By Timothy S. Donahue

Top Takeaways:

• RRP momentum: Japan Tobacco posts nearly 64% smoke-free revenue growth
• Ploom expansion: Heated tobacco platform now spans nearly 30 markets
• Stable combustibles: Cigarette volumes hold steady despite global market pressures

Japan Tobacco Inc. opened 2026 with another strong quarter, driven by pricing power, stable combustible performance, and accelerating growth in heated tobacco products, as the company continues to pour investment into its global Ploom platform.

The company reported first-quarter revenue of JPY 924 billion ($5.9 billion), up 15.2% year over year, and operating profit rose 24.7% to JPY 304.6 billion ($1.9 billion). Reduced-risk products (RRP) were again the standout.

RRP-related revenue surged 63.8% to JPY 43.5 billion ($278 million), while shipment volume rose 44.2% year over year to 4.3 billion units, largely fueled by the continued expansion of the company’s Ploom heated tobacco platform.

Executives said Ploom is now available in 29 markets worldwide, and the company’s newer Ploom Ora platform has already launched in 25 markets. “Growth in RRP volume and RRP-related revenue have accelerated,” management said during the earnings call.

Japan Tobacco added that although temporary demand ahead of Japan’s heated tobacco tax changes contributed to growth, the company remains confident that the broader momentum behind Ploom is sustainable. “We remain confident in our ability to continue capturing additional volume and category share building on the momentum of Ploom Ora,” executives said.

The company said Ploom’s share of the heated tobacco category in selected key markets reached 10.1% as of February 2026. In Japan, the average category share reached 15.8% in the first quarter, with management noting that the pace of gains has accelerated since the launch of Ploom Ora last year.

JT also highlighted Taiwan as one of its strongest heated-tobacco launches to date. “Taiwan represents the best launch performance of Ploom so far,” management said.

To further strengthen its heated product portfolio, the company recently launched Leo, a new heated nicotine stick brand without tobacco leaf, in Poland and Italy. “Leo offers an innovative proposition using a herbal substance and to consumers interested in flavored heated products,” executives said.

Despite the focus on RRPs, combustibles remain the business’s financial backbone. Combustible shipment volume remained broadly stable at 131.3 billion units, with gains in flagship brands helping to offset declines in markets such as Japan, Russia, and the United Kingdom.

Management said the company gained market share in more than 45 countries during the quarter. “Strong share momentum continued across many markets,” executives said.

Pricing also remained a major driver of earnings. “Pricing contributions materialized across many markets, driving double-digit growth in both revenue and AOP,” management said, citing strong pricing performance in Japan, Russia, Turkey and the United States.

The company said those gains more than offset increased investment in Ploom and inflation-related pressures on raw materials and labor costs. JT maintained its full-year outlook, forecasting 2026 revenue of JPY 3.697 trillion ($23.7 billion) and operating profit of JPY 921 billion ($5.9 billion).

The results reflect a broader strategic shift underway at Japan Tobacco as it invests heavily to compete more aggressively in reduced-risk nicotine categories, which are dominated globally by rivals such as Philip Morris International and British American Tobacco.

Under its current business plan, JT has committed roughly JPY 800 billion to reduced-risk product investment and expansion from 2026 to 2028.