Philip Morris' ILUMA Rollout: Key Driver of H2 Volume Growth?

Philip Morris International is relying on its ILUMA platform to drive heated tobacco unit volume growth in H2 2025. The rollout of ILUMA i and an expanding consumables range have boosted user adoption and market share, particularly in Europe. The company estimates smoke-free product volume growth of 12-14% in 2025, with ILUMA expected to contribute meaningfully to balancing declines in the combustible segment. Shares of Philip Morris have lost 5.7% in the past month and trade at a forward P/E ratio of 21.17X.

Philip Morris International (PM) is leveraging its ILUMA platform to sustain momentum for its heated tobacco unit (HTU) in the second half of 2025. In the second quarter of 2025, adjusted in-market sales growth for HTUs reaccelerated to 11.4%, with Europe up 9.1% and Japan advancing 7.8%. The rollout of ILUMA i and an expanding consumables range, including DELIA and the tobacco-free LEVIA, have significantly boosted user adoption and market share, particularly in Europe. ILUMA's expansion helped IQOS HTU share climb 1.2 percentage points to 10.9%, with offtake share topping 20% in key cities of 12 markets [1].

Japan remains a cornerstone market, with over 10 million users and strong performance from TEREA and SENTIA consumables. Philip Morris has now launched ILUMA in more than 30 markets, leveraging experience from mature markets to accelerate awareness, conversion, and switching among legal-age smokers [1]. The company estimates smoke-free product volume growth of 12-14% in 2025, with ILUMA expected to contribute meaningfully to balancing declines in the combustible segment [1].

Shares of Philip Morris have lost 5.7% in the past month and trade at a forward P/E ratio of 21.17X [2]. The Zacks Consensus Estimate for PM’s 2025 and 2026 earnings per share has inched up by 4 cents and 7 cents in the past 30 days to $7.49 and $8.39, respectively [2]. Despite the recent stock price decline, investors should closely monitor the continued rollout of ILUMA and its impact on market share and user adoption in key markets.

References:
[1] https://finviz.com/news/136937/philip-morris-iluma-rollout-will-it-power-h2-volume-growth
[2] https://simplywall.st/stocks/us/food-beverage-tobacco/nyse-pm/philip-morris-international/news/is-veevs-surging-global-shipments-changing-the-investment-ca