Shares in British American Tobacco have fallen more than 4% after it downgraded forecasts for the global cigarette market.
BAT estimated in a half-year trading update that global sales of combustible tobacco would decline by 2.5% in the 2026 calendar year, down from the -2% previously guided. The company’s combustibles volume share has fallen by 0.3 percentage points in the year to date.
The tobacco and nicotine group maintained its guidance to reach the lower end of mid-term goals of 3%-5% revenue growth.
Despite the accelerated decline in global cigarette sales, BAT said it had achieved “strong US revenue and profit growth” driven by cigarettes and pure nicotine products such as pouches and vapes.
The group’s new categories exceeded expectations, with sales growth upgraded from low double-digits to mid-teens percentage growth.
US vapes were the “main positive” from the morning update, said Bank of America analyst Bastien Agaud.
But he added tough trading in Asia Pacific, Middle East and Africa was enough to prevent the stock from being upgraded, though BAT had said performance was “stabilising”.
Driven by weak sales in Bangladesh and a soft market for heated tobacco – blamed on destocking in Japan and high levels of competition – the region’s weaker trading “likely explains the absence of a guidance upgrade”, he said.
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