gain on the sale of IQOS System commercialization rights—(2,700)—(2,700)
Earnings before income taxes$4,801$7,855$3,118$5,116

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

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Net revenues$9,979$10,401$5,357$5,495
Settlement charges (1)(1,486)(1,779)(799)(924)
Excise taxes on products sold(1,502)(1,742)(787)(908)
Other segment items (2)(1,592)(1,634)(841)(856)
Operating companies income$5,399$5,246$2,930$2,807

(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 and FDA user fees.

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, asset impairment, marketing, administration and research costs and excise taxes on products sold. Total oral tobacco products other segment items were $476 million and $830 million for the six months ended June 30, 2025 and 2024, respectively, and $255 million and $614 million for the three months ended June 30, 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.

Table of Contents

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

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Depreciation expense:
Smokeable products$29$36$14$17
Oral tobacco products21211112
General corporate and other181898
Total depreciation expense$68$75$34$37
Capital expenditures:
Smokeable products$30$27$12$9
Oral tobacco products221697
General corporate and other18211113
Total capital expenditures$70$64$32$29

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

**▪**Asset Impairment, Exit and Implementation Costs: We recorded exit and implementation costs of $30 million and $15 million related to the Initiative for the six and three months ended June 30, 2025, respectively. For a breakdown of these costs by segment, see Note 5. Exit and Implementation Costs. We recorded a non-cash, pre-tax impairment of the Skoal trademark of $354 million for the six and three months ended June 30, 2024 in our oral tobacco products segment. For further discussion, see Note 4. Goodwill and Other Intangible Assets, net.

**▪**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 Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Smokeable products segment$40$38$4$20
General corporate expenses130124
Interest and other debt expense, net4———
Total$45$68$5$44

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.

Note 12. Debt

Short-term Borrowings and Borrowing Arrangements

At June 30, 2025 and December 31, 2024, we had no short-term borrowings.

At June 30, 2025, we had availability under our senior unsecured 5-year revolving credit agreement (“Credit Agreement”) for borrowings of up to an aggregate principal amount of $3.0 billion. We intend to use any borrowings under our Credit Agreement for general corporate purposes. In July 2025, we entered into an extension agreement (“Extension”) to extend the expiration of the Credit Agreement from October 24, 2028 to October 24, 2029. All other terms and conditions remain in full force and effect. The Credit Agreement, after entering into the Extension, includes an option, subject to certain conditions, for us to extend the term for an additional one-year period.

Pricing for interest and fees under our Credit Agreement may be modified in the event of a change in the rating of our long-term senior unsecured debt. We expect interest rates on borrowings under our Credit Agreement to be based on the Term Secured Overnight Financing Rate plus a percentage based on the higher of the ratings of our long-term senior unsecured debt from Moody’s Investors Service, Inc. (“Moody’s”) and Standard & Poor’s Financial Services LLC (“S&P”). The applicable percentage for borrowings under our Credit Agreement at June 30, 2025 was 1.0% based on our long-term senior unsecured debt ratings on that date. Our Credit Agreement does not include any other rating triggers or any provisions that could require the posting of collateral.

Our Credit Agreement includes various covenants, one of which requires us to maintain a ratio of Consolidated EBITDA (earnings before interest, taxes, depreciation and amortization) to Consolidated Interest Expense of not less than 4.0 to 1.0, calculated for the four most recent fiscal quarters. At June 30, 2025, we were in compliance with our covenants in our Credit

Table of Contents

Agreement. The terms “Consolidated EBITDA” and “Consolidated Interest Expense,” each as defined in our Credit Agreement, include certain adjustments.

PM USA guarantees any borrowings under our Credit Agreement and any amounts outstanding under our commercial paper program.

Long-term Debt

The aggregate carrying value of our total long-term debt at June 30, 2025 and December 31, 2024 was $24.7 billion and $24.9 billion, respectively.

In May 2025 and June 2025, we repaid in full at maturity our 2.350% and 1.700% senior unsecured notes in the aggregate principal amounts of $750 million and $857 million (€750 million), respectively.

In the first quarter of 2025, we issued U.S. dollar denominated senior unsecured notes in the aggregate principal amount of $1.0 billion. The net proceeds from the notes were used for general corporate purposes, which included repayment of certain of our notes in the second quarter of 2025 as discussed above. The notes contain the following terms:

▪$0.5 billion at 4.875%, due 2028, interest payable semiannually beginning August 4, 2025; and

▪$0.5 billion at 5.625%, due 2035, interest payable semiannually beginning August 6, 2025.

Similar to our other notes, these notes are senior unsecured obligations and rank equally in right of payment with all of our existing and future senior unsecured indebtedness. Following the occurrence of both (i) a change of control of Altria and (ii) the notes ceasing to be rated investment grade by each of Moody’s, S&P and Fitch Ratings Inc., we will be required to make an offer to purchase the notes at a price equal to 101% of the aggregate principal amount of such notes, plus accrued and unpaid interest to the date of repurchase as and to the extent set forth in the terms of the notes.

At June 30, 2025 and December 31, 2024, accrued interest on long-term debt of $369 million and $389 million, respectively, was included in other accrued liabilities on our condensed consolidated balance sheets.

For a discussion of the fair value of our long-term debt and the designation of our Euro denominated senior unsecured notes as a net investment hedge of our investment in ABI, see Note 7. Financial Instruments.

Note 13. Income Taxes

Earnings before income taxes, provision for income taxes and income tax rates consisted of the following:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Earnings before income taxes$4,801$7,855$3,118$5,116
Provision for income taxes1,3461,9237401,313
Income tax rate28.0%24.5%23.7%25.7%

Our income tax rate for the six months ended June 30, 2025 differed from the U.S. federal statutory rate of 21%, due primarily to the non-deductible impairment of the e-vapor reporting unit goodwill and state tax expense. Our income tax rate for the three months ended June 30, 2025 differed from the U.S. federal statutory rate of 21%, due primarily to state tax expense. For further discussion of the impairment charge, see Note 4. Goodwill and Other Intangible Assets, net.

Our income tax rate for the six months ended June 30, 2024 differed from the U.S. federal statutory rate of 21%, due primarily to state tax expense and the change in the fair value of the contingent payments related to the NJOY Transaction, which is treated as an outside basis difference that we do not expect to reverse in the foreseeable future, partially offset by an income tax benefit from the partial release of a valuation allowance recorded against a deferred tax asset associated with our losses related to our former investment in JUUL Labs, Inc. (“JUUL”). The valuation allowance release was due to our capital gain on the ABI Transaction. Our income tax rate for the three months ended June 30, 2024 differed from the U.S. federal statutory rate of 21%, due primarily to state tax expense and the change in the fair value of the contingent payments related to the NJOY Transaction, which is treated as an outside basis difference that we do not expect to reverse in the foreseeable future. For further discussion of the ABI Transaction and contingent payments related to the NJOY Transaction, see Note 6. Investments in Equity Securities and Note 7. Financial Instruments, respectively.

The One Big Beautiful Bill Act (“OBBB”) was signed into law on July 4, 2025. The OBBB includes various tax law changes, including the restoration of favorable tax treatment for certain business-related provisions and modifications to the international tax law framework. The OBBB has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We do not expect these provisions and modifications to have a material impact on our consolidated financial statements.

Table of Contents

Note 14. Contingencies

Legal proceedings covering a wide range of matters are pending or threatened in various United States and foreign jurisdictions against Altria and certain of our subsidiaries, including PM USA and NJOY, as well as our indemnitees. Various types of claims may be raised in these proceedings, including product liability, unfair trade practices, antitrust, income tax liability, contraband shipments, patent infringement, employment matters, environmental matters, claims alleging violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), claims for contribution and claims of competitors, shareholders or distributors. Legislative action, such as changes to tort law, also may expand the types of claims and remedies available to plaintiffs.

Litigation is subject to uncertainty, and it is possible that there could be adverse developments in pending or future cases. An unfavorable outcome or settlement of pending tobacco-related or other litigation could encourage the commencement of additional litigation. Damages claimed in some tobacco-related and other litigation are or can be significant and, in certain cases, have ranged in the billions of dollars. The variability in pleadings in multiple jurisdictions, together with the actual experience of management in litigating claims, demonstrates that the monetary relief that may be specified in a lawsuit bears little relevance to the ultimate outcome. In certain cases, plaintiffs claim that defendants’ liability is joint and several. In such cases, we may face the risk that one or more co-defendants decline or otherwise fail to participate in the bonding required for an appeal or to pay their proportionate or jury-allocated share of a judgment. As a result, under certain circumstances, we may have to pay more than our proportionate share of any bonding- or judgment-related amounts. Furthermore, in those cases where plaintiffs are successful, we also may be required to pay interest and attorneys’ fees.

Although PM USA historically has been able to obtain required bonds or relief from bonding requirements in order to prevent plaintiffs from seeking to collect judgments while adverse verdicts have been appealed, there remains a risk that such relief may not be obtainable in all cases. This risk has been substantially reduced given that 47 states and Puerto Rico limit the dollar amount of bonds or require no bond at all. However, tobacco litigation plaintiffs have challenged the constitutionality of Florida’s bond cap statute in several cases, and plaintiffs may challenge state bond cap statutes in other jurisdictions as well. Such challenges may include the applicability of state bond caps in federal court. States, including Florida, also may seek to repeal or alter bond cap statutes through legislation. Although we cannot predict the outcome of such challenges, it is possible that our consolidated results of operations, cash flows or financial position could be materially affected in a particular fiscal quarter or fiscal year by an unfavorable outcome of one or more such challenges.

We record provisions in our condensed consolidated financial statements for pending litigation when we determine that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. At the present time, while it is reasonably possible that an unfavorable outcome in a case may occur, except to the extent discussed elsewhere in this Note 14. Contingencies: (i) management has concluded that it is not probable that a loss has been incurred in any of the pending cases; (ii) management is unable to estimate the possible loss or range of loss that could result from an unfavorable outcome in any of the pending cases; and (iii) accordingly, management has not provided any amounts in our condensed consolidated financial statements for unfavorable outcomes, if any. Litigation defense costs are expensed as incurred.

We have achieved substantial success in managing litigation. Nevertheless, litigation is subject to uncertainty and significant challenges remain. It is possible that our consolidated results of operations, cash flows or financial position could be materially affected in a particular fiscal quarter or fiscal year by an unfavorable outcome or settlement of certain pending litigation. We believe, and have been so advised by counsel handling the respective cases, that we have valid defenses to the litigation pending against us, as well as valid bases for appeal of adverse verdicts. We have defended, and will continue to defend, vigorously against litigation challenges. However, we may enter into settlement discussions in particular cases if we believe it is in our best interests to do so.

Table of Contents

Judgments Paid and Provisions for Tobacco and Health (Including Engle Progeny Litigation) and Certain Other Litigation Items: The changes in our accrued liability for tobacco and health and certain other litigation items, including related interest costs, for the periods specified below are as follows:

For the Six Months Ended June 30,For the Three Months Ended June 30,
(in millions)2025202420252024
Accrued liability for tobacco and health and certain other litigation items at beginning of period$96$346$118$364
Pre-tax charges for:
Tobacco and health and certain other litigation (1)4038420
Shareholder derivative lawsuits (2)————
JUUL-related settlements (3)130124
Related interest costs4———
Payments(46)(263)(28)(257)
Accrued liability for tobacco and health and certain other litigation items at end of period$95$151$95$151

(1) Includes judgments, settlements and fee disputes associated with tobacco and health and certain other litigation.

(2) See Federal and State Shareholder Derivative Lawsuits below for a discussion of the settlement of the federal and state shareholder derivative lawsuits.

(3) Includes the settlement of certain e-vapor product litigation relating to JUUL e-vapor products. See E-vapor Product Litigation below for a discussion of these settlements.

The accrued liability for tobacco and health and certain other litigation items, including related interest costs, was included in accrued liabilities and other liabilities on our condensed consolidated balance sheets. Pre-tax charges except for related interest costs were included in marketing, administration and research costs in our condensed consolidated statements of earnings. Pre-tax charges for related interest costs were included in interest and other debt expense, net in our condensed consolidated statements of earnings.

Since October 2004, PM USA has paid judgments and settlements (including related costs and fees) totaling approximately $1.1 billion and interest totaling approximately $246 million as of June 30, 2025. These amounts include payments for Engle progeny judgments (and related costs and fees) totaling approximately $452 million and related interest totaling approximately $62 million.

Security for Judgments: To obtain stays of judgments pending appeal, PM USA has posted various forms of security. As of June 30, 2025, PM USA has posted appeal bonds totaling approximately $24 million, which have been collateralized with restricted cash and are included in assets on our condensed consolidated balance sheets.

Overview of Tobacco-Related Litigation

Types and Number of U.S. Cases: Claims related to tobacco products generally fall within the following categories: (i) smoking and health cases alleging personal injury brought on behalf of individual plaintiffs; (ii) health care cost recovery cases brought by governmental (both domestic and foreign) plaintiffs seeking reimbursement for health care expenditures allegedly caused by cigarette smoking and/or disgorgement of profits; (iii) e-vapor cases alleging violation of RICO, fraud, failure to warn, design defect, negligence, antitrust, patent infringement and unfair trade practices; and (iv) other tobacco-related litigation described below. Plaintiffs’ theories of recovery and the defenses raised in tobacco-related litigation are discussed below.

Table of Contents

The table below lists the number of certain tobacco-related cases pending in the United States against us as of:

July 28, 2025July 29, 2024July 27, 2023
Individual Smoking and Health Cases (1)195177171
Health Care Cost Recovery Actions (2)111
E-vapor Cases(3)24815,326
Other Tobacco-Related Cases (4)333

(1) Includes as of July 28, 2025, 30 cases filed in Illinois, 16 cases filed in New Mexico, 90 cases filed in Massachusetts, 14 cases filed in Oregon, six cases filed in Hawaii and 15 non-Engle cases filed in Florida. Does not include individual smoking and health cases brought by or on behalf of plaintiffs in Florida state and federal courts following the decertification of the Engle class (these Engle progeny cases are discussed below in Smoking and Health Litigation - Engle Progeny Cases). Also does not include three Broin cases pending as of July 28, 2025. For further discussion of the Broin cases, see Other Smoking and Health Class Actions below.

(2) See Health Care Cost Recovery Litigation - Federal Government’s Lawsuit below.

(3) In May 2023, we reached agreement on terms to resolve the majority of the Multidistrict Litigation lawsuits, and, in March 2024, the court granted final approval of the settlement. Pending final dismissal of these cases, as of July 28, 2025, the remaining cases include 20 individual cases that opted out of the settlement, three class action lawsuits pending in Canada and one individual state court case relating to the Multidistrict Litigation. For further discussion of the Multidistrict Litigation settlement, see E-vapor Product Litigation below.

(4) Includes as of July28, 2025, one inactive smoking and health case alleging personal injury and purporting to be brought on behalf of a class of individual plaintiffs and two inactive class action lawsuits alleging that use of the terms “Lights” and “Ultra Lights” constitute deceptive and unfair trade practices, common law or statutory fraud, unjust enrichment, breach of warranty or violations of RICO.

International Tobacco-Related Cases: As of July 28, 2025, (i) Altria is named as a defendant in three e-vapor class action lawsuits in Canada; (ii) PM USA is a named defendant in 10 health care cost recovery actions in Canada, eight of which also name Altria as a defendant; and (iii) PM USA and Altria are named as defendants in seven smoking and health class actions filed in various Canadian provinces. See Guarantees and Other Similar Matters below for a discussion of the Distribution Agreement (defined below) between Altria and PMI that provides for indemnities for certain liabilities concerning tobacco products.

Tobacco-Related Cases Set for Trial: As of July 28, 2025, one Engle progeny case, one individual smoking and health case and no e-vapor cases are set for trial through September 30, 2025. Trial dates are subject to change.

Trial Results: Since January 1999, excluding the Engle progeny cases (separately discussed below), verdicts have been returned in 85 tobacco-related cases in which PM USA was a defendant. Verdicts in favor of PM USA and other defendants were returned in 53 of the 85 cases. Of the 32 non-Engle progeny cases in which verdicts were returned in favor of plaintiffs, 28 have reached final resolution.

See Smoking and Health Liti**gation - Engle Progeny Trial Results below for a discussion of verdicts in state and federal Engle progeny cases involving PM USA as of July 28, 2025.

Smoking and Health Litigation

Overview: Plaintiffs’ allegations of liability in smoking and health cases are based on various theories of recovery, including negligence, gross negligence, strict liability, fraud, misrepresentation, design defect, failure to warn, nuisance, breach of express and implied warranties, breach of special duty, conspiracy, concert of action, violations of unfair trade practice laws and consumer protection statutes and claims under the federal and state anti-racketeering statutes. Plaintiffs in the smoking and health cases seek various forms of relief, including compensatory and punitive damages, treble/multiple damages and other statutory damages and penalties, creation of medical monitoring and smoking cessation funds, disgorgement of profits, and injunctive and equitable relief. Defenses raised in these cases include lack of proximate cause, assumption of the risk, comparative fault and/or contributory negligence, statutes of limitations and preemption by the Federal Cigarette Labeling and Advertising Act.

**Non-**Engle Progeny Litigation: Summarized below are the non-Engle progeny smoking and health cases pending in which verdicts were returned in favor of plaintiff and against PM USA and remain outstanding or cases concluded within the last 12 months where PM USA paid a final judgment. Charts listing certain verdicts for plaintiffs in the Engle progeny cases can be found in Smoking and Health Litigation - Engle Progeny Trial Results below.

Amaral: In March 2025, a jury in a Massachusetts state court returned a verdict in favor of plaintiff and against PM USA and R.J. Reynolds Tobacco Company (“R.J. Reynolds”), awarding an aggregate of $4 million in compensatory damages against PM USA and R.J. Reynolds and $25 million in punitive damages against PM USA. PM USA has filed post-trial motions challenging the verdict and, if necessary, will appeal.

Taylor: In April 2024, a jury in an Oregon state court returned a verdict in favor of plaintiff and against PM USA, awarding less than $1 million in compensatory damages. The jury found that plaintiff was not entitled to punitive damages. Plaintiff has

Table of Contents

appealed the judgment, and the appeal remains pending. PM USA filed post-trial motions, which were denied, and PM USA has noticed an appeal from the final judgment and the trial court’s denial of the post-trial motions. The parties filed a motion to stay execution pending appeal, and the court has stayed execution of the final judgment pending conclusion of appellate activity.

Ricapor-Hall: In August 2023, a jury in a Hawaii state court returned a verdict in favor of plaintiff and against PM USA, awarding $6 million in compensatory damages and $8 million in punitive damages. In October 2023, the court entered judgment against PM USA for $11 million, having reduced the compensatory damages award to $3 million based on the jury’s finding on comparative fault and a set-off against plaintiff’s settlements with other defendants. PM USA filed post-trial motions challenging the verdict, which were denied in March 2024. In April 2024, PM USA filed a notice of appeal and a motion to stay execution pending appeal, and the court has stayed execution of the final judgment pending resolution of PM USA’s appeal rights. PM USA’s appeal remains pending, and plaintiff has noticed a cross-appeal. In April 2025, the Hawaii Supreme Court granted plaintiff’s application to transfer the appeal to that Court from the Intermediate Court of Appeals.

Woodley: In February 2023, a jury in a Massachusetts state court returned a verdict in favor of plaintiff and against PM USA, awarding $5 million in compensatory damages. There was no claim for punitive damages. Following the denial of PM USA’s post-trial motions, PM USA appealed the judgment to the Appeals Court of Massachusetts, which affirmed the judgment in January 2025. Accordingly, we recorded a pre-tax charge of $5 million and paid the recorded amount in the first quarter of 2025.

Fontaine: In September 2022, a jury in a Massachusetts state court returned a verdict in favor of plaintiff and against PM USA, awarding approximately $8 million in compensatory damages and $1 billion in punitive damages. In September 2023, the court denied PM USA’s motion for a new trial and partially granted PM USA’s motion for remittitur, reducing the punitive damages award to $56 million. In December 2023, the court entered a final judgment awarding plaintiff $8 million in compensatory damages, $56 million in punitive damages and prejudgment interest. PM USA has noticed an appeal to the Appeals Court of Massachusetts. In May 2025, the Massachusetts Supreme Judicial Court took jurisdiction over the appeal, and the appeal remains pending.

Federal Government’s Lawsuit: See Health Care Cost Recovery Litigation - Federal Government’s Lawsuit below for a discussion of the verdict and post-trial developments in the United States of America health care cost recovery case.

Engle Progeny Cases: Engle progeny cases are individual smoking and health lawsuits filed by Florida resident plaintiffs against one or more cigarette manufacturer defendants. The lawsuits arose following the Florida Supreme Court’s decertification of the class in Engle, et. al. v. R.J. Reynolds Tobacco Co., et. al., a smoking and health class action lawsuit filed in Florida state court against multiple defendants, including PM USA, in which the jury returned a verdict in favor of the plaintiff class and the trial court assessed punitive damages against the defendants. In July 2006, the Florida Supreme Court mandated that the trial court’s punitive damages award be vacated, that the class approved by the trial court be decertified and that members of the decertified class could file individual actions against defendants within one year of issuance of the mandate. Plaintiffs in Engle progeny lawsuits are entitled to rely on certain liability findings from the class action lawsuit, substantially reducing each plaintiff’s burden of proof. These liability findings stipulate: (i) that smoking causes various diseases; (ii) that nicotine in cigarettes is addictive; (iii) that defendants’ cigarettes were defective and unreasonably dangerous; (iv) that defendants concealed or omitted material information not otherwise known or available knowing that the material was false or misleading or failed to disclose a material fact concerning the health effects or addictive nature of smoking; (v) that defendants agreed to conceal or omit information regarding the health effects of cigarettes or their addictive nature with the intention that smokers would rely on the information to their detriment; (vi) that defendants sold or supplied cigarettes that were defective; and (vii) that defendants were negligent.

Pending Engl****e Progeny Cases: The deadline for filing Engle progeny cases expired in January 2008, at which point a total of approximately 9,300 federal and state claims were pending. As of July 28, 2025, approximately 81 state court cases were pending against PM USA or Altria asserting individual claims by or on behalf of approximately 97 state court plaintiffs. Because of a number of factors, including docketing delays, duplicated filings and overlapping dismissal orders, these numbers are estimates. Each federal Engle progeny case has been resolved.

Engle Progeny Trial Results: As of July 28, 2025, 147 federal and state Engle progeny cases involving PM USA have resulted in verdicts. Eighty-eight were returned in favor of plaintiffs, four of which have been reversed post-trial or on appeal and remain pending. Fifty-nine verdicts were returned in favor of PM USA, one of which have been reversed post-trial or on appeal and remain pending. In addition, there have been a number of mistrials, only some of which have resulted in new trials as of July 28, 2025.

Post-trial activity in a case can result in a final resolution that differs from the initial verdict. In many cases, parties have appealed either compensatory or punitive damages awards or both. Courts also have increased and decreased the amounts of compensatory damages juries have awarded, decreased the amounts of punitive damages juries have awarded, declared mistrials and vacated judgments, in whole or in part, with respect to compensatory and punitive damages awards. Initial verdicts have

Table of Contents

been reversed in whole or in part on appeal or following retrial. Juries have returned verdicts in favor of or against PM USA awarding no damages. In cases where juries returned verdicts against PM USA awarding no damages, some trial courts have decided to award plaintiff damages notwithstanding the verdict. Cases also have been dismissed with or without prejudice before or after a verdict.

The charts below list the verdicts in and post-trial status of certain Engle progeny cases in which verdicts were returned in favor of plaintiffs. The first chart lists cases that are pending as of July 28, 2025 where PM USA has determined an unfavorable outcome is not probable and the amount of loss cannot be reasonably estimated, and the second chart lists cases that have concluded in the past 12 months. Unless otherwise noted for a particular case, the jury’s award for compensatory damages will not be reduced by any finding of plaintiff’s comparative fault. Further, the damages noted reflect adjustments based on post-trial or appellate rulings.

Currently Pending Engle Cases with Verdicts against PM USA

(rounded to nearest $ million)

PlaintiffVerdict DateDefendant(s)CourtCompensatory Damages**(1)**Punitive Damages (PM USA)Post-Trial Status
GarciaJune 2024PM USAMiami-Dade$2 million$10 millionAppeals to the Third District Court of Appeal pending.
ChaconOctober 2023PM USAMiami-Dade<$1 million<$1 millionAppeals to the Third District Court of Appeal pending.
LippSeptember 2021PM USAMiami-Dade$15 million$28 millionThird District Court of Appeal reversed and remanded for a new trial. Plaintiff’s motion for rehearing pending.
McCallMarch 2019PM USABroward<$1 million (<$1 million PM USA)<$1 millionAppeal to the Fourth District Court of Appeal pending.

(1) PM USA’s portion of the compensatory damages award is noted parenthetically where the court has ruled that comparative fault applies.

Engle Cases Concluded within Past 12 Months

(rounded to nearest $ million)

PlaintiffVerdict DateDefendant(s)CourtPayment Amount for Damages (if any)
ChadwellSeptember 2018PM USAMiami-Dade$2 million
SchertzerApril 2022PM USA and R.J. ReynoldsMiami-Dade$4 million

Other Smoking and Health Class Actions: Since the dismissal in May 1996 of a purported nationwide class action brought on behalf of allegedly addicted smokers, plaintiffs have filed numerous putative smoking and health class action suits in various state and federal courts. In general, these cases have purported to be brought on behalf of residents of a particular state or states (although a few cases have purported to be nationwide in scope) and have raised addiction claims and, in many cases, claims of physical injury as well.

Class certification has been denied or reversed by courts in 61 smoking and health class actions involving PM USA in Arkansas (1), California (1), Delaware (1), the District of Columbia (2), Florida (2), Illinois (3), Iowa (1), Kansas (1), Louisiana (1), Maryland (1), Michigan (1), Minnesota (1), Nevada (29), New Jersey (6), New York (2), Ohio (1), Oklahoma (1), Oregon (1), Pennsylvania (1), Puerto Rico (1), South Carolina (1), Texas (1) and Wisconsin (1). See Certain Other Tobacco-Related Litigation below for a discussion of “Lights” and “Ultra Lights” class action cases and medical monitoring class action cases pending against PM USA.

As of July 28, 2025, PM USA and Altria are named as defendants, along with other cigarette manufacturers, in seven class actions filed in the Canadian provinces of Alberta, Manitoba, Nova Scotia, Saskatchewan, British Columbia and Ontario. In Saskatchewan, British Columbia (two separate cases) and Ontario, plaintiffs seek class certification on behalf of individuals who suffer or have suffered from various diseases, including chronic obstructive pulmonary disease, emphysema, heart disease or cancer, after smoking defendants’ cigarettes. In the actions filed in Alberta, Manitoba and Nova Scotia, plaintiffs seek certification of classes of all individuals who smoked defendants’ cigarettes. In March 2019, all of these class actions were stayed as a result of three Canadian tobacco manufacturers (none of which is related to us) seeking protection under Canada’s Companies’ Creditors Arrangement Act (which is similar to Chapter 11 bankruptcy in the United States). The companies entered into these proceedings following a Canadian appellate court upholding two smoking and health class action verdicts against those companies totaling approximately CAD $13 billion. See Guarantees and Other Similar Matters below for a discussion of the Distribution Agreement between Altria and PMI, which provides for indemnities for certain liabilities concerning tobacco products.

Table of Contents

As of July 28, 2025, PM USA is named as a defendant in three cases brought by flight attendants against United States cigarette manufacturers seeking compensatory damages for personal injuries allegedly caused by exposure to environmental tobacco smoke (“ETS”). The flight attendants allege that they are members of an ETS smoking and health class action in Florida that was settled in 1997 (Broin). The terms of the court-approved settlement in that case allowed class members to file individual lawsuits seeking compensatory damages but prohibited them from seeking punitive damages. Class members were prohibited from filing individual lawsuits after 2000 under the court-approved settlement. In July 2024, we reached agreement on terms to resolve approximately 627 individual Broin lawsuits. Accordingly, in the second quarter of 2024, we recorded a pre-tax provision of $4 million related to the settlement of these cases, which we paid in the third quarter of 2024.

Health Care Cost Recovery Litigation

Overview: In the health care cost recovery litigation, governmental entities seek reimbursement of health care cost expenditures allegedly caused by tobacco products and, in some cases, of future expenditures and damages. Relief sought by some but not all plaintiffs includes punitive damages, multiple damages and other statutory damages and penalties, injunctions prohibiting alleged marketing and sales to minors, disclosure of research, disgorgement of profits, funding of anti-smoking programs, additional disclosure of nicotine yields, and payment of attorney and expert witness fees.

Although there have been some decisions to the contrary, most judicial decisions in the United States have dismissed all or most health care cost recovery claims against cigarette manufacturers. Nine federal circuit courts of appeals and eight state appellate courts, relying primarily on grounds that plaintiffs’ claims were too remote, have ordered or affirmed dismissals of health care cost recovery actions. The U.S. Supreme Court has refused to consider plaintiffs’ appeals from the cases decided by five federal circuit courts of appeal.

In addition to the cases brought in the United States, health care cost recovery actions have been brought against tobacco industry participants, including PM USA and Altria, in Canada (10 cases), and other entities have stated that they are considering filing such actions.

Since the beginning of 2008, the Canadian Provinces of British Columbia, New Brunswick, Ontario, Newfoundland and Labrador, Quebec, Alberta, Manitoba, Saskatchewan, Prince Edward Island and Nova Scotia have brought health care reimbursement claims against cigarette manufacturers. PM USA is named as a defendant in the British Columbia and Quebec cases, while both Altria and PM USA are named as defendants in the New Brunswick, Ontario, Newfoundland and Labrador, Alberta, Manitoba, Saskatchewan, Prince Edward Island and Nova Scotia cases. The Nunavut Territory and Northwest Territory have passed legislation permitting similar claims, but lawsuits based on this legislation have not been filed. All of these cases have been stayed pending resolution of proceedings in Canada involving three tobacco manufacturers (none of which are affiliated with us) under the Companies’ Creditors Arrangement Act discussed above. See Smoking and Health Litigation - Other Smoking and Health Class Actions above for a discussion of these proceedings. See Guarantees and Other Similar Matters below for a discussion of the Distribution Agreement between Altria and PMI that provides for indemnities for certain liabilities concerning tobacco products.

Settlements of Health Care Cost Recovery Litigation: In November 1998, PM USA and certain other tobacco product manufacturers entered into the Master Settlement Agreement (the “MSA”) with 46 states, the District of Columbia and certain United States territories to settle asserted and unasserted health care cost recovery and other claims. PM USA and certain other tobacco product manufacturers had previously entered into agreements to settle similar claims brought by Mississippi, Florida, Texas and Minnesota (together with the MSA, the “State Settlement Agreements”). The State Settlement Agreements require that the original participating manufacturers or “OPMs” (now PM USA, R.J. Reynolds and, with respect to certain brands, ITG Brands, LLC (“ITG”)) make annual payments of approximately $10.4 billion, subject to adjustments for several factors, including inflation, market share and industry volume. The OPMs’ obligation to make quarterly payments settling plaintiffs’ attorneys’ fees, subject to an annual cap of $500 million, on a pro rata basis based on market share, ended in the fourth quarter of 2024. For the six months ended June 30, 2025 and 2024, the aggregate amount recorded in cost of sales with respect to the State Settlement Agreements was approximately $1.5 billion and $1.8 billion, respectively. These amounts include PM USA’s estimate of amounts related to NPM Adjustments discussed below.

Non-Participating Manufacturer (“NPM”) Adjustment Disputes: The “NPM Adjustment” is a reduction in MSA payments made by the OPMs and those manufacturers that are subsequent signatories to the MSA (collectively, the “participating manufacturers” or “PMs”) that applies if the PMs collectively lose at least a specified level of market share to non-participating manufacturers since 1997, subject to certain conditions and defenses. The applicability of this reduction has been subject to certain disputes, some of which have been resolved via settlement, as discussed below.

Settlements of NPM Adjustment Disputes.

▪Multi-State Settlement. As of December 2024, a total of 39 states and territories have joined the multi-state settlement. Pursuant to this settlement, PM USA has received $1.47 billion since 2014 and expects to receive annual credits applied against PM USA’s MSA payments through 2041.

Table of Contents

▪New York Settlement. In 2015, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with New York in perpetuity. PM USA has received $646 million pursuant to the New York settlement and expects to receive annual credits applied against the MSA payments due to New York going forward.

▪Montana Settlement. In 2020, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with Montana through 2030, resulting in a payment from PM USA to Montana for an immaterial amount.

▪Massachusetts Settlement. In 2024, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with Massachusetts through 2011. As a result of this settlement, PM USA will receive $28 million. Accordingly, PM USA recorded $28 million as a reduction in costs of sales in the third quarter of 2024.

Continuing NPM Adjustment Disputes with States That Have Not Settled.

▪2004 NPM Adjustment. The PMs and the nine states that had not settled the NPM Adjustment disputes for 2004 participated in a multi-state arbitration. Iowa subsequently joined the multistate settlement in August 2023. The arbitration panel found three of the remaining eight states that have not settled the NPM Adjustment disputes, Washington, Missouri and New Mexico, were not diligent in the enforcement of their escrow statutes in 2004, and PM USA received approximately $52 million on account of the 2004 NPM Adjustment as a credit against its April 2023 MSA payment. Washington, Missouri and New Mexico have challenged those determinations in their respective state courts, and several issues remain to be resolved by the state trial and appellate courts that may affect the final amount of the 2004 NPM adjustment PM USA and other PMs will receive.

▪2005-2007 NPM Adjustments. The PMs and the six states that have not settled the NPM Adjustment disputes are currently arbitrating NPM Adjustment disputes before a single arbitration panel. The arbitration encompasses three years, 2005 through 2007, for five of the six states, and one year, 2005, for one state. As of July 28, 2025, the arbitration panel had issued decisions for Maryland, Washington, Wisconsin and Ohio, finding Maryland, Wisconsin and Ohio diligent for all three years and Washington not diligent for all three years. Washington challenged that determination in Washington state court, and the challenge was denied by the trial court. Washington has appealed that denial, and the appeal remains pending. PM USA recorded $35 million in the fourth quarter of 2023 for its estimate of the minimum amount of the 2005 through 2007 NPM Adjustment it will receive.

▪Subsequent Years. No assurance can be given as to when proceedings for 2008 and subsequent years will be scheduled or the precise form those proceedings will take.

Other Disputes under the State Settlement Agreements: The payment obligations of the tobacco product manufacturers that are parties to the State Settlement Agreements, as well as the allocations of any NPM Adjustments and related settlements, have been and may continue to be affected by R.J. Reynolds’s acquisition of Lorillard Tobacco Company in 2015 and its related sale of certain cigarette brands to ITG (the “ITG transferred brands”). PM USA continues to dispute how the ITG transferred brands are treated in allocating the NPM Adjustments and profit adjustments under the State Settlement Agreements.

In December 2019, the State of Mississippi filed a motion in Mississippi state court seeking to enforce the Mississippi State Settlement Agreement against PM USA, R.J. Reynolds and ITG concerning the tax rates used in the annual calculation of the net operating profit adjustment payments starting in 2018. The Mississippi state court held a hearing in October 2021 and issued a decision in June 2022 granting the State’s motion. PM USA appealed the court’s decision in June 2024. In September 2024, PM USA and Mississippi settled their dispute over the profit adjustment payments. Pursuant to the settlement, PM USA paid $7 million to Mississippi for 2018 through 2023. Accordingly, PM USA recorded $5 million of expense to cost of sales and $2 million of interest expense in the third quarter of 2024.

In May 2023, PM USA and R.J. Reynolds filed a motion in the U.S. District Court for the Eastern District of Texas seeking to enforce the Texas State Settlement Agreement against the State of Texas concerning the same tax rate issue raised by the State of Mississippi. The State of Texas filed a cross-motion to enforce, and the court found in favor of the State of Texas. In March 2025, the court issued a final order in the matter, finding that PM USA owes $31 million to the State of Texas, plus pre- and post-judgment interest. PM USA has appealed, and the appeal remains pending.

In July 2024, the State of Minnesota filed a motion in Minnesota state court seeking to enforce the Minnesota State Settlement Agreement against PM USA, R.J. Reynolds and ITG concerning the same state tax issues raised by Mississippi and Texas. The court found in favor of the State of Minnesota. As of July 28, 2025, the court had not made a determination on damages. PM USA intends to appeal.

Federal Government’s Lawsuit: In 1999, the U.S. government filed a lawsuit in the U.S. District Court for the District of Columbia against various cigarette manufacturers, including PM USA, and others, including Altria, asserting claims under three federal statutes. The case ultimately proceeded only under the civil provisions of RICO. In August 2006, the district court held

Table of Contents

that certain defendants, including Altria and PM USA, violated RICO and engaged in certain “sub-schemes” to defraud that the government had alleged.

The court did not impose monetary penalties on defendants, but ordered various types of non-monetary relief, including an injunction against conveying any express or implied health message or health descriptors on cigarette packaging or in cigarette advertising or promotional material, including “lights,” “ultra lights” and “low tar,” which the court found could cause consumers to believe one cigarette brand is less hazardous than another brand, and the issuance of “corrective statements” in various media regarding the adverse health effects of smoking, the addictiveness of smoking and nicotine, the lack of any significant health benefit from smoking “low tar” or “light” cigarettes, defendants’ manipulation of cigarette design to ensure optimum nicotine delivery and the adverse health effects of exposure to ETS.

Corrective statements appeared in newspapers and on television for four months and one year, respectively, beginning in the fourth quarter of 2017, and the onserts appeared for two weeks at a time for a total of twelve weeks over two years beginning in the fourth quarter of 2018. Corrective statements have appeared on websites since the second quarter of 2018. In December 2022, the district court entered a consent order approving a settlement with respect to corrective statements on point-of-sale signage, which appeared through June 2025. In addition to the $28 million of provisions recorded in 2022, we recorded in the first quarter of 2024 provisions of $15 million for estimated costs of implementing the corrective statements on point-of-sale signage remedy.

E-vapor Product Litigation

We have been named as defendants in federal class action lawsuits, individual lawsuits and “third party” lawsuits relating to JUUL e-vapor products, which include school districts, state and local governments and tribal and healthcare organization lawsuits. We refer to this litigation in the United States collectively as the “Multidistrict Litigation.” The theories of recovery in the Multidistrict Litigation include violation of RICO, fraud, failure to warn, design defect, negligence, public nuisance and unfair trade practices. Plaintiffs seek various remedies, including compensatory and punitive damages, restitution or remediation (for plaintiffs that are government entities) and an injunction prohibiting product sales. We also have been named as defendants in a group of cases pending in a consolidated California state court proceeding.

In May 2023, we reached agreement on terms to resolve the majority of the Multidistrict Litigation lawsuits as well as the majority of the group of cases pending in the consolidated California state court proceeding for $235 million, for which amount we recorded a pre-tax provision in the second quarter of 2023. In March 2024, the court granted final approval of the class action settlement, and we paid the settlement amount in the second quarter of 2024. The settlement applies to all of the Multidistrict Litigation except 11 individual cases that opted out of the settlement, all of the consolidated California cases except nine individual cases that opted out of the settlement and 38 “third party” cases brought by Native American tribes. We separately agreed to settle the cases brought by Native American tribes in July 2024, and these cases have been dismissed. We recorded a pre-tax provision for $20 million in the second quarter of 2024 related to the Native American tribes settlement and paid the settlement amount in October 2024. Neither settlement applies to three class action lawsuits pending in Canada or 17 putative class action antitrust lawsuits. For a description of the antitrust cases not subject to the settlement, see Antitrust Litigation below.

In May 2023, Fuma International LLC (“Fuma”) filed a lawsuit against Altria and our affiliates Nu Mark LLC (“Nu Mark”), AGDC, ALCS and NJOY in the U.S. District Court for the Eastern District of Virginia asserting claims of patent infringement based on the sale of various Nu Mark and NJOY products, including NJOY ACE, in the United States. In August 2023, we entered into an agreement with Fuma resulting in NJOY’s acquisition of the patents that Fuma asserted in its lawsuit. The parties separately agreed that Fuma would dismiss its patent infringement claims in exchange for $10 million, and such claims were dismissed in August 2023. We recorded a pre-tax provision for $10 million in the third quarter of 2023 related to the agreement and paid such amount to Fuma in August 2023.

In June 2023, JUUL and VMR Products LLC (“VMR”) filed a lawsuit against Altria and our affiliates AGDC, ALCS, NJOY Holdings, Inc. and NJOY in the U.S. District Court for the District of Arizona asserting claims of patent infringement based on the sale of NJOY ACE in the United States. Plaintiffs seek various remedies, including damages and an injunction on sales of NJOY ACE. The lawsuit is currently stayed.

Also in June 2023, the same plaintiffs filed a related action against the same defendants with the ITC. There, the plaintiffs also allege patent infringement, but the remedies sought include an exclusion order that would prohibit the importation of NJOY ACE into the United States. No damages are recoverable in the proceedings before the ITC. A hearing before the Administrative Law Judge (“ALJ”) was held in May 2024, and, in August 2024, the ALJ issued an initial determination supporting the plaintiffs’ allegations with respect to four patents and recommending an exclusion order. In September 2024, NJOY petitioned the ITC to review the ALJ’s initial determination. In October 2024, the ITC granted review of the ALJ’s initial determination with respect to aspects of two of the four patents. In January 2025, the ITC issued its final determination finding that NJOY ACE infringes the four patents plaintiff asserted and issued an exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE in the United States. The ITC sent its orders to the Office of the United

Table of Contents

States Trade Representative, which had 60 days to review the ITC’s determination. The orders became effective on March 31, 2025 after the 60-day review period ended without the United States Trade Representative taking action. The final exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE will remain in effect during the pendency of the appeal. In February 2025, we filed a motion for reconsideration of the ITC’s determination finding that NJOY ACE infringes the four patents plaintiff asserted, asking the ITC to reverse its determination that NJOY ACE infringes one of the four patents. The ITC denied the motion in April 2025. We have appealed the final exclusion order and cease-and-desist orders to the U.S. Court of Appeals for the Federal Circuit.

In November and December 2023 and February 2024, Altria and our affiliates filed petitions with the U.S. Patent Office Patent Trial and Appeal Board (“PTAB”) challenging the validity of the patents underlying JUUL and VMR’s patent infringement claims. In May, June and August 2024, the PTAB denied Altria’s requests to institute review as to four patents (including three of the patents that form the basis of the ITC’s final determination) and, in June 2024, granted Altria’s request to institute review as to one of the patents that forms the basis of the ITC’s final determination. In June 2025, the PTAB issued its decision concluding that the patent it reviewed was valid. Appeals may be filed with the U.S. Court of Appeals for the Federal Circuit.

In August 2023, NJOY filed a complaint against JUUL in the U.S. District Court for the District of Delaware asserting claims of patent infringement based on the sale of certain JUUL e-vapor products, including the currently marketed JUUL device and JUULpods, in the United States. The lawsuit is currently stayed. However, as discussed below, we have moved to lift the stay.

Also in August 2023, NJOY filed a related action against JUUL with the ITC alleging patent infringement and seeking a ban on the importation and sale of the same JUUL products in the United States. A hearing before the ALJ was held in June 2024. In December 2024, the ALJ issued an initial determination concluding that, while the patents NJOY asserted against JUUL are valid, JUUL products do not infringe the patents. The ALJ also determined that, with respect to the asserted patents, NJOY did not satisfy the “domestic industry” requirement, which requires the party asserting a patent to show significant and substantial domestic investments, such as investments related to engineering, research and development or licensing, designed to exploit the patent. Subsequently, in December 2024, NJOY petitioned the ITC to review the ALJ’s initial determination. In March 2025, the ITC granted in part NJOY’s petition to review the ALJ’s initial determination. On review, the ITC affirmed the ALJ’s initial determination that the JUUL products do not infringe the asserted patents and terminated the investigation. In May 2025, we appealed the ITC’s final determination to the U.S. Court of Appeals for the Federal Circuit. Subsequently, in July 2025, we voluntarily dismissed the appeal and moved to lift the stay on NJOY’s lawsuit against JUUL in the U.S. District Court for the District of Delaware (discussed above).

In November 2023, JUUL filed petitions with the PTAB challenging the validity of the patents underlying NJOY’s patent infringement claims. In May 2024, the PTAB agreed to review JUUL’s challenge to both of the NJOY patents asserted against JUUL. In May 2025, the PTAB issued its decision concluding that the patents it reviewed were valid. The deadline to appeal the PTAB’s decision has passed, and JUUL did not appeal.

We, JUUL and VMR previously engaged with a mediator to attempt to negotiate a resolution of the proceedings pending before the ITC, U.S. District Courts and the PTAB. The parties also have engaged in negotiations without a mediator. Based on the status of the negotiations and the proceedings before the ITC, U.S. District Courts, the PTAB and the U.S. Court of Appeals for the Federal Circuit, we have determined that a loss with respect to a negotiated resolution of such proceedings is not probable or reasonably estimable as of the date of this filing.

IQOS Litigation

In April 2020, RAI Strategic Holdings, Inc. and R.J. Reynolds Vapor Co., which are affiliates of R.J. Reynolds, filed a lawsuit against Altria, PM USA, ALCS, PMI and its affiliate, Philip Morris Products S.A., in the U.S. District Court for the Eastern District of Virginia asserting claims of patent infringement based on the sale of the IQOS System electronic device and Marlboro HeatSticks in the United States. Plaintiffs seek various remedies, including preliminary and permanent injunctive relief, treble damages and attorneys’ fees. Altria and PMI were previously dismissed from the lawsuit, and plaintiffs’ claims against the other defendants have been stayed.

PM USA, ALCS and Philip Morris Products S.A. filed counterclaims against plaintiffs in the Eastern District of Virginia lawsuit alleging patent infringement by R.J. Reynolds’ e-vapor products. In June 2022, PM USA and ALCS reached an agreement with R.J. Reynolds resulting in dismissal of their counterclaims. In addition, ALCS filed a separate lawsuit against R.J. Reynolds in the U.S. District Court for the Middle District of North Carolina also alleging patent infringement by R.J. Reynolds’ e-vapor products. In September 2022, a jury awarded ALCS $95 million in damages for past infringement, plus supplemental damages and interest. In January 2023, the court ordered R.J. Reynolds to pay ALCS a 5.25% royalty on future sales of its infringing product resulting in positive net income through the expiration of the relevant patents in 2035. R.J. Reynolds filed a notice of appeal of the judgment to the U.S. Court of Appeals for the Federal Circuit, which affirmed the judgment in December 2024. In July 2024, R.J. Reynolds moved the district court to vacate the judgment, including the damages awards and ongoing royalties, on the grounds that R.J. Reynolds obtained a sub-license to the asserted patents from JUUL in December 2023. In December 2024, the district court denied the motion as to the damages award and royalties due

Table of Contents

through December 2023. The district court also found that additional proceedings were warranted on the part of the motion regarding royalties after R.J. Reynolds obtained the sub-license. The district court has set an evidentiary hearing for February 2026. As gains related to this lawsuit have not yet been determined to be realized or realizable in accordance with GAAP, they have not been recognized in our condensed consolidated financial statements.

Antitrust Litigation

In March 2023, we entered into a stock transfer agreement with JUUL pursuant to which, among other things, we transferred to JUUL all of our beneficially owned JUUL equity securities.

As of July 28, 2025, 17 putative class action lawsuits have been filed against Altria and JUUL in the U.S. District Court for the Northern District of California. In November 2020, these lawsuits were consolidated into three complaints (one on behalf of direct purchasers, one on behalf of indirect purchasers and one on behalf of indirect resellers). The consolidated lawsuits, as amended, allege that Altria and JUUL violated Sections 1, 2 and/or 3 of the Sherman Antitrust Act of 1890 and Section 7 of the Clayton Antitrust Act and various state antitrust, consumer protection and unjust enrichment laws by restraining trade and/or substantially lessening competition in the U.S. closed-system electronic cigarette market. Plaintiffs seek various remedies, including treble damages, attorneys’ fees, a declaration that the agreements between Altria and JUUL are invalid and rescission of the transaction. In February 2024, the court ordered that certain of the direct-purchaser plaintiffs’ claims against JUUL be sent to arbitration pursuant to an arbitration provision in JUUL’s online purchase agreement and dismissed without prejudice the direct-purchaser plaintiffs’ claims for injunctive relief. In April 2025, plaintiffs voluntarily dismissed all monopolization claims and all claims against the Altria defendants under California’s Unfair Competition Law. The trial with respect to the remaining claims in the consolidated lawsuits is set to commence in May 2026.

Federal and State Shareholder Derivative Lawsuits

In October 2022, we agreed to settle a series of federal and state derivative cases brought by Altria shareholders on behalf of themselves and Altria against Altria and certain of our current and former executives and directors and JUUL, its founders and certain of its current and former executives. The cases related to our former investment in JUUL and asserted claims of breach of fiduciary duty by the Altria defendants and aiding and abetting in that alleged breach of fiduciary duty by the remaining defendants.

Under the terms of the settlement, which became effective in May 2023, among other things, we agreed to provide $100 million in funding over a five-year period to underage tobacco prevention and cessation programs, which may include positive youth development programs, led by independent third-party organizations. We began providing funding in the third quarter of 2024. In 2022, we recorded pre-tax provisions totaling $27 million for costs associated with the independent monitoring of our funding commitments and attorneys’ fees. In the first quarter of 2023, we recorded pre-tax provisions totaling approximately $100 million related to the settlement, and in April 2023, paid $15 million to plaintiffs’ escrow account for attorneys’ fees.

Certain Other Tobacco-Related Litigation

“Lights/Ultra Lights” Cases and Other Smoking and Health Class Actions**:** Plaintiffs have sought certification of their cases as class actions, alleging among other things, that the uses of the terms “Lights” and/or “Ultra Lights” constitute deceptive and unfair trade practices, common law or statutory fraud, unjust enrichment or breach of warranty, and have sought injunctive and equitable relief, including restitution and, in certain cases, punitive damages. These class actions have been brought against PM USA and, in certain instances, Altria or our other subsidiaries, on behalf of individuals who purchased and consumed various brands of cigarettes. Defenses raised in these cases include lack of misrepresentation, lack of causation, injury and damages, the statute of limitations, non-liability under state statutory provisions exempting conduct that complies with federal regulatory directives, and the First Amendment. Twenty-one state courts in 23 “Lights” cases have refused to certify class actions, dismissed class action allegations, reversed prior class certification decisions or have entered judgment in favor of PM USA. As of July 28, 2025, two “Lights/Ultra Lights” class actions are pending in U.S. state courts. Neither case is active.

As of July 28, 2025, one smoking and health case alleging personal injury or seeking court-supervised programs or an ongoing medical monitoring program on behalf of individuals exposed to ETS and purporting to be brought on behalf of a class of individual plaintiffs, is pending in a U.S. state court. The case is currently inactive.

UST Litigation**:** UST and/or its tobacco subsidiaries have been named in a number of individual tobacco and health lawsuits over time. Plaintiffs’ allegations of liability in these cases have been based on various theories of recovery, such as negligence, strict liability, fraud, misrepresentation, design defect, failure to warn, breach of implied warranty, addiction and breach of consumer protection statutes. Plaintiffs have typically sought various forms of relief, including compensatory and punitive damages, and certain equitable relief, including disgorgement. Defenses raised in these cases have included lack of causation, assumption of the risk, comparative fault and/or contributory negligence, and statutes of limitations. As of July 28, 2025, there is no such case pending against UST and/or its tobacco subsidiaries.

Table of Contents

Environmental Regulation

Altria and our former subsidiaries are subject to various federal, state and local laws and regulations concerning the discharge of materials into the environment, or otherwise related to environmental protection, including, in the United States: the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act and the Comprehensive Environmental Response, Compensation and Liability Act (commonly known as “Superfund”), which can impose joint and several liability on each responsible party. Altria and our former subsidiaries are involved in several cost recovery/contribution cases subjecting them to potential costs of remediation and natural resource damages under Superfund or other laws and regulations. We expect to continue to make capital and other expenditures in connection with environmental laws and regulations.

We provide for expenses associated with environmental remediation obligations on an undiscounted basis when such amounts are probable and can be reasonably estimated. Such accruals are adjusted as new information develops or circumstances change. Other than those amounts, it is not possible to reasonably estimate the cost of any environmental remediation and compliance efforts that we may undertake in the future. In the opinion of our management, however, compliance with environmental laws and regulations, including the payment of any remediation costs or damages and the making of related expenditures, has not had a material adverse effect on our condensed consolidated results of operations, capital expenditures, financial position or cash flows.

Guarantees and Other Similar Matters

In the ordinary course of business, we have agreed to indemnify a limited number of third parties in the event of future litigation. At June 30, 2025, we (i) had $43 million of unused letters of credit obtained in the ordinary course of business and (ii) were contingently liable for guarantees related to our own performance, including $90 million for surety bonds. In addition, from time to time, we issue lines of credit to affiliated entities. These items have not had, and are not expected to have, a significant impact on our liquidity.

Under the terms of a distribution agreement between Altria and PMI (“Distribution Agreement”), entered into as a result of our 2008 spin-off of our former subsidiary PMI, liabilities concerning tobacco products will be allocated based in substantial part on the manufacturer. PMI will indemnify Altria and PM USA for liabilities related to tobacco products manufactured by PMI or contract manufactured for PMI by PM USA, and PM USA will indemnify PMI for liabilities related to tobacco products manufactured by PM USA, excluding tobacco products contract manufactured for PMI. We do not have a related liability recorded on our condensed consolidated balance sheet at June 30, 2025 as the fair value of this indemnification is insignificant. PMI has agreed not to seek indemnification with respect to the active IQOS System patent litigation discussed above under IQOS Litigation.

As part of the supplier financing program, Altria guarantees the financial obligations of ALCS under the financing program agreement.

PM USA guarantees our obligations under our outstanding debt securities, any borrowings under our $3.0 billion Credit Agreement and any amounts outstanding under our commercial paper program.

Note 15. New Accounting Guidance Not Yet Adopted

The following table provides a description of issued accounting guidance applicable to, but not yet adopted by, us:

StandardsDescriptionEffective Date for Public EntityEffect on Financial Statements
ASU No. 2023-09 Income Taxes (Topic 740): Improvements to Income Tax DisclosuresThe guidance will require additional income tax disclosures, primarily related to the rate reconciliation and income taxes paid information.The guidance is effective for fiscal years beginning after December 15, 2024.The guidance will result in expanded disclosures beginning in our annual consolidated financial statements for the year ending December 31, 2025, which we plan to adopt retrospectively.
ASU Nos. 2024-03 and 2025-01 Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement ExpensesThe guidance will require additional disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses.The guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.We are in the process of evaluating the impact of this guidance on our disclosures.

Previous: Cover and table of contents · Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations