The Growing Dominance of Modern Nicotine Pouches: Which Companies are Winning?

Helix’s Ascending Role in Altria’s Oral Tobacco Strategy

Altria Group, Inc. (MO) has witnessed a fundamental shift in its oral tobacco business structure, with nicotine pouches emerging as a critical profit engine. Operating through Helix Innovations, the company’s pouch segment is fundamentally reshaping how the traditional oral tobacco category performs. During Q3 2025, the pouch category outpaced all other oral segments, with Helix delivering 42.2 million cans of on! to retail channels.

Across the first three quarters of 2025, shipment volumes climbed 14.8% to reach 133.6 million cans, a trajectory that stands in sharp contrast to declining volumes in conventional oral tobacco categories. What’s particularly noteworthy is that this growth isn’t merely a volume story—Helix’s expanding footprint has directly supported adjusted operating income stability and margin expansion despite headwinds in the broader segment. The company’s recent introduction of on! PLUS in select markets, offering consumers multiple flavor and nicotine strength combinations, signals an intentional move toward premium differentiation within various types of nicotine pouches.

Pricing dynamics reveal additional competitive advantages. While national average prices for nicotine pouches fell approximately 7%, on! managed to increase retail pricing by roughly 1.5% year-over-year during Q3. Currently, on!'s retail share of the total oral tobacco category stands at 8.7%, with modest sequential and year-over-year fluctuations. These metrics collectively demonstrate how Helix has positioned different types of nicotine pouches to support both volume momentum and profitability in Altria’s segment.

Competitive Momentum: Philip Morris International and Turning Point Brands

The competitive landscape reveals aggressive expansion across the sector. Philip Morris International (PM) reported robust Q3 2025 performance in its modern oral division, with global ZYN can shipments accelerating approximately 36% and U.S. ZYN consumer takeaway growing 39% according to Nielsen data. The company attributed this surge to full trade availability, coupled with targeted promotional support designed to address earlier supply constraints. Philip Morris International has committed substantial capital to capacity expansion and commercial initiatives to sustain the rising demand trajectory.

Meanwhile, Turning Point Brands (TPB) delivered what can only be described as exceptional results. Modern oral segment net sales expanded 627.6% year-over-year to $36.7 million, now constituting 30.8% of total company revenue. Sequential growth within modern oral reached 22%, prompting management to raise full-year modern oral sales guidance to $125-$130 million. The company’s announced progress toward establishing its first U.S. white-pouch production capacity in 2026 underscores its strategic commitment to capturing share within the evolving landscape of different types of nicotine pouches.

Altria’s Market Position and Investment Outlook

MO shares have declined 0.8% over the past month, underperforming the broader industry’s 1.6% gain. From a valuation perspective, Altria trades at a forward P/E multiple of 10.36X, substantially below the industry average of 14.47X, potentially reflecting market skepticism around the oral tobacco segment’s trajectory.

Consensus earnings estimates project Altria will deliver 6.3% year-over-year earnings growth in 2025, followed by more modest 2.3% growth in 2026. The company currently maintains a Zacks Rank #3 (Hold) rating, suggesting a neutral positioning among analysts. Whether Helix’s impressive pouch-driven performance can offset broader oral category headwinds will likely determine investor sentiment moving forward, particularly as competitive pressures intensify across the various types of nicotine pouches available to consumers.