Consumption of smoke-free nicotine products—such as nicotine pouches, snus, and vapes—will surpass that of combustible cigarettes in volume in 2025, according to a new analysis from investment bank Goldman Sachs.

“Expanding beyond combustible products to smoke-free alternatives is an imperative for the industry,” the authors write in the report, reviewed by Snusforumet.

“Over the next decade, we anticipate a significant shift in the nicotine landscape whereby smoke-free products overtake combustibles to become the primary driver of industry growth.”

Cigarette consumption in the US has been declining steadily for decades, a trend Goldman Sachs expects to accelerate in the coming decade. While 12.9 billion packs of cigarettes were sold in the US in 2016, that figure is expected to decline to only 2.7 billion packs by 2035.

The rise of nicotine pouches

By that time, cigarettes are expected to comprise only 20 percent of total nicotine US consumption, down from 47 percent in 2024. 

This decline is being driven by increased awareness of the health risks associated with smoking, rising cigarette prices, and the growing availability of smoke-free nicotine product alternatives, such as nicotine pouches.

“By 2035, we expect nicotine pouches to surpass traditional smokeless tobacco in both volume and revenue, cementing their position as a leading smoke-free nicotine category,” the report explains. 

The shift away from cigarettes is largely consumer-driven. Given the choice, adult nicotine users are increasingly opting for alternatives that eliminate the harmful effects of combustion. 

Smoke-free nicotine products, particularly pouches, are gaining popularity due to their convenience, discreet use, and growing scientific consensus that they present significantly lower health risks compared to smoking.

Consumers shift to reduced-risk products

Nicotine pouch volumes are expected to grow by 21 percent annually in the coming decade, while cigarettes will fall by nearly 8 percent. 

“Consumers are clearly moving toward reduced-risk nicotine products,” the report notes, highlighting the rapid expansion of the oral nicotine pouch category.

Nevertheless, the Goldman Sachs report expects vapes will dominate the US smoke-free market, becoming the largest market segment by 2035, followed by pouches and heat-not-burn (HNB).

The US nicotine market remains in a “state of flux” in part due to the FDA’s slow and cumbersome PTMA (pre-market tobacco product authorization) process that “hinder the industry’s transition to smoke-free products and the creation of a viable market”.

Policy should ease access to smoke-free nicotine products

The transition underway in the US mirrors Sweden’s long-standing experience with less harmful smokeless alternatives, where widespread snus use has led to the lowest smoking rates and tobacco-related health issues in Europe.

“This is exactly what we have seen in Sweden—when consumers have access to safer alternatives, that’s what they prefer,” says Patrik Strömer, secretary general of the Association of Swedish Snus Manufacturers.

“The fact that the US is following Sweden’s path shows that harm reduction works and that smoke-free nicotine products can play a crucial role in helping consumers transition away from cigarettes.”

He emphasizes that while the transition is promising, regulatory frameworks must support, rather than hinder, the availability of scientifically backed reduced-risk products. 

“Policymakers on both sides of the Atlantic should recognize the public health benefits of these alternatives and make them more accessible to smokers looking to quit,” he adds.