British American Tobacco (BAT) expects its revenue from smoking alternatives, including vapes and nicotine pouches, to grow at a mid-teens percentage rate annually through 2030, as the company accelerates its shift beyond traditional cigarettes.
The forecast highlights the growing importance of so-called “new category” products to BAT’s long-term business strategy. The company is increasingly directing investment towards modern oral nicotine products, vaping and other alternatives as consumer demand evolves.
BAT’s latest performance has already shown strong momentum in these categories. Its first-half 2026 results showed new-category revenue growth of 18%, with modern oral products recording particularly strong growth.
The expansion comes as tobacco companies seek to build businesses around products they say can provide alternatives to combustible cigarettes. However, the sector continues to face differing regulatory approaches and public-health concerns, particularly around nicotine addiction and youth access.
The outlook also comes amid changing regulation in major markets. India, for example, recently ordered a crackdown on nicotine pouches, while US regulators are considering changes that could accelerate approval processes for some vaping and nicotine-pouch products.
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