false2022Q1000076418012/310.33330.33332100007641802022-01-012022-03-310000764180mo:CommonStock0.3313ParValueMember2022-01-012022-03-310000764180mo:CommonStock1.000NotesDue2023Member2022-01-012022-03-310000764180mo:CommonStock1.700NotesDue2025Member2022-01-012022-03-310000764180mo:CommonStock2.200NotesDue2027Member2022-01-012022-03-310000764180mo:CommonStock3.125NotesDue2031Member2022-01-012022-03-3100007641802022-04-19xbrli:shares00007641802022-03-31iso4217:USD00007641802021-12-31iso4217:USDxbrli:shares00007641802021-01-012021-03-310000764180us-gaap:CommonStockMember2021-12-310000764180us-gaap:AdditionalPaidInCapitalMember2021-12-310000764180us-gaap:RetainedEarningsMember2021-12-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000764180us-gaap:TreasuryStockMember2021-12-310000764180us-gaap:RetainedEarningsMember2022-01-012022-03-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000764180us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310000764180us-gaap:TreasuryStockMember2022-01-012022-03-310000764180us-gaap:CommonStockMember2022-03-310000764180us-gaap:AdditionalPaidInCapitalMember2022-03-310000764180us-gaap:RetainedEarningsMember2022-03-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000764180us-gaap:TreasuryStockMember2022-03-310000764180us-gaap:CommonStockMember2020-12-310000764180us-gaap:AdditionalPaidInCapitalMember2020-12-310000764180us-gaap:RetainedEarningsMember2020-12-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000764180us-gaap:TreasuryStockMember2020-12-310000764180us-gaap:NoncontrollingInterestMember2020-12-3100007641802020-12-310000764180us-gaap:RetainedEarningsMember2021-01-012021-03-310000764180us-gaap:NoncontrollingInterestMember2021-01-012021-03-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000764180us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310000764180us-gaap:TreasuryStockMember2021-01-012021-03-310000764180us-gaap:CommonStockMember2021-03-310000764180us-gaap:AdditionalPaidInCapitalMember2021-03-310000764180us-gaap:RetainedEarningsMember2021-03-310000764180us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000764180us-gaap:TreasuryStockMember2021-03-310000764180us-gaap:NoncontrollingInterestMember2021-03-3100007641802021-03-310000764180mo:January2021ShareRepurchaseProgramMember2021-01-310000764180mo:January2021ShareRepurchaseProgramMember2021-10-280000764180mo:January2021ShareRepurchaseProgramMember2022-03-310000764180mo:January2021ShareRepurchaseProgramMember2022-01-012022-03-310000764180mo:January2021ShareRepurchaseProgramMember2021-01-012021-03-310000764180mo:ABInBevMember2022-03-310000764180mo:ABInBevMember2021-12-310000764180mo:JUULMember2022-03-310000764180mo:JUULMember2021-12-310000764180mo:CronosGroupInc.Member2022-03-310000764180mo:CronosGroupInc.Member2021-12-310000764180mo:CronosGroupInc.Memberus-gaap:CommonStockMember2022-03-310000764180mo:CronosGroupInc.Memberus-gaap:CommonStockMember2021-12-310000764180mo:ABInBevMember2022-01-012022-03-310000764180mo:ABInBevMember2021-01-012021-03-310000764180mo:CronosGroupInc.Member2022-01-012022-03-310000764180mo:CronosGroupInc.Member2021-01-012021-03-310000764180mo:JUULMember2022-01-012022-03-310000764180mo:JUULMember2021-01-012021-03-31xbrli:pure0000764180mo:ABInBevMemberus-gaap:FairValueInputsLevel1Member2022-03-310000764180mo:ABInBevMemberus-gaap:FairValueInputsLevel1Member2021-12-310000764180mo:ABInBevEfesMembermo:ABInBevMember2022-03-310000764180mo:JUULMember2018-12-012018-12-310000764180mo:JUULMember2018-12-310000764180mo:JUULMember2020-01-31mo:director0000764180mo:JUULMembermo:EquityMethodInvestmentsFairValueOptionMember2020-12-310000764180mo:JUULMembermo:EquityMethodInvestmentsFairValueOptionMember2021-01-012021-12-310000764180mo:JUULMembermo:EquityMethodInvestmentsFairValueOptionMember2021-12-310000764180mo:JUULMembermo:EquityMethodInvestmentsFairValueOptionMember2022-01-012022-03-310000764180mo:JUULMembermo:EquityMethodInvestmentsFairValueOptionMember2022-03-310000764180mo:CronosGroupInc.Memberus-gaap:SubsequentEventMember2022-04-250000764180mo:EquityContractPreemptiveRIghtsMembermo:CronosGroupInc.Member2022-03-31iso4217:CADxbrli:shares0000764180mo:CronosGroupInc.Membermo:EquityContractWarrantMember2022-03-310000764180mo:CronosGroupInc.Membermo:EquityContractWarrantMember2022-01-012022-03-31iso4217:CAD0000764180mo:EquityContractPreemptiveRIghtsMembermo:CronosGroupInc.Member2022-01-012022-03-310000764180mo:CronosGroupInc.Memberus-gaap:SubsequentEventMembermo:EquityContractWarrantMember2022-04-252022-04-250000764180mo:EquityContractPreemptiveRIghtsMembermo:CronosGroupInc.Memberus-gaap:SubsequentEventMember2022-04-252022-04-250000764180mo:CronosGroupInc.Membermo:EquityContractWarrantAndEquityContractPreemptiveRightsMember2022-01-012022-03-310000764180mo:EquityContractPreemptiveRIghtsMember2022-01-012022-03-310000764180mo:EquityContractPreemptiveRIghtsMember2021-01-012021-03-310000764180mo:EquityContractWarrantMember2022-01-012022-03-310000764180mo:EquityContractWarrantMember2021-01-012021-03-310000764180mo:ForeignCurrencyDenominatedDebtMember2022-03-310000764180mo:ForeignCurrencyDenominatedDebtMember2021-12-310000764180us-gaap:ForeignExchangeContractMemberus-gaap:NetInvestmentHedgingMember2022-01-012022-03-310000764180us-gaap:ForeignExchangeContractMemberus-gaap:NetInvestmentHedgingMember2021-01-012021-03-310000764180mo:ForeignCurrencyDenominatedDebtMemberus-gaap:NetInvestmentHedgingMember2022-01-012022-03-310000764180mo:ForeignCurrencyDenominatedDebtMemberus-gaap:NetInvestmentHedgingMember2021-01-012021-03-310000764180us-gaap:NetInvestmentHedgingMember2022-01-012022-03-310000764180us-gaap:NetInvestmentHedgingMember2021-01-012021-03-310000764180us-gaap:PensionPlansDefinedBenefitMember2022-01-012022-03-310000764180us-gaap:PensionPlansDefinedBenefitMember2021-01-012021-03-310000764180us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2022-01-012022-03-310000764180us-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2021-01-012021-03-310000764180srt:MaximumMemberus-gaap:OtherPostretirementBenefitPlansDefinedBenefitMember2022-03-310000764180srt:MaximumMemberus-gaap:PensionPlansDefinedBenefitMember2022-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-12-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2021-12-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2021-12-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-01-012022-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2022-01-012022-03-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2022-01-012022-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2022-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2022-03-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2022-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2020-12-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2020-12-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2020-12-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-01-012021-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2021-01-012021-03-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2021-01-012021-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMember2021-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMember2021-03-310000764180us-gaap:AccumulatedTranslationAdjustmentMember2021-03-310000764180us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2022-01-012022-03-310000764180us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMemberus-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetUnamortizedGainLossMember2021-01-012021-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentNetPriorServiceCostCreditMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000764180us-gaap:AccumulatedDefinedBenefitPlansAdjustmentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000764180mo:AccumulatedEquityMethodInvestmentsAttributableToParentMemberus-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000764180us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000764180us-gaap:ReclassificationOutOfAccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000764180mo:SmokeableProductsSegmentMember2022-01-012022-03-310000764180mo:SmokeableProductsSegmentMember2021-01-012021-03-310000764180mo:OralTobaccoSegmentMember2022-01-012022-03-310000764180mo:OralTobaccoSegmentMember2021-01-012021-03-310000764180mo:WineSegmentMember2022-01-012022-03-310000764180mo:WineSegmentMember2021-01-012021-03-310000764180us-gaap:AllOtherSegmentsMember2022-01-012022-03-310000764180us-gaap:AllOtherSegmentsMember2021-01-012021-03-310000764180us-gaap:MaterialReconcilingItemsMember2022-01-012022-03-310000764180us-gaap:MaterialReconcilingItemsMember2021-01-012021-03-310000764180us-gaap:CorporateNonSegmentMember2022-01-012022-03-310000764180us-gaap:CorporateNonSegmentMember2021-01-012021-03-310000764180us-gaap:OperatingSegmentsMembermo:PhilipMorrisUSAMemberus-gaap:OperatingIncomeLossMembermo:NpmAdjustmentToCostOfSalesMembermo:SmokeableProductsSegmentMembermo:NonParticipatingManufacturerArbitrationPanelDecisionMember2022-01-012022-03-310000764180us-gaap:OperatingSegmentsMembermo:PhilipMorrisUSAMemberus-gaap:OperatingIncomeLossMembermo:NpmAdjustmentToCostOfSalesMembermo:SmokeableProductsSegmentMembermo:NonParticipatingManufacturerArbitrationPanelDecisionMember2021-01-012021-03-310000764180us-gaap:OperatingSegmentsMembermo:PhilipMorrisUSAMemberus-gaap:OperatingIncomeLossMembermo:SmokeableProductsSegmentMembermo:TobaccoandHealthLitigationCasesMember2022-01-012022-03-310000764180us-gaap:OperatingSegmentsMembermo:PhilipMorrisUSAMemberus-gaap:OperatingIncomeLossMembermo:SmokeableProductsSegmentMembermo:TobaccoandHealthLitigationCasesMember2020-01-012020-03-310000764180mo:RevolvingCreditFacilityDueAugust2024Memberus-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2022-01-012022-03-310000764180mo:RevolvingCreditFacilityDueAugust2024Memberus-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2022-03-310000764180mo:RevolvingCreditFacilityDueAugust2024Memberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:RevolvingCreditFacilityMemberus-gaap:LineOfCreditMember2022-01-012022-03-310000764180us-gaap:RevolvingCreditFacilityMember2022-01-012022-03-310000764180mo:USDDenominatedNotesMemberus-gaap:SeniorNotesMember2021-03-310000764180us-gaap:SeniorNotesMember2021-03-310000764180mo:USDDenominatedNotes3490PercentDue2022Memberus-gaap:SeniorNotesMember2021-03-310000764180mo:USDDenominatedNotes3490PercentDue2022Memberus-gaap:SeniorNotesMember2021-01-012021-03-31mo:state0000764180mo:LitigationCasesResultsMembermo:TobaccoandHealthJudgmentMember2022-01-012022-03-310000764180mo:LitigationCasesResultsMembermo:TobaccoandHealthJudgmentMember2021-01-012021-03-310000764180mo:InterestExpenseRelatedToLitigationMember2022-01-012022-03-310000764180mo:InterestExpenseRelatedToLitigationMember2021-01-012021-03-310000764180mo:TobaccoandHealthJudgmentMember2004-10-012022-03-310000764180mo:EngleProgenyCasesMember2004-10-012022-03-310000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberus-gaap:PendingLitigationMemberus-gaap:AssetsMember2022-04-250000764180us-gaap:SubsequentEventMembermo:IndividualSmokingAndHealthCasesMember2022-04-25mo:claim0000764180mo:IndividualSmokingAndHealthCasesMember2020-10-270000764180mo:IndividualSmokingAndHealthCasesMember2019-10-280000764180us-gaap:SubsequentEventMembermo:HealthCareCostRecoveryActionsMember2022-04-250000764180mo:HealthCareCostRecoveryActionsMember2020-10-270000764180mo:HealthCareCostRecoveryActionsMember2019-10-280000764180us-gaap:SubsequentEventMembermo:EvaporLitigationMember2022-04-250000764180mo:EvaporLitigationMember2020-10-270000764180mo:EvaporLitigationMember2019-10-280000764180us-gaap:SubsequentEventMembermo:OtherTabaccoRelatedCasesMember2022-04-250000764180mo:OtherTabaccoRelatedCasesMember2020-10-270000764180mo:OtherTabaccoRelatedCasesMember2019-10-280000764180us-gaap:SubsequentEventMemberus-gaap:PendingLitigationMembermo:IndividualSmokingAndHealthCasesMemberstpr:IL2022-04-250000764180us-gaap:SubsequentEventMemberus-gaap:PendingLitigationMemberstpr:NMmo:IndividualSmokingAndHealthCasesMember2022-04-250000764180us-gaap:SubsequentEventMemberstpr:MAus-gaap:PendingLitigationMembermo:IndividualSmokingAndHealthCasesMember2022-04-250000764180us-gaap:SubsequentEventMemberus-gaap:PendingLitigationMembermo:IndividualSmokingAndHealthCasesMemberstpr:FL2022-04-250000764180mo:ETSSmokingandHealthCaseFlightAttendantsMemberus-gaap:SubsequentEventMemberus-gaap:PendingLitigationMember2022-04-252022-04-25mo:casemo:lawsuit0000764180us-gaap:SubsequentEventMembermo:PendingIndividualLawsuitsMembermo:EvaporLitigationMember2022-04-250000764180us-gaap:SubsequentEventMembermo:PendingLawsuitsFiledByStateOrLocalGovernmentsMembermo:EvaporLitigationMember2022-04-250000764180mo:ClassActionLawsuitMemberus-gaap:SubsequentEventMembermo:EvaporLitigationMember2022-04-250000764180country:CAus-gaap:SubsequentEventMembermo:HealthCareCostRecoveryActionsMember2022-04-250000764180country:CAmo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:HealthCareCostRecoveryActionsMember2022-04-250000764180country:CAus-gaap:SubsequentEventMembermo:HealthCareCostRecoveryActionsMembermo:PhilipMorrisUSAandAltriaGroupMember2022-04-250000764180mo:SmokingAndHealthClassActionsMembercountry:CAus-gaap:SubsequentEventMembermo:PhilipMorrisUSAandAltriaGroupMember2022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:EngleProgenyCasesMember2022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberstpr:AKus-gaap:SubsequentEventMember1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:CA1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:CT1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:FL1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:LA1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:MA1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:MS1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:MO1999-01-012022-04-250000764180stpr:NHmo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember1999-01-012022-04-250000764180stpr:NJmo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember1999-01-012022-04-250000764180stpr:NYmo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:OH1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:PA1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:RI1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberstpr:TNus-gaap:SubsequentEventMember1999-01-012022-04-250000764180mo:NonEngleProgenyCasesMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberstpr:WV1999-01-012022-04-250000764180mo:NonEngleProgenySmokingAndHealthCasePrincipeMember2020-02-290000764180mo:NonEngleProgenySmokingandHealthCaseGreeneMember2019-09-300000764180mo:NonEngleProgenySmokingandHealthCaseGreeneMember2020-05-310000764180mo:NonEngleProgenySmokingandHealthCaseGreeneMember2021-02-280000764180mo:NonEngleProgenySmokingandHealthCaseLaramieMember2019-08-310000764180mo:NonEngleProgenySmokingandHealthCaseLaramieMember2021-09-012021-09-300000764180mo:NonEngleProgenySmokingandHealthCaseLaramieMember2021-12-012021-12-310000764180mo:NonEngleProgenySmokingandHealthCaseGentileMember2017-10-310000764180mo:PhilipMorrisUSAMembermo:NonEngleProgenySmokingandHealthCaseGentileMember2017-10-310000764180mo:EngleProgenyCasesMember2000-07-310000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesMember2000-07-310000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesMember2006-07-012006-07-310000764180mo:EngleProgenyCasesMember2008-01-310000764180mo:EngleProgenyCasesStateMemberus-gaap:SubsequentEventMember2022-04-250000764180mo:EngleProgenyCasesStateMemberus-gaap:SubsequentEventMember2022-04-252022-04-25mo:plantiff0000764180mo:EngleProgenyCasesFederalMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:EngleProgenyCasesMember2022-04-252022-04-250000764180mo:EngleProgenyCasesStateMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-252022-04-250000764180mo:EngleProgenyCasesPearsonDCohenCollarChaconMemberMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-252022-04-250000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesReiderandBanksMemberus-gaap:SubsequentEventMember2022-04-252022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:EngleProgenyCasesWeingartandHancockMember2022-04-252022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:EngleProgenyCasesPollariMember2022-04-252022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMembermo:EngleProgenyCasesGlogerRintoulandDuignamMember2022-04-252022-04-250000764180mo:EngleProgenyCasesFreemanMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-252022-04-250000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-250000764180us-gaap:SubsequentEventMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesSchertzerMember2022-04-300000764180mo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesSchertzerMember2022-04-300000764180mo:EngleProgenyCasesLippMemberus-gaap:PendingLitigationMember2022-03-310000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesLippMemberus-gaap:PendingLitigationMember2022-03-310000764180mo:EngleProgenyCasesGarciaMemberus-gaap:PendingLitigationMember2021-05-310000764180mo:EngleProgenyCasesDuignanMemberus-gaap:PendingLitigationMember2020-02-290000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesDuignanMemberus-gaap:PendingLitigationMember2020-02-290000764180mo:EngleProgenyCasesCuddiheeMemberus-gaap:PendingLitigationMember2020-01-310000764180mo:EngleProgenyCasesCuddiheeMembermo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMember2020-01-310000764180mo:EngleProgenyCasesRintoulMemberus-gaap:PendingLitigationMember2019-11-300000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesRintoulMemberus-gaap:PendingLitigationMember2019-11-300000764180mo:EngleProgenyCasesGlogerMemberus-gaap:PendingLitigationMember2019-11-300000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesGlogerMemberus-gaap:PendingLitigationMember2019-11-300000764180mo:EngleProgenyCasesMcCallMemberus-gaap:PendingLitigationMember2019-09-300000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesMcCallMemberus-gaap:PendingLitigationMember2019-09-300000764180mo:EngleProgenyCasesNeffMemberus-gaap:PendingLitigationMember2019-09-300000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesNeffMemberus-gaap:PendingLitigationMember2019-09-300000764180mo:EngleProgenyCasesMahfuzMemberus-gaap:PendingLitigationMember2019-02-280000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesMahfuzMemberus-gaap:PendingLitigationMember2019-02-280000764180us-gaap:PendingLitigationMembermo:EngleProgenyCasesHollimanMember2019-02-280000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesHollimanMember2019-02-280000764180mo:EngleProgenyCasesChadwellMemberus-gaap:PendingLitigationMember2019-03-310000764180mo:PhilipMorrisUSAMembermo:EngleProgenyCasesChadwellMemberus-gaap:PendingLitigationMember2019-03-310000764180mo:EngleProgenyCasesKaplanMemberus-gaap:PendingLitigationMember2018-07-310000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesKaplanMember2018-07-310000764180mo:EngleProgenyCasesR.DouglasMemberus-gaap:PendingLitigationMember2017-11-300000764180mo:EngleProgenyCasesR.DouglasMembermo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMember2017-11-300000764180us-gaap:PendingLitigationMembermo:EngleProgenyCasesSommersMember2017-04-300000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesSommersMember2017-04-300000764180us-gaap:PendingLitigationMembermo:EngleProgenyCasesSommersMember2022-01-012022-03-310000764180us-gaap:PendingLitigationMembermo:EngleProgenyCasesCooperMember2016-03-310000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesCooperMember2016-03-310000764180mo:EngleProgenyCasesD.BrownMemberus-gaap:PendingLitigationMember2015-01-310000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:EngleProgenyCasesD.BrownMember2015-01-310000764180mo:EngleProgenyCasesStateMemberstpr:FL2009-06-300000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:AR1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:CA1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:DEmo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:DC1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:FL1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:IL1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:IAmo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:KS1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:LA1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:MD1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:MImo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:MN1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:NVmo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:NJmo:PhilipMorrisUSAMember1996-05-012022-03-310000764180stpr:NYmo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:OH1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:OKmo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:OR1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:PA1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMembercountry:PR1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:SC1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:PhilipMorrisUSAMemberstpr:TX1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMemberstpr:WImo:PhilipMorrisUSAMember1996-05-012022-03-310000764180mo:SmokingAndHealthClassActionsMembermo:BritishColumbiaSaskatchewanMemberus-gaap:SubsequentEventMembermo:PhilipMorrisUSAandAltriaGroupMember2022-04-250000764180mo:SmokingAndHealthClassActionsMembercountry:CAmo:CanadianTobaccoManufacturersMember2019-09-30mo:manufacture0000764180mo:SmokingAndHealthClassActionsMembermo:AltriaGroupMembercountry:CA2019-09-30mo:ruling0000764180mo:SmokingAndHealthClassActionsMembercountry:CAmo:CanadianTobaccoManufacturersMember2019-03-012019-03-310000764180country:CAmo:HealthCareCostRecoveryActionsMemberus-gaap:ThreatenedLitigationMember2022-03-310000764180mo:SmokingAndHealthClassActionsMembercountry:CAmo:CanadianTobaccoManufacturersMember2022-03-310000764180mo:HealthCareCostRecoveryActionsMember1998-11-011998-11-300000764180mo:HealthCareCostRecoveryActionsMember1998-11-300000764180mo:HealthCareCostRecoveryActionsMember2021-01-012021-03-310000764180mo:HealthCareCostRecoveryActionsMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2004NPMAdjustmentMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2005NPMAdjustmentMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2006NPMAdjustmentMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2007NPMAdjustmentMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2008NPMAdjustmentMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2009NPMAdjustmentMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2010NPMAdjustmentMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2011NPMAdjustmentMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2012NPMAdjustmentMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2013NPMAdjustmentMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2014NPMAdjustmentMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2015NPMAdjustmentsMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2016NPMAdjustmentsMemberMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2017NPMAdjustmentsMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2018NPMAdjustmentsMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2019NPMAdjustmentsMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions2020NPMAdjustmentsMembermo:PhilipMorrisUSAMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActions2021NPMAdjustmentsMember2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActionsMember2018-01-012018-12-310000764180mo:PhilipMorrisUSAMemberus-gaap:SettledLitigationMembermo:HealthCareCostRecoveryActionsMember2018-01-012018-12-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActionsMemberus-gaap:PendingLitigationMember2018-01-012018-12-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActionsMember2022-03-012022-03-310000764180mo:HealthCareCostRecoveryActionsTransitionYears20042021Membermo:PhilipMorrisUSAMemberus-gaap:SettledLitigationMemberstpr:IL2022-03-012022-03-310000764180mo:PhilipMorrisUSAMemberus-gaap:SettledLitigationMembermo:HealthCareCostRecoveryActionsTransitionYears20192021Memberstpr:IL2022-03-012022-03-310000764180mo:PhilipMorrisUSAMemberstpr:IL2022-01-012022-03-310000764180mo:PhilipMorrisUSAMembermo:HealthCareCostRecoveryActionsMember2022-01-012022-03-310000764180stpr:NYmo:PhilipMorrisUSAMemberus-gaap:SettledLitigationMembermo:HealthCareCostRecoveryActionsTransitionYears20042020Member2015-01-012015-12-310000764180mo:PhilipMorrisUSAMemberus-gaap:SettledLitigationMemberstpr:MT2020-01-012020-12-310000764180mo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:HealthCareCostRecoveryActions2004NPMAdjustmentMember2022-01-012022-03-310000764180us-gaap:CostOfSalesMembermo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMembermo:HealthCareCostRecoveryActions2004NPMAdjustmentMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions20052007NPMAdjustmentMembermo:PhilipMorrisUSAMemberus-gaap:PendingLitigationMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions20052007NPMAdjustmentMembermo:PhilipMorrisUSAMembermo:PeriodOneMemberus-gaap:PendingLitigationMember2022-01-012022-03-310000764180mo:HealthCareCostRecoveryActions20052007NPMAdjustmentMembermo:PhilipMorrisUSAMembermo:PeriodTwoMemberus-gaap:PendingLitigationMember2022-01-012022-03-310000764180mo:OtherDisputesUndertheStateSettlementAgreementsMembermo:PhilipMorrisUSAMember2021-01-012021-01-310000764180mo:FederalGovernmentsLawsuitMember2006-08-012006-08-310000764180mo:PhilipMorrisUSAMembermo:FederalGovernmentsLawsuitMembermo:ImplementationofCorrectiveCommunicationsMember2014-01-012014-12-310000764180mo:PhilipMorrisUSAMembermo:FederalGovernmentsLawsuitMembermo:ImplementationofCorrectiveCommunicationsMember2019-01-012019-12-310000764180mo:AltriaGroupMembermo:FederalGovernmentsLawsuitMembermo:ImplementationofCorrectiveCommunicationsMember2014-01-012014-12-310000764180mo:AltriaGroupMembermo:FederalGovernmentsLawsuitMembermo:ImplementationofCorrectiveCommunicationsMember2019-01-012019-12-310000764180country:CAmo:PendingClassActionLawsuitMemberus-gaap:SubsequentEventMembermo:EvaporLitigationMember2022-04-250000764180mo:PendingLawsuitFiledBySchoolDistrictMemberus-gaap:SubsequentEventMembermo:EvaporLitigationMember2022-04-250000764180mo:EvaporLitigationMember2022-03-310000764180us-gaap:SettledLitigationMemberus-gaap:SubsequentEventMembermo:EvaporLitigationMember2022-04-252022-04-250000764180mo:IQOSMember2020-04-012020-04-300000764180mo:JUULMember2020-04-300000764180us-gaap:SubsequentEventMember2022-04-2500007641802020-11-30mo:complaint00007641802022-02-012022-02-2800007641802019-10-012019-12-31mo:shareholder00007641802021-10-012021-12-3100007641802021-01-012021-12-3100007641802022-01-012022-01-3100007641802020-08-012020-08-3100007641802020-10-012021-03-3100007641802021-04-012021-04-3000007641802020-09-012021-08-3100007641802021-07-012021-07-310000764180mo:LightsMemberus-gaap:SubsequentEventMember2022-04-250000764180mo:SmokingAndHealthClassActionsMemberus-gaap:SubsequentEventMember2022-04-250000764180us-gaap:SubsequentEventMembermo:PendingIndividualLawsuitsMembermo:USTLitigationMember2022-04-250000764180us-gaap:LetterOfCreditMember2022-03-310000764180us-gaap:RevolvingCreditFacilityMembermo:CreditAgreementMember2022-03-310000764180mo:LightsMembermo:PhilipMorrisUSAMemberus-gaap:SubsequentEventMember2022-04-25mo:court

FORM 10-Q

☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Virginia

13-3260245

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

6601 West Broad Street,

Richmond,

Virginia

23230

(Address of principal executive offices)

(Zip Code)

Title of each class			Trading Symbols			Name of each exchange on which registered
Common Stock, $0.33 1/3 par value			MO			New York Stock Exchange
1.000% Notes due 2023			MO23A			New York Stock Exchange
1.700% Notes due 2025			MO25			New York Stock Exchange
2.200% Notes due 2027			MO27			New York Stock Exchange
3.125% Notes due 2031			MO31			New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes   þ     No   ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).     Yes   þ    No  ¨

Large accelerated filer

þ

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

									Page No.
PART I -						FINANCIAL INFORMATION
Item 1.						Financial Statements (Unaudited)
						Condensed Consolidated Balance Sheets at March 31, 2022 and December 31, 2021			3
						Condensed Consolidated Statements of Earnings for the Three Months Ended March 31, 2022 and 2021			5
						Condensed Consolidated Statements of Comprehensive Earnings for the Three Months Ended March 31, 2022 and 2021			6
						Condensed Consolidated Statements of Stockholders’ Equity (Deficit) for the Three Months Ended March 31, 2022 and 2021			7
						Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021			8
						Notes to Condensed Consolidated Financial Statements			10
Item 2.						Management’s Discussion and Analysis of Financial Condition and Results of Operations			33
Item 3.						Quantitative and Qualitative Disclosures About Market Risk			60
Item 4.						Controls and Procedures			60
PART II -						OTHER INFORMATION
Item 1.						Legal Proceedings			61
Item 1A.						Risk Factors			61
Item 2.						Unregistered Sales of Equity Securities and Use of Proceeds			61
Item 6.						Exhibits			62
Signature						Signature			63

						March 31, 2022						December 31, 2021
Assets
Cash and cash equivalents						$	5,353					$	4,544
Receivables						46						47
Inventories:
Leaf tobacco						677						744
Other raw materials						179						166
Work in process						30						23
Finished product						328						261
						1,214						1,194
Other current assets						149						298
Total current assets						6,762						6,083
Property, plant and equipment, at cost						4,300						4,432
Less accumulated depreciation						2,753						2,879
						1,547						1,553
Goodwill						5,177						5,177
Other intangible assets, net						12,289						12,306
Investments in equity securities ($1,610 million and $1,720 million at March 31, 2022 and December 31, 2021, respectively, measured at fair value)						13,479						13,481
Other assets						981						923
Total Assets						$	40,235					$	39,523

						March 31, 2022						December 31, 2021
Liabilities
Current portion of long-term debt						$	2,517					$	1,105
Accounts payable						379						449
Accrued liabilities:
Marketing						658						664
Settlement charges						4,229						3,349
Other						1,508						1,365
Dividends payable						1,637						1,647
Total current liabilities						10,928						8,579
Long-term debt						25,405						26,939
Deferred income taxes						3,766						3,692
Accrued pension costs						199						200
Accrued postretirement health care costs						1,438						1,436
Other liabilities						259						283
Total liabilities						41,995						41,129
Contingencies (Note 10)
Stockholders’ Equity (Deficit)
Common stock, par value $0.33 1/3 per share (2,805,961,317 shares issued)						935						935
Additional paid-in capital						5,848						5,857
Earnings reinvested in the business						30,988						30,664
Accumulated other comprehensive losses						(2,962)						(3,056)
Cost of repurchased stock (993,749,776 shares at March 31, 2022 and 982,785,699 shares at December 31, 2021)						(36,569)						(36,006)
Total stockholders’ equity (deficit)						(1,760)						(1,606)
Total Liabilities and Stockholders’ Equity (Deficit)						$	40,235					$	39,523

For the Three Months Ended March 31,						2022						2021
Net revenues						$	5,892					$	6,036
Cost of sales						1,446						1,608
Excise taxes on products						1,073						1,156
Gross profit						3,373						3,272
Marketing, administration and research costs						489						582
Operating income						2,884						2,690
Interest and other debt expense, net						281						308
Net periodic benefit income, excluding service cost						(46)						(43)
Loss on early extinguishment of debt						—						649
(Income) losses from equity investments						(34)						(51)
(Gain) loss on Cronos-related financial instruments						10						(110)
Earnings before income taxes						2,673						1,937
Provision for income taxes						714						516
Net earnings						1,959						1,421
Net losses attributable to noncontrolling interests						—						3
Net earnings attributable to Altria						$	1,959					$	1,424
Per share data:
Basic and diluted earnings per share attributable to Altria						$	1.08					$	0.77

For the Three Months Ended March 31,						2022						2021
Net earnings						$	1,959					$	1,421
Other comprehensive earnings (losses), net of deferred income taxes:
Benefit plans						15						28
ABI						78						517
Currency translation adjustments and other						1						22
Other comprehensive earnings (losses), net of deferred income taxes						94						567
Comprehensive earnings						2,053						1,988
Comprehensive losses attributable to noncontrolling interests						—						3
Comprehensive earnings attributable to Altria						$	2,053					$	1,991

						Common Stock						Additional Paid-in Capital						Earnings Reinvested in the Business						Accumulated Other Comprehensive Losses						Cost of Repurchased Stock												Total Stockholders’ Equity (Deficit)
Balances, December 31, 2021						$	935					$	5,857					$	30,664					$	(3,056)					$	(36,006)											$	(1,606)
Net earnings						—						—						1,959						—						—												1,959
Other comprehensive earnings (losses), net of deferred income taxes						—						—						—						94						—												94
Stock award activity						—						(9)						—						—						13												4
Cash dividends declared ($0.90 per share)						—						—						(1,635)						—						—												(1,635)
Repurchases of common stock						—						—						—						—						(576)												(576)
Balances, March 31, 2022						$	935					$	5,848					$	30,988					$	(2,962)					$	(36,569)											$	(1,760)

						Attributable to Altria
						Common Stock						Additional Paid-in Capital						Earnings Reinvested in the Business						Accumulated Other Comprehensive Losses						Cost of Repurchased Stock						Non- controlling Interests						Total Stockholders’ Equity (Deficit)
Balances, December 31, 2020						$	935					$	5,910					$	34,679					$	(4,341)					$	(34,344)					$	86					$	2,925
Net earnings						—						—						1,424						—						—						(4)						1,420
Other comprehensive earnings (losses), net of deferred income taxes						—						—						—						567						—						—						567
Stock award activity						—						(5)						—						—						9						—						4
Cash dividends declared ($0.86 per share)						—						—						(1,596)						—						—						—						(1,596)
Repurchases of common stock						—						—						—						—						(325)						—						(325)
Balances, March 31, 2021						$	935					$	5,905					$	34,507					$	(3,774)					$	(34,660)					$	82					$	2,995

For the Three Months Ended March 31,						2022						2021
Cash Provided by (Used in) Operating Activities
Net earnings						$	1,959					$	1,421
Adjustments to reconcile net earnings to operating cash flows:
Depreciation and amortization						52						63
Deferred income tax provision (benefit)						43						65
(Income) losses from equity investments						(34)						(51)
(Gain) loss on Cronos-related financial instruments						10						(110)
Loss on early extinguishment of debt						—						649
Cash effects of changes:
Receivables						1						(5)
Inventories						(20)						18
Accounts payable						(59)						(98)
Income taxes						637						396
Accrued liabilities and other current assets						(372)						(307)
Accrued settlement charges						880						975
Pension plan contributions						(3)						(3)
Pension provisions and postretirement, net						(35)						(32)
Other, net						16						59
Net cash provided by (used in) operating activities						3,075						3,040
Cash Provided by (Used in) Investing Activities
Capital expenditures						(45)						(26)
Other, net						11						(3)
Net cash provided by (used in) investing activities						$	(34)					$	(29)

For the Three Months Ended March 31,						2022						2021
Cash Provided by (Used in) Financing Activities
Long-term debt issued						$	—					$	5,472
Long-term debt repaid						—						(5,042)
Repurchases of common stock						(576)						(325)
Dividends paid on common stock						(1,645)						(1,601)
Premiums and fees related to early extinguishment of debt						—						(623)
Other, net						(11)						(53)
Net cash provided by (used in) financing activities						(2,232)						(2,172)
Cash, cash equivalents and restricted cash:
Increase (decrease)						809						839
Balance at beginning of period						4,594						5,006
Balance at end of period						$	5,403					$	5,845
The following table provides a reconciliation of cash, cash equivalents and restricted cash to the amounts reported on Altria’s condensed consolidated balance sheets:
						At March 31, 2022						At December 31, 2021
Cash and cash equivalents						$	5,353					$	4,544
Restricted cash included in other assets (1)						50						50
Cash, cash equivalents and restricted cash						$	5,403					$	4,594

(1)Restricted cash consisted of cash deposits collateralizing appeal bonds posted by PM USA to obtain stays of judgments pending appeals. See Note 10. Contingencies.

When used in these notes, the terms “Altria,” “we,” “us” and “our” refer to either (i) Altria Group, Inc. and its consolidated subsidiaries or (ii) Altria Group, Inc. only and not its consolidated subsidiaries, as appropriate in the context.

▪Background: At March 31, 2022, 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; John Middleton Co. (“Middleton”), which is engaged in the manufacture and sale of machine-made large cigars and pipe tobacco and is a wholly owned subsidiary of PM USA; UST LLC (“UST”), which through its wholly owned subsidiary U.S. Smokeless Tobacco Company LLC (“USSTC”), is engaged in the manufacture and sale of moist smokeless tobacco products (“MST”) and snus products; Helix Innovations LLC (“Helix”), which operates in the United States and Canada, and Helix Innovations GmbH and its subsidiaries (“Helix ROW”), which operate internationally in the rest-of-world, are engaged in the manufacture and sale of on! oral nicotine pouches; and Philip Morris Capital Corporation (“PMCC”), which has one leveraged lease remaining. Other wholly owned subsidiaries included Altria Group Distribution Company, which provides sales and distribution services to our domestic tobacco operating companies, and Altria Client Services LLC, which provides various support services to our companies in areas such as legal, regulatory, consumer engagement, finance, human resources and external affairs. Altria’s access to the operating cash flows of our wholly owned subsidiaries consists of cash received from the payment of dividends and distributions, and the payment of interest on intercompany loans by our subsidiaries. At March 31, 2022, our significant wholly owned subsidiaries were not limited by contractual obligations in their ability to pay cash dividends or make other distributions with respect to their equity interests.

For further discussion of our investments in equity securities, see Note 3. Investments in Equity Securities.

▪Share Repurchases: In January 2021, our Board of Directors (“Board of Directors” or “Board”) authorized a $2.0 billion share repurchase program that it expanded to $3.5 billion in October 2021 (as expanded, the “January 2021 share repurchase program”). At March 31, 2022, we had $1,249 million remaining in the January 2021 share repurchase program. The timing of share repurchases under this program depends upon marketplace conditions and other factors, and the program remains subject to the discretion of our Board.

			For the Three Months Ended March 31,
(in millions, except per share data)			2022						2021
Total number of shares repurchased			11.3						6.9
Aggregate cost of shares repurchased			$	576					$	325
Average price per share of shares repurchased			$	50.69					$	47.02

▪Basis of Presentation: Our interim condensed consolidated financial statements are unaudited. 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. All such adjustments were of a normal recurring nature. Net revenues and net earnings for any interim period are not necessarily indicative of results that may be expected for the entire year.

On January 1, 2022, we adopted Accounting Standards Update (“ASU”) 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (“ASU No. 2020-06”). This guidance simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Our adoption of ASU No. 2020-06 did not have a material impact on our condensed consolidated financial statements.

For a description of issued accounting guidance applicable to, but not yet adopted by, us, see Note 11. New Accounting Guidance Not Yet Adopted.

We disaggregate net revenues based on product type. For further discussion, see Note 8. Segment Reporting.

Price promotion payments- We make price promotion payments, substantially all of which are made to our retail partners, to incent the promotion of certain product offerings in select geographic areas.

Wholesale and retail participation payments- We make payments to our wholesale and retail partners to incent merchandising and sharing of sales data in accordance with our trade agreements.

(in millions)						March 31, 2022						December 31, 2021
ABI						$	11,318					$	11,144
JUUL						1,605						1,705
Cronos (1)						556						632
Total						$	13,479					$	13,481

(1) Our investment in Cronos at March 31, 2022 and December 31, 2021 consisted of our equity method investment in Cronos of $551 million and $617 million, respectively, and also included the Cronos warrant and the Fixed-price Preemptive Rights, which are measured at fair value (collectively, “Investment in Cronos”). See below for further discussion.

			For the Three Months Ended March 31,
(in millions)			2022						2021
ABI (1)			$	(200)					$	(318)
Cronos (1)			66						67
(Income) losses from investments under equity method of accounting			(134)						(251)
JUUL			100						200
(Income) losses from equity investments			$	(34)					$	(51)

(1) Includes our share of amounts recorded by our investees and additional adjustments, if required, related to (i) the conversion from international financial reporting standards to GAAP and (ii) adjustments to our investment required under the equity method of accounting.

Investment in ABI

▪are unlisted and not admitted to trading on any stock exchange;

▪are convertible by us into ordinary shares of ABI on a one-for-one basis;

▪rank equally with ordinary shares of ABI with regards to dividends and voting rights; and

▪have director nomination rights with respect to ABI.

In April 2020, the U.S. Federal Trade Commission (“FTC”) issued an administrative complaint challenging our investment in JUUL. In February 2022, the administrative law judge dismissed the FTC’s complaint. FTC complaint counsel appealed that decision to the FTC, which appeal remains pending. For further discussion, see Note 10. Contingencies - Antitrust Litigation.

▪    restructure JUUL’s current seven-member board of directors to a nine-member board that will include independent board members. The new structure will include: (i) three independent directors (one of whom will be designated by us and two of whom will be designated by JUUL stockholders other than us) unanimously certified as independent by a nominating committee, which will include at least one Altria designee, (ii) two directors designated by us, (iii) three directors designated by JUUL stockholders other than us and (iv) the JUUL chief executive officer; and

▪    create a litigation oversight committee, which will include two Altria designated directors (one of whom will chair the litigation oversight committee). The committee will have oversight authority and review of litigation management for matters in which JUUL and we are co-defendants and have, or reasonably could have, a written joint defense agreement in effect between them. Subject to certain limitations, the Litigation Oversight Committee will recommend to JUUL changes to outside counsel and litigation strategy by majority vote, with disagreements by JUUL’s management being resolved by majority vote of JUUL’s board of directors.

						Investment
(in millions)						Balance
Balance at December 31, 2020						$	1,705
Unrealized gains (losses) included in (income) losses from equity investments						—
Balance at December 31, 2021						$	1,705
Unrealized gains (losses) included in (income) losses from equity investments						(100)
Balance at March 31, 2022						$	1,605

▪anti-dilution protections to purchase Cronos common shares, exercisable each quarter upon dilution, to maintain our ownership percentage. Certain of the anti-dilution protections provide us the ability to purchase additional Cronos common shares at a per share exercise price of Canadian dollar (“CAD”) $16.25 upon the occurrence of specified events (“Fixed-price Preemptive Rights”). Based on our assumptions as of March 31, 2022, we estimate the Fixed-price Preemptive Rights allows us to purchase up to an additional approximately 11 million common shares of Cronos; and

▪a warrant providing us the ability to purchase an additional approximate 10% of common shares of Cronos (approximately 83 million common shares at March 31, 2022) at a per share exercise price of CAD $19.00, which expires on March 8, 2023.

			For the Three Months Ended March 31,
(in millions)			2022						2021
Fixed-price Preemptive Rights			$	—					$	(14)
Cronos warrant			10						(96)
Total			$	10					$	(110)

The following table provides the aggregate carrying value and fair value of our total long-term debt:

(in millions)			March 31, 2022						December 31, 2021
Carrying value			$	27,922					$	28,044
Fair value			27,670						30,459

(in millions)			March 31, 2022						December 31, 2021
Foreign currency denominated debt
Carrying value			$	4,690					$	4,817
Fair value			4,713						5,114

						(Gain) Loss Recognized in Accumulated Other Comprehensive Losses												(Gain) Loss Recognized in Net Earnings
						For the Three Months Ended March 31,
(in millions)						2022						2021						2022						2021
Foreign currency contracts						$	—					$	(35)					$	—					$	(5)
Foreign currency denominated debt						(128)						(206)						—						—
Total						$	(128)					$	(241)					$	—					$	(5)

			Pension												Postretirement
			For the Three Months Ended March 31,
(in millions)			2022						2021						2022						2021
Service cost			$	15					$	17					$	5					$	5
Interest cost			52						46						10						11
Expected return on plan assets			(123)						(131)						(3)						(4)
Amortization:
Net loss			24						33						4						7
Prior service cost (credit)			2						1						(12)						(6)
Net periodic benefit (income) cost			$	(30)					$	(34)					$	4					$	13

Employer Contributions

						For the Three Months Ended March 31,
(in millions)						2022						2021
Net earnings attributable to Altria						$	1,959					$	1,424
Less: Distributed and undistributed earnings attributable to share-based awards						(4)						(3)
Earnings for basic and diluted EPS						$	1,955					$	1,421
Weighted-average shares for basic and diluted EPS						1,818						1,857

						For the Three Months Ended March 31, 2022
(in millions)						Benefit Plans						ABI						Currency Translation Adjustments and Other						Accumulated Other Comprehensive Losses
Balances, December 31, 2021						$	(1,612)					$	(1,512)					$	68					$	(3,056)
Other comprehensive earnings (losses) before reclassifications						—						138						1						139
Deferred income taxes						—						(32)						—						(32)
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes						—						106						1						107
Amounts reclassified to net earnings						21						(35)						—						(14)
Deferred income taxes						(6)						7						—						1
Amounts reclassified to net earnings, net of deferred income taxes						15						(28)						—						(13)
Other comprehensive earnings (losses), net of deferred income taxes						15						78			(1)			1						94
Balances, March 31, 2022						$	(1,597)					$	(1,434)					$	69					$	(2,962)

(1) Primarily reflects the impact of our designated net investment hedges related to our investment in ABI. For further discussion of designated net investment hedges, see Note 4. Financial Instruments.

						For the Three Months Ended March 31, 2021
(in millions)						Benefit Plans						ABI						Currency Translation Adjustments and Other						Accumulated Other Comprehensive Losses
Balances, December 31, 2020						$	(2,420)					$	(1,938)					$	17					$	(4,341)
Other comprehensive earnings (losses) before reclassifications						—						690						22						712
Deferred income taxes						—						(151)						—						(151)
Other comprehensive earnings (losses) before reclassifications, net of deferred income taxes						—						539						22						561
Amounts reclassified to net earnings						38						(28)						—						10
Deferred income taxes						(10)						6						—						(4)
Amounts reclassified to net earnings, net of deferred income taxes						28						(22)						—						6
Other comprehensive earnings (losses), net of deferred income taxes						28						517			(1)			22						567
Balances, March 31, 2021						$	(2,392)					$	(1,421)					$	39					$	(3,774)

(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. For further discussion of designated net investment hedges, see Note 4. Financial Instruments.

						For the Three Months Ended March 31,
(in millions)						2022						2021
Benefit Plans: (1)
Net loss						$	31					$	43
Prior service cost/credit						(10)						(5)
						21						38
ABI (2)						(35)						(28)
Pre-tax amounts reclassified from accumulated other comprehensive losses to net earnings						$	(14)					$	10

(1) Amounts are included in net defined benefit plan costs. For further details, see Note 5. Benefit Plans.

(2) Amounts are included in (income) losses from equity investments. For further information, see Note 3. Investments in Equity Securities.

						For the Three Months Ended March 31,
(in millions)						2022						2021
Net Revenues:
Smokeable products						$	5,265					$	5,250
Oral tobacco products						613						626
Wine						—						150
All other						14						10
Net revenues						$	5,892					$	6,036
Earnings before Income Taxes:
OCI:
Smokeable products						$	2,559					$	2,372
Oral tobacco products						407						392
Wine						—						18
All other						(5)						(14)
Amortization of intangibles						(17)						(17)
General corporate expenses						(60)						(61)
Operating income						2,884						2,690
Interest and other debt expense, net						281						308
Net periodic benefit income, excluding service cost						(46)						(43)
Loss on early extinguishment of debt						—						649
(Income) losses from equity investments						(34)						(51)
(Gain) loss on Cronos-related financial instruments						10						(110)
Earnings before income taxes						$	2,673					$	1,937

▪Non-Participating Manufacturer (“NPM”) Adjustment Items: We recorded pre-tax income for NPM adjustment items of $60 million and $32 million for the three months ended March 31, 2022 and 2021, respectively, to cost of sales 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 (such dispute resolutions are referred to as “NPM Adjustment Items” and are more fully described in Health Care Cost Recovery Litigation in Note 10. Contingencies).

▪Tobacco and Health and Certain Other Litigation Items: We recorded pre-tax charges related to tobacco and health and certain other litigation items of $12 million and $35 million for the three months ended March 31, 2022 and 2021, respectively, in our smokeable products segment. We included these costs in marketing, administration and research costs in our condensed consolidated statements of earnings. For further discussion, see Note 10. Contingencies.

▪Acquisition-Related Costs: We recorded pre-tax acquisition-related costs of $37 million for the three months ended March 31, 2021 in our oral tobacco products segment primarily for the settlement of an arbitration related to the 2019 on! transaction. We included these costs in marketing, administration and research costs in our condensed consolidated statements of earnings.

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 4. Financial Instruments.

Note 10. Contingencies

We record provisions in our condensed consolidated financial statements for pending litigation when we determine that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. At the present time, while it is reasonably possible that an unfavorable outcome in a case may occur, except to the extent discussed elsewhere in this Note 10. Contingencies: (i) management has concluded that it is not probable that a loss has been incurred in any of the pending cases; (ii) management is unable to estimate the possible loss or range of loss that could result from an unfavorable outcome in any of the pending cases; and (iii) accordingly, management has not provided any amounts in our condensed consolidated financial statements for unfavorable outcomes, if any. Litigation defense costs are expensed as incurred.

Judgments Paid and Provisions for Tobacco and Health (Including Engle Progeny Litigation) and Certain Other Litigation Items: 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 Three Months Ended March 31,
(in millions)			2022						2021
Accrued liability for tobacco and health and certain other litigation items at beginning of period			$	91					$	9
Pre-tax charges for:
Tobacco and health and certain other litigation (1)			12						35
Related interest costs			—						—
Payments			(103)						(36)
Accrued liability for tobacco and health and certain other litigation items at end of period			$	—					$	8

(1) Includes judgments, settlements and fee disputes associated with tobacco and health and certain other litigation.

After exhausting all appeals in those cases resulting in adverse verdicts associated with tobacco-related litigation, since October 2004, PM USA has paid judgments and settlements (including related costs and fees) totaling approximately $909 million and interest totaling approximately $227 million as of March 31, 2022. These amounts include payments for Engle progeny judgments (and related costs and fees) totaling approximately $410 million and related interest totaling approximately $56 million.

Security for Judgments: To obtain stays of judgments pending appeal, PM USA has posted various forms of security. As of April 25, 2022, PM USA has posted appeal bonds totaling approximately $50 million, which have been collateralized with restricted cash that are included in assets on our condensed consolidated balance sheets.

Types and Number of U.S. Cases: Claims related to tobacco products generally fall within the following categories: (i) smoking and health cases alleging personal injury brought on behalf of individual plaintiffs; (ii) health care cost recovery

			April 25, 2022						April 26, 2021						April 27, 2020
Individual Smoking and Health Cases (1)			163						162						109
Health Care Cost Recovery Actions (2)			1						1						1
E-vapor Cases (3)			3,744						2,150						202
Other Tobacco-Related Cases (4)			3						3						4

(1) Includes as of April 25, 2022, 18 cases filed in Illinois, 17 cases filed in New Mexico, 42 cases filed in Massachusetts and 53 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 case (these Engle progeny cases are discussed below in Smoking and Health Litigation - Engle Class Action). Also does not include 1,408 cases brought by flight attendants 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, which 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. Class members were prohibited from filing individual lawsuits after 2000 under the court-approved settlement.

(2) See Health Care Cost Recovery Litigation - Federal Government’s Lawsuit below.

(3) Includes as of April 25, 2022, 53 class action lawsuits, 2,891 individual lawsuits and 800 “third party” lawsuits relating to JUUL e-vapor products, which include school districts, state and local government, tribal and healthcare organization lawsuits. JUUL is an additional named defendant in each of these lawsuits. The 53 class action lawsuits include 28 cases in the Northern District of California (“Multidistrict Litigation” or “MDL”) involving plaintiffs whose claims were previously included in other class action complaints but were refiled as separate stand-alone class actions for procedural and other reasons.

(4) Includes as of April 25, 2022, 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 April 25, 2022, (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; and (iii) PM USA and Altria are named as defendants in seven smoking and health class actions filed in various Canadian provinces. See Guarantees and Other Similar Matters below for a discussion of the Distribution Agreement (defined below) between Altria and Philip Morris International Inc. (“PMI”) that provides for indemnities for certain liabilities concerning tobacco products.

Tobacco-Related Cases Set for Trial: As of April 25, 2022, five Engle progeny cases and one individual smoking and health case against PM USA are set for trial through June 30, 2022. Trial dates are subject to change and many of the trials were postponed due to the COVID-19 pandemic; however, the courts are reopening and additional trials may be scheduled for the remainder of 2022.

Trial Results: Since January 1999, excluding the Engle progeny cases (separately discussed below), verdicts have been returned in 70 tobacco-related cases in which PM USA was a defendant. Verdicts in favor of PM USA and other defendants were returned in 45 of the 70 cases. These 45 cases were tried in Alaska (1), California (7), Connecticut (1), Florida (10), Louisiana (1), Massachusetts (5), Mississippi (1), Missouri (4), New Hampshire (1), New Jersey (1), New York (5), Ohio (2), Pennsylvania (1), Rhode Island (1), Tennessee (2) and West Virginia (2). One case in Massachusetts, Main, where the verdict was initially returned in favor of PM USA, was reversed on appeal and remanded for a new trial.

Of the 25 non-Engle progeny cases in which verdicts were returned in favor of plaintiffs, 22 have reached final resolution, and one case (Principe) that was initially returned in favor of plaintiffs was reversed post-trial and remains pending.

See Smoking and Health Litigation - Engle Progeny Trial Results below for a discussion of verdicts in state and federal Engle progeny cases involving PM USA as of April 25, 2022.

Overview: Plaintiffs’ allegations of liability in smoking and health cases are based on various theories of recovery, including negligence, gross negligence, strict liability, fraud, misrepresentation, design defect, failure to warn, nuisance, breach of express and implied warranties, breach of special duty, conspiracy, concert of action, violations of unfair trade practice laws and consumer protection statutes, and claims under the federal and state anti-racketeering statutes. Plaintiffs in the smoking and health cases seek various forms of relief, including compensatory and punitive damages, treble/multiple damages and other statutory damages and penalties, creation of medical monitoring and smoking cessation funds, disgorgement of profits, and

Non-Engle Progeny Litigation: Summarized below are the non-Engle progeny smoking and health cases pending during 2022 (or recently concluded) in which a verdict was returned in favor of plaintiff and against PM USA. Charts listing certain verdicts for plaintiffs in the Engle progeny cases can be found in Smoking and Health Litigation - Engle Progeny Trial Results below.

Federal Government’s Lawsuit: See Health Care Cost Recovery Litigation - Federal Government’s Lawsuit below for a discussion of the verdict and post-trial developments in the United States of America health care cost recovery case.

Engle Class Action: In July 2000, in the second phase of the Engle smoking and health class action in Florida, a jury returned a verdict assessing punitive damages totaling approximately $145 billion against various defendants, including $74 billion against PM USA. Following entry of judgment, PM USA appealed. In May 2003, the Florida Third District Court of Appeal reversed the judgment entered by the trial court and instructed the trial court to order the decertification of the class. Plaintiffs petitioned the Florida Supreme Court for further review.

In July 2006, the Florida Supreme Court ordered that the punitive damages award be vacated, that the class approved by the trial court be decertified and that members of the decertified class could file individual actions against defendants within one year of issuance of the mandate. The court further declared the following Phase I findings are entitled to res judicata effect in such individual actions brought within one year of the issuance of the mandate: (i) that smoking causes various diseases; (ii) that nicotine in cigarettes is addictive; (iii) that defendants’ cigarettes were defective and unreasonably dangerous; (iv) that defendants concealed or omitted material information not otherwise known or available knowing that the material was false or misleading or failed to disclose a material fact concerning the health effects or addictive nature of smoking; (v) that defendants agreed to misrepresent information regarding the health effects or addictive nature of cigarettes with the intention of causing the public to rely on this information to their detriment; (vi) that defendants agreed to conceal or omit information regarding the health effects of cigarettes or their addictive nature with the intention that smokers would rely on the information to their detriment; (vii) that all defendants sold or supplied cigarettes that were defective; and (viii) that defendants were negligent.

In August 2006, PM USA and plaintiffs sought rehearing from the Florida Supreme Court on parts of its July 2006 opinion. In December 2006, the Florida Supreme Court refused to revise its July 2006 ruling, except that it revised the set of Phase I findings entitled to res judicata effect by excluding finding (v) listed above (relating to agreement to misrepresent information), and added the finding that defendants sold or supplied cigarettes that, at the time of sale or supply, did not conform to the representations of fact made by defendants. In February 2008, the trial court decertified the class.

Pending Engle Progeny Cases: 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 April 25, 2022, approximately 813 state court cases were

pending against PM USA or Altria asserting individual claims by or on behalf of approximately 1,005 state court plaintiffs. Because of a number of factors, including docketing delays, duplicated filings and overlapping dismissal orders, these numbers are estimates. While the 2015 federal Engle agreement resolved nearly all Engle progeny cases pending in federal court, as of April 25, 2022, two cases were pending against PM USA in federal court representing the cases excluded from that agreement.

Engle Progeny Trial Results: As of April 25, 2022, 138 federal and state Engle progeny cases involving PM USA have resulted in verdicts since the Florida Supreme Court Engle decision. Seventy-six verdicts were returned in favor of plaintiffs and eight verdicts (Skolnick, Calloway, Oshinsky-Blacker, McCoy, Mahfuz, Neff, Frogel and Gloger) that were initially returned in favor of plaintiffs were reversed post-trial or on appeal and remain pending.

Fifty-four verdicts were returned in favor of PM USA, of which 44 were state cases. In addition, there have been a number of mistrials, only some of which have resulted in new trials as of April 25, 2022. The jury in one case, Garcia, awarded plaintiff compensatory damages and found plaintiff was entitled to punitive damages; however, the court declared a mistrial in the second phase of the trial regarding punitive damages because the jury was unable to determine the amount of the punitive damages. Four verdicts (Pearson, D. Cohen, Collar and Chacon) that were returned in favor of PM USA were subsequently reversed for new trials. Juries in two cases (Reider and Banks) returned zero damages verdicts in favor of PM USA. Juries in two other cases (Weingart and Hancock) returned verdicts against PM USA awarding no damages, but the trial court in each case decided to award plaintiffs damages. One case, Pollari, resulted in a verdict in favor of PM USA following a retrial of an initial verdict returned in favor of plaintiff. Plaintiff and defendants appealed the verdict and the appellate court affirmed the judgment in favor of the defendants. Three cases, Gloger, Rintoul (Caprio) and Duignan, resulted in verdicts in favor of plaintiffs following retrial of initial verdicts returned in favor of plaintiffs. Post-trial appeals are pending in Rintoul (Caprio) and Duignan, while the verdict in Gloger was reversed upon appeal and the case was remanded for a new trial. Two cases, Freeman and Harris, resulted in an appellate reversal of a jury verdict in favor of plaintiff, and a judgment in favor of PM USA.

The chart below lists the verdicts and post-trial developments in certain Engle progeny cases in which verdicts were returned in favor of plaintiffs. The chart lists cases that are pending as of April 25, 2022 but 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. Further, the damages noted reflect adjustments based on post-trial or appellate rulings. As of April 25, 2022, there is no Engle progeny case where PM USA has recorded a provision in its condensed consolidated financial statements because PM USA has not determined for any currently pending case that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated.

Plaintiff

Verdict Date

Defendant(s)

Court

Compensatory Damages (1)

Punitive Damages (PM USA)

Post-Trial Status

Schertzer

April 2022

PM USA and R.J. Reynolds

Miami-Dade

$3 million

$0

PM USA plans to file one or more post-trial motions.

Lipp

September 2021

PM USA

Miami-Dade

$15 million

$28 million

Appeal by defendant to Third District Court of Appeal pending.

Garcia

May 2021

PM USA

Miami-Dade

$6 million

Mistrial

Appeals by plaintiff and defendant to Third District Court of Appeal pending.

Duignan

February 2020 (2)

PM USA and R.J. Reynolds

Pinellas

$3 million

$12 million

Second District Court of Appeal affirmed the judgment against defendants. Defendants’ petitioned the Florida Supreme Court for review. Case stayed pending Florida Supreme Court decision in Prentice.(3)

Cuddihee

January 2020

PM USA

Duval

$3 million

$0

Appeal by defendant to First District Court of Appeal pending.

Rintoul (Caprio)

November 2019 (2)

PM USA and R.J. Reynolds

Broward

$9 million

$74 million

Appeals by plaintiff and defendants to Fourth District Court of Appeal pending.

Gloger

November 2019 (2)

PM USA and R.J. Reynolds

Miami-Dade

$15 million

$11 million

Third District Court of Appeal reversed the judgment against defendants and remanded for a new trial.

Plaintiff

Verdict Date

Defendant(s)

Court

Compensatory Damages (1)

Punitive Damages (PM USA)

Post-Trial Status

McCall

March 2019

PM USA

Broward

<$1 million (<$1 million PM USA)

$0

New trial ordered on punitive damages.

Neff

March 2019

PM USA and R.J. Reynolds

Broward

$4 million

$2 million

Fourth District Court of Appeal reversed the judgment against defendants and remanded for a new trial. Plaintiff’s petition for review to the Florida Supreme Court pending.

Mahfuz

February 2019

PM USA and R.J. Reynolds

Broward

$12 million

$10 million

Fourth District Court of Appeal reversed the judgment against defendants and remanded for a new trial. Florida Supreme Court denied plaintiff’s petition for review of the Fourth District Court of Appeal’s decision.

Holliman

February 2019

PM USA

Miami-Dade

$3 million

$0

Appeal by defendant to Third District Court of Appeal pending.

Chadwell

September 2018

PM USA

Miami-Dade

$2 million

$0

Third District Court of Appeal affirmed the compensatory damages award. Defendant’s petitioned the Florida Supreme Court for review. Case stayed pending Florida Supreme Court decision in Prentice.(3)

Kaplan

July 2018

PM USA and R.J. Reynolds

Broward

$2 million

$2 million

Florida Supreme Court vacated the punitive damages award in accordance with the decision in Sheffield (3). The Fourth District Court of Appeals remanded the case to the trial court.

R. Douglas

November 2017

PM USA

Duval

<$1 million

$0

Awaiting entry of final judgment by the trial court.

Sommers

April 2017

PM USA

Miami-Dade

$1 million

$0

Third District Court of Appeal affirmed compensatory damages award and granted new trial on punitive damages. Florida Supreme Court denied PM USA’s petition for review of the Third District Court of Appeal’s decision. PM USA paid approximately $1 million for the compensatory damages award and awaits the new trial on punitive damages.

Cooper (Blackwood)

September 2015

PM USA and R.J. Reynolds

Broward

$5 million (<$1 million PM USA)

$0

Fourth District Court of Appeal affirmed judgment and granted a new trial on punitive damages.

D. Brown

January 2015

PM USA

Federal Court - Middle District of Florida

$8 million

$9 million

Appeal by defendant to U.S. Court of Appeals for the Eleventh Circuit stayed pending Florida Supreme Court decision in Prentice.(3)

(1) PM USA’s portion of the compensatory damages award is noted parenthetically where the court has ruled that comparative fault applies.

(2) Plaintiff’s verdict following a retrial of an initial verdict in favor of plaintiff.

(3) PM USA is not a defendant in Sheffield or Prentice. Both cases are discussed below in Engle Progeny Appellate Issues.

Engle Progeny Appellate Issues: Appellate decisions in the following Engle progeny cases may have wide application to other Engle progeny cases:

In Mary Sheffield v. R.J. Reynolds Tobacco Company, an Engle progeny case against R.J. Reynolds only, the Florida Supreme Court resolved a conflict among Florida’s District Courts of Appeal finding that the 1999 amendments to Florida’s punitive damages statute (including its caps and bar on multiple punitive damages awards for the same course of conduct) apply in wrongful death cases where the decedent was injured prior to the October 1, 1999 effective date of the amendments but died from his or her injuries after such effective date.

In Linda Prentice v. R.J. Reynolds Tobacco Company, an Engle progeny case against R.J. Reynolds only, the Florida Supreme Court resolved a conflict among Florida’s District Courts of Appeal finding that in order for an Engle plaintiff to prevail on fraudulent concealment and conspiracy claims, plaintiff must prove that the smoker relied to his or her detriment on a statement

that concealed or omitted material information about the health risks or addictiveness of smoking. The Florida Supreme Court declined to revisit its prior decisions giving preclusive effect to the Engle Phase I findings, described above in Engle Class Action. Plaintiffs filed a motion seeking rehearing on the proper remedy for cases in which the court’s jury instructions did not comply with the Florida Supreme Court’s decision in Prentice.

Florida Bond Statute: In June 2009, Florida amended its existing bond cap statute by adding a $200 million bond cap that applies to all state Engle progeny lawsuits in the aggregate and establishes individual bond caps for individual Engle progeny cases in amounts that vary depending on the number of judgments in effect at a given time. Plaintiffs have been unsuccessful in various challenges to the bond cap statute in Florida state court.

No federal court has yet addressed the constitutionality of the bond cap statute or the applicability of the bond cap to Engle progeny cases tried in federal court.

Other Smoking and Health Class Actions: Since the dismissal in May 1996 of a purported nationwide class action brought on behalf of allegedly addicted smokers, plaintiffs have filed numerous putative smoking and health class action suits in various state and federal courts. In general, these cases have purported to be brought on behalf of residents of a particular state or states (although a few cases have purported to be nationwide in scope) and have raised addiction claims and, in many cases, claims of physical injury as well.

Class certification has been denied or reversed by courts in 61 smoking and health class actions involving PM USA in Arkansas (1), California (1), Delaware (1), the District of Columbia (2), Florida (2), Illinois (3), Iowa (1), Kansas (1), Louisiana (1), Maryland (1), Michigan (1), Minnesota (1), Nevada (29), New Jersey (6), New York (2), Ohio (1), Oklahoma (1), Oregon (1), Pennsylvania (1), Puerto Rico (1), South Carolina (1), Texas (1) and Wisconsin (1). 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 April 25, 2022, 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. In the actions filed in Alberta, Manitoba and Nova Scotia, plaintiffs seek certification of classes of all individuals who smoked defendants’ cigarettes. In March 2019, all of these class actions were stayed as a result of three Canadian tobacco manufacturers (none of which is related to us) seeking protection under Canada’s Companies’ Creditors Arrangement Act (which is similar to Chapter 11 bankruptcy in the United States). 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. 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.

Overview: In the health care cost recovery litigation, governmental entities seek reimbursement of health care cost expenditures allegedly caused by tobacco products and, in some cases, of future expenditures and damages. Relief sought by some but not all plaintiffs includes punitive damages, multiple damages and other statutory damages and penalties, injunctions prohibiting alleged marketing and sales to minors, disclosure of research, disgorgement of profits, funding of anti-smoking programs, additional disclosure of nicotine yields, and payment of attorney and expert witness fees.

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. See Smoking and Health Litigation - Other Smoking and Health Class Actions above for a discussion of these proceedings. See Guarantees and Other Similar Matters below for a discussion of the Distribution Agreement between Altria and PMI that provides for indemnities for certain liabilities concerning tobacco products.

Settlements of Health Care Cost Recovery Litigation: 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”). The State Settlement Agreements require that the original participating manufacturers or “OPMs” (now PM USA, R.J. Reynolds and, with respect to certain brands, ITG Brands, LLC (“ITG”)) make annual payments of approximately $9.4 billion, subject to adjustments for several factors, including inflation, market share and industry volume. In addition, the OPMs are required to pay settling plaintiffs’ attorneys’ fees, subject to an annual cap of $500 million; these quarterly payments are expected to end in 2024. For the three months ended March 31, 2022 and 2021, the aggregate amount recorded in cost of sales with respect to the State Settlement Agreements was approximately $900 million for each period. These amounts include PM USA’s estimate of amounts related to NPM Adjustments discussed below.

NPM Adjustment Disputes: The “NPM Adjustment” is a reduction in MSA payments made by the OPMs and those manufacturers that are subsequent signatories to the MSA (collectively, the “participating manufacturers” or “PMs”) that applies if the PMs collectively lose at least a specified level of market share to non-participating manufacturers since 1997, subject to certain conditions and defenses.

▪Multi-State Settlement. By the end of 2018, PM USA entered into a multi-state settlement of NPM Adjustment disputes with a total of 36 MSA states and territories in which PM USA settled the NPM Adjustment disputes through 2022 with 35 of the 36 states, and through 2024 with one state. In March 2022, Illinois joined the multi-state settlement, settling the NPM Adjustment disputes through 2028 and bringing the total number of settling states and territories to 37. As a result, PM USA will receive approximately $80 million for 2004-2021 ($20 million of which relates to the 2019-2021 “transition years”). In connection with this development for Illinois, PM USA recorded $80 million as a reduction to cost of sales in the first quarter of 2022. Pursuant to the multi-state settlement, PM USA has received $1.15 billion and expects to receive approximately $410 million in credits to offset PM USA’s MSA payments through 2036.

▪New York Settlement. In 2015, PM USA entered into a separate NPM Adjustment settlement with New York in which PM USA settled the NPM Adjustment disputes with New York in perpetuity. PM USA has received $435 million pursuant to the New York settlement and expects to receive annual credits applied against the MSA payments due to New York going forward.

▪Montana Settlement. In 2020, PM USA entered into a separate NPM Adjustment settlement with Montana in which PM USA settled the NPM Adjustment disputes with Montana through 2030. This settlement resulted in a payment by PM USA of $4 million.

▪2004 NPM Adjustment. The PMs and the nine states that have not settled the NPM Adjustment disputes are currently arbitrating NPM Adjustment disputes for 2004 in a multi-state arbitration. A tenth state, Illinois, also participated in the arbitration, but joined the multi-state settlement after the arbitration panel issued its decisions described below. Hearings for nine of the 10 states concluded by the end of 2020. In September 2021, the arbitration panels issued decisions finding that two states, Missouri and Washington, were not diligent in their enforcement of their escrow statutes in 2004 and, therefore, are subject to the NPM adjustment for 2004. The arbitration panels further found that the remaining seven states

▪2005-2007 NPM Adjustments. The PMs and the nine states that have not settled the NPM Adjustment disputes are currently arbitrating NPM Adjustment disputes before a single arbitration panel. The arbitration encompasses three years, 2005-2007, for eight of the nine states, and one year, 2005, for one state. As of April 25, 2022, no decisions have resulted from the arbitration.

▪Subsequent Years. No assurance can be given as to when proceedings for 2008 and subsequent years will be scheduled or the precise form those proceedings will take.

Other Disputes Under the State Settlement Agreements: The payment obligations of the tobacco product manufacturers that are parties to the State Settlement Agreements, as well as the allocations of any NPM Adjustments and related settlements, have been and may continue to be affected by R.J. Reynolds’s acquisition of Lorillard in 2015 and its related sale of certain cigarette brands to ITG (the “ITG transferred brands”). PM USA filed motions to enforce the State Settlement Agreements in Florida, Minnesota, Texas and Mississippi in connection with various positions that R.J. Reynolds and ITG took with regard to the ITG transferred brands. After various court decisions in each of those states that were favorable to PM USA, those motions to enforce have now been resolved either through settlement or exhaustion of appeals. Despite these resolutions, PM USA continues to dispute the accuracy of certain submissions made by R.J. Reynolds and ITG concerning the calculation of certain payments relating to the ITG transferred brands and may pursue such claims.

Federal Government’s Lawsuit: In 1999, the U.S. government filed a lawsuit in the U.S. District Court for the District of Columbia against various cigarette manufacturers, including PM USA, and others, including Altria, asserting claims under three federal statutes. 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 seven of the eight “sub-schemes” to defraud that the government had alleged. Specifically, the court found that:

▪defendants falsely denied, distorted and minimized the significant adverse health consequences of smoking;

▪defendants hid from the public that cigarette smoking and nicotine are addictive;

▪defendants falsely denied that they control the level of nicotine delivered to create and sustain addiction;

▪defendants falsely marketed and promoted “low tar/light” cigarettes as less harmful than full-flavor cigarettes;

▪defendants falsely denied that they intentionally marketed to youth;

▪defendants publicly and falsely denied that ETS is hazardous to non-smokers; and

▪defendants suppressed scientific research.

In June 2020, the U.S. government filed a motion with the district court asking for clarification as to whether the court-ordered injunction that applies to cigarettes also applies to HeatSticks, a heated tobacco product used with the IQOS electronic device. In August 2020, we filed an opposition to the government’s motion and, in the alternative, a motion to modify the injunction to make clear it does not apply to HeatSticks. Regardless of the district court’s decisions on the pending motions, the government has indicated it will not oppose a modification to the injunction that permits PM USA to use the Modified Risk Tobacco Product claim authorized by the U.S. Food and Drug Administration for HeatSticks.

IQOS Litigation

In April 2020, RAI Strategic Holdings, Inc. and R.J. Reynolds Vapor Co., which are affiliates of R.J. Reynolds, filed a lawsuit against Altria, PM USA, Altria Client Services LLC, PMI and its affiliate, Philip Morris Products S.A., in the U.S. District Court for the Eastern District of Virginia. The lawsuit asserts claims of patent infringement based on the sale of the IQOS electronic device and HeatSticks in the United States. Plaintiffs seek various remedies, including preliminary and permanent injunctive relief, treble damages and attorneys’ fees. Altria and PMI have been dismissed from the lawsuit. In June 2020, the remaining defendants filed a motion to dismiss certain of plaintiffs’ claims and also filed counterclaims against the plaintiffs for infringement of various patents owned by the remaining defendants. The case was stayed in December 2020 due to the COVID-19 pandemic; however, the stay was lifted with respect to defendants’ counterclaims in February 2021. The trial is currently scheduled for June 2022.

Also in April 2020, a related patent infringement action was filed against the same defendants by the same plaintiffs, as well as R.J. Reynolds, with the U.S. International Trade Commission (“ITC”), but the remedies sought included a prohibition on the importation of the IQOS electronic device, HeatSticks and component parts into the United States and on the sale of any such products previously imported into the United States. No damages are recoverable in the proceedings before the ITC. In September 2021, the ITC issued a limited exclusion order barring the importation of the IQOS electronic device, HeatSticks and the infringing components into the United States and a cease and desist order barring domestic sales, marketing and distribution of these imported products. The orders became effective on November 29, 2021. Consequently, PM USA removed the IQOS electronic device and HeatSticks from the marketplace. In December 2021, defendants appealed the orders to the U.S. Court of Appeals for the Federal Circuit and, in January 2022, the court denied defendants’ motion to stay the orders pending the conclusion of the appeal.

An additional unrelated patent infringement case regarding the IQOS electronic device was filed in November 2020 in the U.S. District Court for the Northern District of Georgia against PM USA and Philip Morris Products S.A. seeking damages and equitable relief. In February 2021, defendants filed a motion to dismiss the lawsuit, which the court granted in July 2021. In December 2021, the U.S. District Court denied plaintiff’s motion to amend the complaint and plaintiff appealed this ruling to the U.S. Court of Appeals for the Federal Circuit, which appeal remains pending.

Shareholder Class Action: In October and December 2019, two purported Altria shareholders filed putative class action lawsuits against Altria, Howard A. Willard III, our former Chairman and Chief Executive Officer, and William F. Gifford, Jr., our former Vice Chairman and Chief Financial Officer and current Chief Executive Officer, in the U.S. District Court for the Eastern District of New York. In December 2019, the court consolidated the two lawsuits into a single proceeding. The consolidated lawsuit was subsequently transferred to the U.S. District Court for the Eastern District of Virginia. The lawsuit asserts claims under Sections 10(b) and 20(a) and under Rule 10b-5 of the Exchange Act. In April 2020, JUUL, its founders and some of its current and former executives were added to the lawsuit. The claims allege false and misleading statements and omissions relating to our investment in JUUL. Plaintiffs seek various remedies, including damages and attorneys’ fees. In July 2020, the defendants filed motions to dismiss plaintiffs’ claims, which the district court denied in March 2021. In the fourth quarter of 2021, plaintiffs and defendants agreed upon a class action settlement under which, among other things, (i) all claims asserted against Altria and the other named defendants are resolved without any liability or wrongdoing attributed to them personally or to Altria and (ii) Altria will pay the class an aggregate amount of $90 million, which amount includes attorneys’ fees. The class is defined to include persons and entities who purchased or otherwise acquired shares of Altria between October 25, 2018 through April 2, 2020, subject to certain exclusions. The trial court preliminarily approved the settlement in December 2021 and granted final approval in March 2022. We recorded pre-tax provisions totaling $90 million in 2021 and, in January 2022, paid $90 million to plaintiffs’ escrow account.

Federal Shareholder Derivative Lawsuits: In August 2020, two purported Altria shareholders filed separate derivative lawsuits in the U.S. District Court for the Northern District of California on behalf of themselves and Altria, against Mr. Willard, Mr. Gifford, JUUL and certain of our executives and officers. These derivative lawsuits relate to our investment in JUUL, and assert 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. In March 2021, the U.S. District Court for the Northern District of California granted defendants’ motion to transfer both lawsuits to the U.S. District Court for the Eastern District of Virginia. Three additional federal derivative lawsuits were filed in October 2020, January 2021 and March 2021, respectively, in the U.S. District Court for the Eastern District of Virginia against Mr. Willard, Mr. Gifford, Mr. Crosthwaite, certain members of our Board of Directors, JUUL, its founders and some of its current and former executives. These suits assert various claims, including breach of fiduciary duty, unjust enrichment, waste of corporate assets and violations of certain federal securities laws. The remedies sought in these lawsuits include damages, disgorgement of profits, reformation of our corporate governance and internal procedures, and attorneys’ fees. In April 2021, the court consolidated the five cases pending in the Eastern District of Virginia into a single case.

State Shareholder Derivative Lawsuits: Six derivative lawsuits have been filed in Virginia state courts against Mr. Willard, Mr. Gifford, Mr. Crosthwaite (our former Chief Growth Officer and JUUL’s current Chief Executive Officer), certain members of our Board of Directors, JUUL, its founders and some of its current and former executives. The lawsuits were filed in September 2020, May 2021, June 2021, July 2021, August 2021 and August 2021, respectively. The lawsuits assert various claims, including breach of fiduciary duty, and seek remedies similar to those sought by plaintiffs in the cases pending in federal court in the Eastern District of Virginia. In successive orders from July 2021, September 2021 and January 2022, the court consolidated five of these six state derivative cases into a single consolidated case.

“Lights/Ultra Lights” Cases and Other Smoking and Health Class Actions: Plaintiffs have sought certification of their cases as class actions, alleging among other things, that the uses of the terms “Lights” and/or “Ultra Lights” constitute deceptive and unfair trade practices, common law or statutory fraud, unjust enrichment or breach of warranty, and have sought injunctive and equitable relief, including restitution and, in certain cases, punitive damages. These class actions have been brought against PM USA and, in certain instances, Altria or our other subsidiaries, on behalf of individuals who purchased and consumed various brands of cigarettes. Defenses raised in these cases include lack of misrepresentation, lack of causation, injury and damages, the statute of limitations, non-liability under state statutory provisions exempting conduct that complies with federal regulatory directives, and the First Amendment. 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 April 25, 2022, two “Lights/Ultra Lights” class actions are pending in U.S. state courts. Neither case is active.

UST Litigation: UST and/or its tobacco subsidiaries have been named in a number of individual tobacco and health lawsuits over time. Plaintiffs’ allegations of liability in these cases have been based on various theories of recovery, such as negligence, strict liability, fraud, misrepresentation, design defect, failure to warn, breach of implied warranty, addiction and breach of consumer protection statutes. Plaintiffs have typically sought various forms of relief, including compensatory and punitive damages, and certain equitable relief, including but not limited to disgorgement. 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 April 25, 2022, there is no such case pending against UST and/or its tobacco subsidiaries.

Under the terms of a distribution agreement between Altria and PMI (the “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 March 31, 2022 as the fair value of this indemnification is insignificant. PMI has agreed not to seek indemnification with respect to the IQOS patent litigation discussed above under IQOS Litigation, excluding the patent infringement case filed with the U.S. District Court for the Northern District of Georgia.

Standards			Description			Effective Date for Public Entity			Effect on Financial Statements
ASU 2021-08 Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers			The guidance updates how an entity recognizes and measures contract assets and contract liabilities acquired in a business combination. Acquirers will now account for related revenue contracts in accordance with Topic 606 as if it had originated the contract.			The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022.			We are in the process of evaluating the impact of this guidance on our consolidated financial statements and related disclosures.