Altria

Altria Group, Inc.
Company type	Public
Industry	Tobacco
Predecessor	Philip Morris Companies, Inc.
Founded	1985; 41 years ago
Headquarters	Henrico County, near Richmond, Virginia, United States
Area served	Worldwide
Key people	Martin Barrington (Chairman and CEO)
Products	Tobacco products, cigarettes, smokeless tobacco, electronic nicotine delivery systems, medical solutions for tobacco-related health conditions
Owner	Publicly traded company
Number of employees	7,100 (2020)
Website	www.altria.com

Altria Group, Inc. (known as Philip Morris Companies, Inc. until 2003) stands as a prominent American enterprise within the tobacco sector, specializing in the manufacture and distribution of tobacco products, cigarettes, and medical solutions for tobacco-induced health conditions. Based in Richmond, Virginia, Altria maintains a global presence supported by a varied portfolio.

Among Altria’s principal subsidiaries are Philip Morris USA, John Middleton, Inc., U.S. Smokeless Tobacco Company, Philip Morris Capital Corporation, and NJOY Holdings, Inc.. The company also possesses notable minority stakes in Belgian brewing giant AB InBev and Canadian cannabis firm Cronos Group. Altria is publicly traded on the S&P 500 index and was included in the Dow Jones Industrial Average from 1985 until 2008; its representation diminished following the spin-offs of Kraft Foods Inc. and Philip Morris International.

History

Altria's origins trace back to Philip Morris USA. The transition from Philip Morris Companies to Altria in 2003 was intended to highlight a broadened business scope beyond tobacco, including an 84% ownership of Kraft Foods, which was subsequently separated. The name "Altria," derived from a Latin term meaning "high," was chosen to help rebrand the company amid social and legal scrutiny. Marketing experts observed that this change aided in distancing the corporate image from negative tobacco associations, aligning with strategic goals to enhance reputation while maintaining profitability.

During the rebranding phase, Altria ranked 11th on the Fortune 500 list but fell to 137th by 2010; concurrently, Philip Morris International (PMI) achieved a ranking of 94. In 2006, U.S. courts ruled that Philip Morris and related entities had deceived the public regarding smoking hazards, including deliberately altering nicotine levels to heighten addiction—a verdict that significantly influenced regulatory frameworks and market conditions.

In 2007, Altria divested its majority 88.1% shareholding in Kraft Foods and initiated the separation of PMI shares, completing this process in 2008. That year also saw the acquisition of cigar producer John Middleton Co., broadening Altria’s tobacco offerings. PMI’s independence led to diminished demand for U.S.-made tobacco exports, resulting in plant shutdowns and workforce reductions.

The company moved its headquarters from New York City to Richmond, Virginia in 2008 to centralize manufacturing and executive functions closer to its primary market. Facilities include the Altria Center for Research and Technology along with production sites in Richmond; however, workforce cuts followed due to decreased demand after PMI's spin-off.

In 2009, Altria expanded into smokeless tobacco through acquiring UST Inc. (operating via U.S. Smokeless Tobacco Company) and entered the wine industry with Chateau Ste. Michelle, enhancing its diversified product range.

Strategic investments persisted with a $1.8 billion purchase securing a 45% interest in Cronos Group in December 2018, marking entry into cannabis-related sectors. That same month, Altria made a $12.8 billion investment for a 35% stake in e-cigarette manufacturer JUUL Labs, signaling a shift toward alternative nicotine delivery products. Despite this, by late 2019 Altria recorded a $4.5 billion impairment on Juul amid market difficulties; by mid-2022, the investment's value had dwindled to roughly 5% of its initial cost, though Altria continues supporting Juul to safeguard its market position.

In June 2019, Altria acquired a shareholding in Swiss tobacco firm Burger Söhne (Helix Innovations) for $372 million, further extending its international footprint.

On October 27, 2022, Altria partnered with Japan Tobacco to establish Horizon Innovations LLC—a joint venture where Altria holds a 75% majority—to introduce Japan Tobacco’s Ploom heated tobacco sticks into the U.S., subject to FDA approval anticipated by 2025.

Most recently, on June 1, 2023, Altria completed acquiring NJOY Holdings, Inc., strengthening its standing within the electronic nicotine delivery systems market.

This progression illustrates Altria’s adaptive business approach emphasizing diversification within tobacco-related segments alongside targeted investments in emerging nicotine markets to foster sustained growth amid evolving regulatory challenges.

Financial Overview

Altria, alongside its antecedent companies, has consistently ranked among the most successful publicly listed corporations throughout the 20th century.

For the fiscal year 2020, Altria disclosed a net profit of US$4.45 billion on total revenues amounting to US$26.15 billion. By October 2018, its stock price exceeded $66 per share, resulting in a market capitalization surpassing US$118.5 billion. In 2018, the company secured the 154th position on the Fortune 500 list based on revenue.

Year	Revenue (million US$)	Net Income (million US$)	Total Assets (million US$)	Share Price (US$)	Number of Employees
2006	18,790	12,022	104,270	9.59
2007	18,664	9,786	57,746	11.98
2008	19,356	4,930	27,215	12.11
2009	23,556	3,206	36,677	11.06
2010	24,363	3,890	37,402	15.08
2011	23,800	3,377	36,751	19.25
2012	24,618	4,167	35,329	24.79
2013	24,466	4,535	34,859	28.70	9,000
2014	24,522	5,058	34,475	35.86	9,000
2015	25,434	5,231	31,459	47.86	8,800
2016	25,744	14,215	45,932	59.00	8,300
2017	25,576	10,208	43,202	77.41	8,300
2018	25,364	6,955	55,495	48.89	8,300
2019	25,110
49,271	49.91	7,300
2020	26,153	4,454	47,414	41.00	7,100

Board of Directors

As of February 2013, Altria's board comprised prominent executives and industry authorities who provide strategic direction:

Martin Barrington – Chairman and Chief Executive Officer of Altria Group
Elizabeth E. Bailey – Professor emerita at the Wharton School of the University of Pennsylvania
Gerald L. Baliles (served 2008–2019) – Former Governor of Virginia and director at the Miller Center of Public Affairs
John T. Casteen III – President emeritus of the University of Virginia
Dinyar S. Devitre – Special advisor at General Atlantic Partners; previously served as Senior Vice President and Chief Financial Officer at Altria
Thomas F. Farrell II (served 2008–2021) – Chairman and CEO of Dominion Resources
Thomas W. Jones – Senior partner at TWJ Capital LLC; formerly an executive at Citigroup
Debra J. Kelly-Ennis – Former CEO of Diageo Canada; with prior experience at RJR Nabisco and The Coca-Cola Company
W. Leo Kiely III – Retired Chief Executive Officer of MillerCoors LLC
Kathryn B. McQuade – Former Executive Vice President and Chief Financial Officer at Canadian Pacific Railway
George Muñoz – Principal at Muñoz Investment Banking Group; ex-Assistant Secretary of the U.S. Treasury
Nabil Y. Sakkab – Retired Senior Vice President of Research and Development at Procter & Gamble

This governance framework underscores Altria’s commitment to seasoned leadership aimed at sustaining its competitive edge and supporting its worldwide subsidiaries and diverse product offerings.

Corporate Headquarters

Philip Morris initially maintained its headquarters in Midtown Manhattan, New York City. In 2003, the company revealed plans to relocate to Virginia with the objective of achieving annual savings exceeding $60 million while preserving approximately 750 positions within its former New York office. Presently, Altria’s main offices are situated in an unincorporated area within Henrico County, Virginia near Richmond. Additionally, the corporation operates a state-of-the-art Center for Research and Technology spanning 450,000 square feet and valued at $350 million within the Virginia BioTechnology Research Park, employing roughly 600 scientists, engineers, and support personnel.

Diversification

Altria has expanded its operations beyond the tobacco sector by investing in medical and biotechnology firms that target health issues associated with smoking. As of 2024, its healthcare holdings encompass Cronos Group, which operates in recreational cannabis; Lexaria Bioscience, known for its proprietary drug delivery system called DehydraTECH; and Micreos, a biotech company specializing in recombinant proteins for dermatological and oncological applications.

In the realm of electronic cigarettes, Altria initially introduced the MarkTen and Green Smoke brands but ceased their production in December 2018. The company later reentered this market segment by acquiring NJOY, signaling a strategic realignment aimed at increasing its presence in the evolving nicotine delivery product landscape.

Political influence

From 1998 through 2004, Altria allocated roughly $101 million toward lobbying efforts directed at the U.S. government, positioning it as the second-largest spender among all organizations nationwide during that period. Additionally, the company supported The Advancement of Sound Science Coalition, an entity that challenged the prevailing scientific agreement on human-induced climate change. Daniel Smith, representing Altria, holds a seat on the Private Enterprise Board of the American Legislative Exchange Council.

Controversies

In August 2006, Altria was adjudicated liable for civil fraud and racketeering concerning its promotion of "light" and "low tar" cigarettes. The court determined that these products were misleadingly marketed as safer options, constituting a violation of the Maine Unfair Trade Practices Act (MUTPA).

External links

Altria Group U.S. political contributions from Influence Explorer at the Sunlight Foundation