Analysts at TD Cowen said that sales of cigarettes and e-cigarettes have declined in the United States over the past two weeks, while sales of oral nicotine pouches have increased significantly.
Cigarette sales across multiple channels fell 10% in the two weeks ended January 13, a steeper decline than the previous four and 12 weeks, they wrote in a research note.
Bonnie Herzog, managing director at Goldman Sachs, remains cautious about the U.S. tobacco/nicotine industry in the near term because tobacco consumers are still facing significant financial pressure.
She said in an emailed outlook that many consumers are becoming more discerning in their purchases and turning to more affordable alternatives such as fourth-tier/deeply discounted cigarettes, modern oral tobacco, and increasingly illicit or gray market of disposable steam products.
Herzog wrote: “With momentum on flavor bans at the state and federal levels (final rules expected in March) and uncertainty over the future of the e-cigarette category and category innovation (FDA PMTA on big markets like JUUL and VUSE Alto A review of the brand, as well as the wider menthol variant, is still ongoing), further exacerbated by changes in category and consumer spending dynamics."
According to Barron's, e-cigarette sales fell 11.3% in two weeks and 10.7% in four weeks.
Meanwhile, sales of smokeless tobacco, including nicotine pouches, rose 12.1% over two weeks and 13% over four weeks.
Analysts said dollar sales of smokeless cigarettes continued to grow strongly, driven by the Zyn brand.
