Sales of nicotine pouches in the United States have surged nearly 251% since early 2023, making them one of the fastest-growing consumer products in the country and reshaping the economics of convenience stores, according to research by the CDC Foundation using retail data from Circana.
Total retail sales climbed from $145.5 million to $510.5 million, a 250.8% increase in just over two years.
Nicotine pouches are small, tobacco-free packets placed under the upper lip that deliver nicotine without smoke, vapor, or chewing tobacco. They can be used where smoking is prohibited and are available in a variety of flavors and nicotine strengths. The best-known brand is Zyn.
Much of the demand is being driven by adult smokers looking for alternatives to traditional cigarettes. While many consumers view pouches as a potential step away from smoking, public health officials note there is still limited evidence showing they are effective smoking-cessation tools.
For convenience stores, however, the business impact has been dramatic.
Traditional cigarette sales continue to decline, falling about 2.4% over the past year, although cigarettes still account for nearly 70% of nicotine-category sales. At the same time, smokeless tobacco products generated approximately $13 billion in sales during the 52 weeks ending March 22, 2026, with nicotine pouches becoming one of the fastest-growing segments.
Retailers that rely heavily on impulse purchases at checkout counters increasingly view nicotine pouches as one of their strongest growth categories.
The boom has also become a lifeline for major tobacco companies.
Philip Morris International, which acquired Swedish Match, the maker of Zyn, reported U.S. Zyn sales rising more than 10% during the first quarter. Altria continues expanding its On! pouch business, while British American Tobacco markets its Velo and Lyft brands.
Rather than replacing tobacco-company profits, nicotine pouches are increasingly replacing older smokeless products such as chewing tobacco and snuff while helping sustain overall nicotine sales.
Competition inside convenience stores has intensified.
Manufacturers are aggressively competing for shelf space through promotions, temporary discounts, and buy-one-get-one offers. Although Zyn generally sells at a 60% to 65% premium over competing brands, growing competition is beginning to pressure retail profit margins.
Regulation remains one of the industry’s biggest uncertainties.
Only two brands have received Food and Drug Administration marketing authorization: 20 Zyn products approved in January 2025 and six On! Plus products approved later that year. Those approvals provide a significant competitive advantage while many other products continue competing without formal FDA authorization.
The rapid expansion has also drawn growing criticism from health advocates.
A tobacco-industry watchdog estimates global nicotine pouch sales have increased roughly 660% since 2020 and could reach $25 billion by 2028. Researchers continue studying their long-term health effects and warn that nicotine remains harmful to brain development through approximately age 25.
Some researchers also note that many users consume nicotine pouches alongside cigarettes or vaping products rather than replacing them entirely.
For now, however, the financial story is unmistakable.
A product that barely registered on store shelves only a few years ago has rapidly become a multibillion-dollar category supporting convenience-store sales while reshaping the strategies of some of the world’s largest tobacco companies.
The next chapter will depend largely on how aggressively regulators oversee the industry, whether competition drives prices lower, and how consumers respond as the category continues expanding at one of the fastest rates in retail.
JBizNews Desk
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