Although it still dominates the US market with a share of the retail market that exceeds 43%, the sales volumes of the Marlboro brand fell by nearly 2% in 2014. Indeed, the Marlboro brand has come under increased pressure from competitors and lower-priced cigarette brands, whereas sales were also hit by high tax hikes, stricter smoking bans in many states and the social stigma against smokers, which have all made the cigarette business tougher for all its participants. Marlboro is one of the most expensive brands for US smokers, since it sold for an average of $6.02 per pack during the fourth quarter of 2014, compared with an average of $4.55 per pack for the cheapest brand.
The Altria groups, which the owner of the nation’s biggest cigarette maker, Philip Morris USA that manufactures the Marlboro brand announced that for 2014 the number of cigarettes it shipped fell by nearly 2 percent to more than 31 billion cigarettes, but its share of the U.S. retail market rose by 0.1 percentage points, settling to 50.9 percent. Altria’s total revenue was up in 2014 by about 5 percent to $4.61 billion, excluding excise taxes. Altria, which is headquartered in Richmond, Virginia, ended the year 2014 by posting earnings of $1.24 billion, or 63 cents per share, which is better than the $488 million, or 24 cents a share, that it had achieved in 2013.
Altria officials have said that they believe that the difficult recession years are over and that adult tobacco consumers in the USA are now feeling better about their economic situation in the present and future, adding that therefore they expect a modest improvement in the tobacco industry during 2015. However, because they also believe that the decline in the smoking of traditional cigarettes is set to continue, they, as well as their competitors, are focusing their efforts of developing and promoting cigarette alternatives, such as electronic cigarettes, cigars, snuff and chewing tobacco.
Within this framework, the shipments of its smokeless tobacco brands such as Copenhagen and Skoal rose by 1 percent and its market share grew to 55.3 percent in 2014, while the Volumes for its Black & Mild cigars increased by 4 percent. In another relevant development, during the fourth quarter of 2014 Altria announced that it completed its national expansion of its MarkTen e-cigarette to more than 130,000 retail stores and remarked that this products is now ranked among the top brands based on retail market share.