Altria Group swung to a loss in the third quarter as it wrote down the value of its investment in e-cigarette maker Juul.
Richmond, Virginia-based Altria bought roughly a third of Juul for $13 billion last December. Since then Juul has been hit by new federal and state investigations into its marketing amid an explosion of underage vaping. Separately, an outbreak of lung injuries tied to vaping has led to government warnings about the potential risks of e-cigarettes.
Juul has made a number of voluntary concessions in an effort to weather the recent backlash, including halting product advertising and pulling several of its flavored products.
Altria Group Inc. said Thursday it posted a quarterly loss of $2.6 billion, or $1.39 per share, including the $4.5 billion pretax write-down, compared with net income of $1.94 billion, or $1.03 per share, a year earlier. Adjusted earnings of $1.08 per share missed the average Street estimate of $1.14 per share, based on an analyst survey by Zacks.
Altria, the owner of Philip Morris USA, the nation’s largest cigarette maker, said total revenue was virtually flat at $6.86 billion. Its adjusted revenue, which excludes excise taxes, totaled $5.41 billion and beat estimates.
The company still expects to earn $4.19 to $4.27 per share for the full year, representing growth of 5% to 7% over last year. It lowered its long-term growth target of 7% to 9% to a new range of 5% to 8% growth for 2020 through 2022.