UK’s BAT Says Its U.S. Cigarette Business Is Dying

The maker of Lucky Strike and Pall Mall cigarettes states that its smoking business in the US is dwindling. British American Tobacco (BAT) wrote off £25 billion ($31.5 billion) in value due to the changed outlook for brands such as Newport and Camel, as reported by Natalie Sherman for BBC News.

BAT has been attempting to reignite growth with vaping products, aiming to have 50% of its revenue from "non-combustible" products by 2035. I Photo: British American Tobacco

This move reduced the brands' worth by more than a third and sent the company's share price down by more than 8%.

BAT's cigarette sales have struggled as US smoking rates decline, and consumers turn to vapes and other alternatives. Demand for its brands has also declined as buyers, squeezed by higher prices, prioritize other purchases or opt for cheaper packs.

BAT has been attempting to reignite growth with vaping products, aiming to have 50% of its revenue from "non-combustible" products by 2035.

It now considers that its US cigarette brands have a useful economic life of 30 years, rather than an indefinite one. This write-down marks the first such acknowledgment by a major tobacco firm of the industry's sea change.

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