BAT Reports 2024 Annual Results: Vuse E-cigarette Sales Decline, Velo Nicotine Pouches Surge by 56.1%

On February 13, 2025, British American Tobacco (BAT) released its annual financial results for the year ending December 31, 2024. The report highlights a mixed performance across its product categories, with Vuse e-cigarettes experiencing a decline in sales while Velo nicotine pouches saw significant growth.

Key Highlights of BAT’s 2024 Performance

Overall Revenue Decline

BAT’s total revenue for 2024 decreased by 5.2% to £25.9 billion, primarily due to the sale of its Russian and Belarusian businesses in September 2023 and unfavorable foreign exchange rates.

New Categories Growth

Revenue from new categories (e-cigarettes, heated tobacco, and nicotine pouches) accounted for 17.5% of total revenue, up by 1 percentage point from 2023. The number of new category users reached 29.1 million, an increase of 3.6 million from the end of 2023.

Performance by Product Category

1. Vapor Products (E-cigarettes)

Sales Decline: Vapor product sales fell by 5.9%, with adjusted revenue dropping by 2.5%.
Challenges: The decline was attributed to insufficient enforcement against illegal flavored disposable e-cigarettes in the U.S. and Quebec, Canada, which impacted BAT’s market share.

2. Heated Tobacco

Sales Performance: Sales volume decreased by 0.3%, but adjusted revenue grew by 5.8%.
Market Share: BAT’s market share in its top nine markets declined by 40 basis points to 16.7%. Growth in Poland and Czech Republic was offset by increased competition in Japan and South Korea.

3. Modern Oral/Nicotine Pouches

Strong Growth: Sales volume surged by 56.1%, with adjusted revenue increasing by 53.2%.
User Base: The category now has 7.4 million users, driven by higher daily consumption and strong performance in markets outside the U.S.
U.S. Success: The Velo brand, supported by a refreshed image and the launch of Grizzly, achieved 234% sales growth and 223% revenue growth in the U.S.

Strategic Focus and Leadership Insights

CEO Tadeu Marroco’s Vision

BAT’s CEO, Tadeu Marroco, emphasized the company’s commitment to building a smoke-free world and transitioning to a business primarily focused on new category products by 2035.

Marroco stated:

“We are committed to building a smoke-free world and becoming a business primarily driven by new category products by 2035. I believe we have the right strategy, science, innovation, capabilities, and talent to achieve this goal and deliver long-term sustainable value for all our stakeholders.”
“Our focus on high-quality growth has led to better returns from targeted investments in all three new categories. We are particularly pleased with the performance of our modern oral category.”
“In the U.S., despite a challenging macroeconomic environment and the proliferation of illegal disposable e-cigarettes, our targeted investments have strengthened the business. We are unlocking untapped growth opportunities, especially in the modern oral category.”

Implications for the Industry

BAT’s 2024 results highlight several trends and opportunities for the tobacco and vaping industry:

1. Shift Toward Nicotine Pouches

The strong performance of Velo nicotine pouches underscores the growing demand for modern oral products as alternatives to traditional tobacco and e-cigarettes.

2. Challenges in the E-cigarette Market

The decline in Vuse e-cigarette sales reflects the impact of illegal flavored products and regulatory challenges. Companies must focus on compliance and innovation to regain market share.

3. Focus on Harm Reduction

BAT’s emphasis on new categories aligns with broader industry trends toward harm reduction and sustainability.

4. Opportunities for Independent Sellers

For independent sellers and wholesalers, the growth of nicotine pouches presents an opportunity to diversify product offerings and cater to evolving consumer preferences.

Conclusion

BAT’s 2024 annual results reflect a dynamic and evolving tobacco industry, with significant growth in nicotine pouches offsetting challenges in the e-cigarette market. As the company continues to prioritize new categories and harm reduction, it sets a benchmark for innovation and sustainability in the industry.

For stakeholders, BAT’s performance highlights the importance of adapting to regulatory changes, investing in new product categories, and addressing consumer demand for safer alternatives.

BAT 2024 results, Vuse e-cigarettes, Velo nicotine pouches, heated tobacco, harm reduction, smoke-free world, tobacco industry trends, nicotine pouch growth, disposable e-cigarettes.

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