Tracking of New Tobacco Industry

Overview of the Global Situation:

According to Euromonitor, the global market size for new tobacco products is expected to reach $79.47 billion in 2022, a year-on-year growth of 17.1%. Among them, the global market size for smokeless tobacco/vapor electronic cigarettes/heated tobacco products is $13.95/26.81/33.38 billion, respectively, with year-on-year growth of 4.9%/17.8%/15.8%.

For vapor electronic cigarettes, the market size in North America/Western Europe/Asia-Pacific is expected to grow by 15.9%/27.0%/14.5% respectively, with Western Europe showing more outstanding growth due to the rapid increase in sales of disposable electronic cigarettes, while the slowing growth in the Asia-Pacific region is mainly due to the taste ban in the Chinese market since Q4 2022 affecting short-term market demand. In terms of HNB (heating but not burning), the market size in the Asia-Pacific/Eastern Europe/Western Europe is expected to grow by 12.1%/34.3%/4.8% respectively in 2022.

Philip Morris International:

In 2022, new tobacco revenue accounted for more than 30%, and core markets maintained steady growth. In 2022, the revenue of Philip Morris International’s new tobacco increased by 7.4% year-on-year to $9.91 billion, and the revenue share increased to 31.2%, with the growth rate slowing mainly due to the short-term sales pressure caused by the increase in tobacco tax in the Japanese market. In Q4 2022, the revenue increased by 18.2% year-on-year to $2.87 billion. The outstanding product power of IQOS ILUMA has continuously promoted the conversion rate of traditional smokers, and the number of IQOS users has reached 24.9 million by the end of 2022, with 17.8 million users replacing traditional cigarette consumption, with a high replacement rate of 71.49%. In terms of market share, Philip Morris International’s market share continued to increase in its main markets in 2022, with market share in Italy/Poland/Germany increasing by 3.1/1.9/1.7% respectively from 2021 to 14.6%/8.2%/4.8%. In addition, Philip Morris International regained its exclusive commercial rights to IQOS in the United States from April 30, 2024, and the future market development in the United States is promising.

British American Tobacco:

Driven by both vapor and HNB, new tobacco revenue continues to grow outstandingly. In 2022, the new tobacco business revenue of British American Tobacco increased by 40.9% year-on-year to £2.89 billion, with new tobacco revenue in H2 2022 reaching £1.61 billion, a year-on-year increase of 37.6%, maintaining outstanding growth. Looking at the categories, the revenue of vapor electronic cigarettes in 2022 increased by 54.9% year-on-year to £1.43 billion, with sales volume increasing by 14.4% year-on-year to 610 million, among which Vuse products achieved revenue of £1.13 billion, a year-on-year increase of 44.0%. In H2 2022, the revenue and sales volume of vapor electronic cigarettes of British American Tobacco increased by 54.8% and 11.1% year-on-year respectively. In terms of HNB, relying on the outstanding performance of Glo Hyper in various regions, the HNB business of British American Tobacco continued to grow rapidly, with the number of users increasing by nearly 30% to 8.8 million people, and the overall revenue in 2022 increased by 24.3% year-on-year to £1.06 billion.

Imperial Brands:

New tobacco business recovered and grew, and sales in the European region accelerated. In 2022, the new tobacco business of Imperial Brands achieved revenue of £210 million, a year-on-year increase of 10.8%, with revenue in H2 2022 reaching £110 million, a year-on-year increase of 15.1%. Although the myblu product of Imperial Brands received a marketing ban from the FDA in the United States in 2022, it still regained growth by relying on the rapid recovery in the European region. In 2022, the revenue of new tobacco in the European region increased by 31.4% year-on-year to £170 million, while the revenue in the United States region decreased by 25.1% year-on-year to £40 million.

Japan Tobacco:

The new tobacco business maintained steady development, and the sales volume of Ploom X in the Japanese market doubled. In 2022, the new tobacco business revenue of Japan Tobacco reached ¥75.4 billion, a year-on-year increase of 4.4%. In Q4 2022, the revenue of new tobacco reached ¥16.6 billion, a year-on-year increase of 18.7%, with sales volume reaching 1.9 billion, a year-on-year increase of 9.2%. Looking at the regions, relying on the sales of Ploom X in Japan, the sales volume of RRP products in the Japanese market in 2022 increased by 30.4% year-on-year to 6 billion, and the market share increased by 1.7 percentage points to 11.9% from 2021, while the sales volume of RRP products in overseas markets decreased slightly by 24% year-on-year to 1.9 billion.

Summary:

From the development of various regions and tobacco giants in 2022, although there are differences, it can be clearly seen that new tobacco products have become the trend in the overseas market, and the new tobacco business has gradually become an important growth driver for various tobacco giants.