Altria announced its quarterly revenue of $5.28 billion USD, which was slightly down on expectations.
👉 Background: Altria is one of the world's largest producers of tobacco, cigarettes and vapes. It's the company behind likes of Marlboro, Parliament, and L&M as well as vaping companies Juul and NJOY.
👉 What happened: Altria announced its quarterly revenue of $5.28 billion USD, which was slightly down on expectations. But what's even more concerning was the words from its CFO about competitive threats - illegal competitors in the vape space.
👉 What else: It's ironic that Altria acquired NJOY for $2.75 billion USD because it had approval by the FDA. And now, their biggest competitor is the illegal alternatives that haven't been approved.
💡In a market where illicit activity thrives, being 'regulated' can become a competitive disadvantage.
💡The tobacco and vaping industries are HEAVILY regulated. Get this: the FDA has authorized 23 e-cigarette products, but there are believed to be more than 260 brands in the market. Altria reckons these companies are not only getting away with it, but are thriving.
💡While Altria jumps through regulatory hoops, illegal competitors are playing a different game. And, investors are worried that this will be an insurmountable obstacle until the regs get involved.
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