What changed in this filing

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Item 1. Financial Statements

2025-10-30 compared with 2025-07-30 · 302 added, 219 removed, 1017 unchanged (34% of the section changed)

5 unchanged sentences

______________________________

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Cash and cash equivalents $ 3,472 $ 3,127

19 unchanged sentences

________________________________________________

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Current portion of long-term debt $ 1,569 $ 1,527

19 unchanged sentences

Accumulated other comprehensive losses ( 2,709 ) ( 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)

Cost of repurchased stock ( 1,126,809,622 shares at September 30, 2025 and 1,115,309,450 shares at December 31, 2024)

( 42,893 ) ( 42,194 )

9 unchanged sentences

_____________________________________

For the Six Months Ended June 30, For the Three Months Ended June 30,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

2025 2024 2025 2024

23 unchanged sentences

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For the Six Months Ended June 30, For the Three Months Ended June 30,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

2025 2024 2025 2024

10 unchanged sentences

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

for the Six Months Ended June 30, 2025 and 2024

for the Nine Months Ended September 30, 2025 and 2024

(in millions of dollars, except per share data)

18 unchanged sentences

Other — — — — ( 7 ) — ( 7 )

Balances, June 30, 2025

Balances, September 30, 2025

$ 935 $ 5,906 $ 36,115 $ ( 2,709 ) $ ( 42,893 ) $ 50 $ ( 2,596 )

10 unchanged sentences

Other — — — — ( 31 ) — ( 31 )

Balances, June 30, 2024

Balances, September 30, 2024

$ 935 $ 5,890 $ 34,206 $ ( 2,617 ) $ ( 41,882 ) $ 50 $ ( 3,418 )

3 unchanged sentences

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

for the Three Months Ended June 30, 2025 and 2024

for the Three Months Ended September 30, 2025 and 2024

( in millions of dollars, except per share data)

9 unchanged sentences

Equity (Deficit)

Balances, March 31, 2025

Balances, June 30, 2025

$ 935 $ 5,895 $ 35,525 $ ( 2,831 ) $ ( 42,780 ) $ 50 $ ( 3,206 )

8 unchanged sentences

Other — — — — ( 1 ) — ( 1 )

Balances, June 30, 2025

Balances, September 30, 2025

$ 935 $ 5,906 $ 36,115 $ ( 2,709 ) $ ( 42,893 ) $ 50 $ ( 2,596 )

Balances, March 31, 2024

Balances, June 30, 2024

$ 935 $ 5,876 $ 33,651 $ ( 2,283 ) $ ( 41,195 ) $ 50 $ ( 2,966 )

8 unchanged sentences

Other — — — — ( 7 ) — ( 7 )

Balances, June 30, 2024

Balances, September 30, 2024

$ 935 $ 5,890 $ 34,206 $ ( 2,617 ) $ ( 41,882 ) $ 50 $ ( 3,418 )

(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.

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_____________________

For the Six Months Ended June 30, 2025 2024

For the Nine Months Ended September 30, 2025 2024

Cash Provided by (Used in) Operating Activities

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Net cash provided by (used in) investing activities $ ( 139 ) $ 2,238

(1) 2025 relates to unrecognized tax benefits from the change in the application of foreign attribution rules relevant to our investment in ABI.

Income Taxes .

(2) See Note 6.

6 unchanged sentences

_____________________

For the Six Months Ended June 30, 2025 2024

For the Nine Months Ended September 30, 2025 2024

Cash Provided by (Used in) Financing Activities

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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, 2025 December 31, 2024

September 30, 2025 December 31, 2024

Cash and cash equivalents $ 3,472 $ 3,127

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▪ 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;

At September 30, 2025, our wholly owned subsidiaries included Philip Morris USA Inc.

(“PM USA”), which is engaged in the manufacture and sale of cigarettes;

John Middleton Co.

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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;

Helix Innovations LLC (“Helix”) and its foreign affiliates (“Helix International”), which 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.

We operate primarily within the United States and generate substantially all of our revenue from domestic customers.

Other wholly owned subsidiaries included Altria Group Distribution Company (“AGDC”), which provides domestic sales and distribution services to our 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.

At September 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 September 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.

At June 30, 2025, we had investments in Anheuser-Busch InBev SA/NV (“ABI”) and Cronos Group Inc.

At September 30, 2025, Horizon had no products in the U.S.

At September 30, 2025, we had investments in Anheuser-Busch InBev SA/NV (“ABI”) and Cronos Group Inc.

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.

▪ Dividends and Share Repurchases:

In August 2025, our Board of Directors (“Board of Directors” or “Board”) approved a 3.9 % increase in the quarterly dividend rate to $ 1.06 per share of our common stock versus the previous rate of $ 1.02 per share.

The current annualized dividend rate is $ 4.24 per share.

Future dividend payments remain subject to the discretion of our Board.

In January 2025, our Board authorized a new $ 1.0 billion share repurchase program, of which $ 288 million was remaining at September 30, 2025.

In October 2025, the Board authorized a $ 1.0 billion expansion of this program to $ 2.0 billion, which now expires on December 31, 2026.

Share repurchases depend on 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”).

In the first half of 2024, we paid the Repurchase Price and received 53.9 million shares of our common stock.

The total number of shares repurchased under the ASR Agreements was based on volume-weighted average prices of our common stock during the term of the ASR transactions, less a discount.

We funded the ASR transactions with proceeds from our sale of a portion of our investment in ABI in the first quarter of 2024 (“ABI Transaction”).

For further information on the ABI Transaction, see Note 6.

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Our share repurchase activity was as follows:

For the Six Months Ended June 30, For the Three Months Ended June 30,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions, except per share data) 2025

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Average price per share of shares repurchased $ 58.08 $ 45.68 $ 60.13 $ 50.37

(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.

(1) Includes 53.9 million shares repurchased under the ASR Agreements at an average price per share of $ 44.50 .

▪ 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.

We have prepared these interim condensed consolidated financial statements in conformity with United States generally accepted accounting principles (“GAAP”) and have applied such principles on a consistent basis.

We have omitted certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP.

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.

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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.

We record receivables net of any cash discounts on our condensed consolidated balance sheets.

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

(in millions) June 30, 2025 December 31, 2024

(in millions) September 30, 2025 December 31, 2024

Receivables $ 249 $ 177

Deferred revenue 167 215

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;

At September 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 no t record an allowance for credit losses against these receivables.

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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.

At September 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.

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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.

At September 30, 2025 and December 31, 2024, confirmed outstanding obligations under the Program were $ 160 million and $ 128 million, respectively.

Goodwill and Other Intangible Assets, net

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

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions) Goodwill Other Intangible Assets, net Goodwill Other Intangible Assets, net

5 unchanged sentences

Other intangible assets consisted of the following:

June 30, 2025 December 31, 2024

September 30, 2025 December 31, 2024

(in millions) Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization

4 unchanged sentences

Total other intangible assets $ 13,715 $ 849 $ 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.

At September 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.

Pre-tax amortization expense for definite-lived intangible assets was $ 112 million and $ 102 million for the nine months ended September 30, 2025 and 2024, respectively, and $ 38 million for the three months ended September 30, 2025 and 2024.

In April 2024, we assigned the exclusive U.S.

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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.

commercialization rights to the IQOS System, we recorded a pre-tax gain of $ 2.7 billion for the nine months ended September 30, 2024 in our condensed consolidated statements of earnings.

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

For the Six Months Ended For the Year Ended

June 30, 2025 December 31, 2024

For the Nine Months Ended For the Year Ended

September 30, 2025 December 31, 2024

(in millions) Goodwill Other Intangible Assets, net Goodwill Other Intangible Assets, net

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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.

There have been no events or changes in circumstances that indicate an interim quantitative impairment assessment was required for the three months ended September 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 September 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.

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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.

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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.

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 during the second quarter of 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.

Exit and Implementation Costs

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

For the Six Months Ended June 30, 2025 For the Three Months Ended June 30, 2025

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

For the Nine Months Ended September 30, 2025 For the Three Months Ended September 30, 2025

(in millions) Exit Costs Implementation Costs (1)

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(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.

There were no exit or implementation costs for the nine months ended September 30, 2024.

In October 2024, we announced a multi-phase Optimize & Accelerate initiative (“Initiative”) designed to modernize our ways of working.

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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.

As of September 30, 2025, total pre-tax charges since the inception of the Initiative were $ 111 million, consisting of employee separation cost of $ 38 million and implementation costs of $ 73 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.

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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.

As of September 30, 2025, total cash payments since the inception of the Initiative were $ 74 million, consisting of $ 12 million for exit costs and $ 62 million for implementation costs.

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

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Cash paid ( 12 ) ( 51 ) ( 63 )

Balances at June 30, 2025 $ 31 (1) $ 18 $ 49

Balances at September 30, 2025 $ 26 (1) $ 11 $ 37

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

1 unchanged sentence

The carrying amount of our investments consisted of the following:

(in millions) June 30, 2025 December 31, 2024

(in millions) September 30, 2025 December 31, 2024

ABI $ 8,071 $ 7,880

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(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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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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.

At September 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:

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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 %.

Because we can convert our Restricted Shares into ordinary shares at our discretion, the fair value of each Restricted Share is based on the value of an ordinary share.

At September 30, 2025, the fair value of our investment in ABI was $ 9.5 billion, which exceeded its carrying value of $ 8.1 billion by approximately 18 %.

At December 31, 2024, the fair value of our investment in ABI approximated its carrying value of $ 7.9 billion.

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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

(in millions) For the Nine Months Ended September 30, 2024

Gain on partial sale of our investment $ 165

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▪ 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.

Subsequently, in the third quarter of 2025, we recorded a $ 77 million increase to this valuation allowance as discussed further in 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.

At September 30, 2025, we had an approximate 40.9 % 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.

T he 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 September 30, 2025, the fair value of our investment in Cronos exceeded its carrying value by approximately $ 119 million or approximately 38 %.

At December 31, 2024, the fair value of our investment in Cronos approximated its carrying value of $ 315 million.

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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.

At September 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, 2025 December 31, 2024

(in millions) September 30, 2025 December 31, 2024

Carrying value $ 25,701 $ 24,926

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Fair value 2,620 3,059

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.

T he 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

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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.

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.

We recognized pre-tax (gains) losses of our net investment hedges of $ 391 million and $ 29 million for the nine months ended September 30, 2025 and 2024, respectively, and $( 12 ) million and $ 127 million for the three months ended September 30, 2025 and 2024, respectively.

In addition, as a result of the ABI Transaction, for the nine months ended September 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.

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

For the Six Months Ended June 30, 2025 For the Year Ended December 31, 2024

For the Nine Months Ended September 30, 2025 For the Year Ended December 31, 2024

(in millions)

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Pension Postretirement Pension Postretirement

For the Six Months Ended June 30, For the Three Months Ended June 30,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024 2025 2024 2025 2024

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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 no t 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.

We made employer contributions of $ 11 million to our pension plans and did no t make any contributions to our postretirement plans during the nine months ended September 30, 2025.

Currently, we anticipate making additional employer contributions of up to approximately $ 5 million to our pension plans and no contributions 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.

1 unchanged sentence

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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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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

For the Nine Months Ended September 30, 2025

(in millions) Benefit Plans ABI Currency Translation Adjustments Accumulated

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Other comprehensive earnings (losses), net of deferred income taxes 4 ( 317 ) (1)

( 20 ) ( 431 )

Balances, June 30, 2025 $ ( 1,389 ) $ ( 1,432 ) $ ( 10 ) $ ( 2,831 )

For the Three Months Ended June 30, 2025

Balances, September 30, 2025 $ ( 1,388 ) $ ( 1,335 ) $ 14 $ ( 2,709 )

For the Three Months Ended September 30, 2025

(in millions) Benefit Plans ABI Currency Translation Adjustments Accumulated

Comprehensive

Balances, March 31, 2025

Balances, June 30, 2025

$ ( 1,389 ) $ ( 1,432 ) $ ( 10 ) $ ( 2,831 )

Other comprehensive earnings (losses) before reclassifications

( 179 ) 3 ( 176 )

Deferred income taxes — ( 27 ) — ( 27 )

Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes

— ( 134 ) 3 ( 131 )

Amounts reclassified to net earnings 1 ( 3 ) — ( 2 )

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Other comprehensive earnings (losses), net of deferred income taxes 1 97 (1)

Balances, June 30, 2025 $ ( 1,389 ) $ ( 1,432 ) $ ( 10 ) $ ( 2,831 )

For the Six Months Ended June 30, 2024

Balances, September 30, 2025 $ ( 1,388 ) $ ( 1,335 ) $ 14 $ ( 2,709 )

For the Nine Months Ended September 30, 2024

(in millions) Benefit Plans ABI Currency Translation Adjustments Accumulated

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Other comprehensive earnings (losses), net of deferred income taxes ( 4 ) 64 (1)

Balances, June 30, 2024 $ ( 1,495 ) $ ( 801 ) $ 13 $ ( 2,283 )

For the Three Months Ended June 30, 2024

Balances, September 30, 2024 $ ( 1,497 ) $ ( 1,131 ) $ 11 $ ( 2,617 )

For the Three Months Ended September 30, 2024

(in millions) Benefit Plans ABI Currency Translation Adjustments Accumulated

Comprehensive

Balances, March 31, 2024

Balances, June 30, 2024

$ ( 1,495 ) $ ( 801 ) $ 13 $ ( 2,283 )

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Other comprehensive earnings (losses), net of deferred income taxes ( 2 ) ( 330 ) (1)

Balances, June 30, 2024 $ ( 1,495 ) $ ( 801 ) $ 13 $ ( 2,283 )

( 2 ) ( 334 )

Balances, September 30, 2024 $ ( 1,497 ) $ ( 1,131 ) $ 11 $ ( 2,617 )

(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.

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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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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(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 the nine months ended September 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.

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Segment Reporting

At June 30, 2025, our reportable segments were (i) smokeable products, consisting of combustible cigarettes and machine-made large cigars;

At September 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.

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Segment data were as follows:

For the Six Months Ended June 30, For the Three Months Ended June 30,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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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.

Total oral tobacco products other segment items were $ 706 million and $ 1,088 million for the nine months ended September 30, 2025 and 2024, respectively, and $ 230 million and $ 258 million for the three months ended September 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.

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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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

▪ Non-Participating Manufacturer (“NPM”) Adjustment Items:

We recorded net pre-tax income for NPM adjustment items as follows:

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

Smokeable products segment $ ( 2 ) $ ( 29 ) $ ( 2 ) $ ( 23 )

Interest and other debt expense, net — 2 — 2

Total $ ( 2 ) $ ( 27 ) $ ( 2 ) $ ( 21 )

We recorded the amounts shown in the table above in our smokeable products segment as reductions to cost of sales in our condensed consolidated statements of earnings, which resulted in increased OCI in our smokeable products segment.

NPM adjustment items result from the resolutions of certain disputes with states and territories related to the NPM adjustment provision under the Master Settlement Agreement (“NPM Adjustment Items”).

For further discussion, see Health Care Cost Recovery Litigation in Note 14.

Contingencies .

▪ 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.

We recorded exit and implementation costs of $ 43 million and $ 13 million related to the Initiative for the nine and three months ended September 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.

We recorded a non-cash, pre-tax impairment of the Skoal trademark of $ 354 million for the nine months ended September 30, 2024 in our oral tobacco products segment.

For further discussion, see Note 4.

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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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

Smokeable products segment

$ 40 $ 38 $ 4 $ 20

General corporate expenses — 30 ( 1 ) —

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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.

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

In July 2025, we entered into an agreement to extend the expiration of our $ 3.0 billion senior unsecured 5-year revolving credit agreement from October 24, 2028 to October 24, 2029 (as extended, “Credit Agreement”).

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.

The Credit Agreement includes an option, subject to certain conditions, for us to extend the term for an additional one-year period.

We intend to use any borrowings under our Credit Agreement for general corporate purposes.

At September 30, 2025, we had availability under the Credit Agreement for borrowings of up to an aggregate principal amount of $ 3.0 billion.

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.

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(“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.

The applicable percentage for borrowings under our Credit Agreement at September 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

At September 30, 2025, we were in compliance with our covenants in our Credit Agreement.

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

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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.

The aggregate carrying value of our total long-term debt at September 30, 2025 and December 31, 2024 was $ 25.7 billion and $ 24.9 billion, respectively.

In August 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 are being used for general corporate purposes.

The notes contain the following terms:

▪ $ 0.5 billion at 4.500 %, due 2030, interest payable semiannually beginning February 6, 2026;

▪ $ 0.5 billion at 5.250 %, due 2035, interest payable semiannually beginning February 6, 2026.

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 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 below.

The notes contain the following terms:

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▪ $ 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.

Similar to our other notes, the notes issued in August 2025 and the first quarter 2025 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.

In the second quarter of 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 € 750 million ($ 857 million), respectively.

PM USA guarantees our obligations under our outstanding debt securities.

At September 30, 2025 and December 31, 2024, accrued interest on long-term debt of $ 214 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 .

The One Big Beautiful Bill Act (“OBBB”) was signed into law in July 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.

These provisions and modifications have not had a material impact on our condensed consolidated financial statements.

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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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Income tax rate 26.0 % 24.4 % 22.8 % 24.2 %

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.

Our income tax rate for the nine months ended September 30, 2025 differed from the U.S.

federal statutory rate of 21%, due primarily to state tax expense, the non-deductible impairment of the e-vapor reporting unit goodwill and a valuation allowance associated with our unrealized capital losses, partially offset by a net income tax benefit related to tax reserves as discussed below.

Our income tax rate for the three months ended September 30, 2025 differed from the U.S.

federal statutory rate of 21%, due primarily to state tax expense and a valuation allowance associated with our unrealized capital losses, partially offset by a net income tax benefit related to tax reserves as discussed below.

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.

Our income tax rate for the nine months ended September 30, 2024 differed from the U.S.

federal statutory rate of 21%, due primarily to state tax expense, 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.

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.

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.

Our income tax rate for the three months ended September 30, 2024 differed from the U.S.

federal statutory rate of 21%, due primarily to state tax expense.

For further discussion of the ABI Transaction, see Note 6.

Investments in Equity Securities .

We are subject to income taxation in many jurisdictions.

Unrecognized tax benefits reflect the differences between tax positions we have taken or expect to take on income tax returns and the amounts recognized in the financial statements.

Resolution of the related tax positions with the relevant tax authorities may take many years to complete, and such timing is not entirely within our control.

On September 29, 2025, the U.S.

District Court for the Eastern District of Virginia ruled in favor of the IRS and denied our refund claim for the 2017 tax year, based on the Tax Cuts and Jobs Act of 2017’s removal of downward attribution rules, which the IRS invoked to attribute income from certain of ABI’s foreign subsidiaries to Altria.

We intend to vigorously contest the ruling by pursuing all available appellate remedies.

This ruling also has a potential impact for our 2018 through 2025 tax years.

Following this ruling, we reevaluated our position and concluded as of September 30, 2025, that it is no longer more likely than not that we will prevail at the conclusion of the appellate process.

Consequently, we reversed a receivable of $ 45 million for the 2017 tax year and recorded a full reserve for this uncertain tax position of $ 310 million for the 2018 through 2025 tax years.

Additionally, we reduced a deferred tax liability by $ 461 million due to the resulting increase in the tax basis of our investment in ABI, partially offset by a $ 77 million increase to a valuation allowance associated with the indirect effect on unrealized capital losses due to the decrease of a previously anticipated capital gain on the ABI Transaction.

As a result of the foregoing, we recognized a net tax benefit of $ 29 million for the nine and three months ended September 30, 2025 in our condensed consolidated statement of earnings related to a favorable rate differential associated with certain cross-border taxes included in the tax reserve.

Effective January 1, 2026, the OBBB reinstates this downward attribution rule, which will limit the impact of this ruling to the 2017 through 2025 tax years.

At September 30, 2025, our total unrecognized tax benefits were $ 573 million.

The amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate at September 30, 2025, was $ 20 million, along with $ 410 million affecting deferred taxes.

The amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate at December 31, 2024, was $ 189 million, along with $ 27 million affecting deferred taxes.

Unrecognized tax benefits increased by $ 291 million from December 31, 2024 due primarily to the removal of downward attribution rules applicable to income from certain ABI foreign subsidiaries.

The following chart provides a reconciliation of the beginning and ending valuation allowances for the nine months ended September 30, 2025:

(in millions)

Balance at beginning of year $ 668

Additions to valuation allowance charged to income tax expense 84

Releases of valuation allowance credited to income tax benefit ( 12 )

Balance at end of period $ 740

The changes in the valuation allowances for the nine months ended September 30, 2025 were due primarily to the indirect effects of tax reserves, as discussed above, on our unrealized capital losses.

The cumulative valuation allowance at September 30, 2025 was primarily attributable to deferred tax assets recorded in connection with the unrealized capital losses related to our former investment in JUUL and our investment in Cronos.

As we continue to evaluate all sources of potential income that may become available to utilize these losses, our valuation allowance position may change.

It is possible sufficient positive evidence may be available in future periods to cause us to reduce or eliminate the valuation allowance on certain deferred tax assets.

That change to the valuation allowance would result in the recognition of previously unrecognized deferred tax assets and a decrease in income tax expense in the period the release is recorded.

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.

Various types of claims may be raised in these proceedings, including product liability, unfair trade practices, antitrust, 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.

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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,

For the Nine Months Ended September 30, For the Three Months Ended September 30,

(in millions) 2025 2024 2025 2024

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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.

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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.

As of September 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

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

July 28, 2025 July 29, 2024 July 27, 2023

October 27, 2025 October 28, 2024 October 23, 2023

Individual Smoking and Health Cases (1)

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Other Tobacco-Related Cases (4)

(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.

(1) Includes as of October 27, 2025, 28 cases filed in Illinois, nine cases filed in New Mexico, 83 cases filed in Massachusetts, 15 cases filed in Oregon, eight cases filed in Hawaii, 11 cases filed in the U.S.

Virgin Islands and 12 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.

Also does not include one Broin case pending as of October 27, 2025.

For further discussion of the Broin cases, see Other Smoking and Health Class Actions below.

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(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.

Pending final dismissal of these cases, as of October 27, 2025, the remaining cases include 12 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.

(4) Includes as of October 27, 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;

As of October 27, 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;

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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.

As of October 27, 2025, no Engle progeny cases, two individual smoking and health cases and no e-vapor cases are set for trial through December 31, 2025.

Trial dates are subject to change.

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Of the 33 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.

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 October 27, 2025.

Smoking and Health Litigation

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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.

In March 2025, a jury in a Massachusetts state court returned a verdict in favor of plaintiff and against PM USA and R.J.

A chart listing certain verdicts for plaintiffs in pending Engle progeny cases can be found in Smoking and Health Litigation - Engle Progeny Trial Results below.

Perez-Trinidad :

In October 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.

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Reynolds and $ 5.5 million in punitive damages against PM USA.

PM USA intends to file post-trial motions challenging the verdict and, if necessary, will appeal.

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, 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.

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The jury found that plaintiff was not entitled to punitive damages.

Plaintiff has

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.

Plaintiff has appealed the judgment, and the appeal remains pending.

PM USA filed post-trial motions, which were denied, and PM USA filed a notice of appeal of the final judgment and the trial court’s denial of the post-trial motions.

Ricapor-Hall :

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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.

In April 2024, PM USA filed a notice of appeal.

PM USA’s appeal remains pending, and plaintiff has noticed a cross-appeal.

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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.

In May 2025, the Massachusetts Supreme Judicial Court took jurisdiction over the appeal.

The appeal remains pending.

Federal Government’s Lawsuit :

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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.

As of October 27, 2025, approximately 51 state court cases were pending against PM USA or Altria asserting individual claims by or on behalf of approximately 66 state court plaintiffs.

Because of a number of factors, including docketing delays, duplicated filings and overlapping dismissal orders, these numbers are estimates.

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Engle Progeny Trial Results:

As of July 28, 2025, 147 federal and state Engle progeny cases involving PM USA have resulted in verdicts.

As of October 27, 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.

Fifty-nine verdicts were returned in favor of PM USA, one of which has been reversed post-trial or on appeal and remains pending.

In addition, there have been a number of mistrials, only some of which have resulted in new trials as of October 27, 2025.

Post-trial activity in a case can result in a final resolution that differs from the initial verdict.

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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

been reversed in whole or in part on appeal or following retrial.

Initial verdicts have 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.

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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.

The chart below lists the verdicts in and post-trial status of certain Engle progeny cases in which verdicts were returned in favor of plaintiffs.

The chart lists cases that are pending as of October 27, 2025 where PM USA has determined an unfavorable outcome is not probable and the amount of loss cannot be reasonably estimated.

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.

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Lipp September 2021 PM USA Miami-Dade $ 15 million $ 28 million Third District Court of Appeal reversed and remanded for a new trial.

Plaintiff’s motion for rehearing pending.

McCall March 2019 PM USA Broward <$ 1 million (<$ 1 million PM USA)

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(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)

Plaintiff Verdict Date Defendant(s) Court Payment Amount for Damages (if any)

Chadwell September 2018 PM USA Miami-Dade $ 2 million

Schertzer April 2022 PM USA and R.J.

Reynolds Miami-Dade $ 4 million

Other Smoking and Health Class Actions:

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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.

As of October 27, 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.

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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.

In August 2025, a plan for those companies was implemented, under which those companies agreed, among other things, to pay an aggregate global settlement amount of CAD $ 32.5 billion to resolve all tobacco product-related claims and litigation in Canada.

Under the plan, Altria and PM USA have obtained releases of claims and the related litigation against them will be dismissed.

Pursuant to the indemnification obligations in the Distribution Agreement, neither Altria nor PM USA is responsible for any payments required to resolve the Canadian litigation.

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.

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 ).

As of October 27, 2025, PM USA is named as a defendant in one case brought by a flight attendant against United States cigarette manufacturers seeking compensatory damages for personal injuries allegedly caused by exposure to environmental tobacco smoke (“ETS”).

The flight attendant alleges that they are a member 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.

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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.

All of these cases were 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.

As discussed above, in August 2025, a plan for those companies was implemented.

See Smoking and Health Litigation - Other Smoking and Health Class Actions above for a discussion of these proceedings.

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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”).

PM USA and certain other tobacco product manufacturers had previously entered into agreements to settle similar claims brought by the States of 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.

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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.

For the nine months ended September 30, 2025 and 2024, the aggregate amount recorded in cost of sales with respect to the State Settlement Agreements was approximately $ 2.3 billion and $ 2.7 billion, respectively.

For the three months ended September 30, 2025 and 2024, the aggregate amount recorded in cost of sales with respect to the State Settlement Agreements was approximately $ 800 million and $ 900 million, respectively.

These amounts include PM USA’s estimate of amounts related to NPM Adjustments discussed below.

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▪ 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.

In 2015, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with the State of 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 the State of 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.

In 2020, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with the State of Montana through 2030, resulting in a payment from PM USA to the State of 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.

In 2024, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with the Commonwealth of 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.

Territories Settlement .

In 2025, PM USA entered into a separate NPM Adjustment settlement in which PM USA settled the NPM Adjustment disputes with American Samoa, Guam, the Commonwealth of the Northern Mariana Islands and the U.S.

Virgin Islands through 2024.

As a result of this settlement, PM USA will receive a credit in an immaterial amount applied against its April 2026 MSA payment to those territories.

Accordingly, PM USA recorded an immaterial amount as a reduction in cost of sales in the third quarter of 2025.

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.

The PMs and the 10 states that had not settled the NPM Adjustment disputes for 2004 participated in a multi-state arbitration.

The arbitration panel found three of these states (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.

The States of 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 PMs and the six states that have not settled the NPM Adjustment disputes are currently arbitrating certain 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 .

As of October 27, 2025, the arbitration panel had issued decisions for four of the six states (Maryland, Washington, Wisconsin and Ohio), finding the States of 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.

The State of 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.

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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.

In September 2024, PM USA and the State of Mississippi settled their dispute over the profit adjustment payments.

Pursuant to the settlement, PM USA paid $ 7 million to the State of 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.

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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.

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.

Reynolds and ITG concerning the same tax rate issues raised by the States of 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.

In October 2025, the court issued an order as to damages, finding that PM USA owes the State of Minnesota $ 10 million plus pre-judgment and post-judgment interest.

PM USA intends to appeal.

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The case ultimately proceeded only under the civil provisions of RICO.

In August 2006, the district court held

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

In August 2006, the district court held 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.

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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.

In addition to the $ 28 million of provisions recorded in 2022, we recorded provisions of $ 15 million in the first quarter of 2024 for estimated costs of implementing the corrective statements on point-of-sale signage remedy.

E-vapor Product Litigation

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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.

(“NJOY Holdings”) 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 .

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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 August 2024, the Administrative Law Judge (“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.

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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

States Trade Representative, which had 60 days to review the ITC’s determination.

The ITC sent its orders to the Office of the United 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.

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Court of Appeals for the Federal Circuit.

The final exclusion order and cease-and-desist orders will remain in effect during the pendency of the appeal.

In November and December 2023 and February 2024, Altria and our affiliates filed petitions with the U.S.

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In June 2025, the PTAB issued its decision concluding that the patent it reviewed was valid.

Appeals may be filed with the U.S.

We have appealed the PTAB’s decision to the U.S.

Court of Appeals for the Federal Circuit.

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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.

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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.

We, JUUL and VMR previously engaged with a mediator to attempt to negotiate a resolution of the proceedings pending before the ITC discussed above, U.S.

District Courts and the PTAB.

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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 August 2025, JUUL filed an additional lawsuit against Altria and our affiliates AGDC, ALCS, NJOY Holdings and NJOY in the U.S.

District Court for the District of Arizona asserting claims of patent infringement based on the sale of NJOY Daily in the United States.

Plaintiffs seek various remedies, including damages and an injunction on sales of NJOY Daily and any other products NJOY may be developing or preparing for commercialization in the United States that would infringe JUUL’s patent.

Also in August 2025, JUUL filed a related action against the same defendants with the ITC.

There, JUUL also alleges patent infringement, but the remedies sought include an exclusion order that would prohibit the importation into the United States of NJOY Daily and any other products NJOY may be developing or preparing for commercialization in the United States that

would infringe JUUL’s patent.

No damages are recoverable in the proceedings before the ITC.

A hearing before the ALJ is scheduled for April 2026, and we expect an initial determination from the ALJ in September 2026, subject to the ALJ’s ability to grant herself an extension.

The ALJ’s recommendation will be reviewed by the ITC, and we expect the ITC’s final determination in January 2027, subject to the ITC’s right to grant itself an extension.

In September 2025, NJOY filed an additional 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.

Also in September 2025, NJOY, ALCS, and AGDC 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.

Reynolds Litigation

In April 2020, RAI Strategic Holdings, Inc.

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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.

Plaintiffs sought 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 were dismissed in August 2025.

PM USA, ALCS and Philip Morris Products S.A.

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Court of Appeals for the Federal Circuit, which affirmed the judgment in December 2024.

In August 2025, R.J.

Reynolds petitioned the U.S.

Supreme Court to review the federal appellate court’s affirmance of the federal district court’s judgment.

In October 2025, the U.S.

Supreme Court denied R.J.

Reynolds’ petition.

In July 2024, R.J.

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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

through December 2023.

In December 2024, the district court denied the motion as to the damages award and royalties due through December 2023.

The district court also found that additional proceedings were warranted on the part of the motion regarding royalties after R.J.

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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.

Any gains related to this lawsuit remain subject to these district court proceedings.

Accordingly, they have not yet been determined to be realized or realizable in accordance with GAAP and 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.

As of October 27, 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.

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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.

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.

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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.

As of October 27, 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.

As of October 27, 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.

The case is currently inactive.

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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.

As of October 27, 2025, there is no such case pending against UST and/or its tobacco subsidiaries.

Environmental Regulation

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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.

At September 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.

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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.

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 September 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 .

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Standards Description Effective Date for Public Entity Effect on Financial Statements

Accounting Standards Update (“ASU”) No.

2023-09 Income Taxes (Topic 740):

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We are in the process of evaluating the impact of this guidance on our disclosures.

2025-05 Financial Instruments-Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets

The guidance provides a practical expedient for the calculation of current expected credit losses on current accounts receivable and current contract assets that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset.

The guidance is effective for fiscal years beginning after December 15, 2025, and interim periods within those fiscal years.

We are in the process of evaluating the impact of this guidance on our consolidated financial statements and related disclosures.

2025-06 Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40):

Targeted Improvements to the Accounting for Internal-Use Software

The guidance replaces the current framework that is based on software development project stages with updated criteria, focused on management’s authorization and the probability of project completion, to determine the timing for cost capitalization.

The guidance is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years.

We are in the process of evaluating the impact of this guidance on our consolidated financial statements and related disclosures.

2025-07 Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606):

Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract

The guidance refines the scope of Topic 815 by excluding from derivative accounting non-exchange trading contracts that have underlyings based on operations or activities specific to one of the parties to the contract with certain exceptions and clarifies the applicability of Topic 606 to share-based noncash consideration received from a customer in exchange for goods or services.

The guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within those fiscal years.

We are in the process of evaluating the impact of this guidance on our consolidated financial statements and related disclosures.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements