British American Tobacco p.l.c.

Tobacco consumption is structurally recurring because consumer repurchase behavior approaches 100% for the core combustible user base, and group revenue of £25.6B in FY2025 (+2.1%) held with directional stability across recent fiscal years despite declining cigarette volumes. Revenue is not contractual, so visibility comes from consumer habit rather than backlog.

Portfolio spans combustibles (Dunhill, Kent, Lucky Strike, Newport, Pall Mall, Rothmans, Camel) and New Categories (Vuse vapour, Velo modern oral, glo heated tobacco), but every segment sits within nicotine delivery and shares correlated regulatory and public-health risk. Combustibles still generated the majority of group revenue and profit in FY2025.

BAT operates through Americas-and-Europe and Asia-Pacific, Middle East and Africa segments with commercial presence in more than 180 markets. The US is the largest single country at roughly 40% of revenue, with meaningful additional contributions from the UK, continental Europe, and emerging markets across Asia, Africa, and Latin America.

Scalability sits at sector norms, with adjusted operating margin stable in the mid-40% range across FY2021-FY2025 supported by established distribution and manufacturing scale. No incremental operating leverage is visible as New Categories investment offsets combustible cost gains.

Consumer repeat purchase is near-universal among addicted users, giving daily transactional revenue a quasi-subscription economic profile even though it is not contractually recurring. Combustibles remain highly defensive; New Categories (Vuse, Velo, glo) add diversification of delivery modes while keeping the same nicotine consumer base.