3 Big Numbers is a weekly column that looks at a few key details from around the c-store industry.
The number of smokers in the U.S. has been declining for decades.
These numbers have cut into c-stores’ bottom lines — but the outlook for them isn’t entirely doom and gloom, according to a recent report on nicotine sales from Goldman Sachs. The investment bank’s research arm surveyed companies representing almost half of all tobacco outlets in the country, including retailers and wholesalers. The results are in.
In this week’s “3 Big Numbers,” we look at how nicotine retailers are feeling about sales for the coming months.
20%
The percent of respondents who said their outlook for tobacco sales has grown more negative.
In the fourth quarter of 2025, 20% of the retailers and wholesalers who Goldman Sachs surveyed said their outlook for the nicotine category has grown more negative, the lowest level since Q4 2021.
Comparatively, 23% said their outlook had grown more positive and 58% said it remained roughly the same.
However, that doesn’t mean the outlook is sunshine and roses, considering 38% of respondents said their view of the overall strength of the tobacco consumer is negative, due in large part to continuing economic pressures.
“Given these ongoing pressures on the consumer, a few retailers noted expectations for increasing promotional activity near term in an effort to drive stronger volumes,” said Goldman Sachs in the report.
$11.2 billion
Smokeless nicotine sales in the past year.
One reason retailers’ optimism has grown in the past few years is because of the profitability of the smokeless category, including oral nicotine. Smokeless is the second-largest category in the nicotine space, earning $11.2 billion in the past year. That was second only to cigarettes, which still accounted for more than $50 billion in the same span.
“Overall, retailers overwhelmingly remain positive on the nic pouch category, as they expect to give more shelf space to pouches in 2026,” Goldman Sachs wrote in its report. Retailers expect to give about 7% more space to these products, according to the report.
Nicotine pouches in particular may see even faster growth in the coming months. The U.S. Food and Drug Administration gave marketing approval to the first Zyn pouches roughly a year ago, and added select on! products early this year.
We may see the approvals come even quicker thanks to an FDA pilot program aimed at making the marketing authorization review process more efficient. The department is also considering Zyn’s request to market these products as “less harmful.” That could make them more appealing to those looking to switch products.
75%
The percent of respondents who said trading down and cross-category switching is accelerating.
As nicotine fans get financially squeezed, they continue to look for ways to treat themselves while paying less. That often comes in the form of downtrading or looking to other items, with 75% of respondents telling Goldman Sachs they’ve seen an increase in these behaviors.
And it could get worse — everyone surveyed said they had seen changes in consumer behavior under the weight of increasing economic pressure.
Moreover, one retailer said that it wasn’t just the price that drew smokers to lower-priced products, it was also because “the quality of discount brands is better than ever and price increases continue to widen the relative gap.”
