“As we continue to invest in top-line growth, we target organic SG&A growth broadly in line with net revenue growth for the year.”

In context

“tting an 80 basis point unfavorable impact from cost inflation, net of productivities and other cost items. Smoke-free growth delivered an excellent plus 230 basis points with a flat contribution from combustible excluding pricing, but including the Indonesia impact. This excellent gross margin performance supported strong adjusted operating income margin expansion of 250 basis points, or plus 200 basis points organically after accounting for the currency mix of our cost, the divestiture of Vectura, and other scope effects. This impressive margin expansion was delivered despite a 140 basis point impact of higher SG&A costs driven by continued investment in our smoke-free growth, including U.S. investments, a low cost comparison in the prior year, and the impact of 2025 investment phasing. As we continue to invest in top-line growth, we target organic SG&A growth broadly in line with net revenue growth for the year. We continue to drive manufacturing and back-office efficiency and delivered over $180 million in gross cost savings in Q1 across both cost of goods sold and SG&A. After more than $750 million of savings in 2024, this places us nicely on track to achieve our $2 billion target over 2024-2026. Focusing now on our IQOS business. As expected, calendar effects and EU flavor ban annualization impacted Q1 adjusted IMS. However, the delivery of plus 9.4% growth despite these factors marks continued strong underlying momentum. We expect double-digit progress in the balance of the year in line with our target of plus 10% to plus 12% growth. Supporting this are commercial initiatives around brand building and continuous innovation on devices and consumables as we progressively roll out ILUMA i and ne”