Tobacco sales abroad drive KT&G's profits for a third consecutive quarter
KT&G, a leading South Korean company specializing in tobacco products, ginseng, and related businesses, is currently embroiled in a tobacco lawsuit. Details about the nature of the lawsuit are scarce, but a petition signed by 1.5 million people has been handed in to the court.
Founded as Korea Tobacco and Ginseng Corporation in 1989, KT&G has evolved into a stock company since 1997 and expanded its business beyond domestic markets to a global footprint spanning roughly 50 countries, primarily in Asia and the Middle East.
In the first half of 2025, KT&G reported record revenue surpassing KRW 3 trillion (approximately USD 2.16 billion), with continuous revenue and operating profit growth for three consecutive quarters since Q4 2024. The tobacco segment, which is the company’s core business, showed a 10% revenue increase and 1.6% growth in operating profit.
KT&G's global cigarette business recorded five consecutive quarters of triple growth in revenue, operating profit, and sales volume. The company has successfully expanded its international market, with strategic pricing and product launches.
Besides tobacco, KT&G holds significant business interests in ginseng products, cosmetics, pharmaceuticals, and real estate investments. The company earns roughly two-thirds of its revenue from tobacco sales in South Korea, with about a quarter from overseas tobacco sales.
KT&G also demonstrates a strong commitment to shareholder value, increasing interim dividends and launching a large-scale stock buyback program. The company targets double-digit operating profit growth for 2025 and focuses on next-generation tobacco products (NGPs), including heated tobacco and forthcoming nicotine pouches and e-cigarettes, aiming to capture nearly half of the domestic reduced-risk product market.
In an effort to combat smoking, Seoul Station Plaza will be designated as a non-smoking zone starting from June 1. However, there has been criticism regarding the use of voucher programs for cigarettes and beauty treatments.
KT&G has completed the construction of a tobacco plant in Seoul and a tobacco plant in Kazakhstan, although no further details about these plants or the specific criticisms of the voucher program in Kazakhstan are available.
As KT&G continues to expand globally, it faces challenges from various fronts, including the tobacco lawsuit, criticisms about voucher programs, and regulatory pressures. Despite these challenges, the company remains financially robust and committed to its growth and shareholder returns.
- Amidst the tobacco lawsuit, KT&G, a financially robust company with expansive business interests in tobacco, ginseng, cosmetics, pharmaceuticals, real estate, and next-generation tobacco products like heated tobacco, nicotine pouches, and e-cigarettes, is proceeding with its global growth strategy.
- The industry-leading South Korean corporation, KT&G, which generated record revenue of over KRW 3 trillion in the first half of 2025 from both domestic and overseas tobacco sales, is now under scrutiny due to a petition relating to the tobacco lawsuit.
- Despitestanding criticism regarding the voucher programs and the tobacco lawsuit, KT&G aims to capture nearly half of the domestic reduced-risk product market with its focus on next-generation tobacco products, demonstrating its commitment to shareholder value amidst the ongoing challenges in the economy and industry.
