Altria Group Inc.

Item 1A. Risk Factors

Information regarding Risk Factors appears in Part I, Item 1A. Risk Factors of our 2024 Form 10-K. Except as set forth below, there have been no material changes to the risk factors previously disclosed in our 2024 Form 10-K. We elaborate on these and other risks we face throughout this Form 10-Q, particularly in the Business Environment section preceding our discussion of our operating results above in MDA.

Risks Relating to Our Business

Business Operations Risks

Failure to complete or manage strategic transactions, including acquisitions, dispositions, joint ventures and investments in third parties, or realize the anticipated benefits of such transactions, could have a material adverse effect on our business, financial position and our ability to achieve our Vision.

We regularly evaluate potential strategic transactions, including acquisitions, dispositions, joint ventures and investments in third parties. Opportunities for strategic transactions may be limited, and the success of any such transaction is dependent upon our ability to complete and realize the expected benefits of the transaction in the expected time frame or at all. Following the completion of a transaction there may be certain financial, managerial, staffing and talent and operational risks, including

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diversion of m and Part II, Item 1A. Risk Factors of our First Quanagements attention from existing core businesses, difficulties integrating other businesses into existing operations and other challenges presented by a transaction that does not achieve anticipated sales levels and profitability. We may not be able to enter into attractive business relationships or execute and complete strategic transactions on favorable terms or at all, and any such relationships or transactions may not improve our competitive position or have the intended financial outcomes. rter For example, our former investment in JUUL did not result in and, to date, our investment in Cronos has not, resulted in the economic and competitive advantages expected at the time the investments were made.

We may not be able to realize the expected benefits of the NJOY Transaction in the expected manner or timeframe, if at all, including due to the ITC exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE in the United States, which became effective on March 31, 2025. As a result of the ITCs orders, we project that our e-vapor reporting unit will have lower volume and revenue due to NJOY ACEs removal from the U.S. market and higher costs associated with the commercialization of NJOYs future e-vapor product portfolio resulting in lower operating margins. Accordingly, in connection with the preparation of our financial statements for the first quarter of 2025, we recorded a non-cash impairment of the value of goodwill within our e-vapor reporting unit. If any of the judgments and assumptions we made in determining the fair value of the e-vapor reporting unit fail to materialize as anticipated, we could have one or more additional non-cash impairments of the value of goodwill in our e-vapor reporting unit in future periods. Other factors that could negatively impact our ability to realize the expected benefits of the NJOY Transaction in the expected manner or timeframe, if at all, include (i) our failure to receive or maintain regulatory authorizations; (ii) changes in adult tobacco consumer preferences; (iii) our failure to comply with regulatory requirements; (iv) prevailing economic, market, regulatory or business conditions, or changes in such conditions negatively affecting our business and our plans with respect to the e-vapor category and (v) the outcome of any current or future legal proceeding or investigation related to the NJOY Transaction or NJOY or its products.

If the NJOY Transaction or any other acquisition, disposition, joint venture, investment in a third party or other strategic relationship is not successful, there could be a material negative impact on our business, financial position and results of operations and our ability to achieve our Vision.

We may be required to write down goodwill and intangible assets, including trademarks and other intellectual property, due to impairment, which could have a material adverse effect on our results of operations or financial position.

We periodically calculate the fair value of our reporting units and intangible assets to test for impairment. This calculation may be affected by several factors, including general macroeconomic conditions, the proliferation of illicit products, government actions, including FDA regulatory actions and inaction, changes in category growth (decline) rates as a result of changing adult tobacco consumer preferences, success of planned new product expansions, competitive activity, unfavorable outcomes with respect to litigation proceedings, including actions brought against us alleging patent infringement, and income and excise taxes. Certain events also can trigger an immediate review of intangible assets.

In connection with the preparation of our financial statements for the first quarter of m 10-Q. There have been no material changes to the risk factors previously disclosed in our 2025, we recorded an impairment of the value of goodwill within our e-vapor reporting unit as a result of the ITC exclusion order and cease-and-desist orders prohibiting the importation and sale of NJOY ACE into the United States, which became effective on March 31, 2025. As a result of the ITCs orders, we project that our e-vapor reporting unit will have lower volume a4 Form 10-K and revenue due to NJOY ACEs removal from the U.S. market and higher costs associated with the commercialization of NJOYs future e-vapor product portfolio resulting in lower operating margins. If any of the judgments and assumptions we made in determining the fair value of the e-vapor reporting unit fail to materialize as anticipated, we could have one or more additional non-cash impairments of the value of goodwill in our e-vapor reporting unit in future periods. In addition to the factors referenced above, these estimates and assumptions include the (i) timing and extent of effective enforcement against illicit flavored disposable e-vapor products; (ii) timing and likelihood of regulatory authorizations of e-vapor products, including of NJOYs products; (iii) timing of the commercialization of NJOY e-vapor products in the United States; (iv) long-term growth of the e-vapor category; and (v) conversion rates of illicit flavored disposable e-vapor consumers to lawful e-vapor products and, specifically, NJOYs e-vapor products. Fair value calculations are sensitive to changes in these estimates and assumptions, some of which relate to broader macroeconomic conditions and governmental actions outside of our control.

Additionally, in the second quarter of 2024, we recorded an impairment of the value of the Skoal trademark. This impairment was the result of the decrease in the fair value of the Skoal trademark caused by decreases in the size of the MST products category, which were due, in part, to the growth of nicotine pouch volumes. We continue to monitor several factors that impact the fair value of our goodwill and intangible assets. First Quarter For example, if Skoals actual revenue and income or long-term outlook are significantly unfavorable compared to forecasted performance used to estimate the fair value or if the discount rate used to estimate the fair value increases, we could have an additional non-cash impairment of the carrying value of the Skoal trademark in future periods.

If any impairment is determined to exist, we will incur impairment charges, which could have a material adverse effect on our results of operations or financial position.

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