Cardinal Health Reports First Quarter Fiscal Year 2026 Results and Raises Outlook

DUBLIN, Ohio, Oct. 30, 2025 /PRNewswire/ -- Cardinal Health (NYSE: CAH) today reported first quarter fiscal year 2026 revenues of $64 billion, an increase of 22% from the first quarter of fiscal year 2025. First quarter GAAP operating earnings increased 18% to $668 million and GAAP diluted earnings per share (EPS) increased 11% to $1.88. First quarter non-GAAP operating earnings increased 37% to $857 million, driven by segment profit growth across all five of the company's operating segments. Non-GAAP diluted EPS increased 36% to $2.55, reflecting the increase in non-GAAP operating earnings, a lower share count and a lower effective tax rate, partially offset by an increase in interest and other expense due to financing costs related to announced acquisitions.

"We are pleased with our strong broad-based operational and financial performance to begin fiscal 2026," said Jason Hollar, CEO of Cardinal Health. "This outstanding first quarter reflects our focused execution across each of our operating segments and provides a solid foundation as we carry forward. As a result, we are raising our fiscal 2026 outlook."

Q1 FY26 summary

Q1 FY26

Q1 FY25

Y/Y

Revenue

$64.0 billion

$52.3 billion

22 %

Operating earnings

$668 million

$568 million

18 %

Non-GAAP operating earnings

$857 million

$625 million

37 %

Net earnings attributable to Cardinal Health, Inc.

$450 million

$416 million

8 %

Non-GAAP net earnings attributable to Cardinal Health, Inc.

$611 million

$460 million

33 %

Effective Tax Rate

24.1 %

23.0 %

Non-GAAP Effective Tax Rate

21.9 %

23.0 %

Diluted EPS attributable to Cardinal Health, Inc.

$1.88

$1.70

11 %

Non-GAAP diluted EPS attributable to Cardinal Health, Inc.

$2.55

$1.88

36 %

Segment results

Pharmaceutical and Specialty Solutions segment

Q1 FY26

Q1 FY25

Y/Y

Revenue

$59.2 billion

$48.0 billion

23 %

Segment profit

$667 million

$530 million

26 %

First quarter revenue for the Pharmaceutical and Specialty Solutions segment increased 23% to $59.2 billion, driven by brand and specialty pharmaceutical sales growth from existing and new customers.

Pharmaceutical and Specialty Solutions segment profit increased 26% to $667 million in the first quarter, driven by contributions from brand and specialty products, the acquisition of MSO platforms and positive generics program performance.

Global Medical Products and Distribution segment

Q1 FY26

Q1 FY25

Y/Y

Revenue

$3.2 billion

$3.1 billion

2 %

Segment profit

$46 million

$8 million

N.M.

First quarter revenue for the Global Medical Products and Distribution segment increased 2% to $3.2 billion, driven by volume growth from existing customers.

Global Medical Products and Distribution segment profit increased by $38 million to $46 million in the first quarter, primarily driven by growth from existing customers.

Other 3

Q1 FY26

Q1 FY25

Y/Y

Revenue

$1.6 billion

$1.2 billion

38 %

Segment profit

$166 million

$104 million

60 %

First quarter revenue for Other increased 38% to $1.6 billion, driven by growth across the three operating segments: at-Home Solutions (including the acquisition of Advanced Diabetes Supply), Nuclear and Precision Health Solutions and OptiFreight Logistics.

Other segment profit increased 60% to $166 million in the first quarter, driven by growth across the three operating segments: at-Home Solutions (including the acquisition of Advanced Diabetes Supply), OptiFreight Logistics, and Nuclear and Precision Health Solutions.

Fiscal year 2026 outlook 2

Cardinal Health is raising its guidance for non-GAAP diluted EPS attributable to Cardinal Health, Inc. to a range of $9.65 to $9.85 (+17% to +20% growth). This $0.35 increase from the prior range of $9.30 to $9.50 takes into account the company's strong first quarter performance and expected contributions from the acquisition of Solaris Health, which the company anticipates completing in early November. The company is also raising its expectations for adjusted free cash flow to $3.0 billion to $3.5 billion, from a prior range of $2.75 billion to $3.25 billion.

This updated guidance reflects increased expectations at the segment level:

The company is also updating the following assumptions for the fiscal year:

Recent highlights

Webcast

Cardinal Health will host a webcast today at 8:30 a.m. ET to discuss first quarter results. To access the webcast and corresponding slide presentation, go to the Investor Relations page at ir.cardinalhealth.com. No access code is required.

Presentation slides and a webcast replay will be available on the Investor Relations page for 12 months.

About Cardinal Health

Cardinal Health is a distributor of pharmaceuticals and specialty products; a global manufacturer and distributor of medical and laboratory products; a supplier of home-health and direct-to-patient products and services; an operator of nuclear pharmacies and manufacturing facilities; and a provider of performance and data solutions. Our company's customer-centric focus drives continuous improvement and leads to innovative solutions that improve people's lives every day. Learn more about Cardinal Health at cardinalhealth.com and in our Newsroom.

Contacts

Media: Erich Timmerman, Erich.Timmerman@cardinalhealth.com and 614.757.8231

Investors: Matt Sims, Matt.Sims@cardinalhealth.com and 614.553.3661

1GAAP refers to U.S. generally accepted accounting principles. This news release includes GAAP financial measures as well as non-GAAP financial measures, which are financial measures not calculated in accordance with GAAP. See "Use of Non-GAAP Measures" following the attached schedules for definitions of the non-GAAP financial measures presented in this news release and see the attached schedules for reconciliations of the differences between the non-GAAP financial measures and their most directly comparable GAAP financial measures.

2The company does not provide forward-looking guidance on a GAAP basis as certain financial information, the probable significance of which cannot be determined, is not available and cannot be reasonably estimated. See "Use of Non-GAAP Measures" following the attached schedules for additional explanation.

3Other includes the following three operating segments: Nuclear and Precision Health Solutions (NPHS), at-Home Solutions and OptiFreight Logistics, which are not significant enough individually to require reportable segment disclosure.

Cardinal Health uses its website as a channel of distribution for material company information. Important information, including news releases, financial information, earnings and analyst presentations, and information about upcoming presentations and events is routinely posted and accessible on the Investor Relations page at ir.cardinalhealth.com. In addition, the website allows investors and other interested persons to sign up automatically to receive email alerts when the company posts news releases, SEC filings and certain other information on its website.

Cautions Concerning Forward-Looking Statements

This release contains forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. These statements may be identified by words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue," "likely," and similar expressions, and include statements reflecting future results or guidance, statements of outlook and various accruals and estimates. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. These risks and uncertainties include our ability to manage uncertainties associated with the pricing of branded pharmaceuticals, including as a result of legislative or executive actions; the risk that we may fail to achieve our strategic objectives, including the continued execution of the GMPD Improvement Plan initiatives, whether as a result of tariffs on products we source or manufacture, an uncertain global economic environment, Cardinal Health Brand sales or ongoing inflationary pressures; competitive pressures in Cardinal Health's various lines of business, including the risk that customers may reduce purchases made under their contracts with us or terminate or not renew their contracts, whether due to price increases or otherwise; risks associated with litigation matters, including a Department of Justice investigation focused on potential violations of the Anti-Kickback Statute and False Claims Act; the risk that events outside of our control, such as weather or geopolitical events, may impact demand for our products or may cause supply shortages that impact our cost and ability to fulfill customer demand; the performance of our generics program, including the amount or rate of generic deflation and our ability to offset generic deflation and maintain other financial and strategic benefits through our generic sourcing venture or other components of our generics programs; risks associated with recently completed and pending acquisitions, including risks arising as a result from our entry into new lines of businesses. Cardinal Health is subject to additional risks and uncertainties described in Cardinal Health's Form 10-K, Form 10-Q and Form 8K reports and exhibits to those reports. This release reflects management's views as of October 30, 2025. Except to the extent required by applicable law, Cardinal Health undertakes no obligation to update or revise any forward-looking statement. Forward-looking statements are aspirational and not guarantees or promises that goals, targets or projections will be met, and no assurance can be given that any commitment, expectation, initiative or plan in this report can or will be achieved or completed. Cardinal Health provides definitions and reconciliations of non-GAAP financial measures and their most directly comparable GAAP financial measures at ir.cardinalhealth.com

Schedule 1

Cardinal Health, Inc. and Subsidiaries

Condensed Consolidated Statements of Earnings (Unaudited)

First Quarter

(in millions, except per common share amounts)

2026

2025

% Change

Revenue

$ 64,009

$ 52,277

22 %

Cost of products sold

61,690

50,375

22 %

Gross margin

2,319

1,902

22 %

Operating expenses:

Distribution, selling, general and administrative expenses

1,461

1,277

14 %

Restructuring and employee severance

Amortization and other acquisition-related costs

104

Acquisition-related cash and share-based compensation costs

—

Impairments and (gain)/loss on disposal of assets, net

(1)

Litigation (recoveries)/charges, net

—

(40)

Operating earnings

668

568

18 %

Other (income)/expense, net

(10)

(5)

Interest expense, net

N.M.

Earnings before income taxes

598

541

11 %

Provision for income taxes

144

124

16 %

Net earnings

454

417

9 %

Less: Net earnings attributable to noncontrolling interests

(4)

(1)

Net earnings attributable to Cardinal Health, Inc.

$ 450

$ 416

8 %

Earnings per common share attributable to Cardinal Health, Inc.:

Basic

$ 1.89

$ 1.71

11 %

Diluted

1.88

1.70

11 %

Weighted-average number of common shares outstanding:

Basic

238

243

Diluted

239

245

Schedule 2

Cardinal Health, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in millions)

September 30,

2025

June 30,

2025

(Unaudited)

Assets

Current assets:

Cash and equivalents

$ 4,593

$ 3,874

Trade receivables, net

13,770

13,242

Inventories, net

17,559

16,831

Prepaid expenses and other

2,602

2,414

Assets held for sale

Total current assets

38,537

36,373

Property and equipment, net

2,831

2,858

Goodwill and other intangibles, net

12,110

12,177

Other assets

1,750

1,714

Total assets

$ 55,228

$ 53,122

Liabilities and Shareholders' Deficit

Current liabilities:

Accounts payable

$ 36,860

$ 34,713

Current portion of long-term obligations and other short-term borrowings

550

Other accrued liabilities

3,356

3,634

Total current liabilities

40,268

38,897

Long-term obligations, less current portion

8,980

7,977

Deferred income taxes and other liabilities

8,711

8,882

Total shareholders' deficit

(2,731)

(2,634)

Total liabilities and shareholders' deficit

$ 55,228

$ 53,122

Schedule 3

Cardinal Health, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited )

First Quarter

(in millions)

2026

2025

Cash flows from operating activities:

Net earnings

$ 454

$ 417

Adjustments to reconcile net earnings to net cash provided by/(used in) operating activities:

Depreciation and amortization

233

182

Impairments and loss on sale of other investments

Impairments and (gain)/loss on disposal of assets, net

(1)

Share-based compensation

Provision for bad debts

Change in operating assets and liabilities, net of effects from acquisitions and divestitures:

(Increase)/decrease in trade receivables

(539)

288

Increase in inventories

(736)

(678)

Increase/(decrease) in accounts payable

2,147

(1,394)

Other accrued liabilities and operating items, net

(699)

(508)

Net cash provided by/(used in) operating activities

973

(1,647)

Cash flows from investing activities:

Acquisition of subsidiaries, net of cash acquired

(41)

—

Additions to property and equipment

(108)

(90)

Other investing items, net

Net cash used in investing activities

(142)

(88)

Cash flows from financing activities:

Proceeds from long-term obligations, net of issuance costs

989

—

Reduction of long-term obligations

(512)

(9)

Purchases/(payments) of noncontrolling interests, net

(3)

—

Net tax withholdings from share-based compensation

(80)

(28)

Dividends on common shares

(129)

(128)

Purchase of treasury shares

(375)

Net cash used in financing activities

(110)

(540)

Effect of exchange rates changes on cash and equivalents

(2)

Net increase/(decrease) in cash and equivalents

719

(2,266)

Cash and equivalents at beginning of period

3,874

5,133

Cash and equivalents at end of period

$ 4,593

$ 2,867

Schedule 4

Cardinal Health, Inc. and Subsidiaries

Segment Information

First Quarter

Pharmaceutical and Specialty Solutions

Global Medical Products and Distribution

Other

(in millions)

2026

2025

2026

2025

2026

2025

Revenue

Amount

$ 59,205

$ 47,990

$ 3,184

$ 3,123

$ 1,641

$ 1,186

Growth rate

23 %

(5) %

2 %

3 %

38 %

13 %

Segment profit

Amount

$ 667

$ 530

$ 46

$ 8

$ 166

$ 104

Growth rate

26 %

16 %

N.M.

60 %

8 %

Segment profit margin

1.13 %

1.10 %

1.44 %

0.26 %

10.12 %

8.77 %

The sum of the components and certain computations may reflect rounding adjustments.

Schedule 5

Cardinal Health, Inc. and Subsidiaries

GAAP / Non-GAAP Reconciliation 1

Net

Earnings

Gross

Operating

Earnings

Attributable

Net

Diluted

Margin

SG&A 2

Earnings

Before

Provision for

to Non-

Earnings 3

Effective

EPS 3

(in millions, except per common share amounts)

Gross

Growth

Operating

Growth

Income

Controlling

Net

Growth

Tax

Diluted

Growth

Margin

Rate

SG&A 2

Rate

Earnings

Rate

Taxes

Interests

Earnings 3

Rate

EPS 3

Rate

First Quarter 2026

GAAP

$ 2,319

22 %

$ 1,461

14 %

$ 668

18 %

$ 598

$ 144

$ (4)

$ 450

8 %

24.1 %

$ 1.88

11 %

Restructuring and employee severance

—

0.06

Amortization and other acquisition-related costs

—

104

0.31

Acquisition-related cash & share-based compensation costs

—

0.26

Impairments and (gain)/loss on disposal of assets, net

—

Litigation (recoveries)/charges, net

—

(8)

0.03

Non-GAAP

$ 2,318

22 %

$ 1,461

14 %

$ 857

37 %

$ 788

$ 173

$ (4)

$ 611

33 %

21.9 %

$ 2.55

36 %

First Quarter 2025

GAAP

$ 1,902

9 %

$ 1,277

8 %

$ 568

N.M.

$ 541

$ 124

$ (1)

$ 416

N.M.

23.0 %

$ 1.70

N.M.

Restructuring and employee severance

—

0.07

Amortization and other acquisition-related costs

—

0.22

Impairments and (gain)/loss on disposal of assets, net

—

(1)

—

(1)

—

Litigation (recoveries)/charges, net

—

(40)

(12)

(28)

(0.11)

Non-GAAP

$ 1,902

9 %

$ 1,277

8 %

$ 625

12 %

$ 598

$ 138

$ (1)

$ 460

7 %

23.0 %

$ 1.88

9 %

1 For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules.

2 Distribution, selling, general and administrative expenses.

3 Attributable to Cardinal Health, Inc.

The sum of the components and certain computations may reflect rounding adjustments.

We generally apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.

Schedule 6

Cardinal Health, Inc. and Subsidiaries

GAAP / Non-GAAP Reconciliation - GAAP Cash Flow to Non-GAAP Adjusted Free Cash Flow

First Quarter

(in millions)

2026

2025

GAAP - Cash Flow Categories

Net cash provided by/(used in) operating activities

$ 973

$ (1,647)

Net cash used in investing activities

(142)

(88)

Net cash used in financing activities

(110)

(540)

Effect of exchange rates changes on cash and equivalents

(2)

Net increase/(decrease) in cash and equivalents

$ 719

$ (2,266)

Non-GAAP Adjusted Free Cash Flow

Net cash provided by/(used in) operating activities

$ 973

$ (1,647)

Additions to property and equipment

(108)

(90)

Payments related to matters included in litigation (recoveries)/charges, net

404

376

Non-GAAP adjusted free cash flow

$ 1,269

$ (1,361)

For more information on these measures, refer to the Use of Non-GAAP Measures and Definitions schedules.

Cardinal Health, Inc. and Subsidiaries

Use of Non-GAAP Measures

This earnings release contains financial measures that are not calculated in accordance with U.S. generally accepted accounting principles ("GAAP").

In addition to analyzing our business based on financial information prepared in accordance with GAAP, we use these non-GAAP financial measures internally to evaluate our performance, engage in financial and operational planning, and determine incentive compensation because we believe that these measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of our underlying, ongoing business. We provide these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on our financial and operating results on a year-over-year basis and in comparing our performance to that of our competitors. However, the non-GAAP financial measures that we use may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by us should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth below should be carefully evaluated.

Exclusions from Non-GAAP Financial Measures

Management believes it is useful to exclude the following items from the non-GAAP measures presented in this report for its own and for investors' assessment of the business for the reasons identified below:

The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded. The gross, tax and net impact of each item are presented with our GAAP to non-GAAP reconciliations.

Non-GAAP adjusted free cash flow: We provide this non-GAAP financial measure as a supplemental metric to assist readers in assessing the effects of items and events on our cash flow on a year-over-year basis and in comparing our performance to that of our peer group companies. In calculating this non-GAAP metric, certain items are excluded from net cash provided by operating activities because they relate to significant and unusual or non-recurring events and are inherently unpredictable in timing and amount. We believe adjusted free cash flow is important to management and useful to investors as a supplemental measure as it indicates the cash flow available for working capital needs, debt repayments, dividend payments, share repurchases, strategic acquisitions, or other strategic uses of cash. A reconciliation of our GAAP financial results to Non-GAAP adjusted free cash flow is provided in Schedule 6 of the financial statement tables included with this release.

Forward Looking Non-GAAP Measures

In this document, the Company presents certain forward-looking non-GAAP metrics. The Company does not provide outlook on a GAAP basis because the items that the Company excludes from GAAP to calculate the comparable non-GAAP measure can be dependent on future events that are less capable of being controlled or reliably predicted by management and are not part of the Company's routine operating activities. Additionally, management does not forecast many of the excluded items for internal use and therefore cannot create or rely on outlook done on a GAAP basis.

The occurrence, timing and amount of any of the items excluded from GAAP to calculate non-GAAP could significantly impact the Company's fiscal 2026 GAAP results. Over the past five fiscal years, the excluded items have impacted the Company's EPS from $1.79 to $8.44, which includes a $6.79 charge related to the goodwill impairment charge for the GMPD segment in fiscal 2022.

Definitions

Growth rate calculation: growth rates in this report are determined by dividing the difference between current-period results and prior-period results by prior-period results.

Interest and Other, net: other (income)/expense, net plus interest expense, net.

Segment Profit: segment revenue minus (segment cost of products sold and segment distribution, selling, general, and administrative expenses).

Segment Profit margin: segment profit divided by segment revenue.

Non-GAAP gross margin: gross margin, excluding LIFO charges/(credits).

Non-GAAP distribution, selling, general and administrative expenses or Non-GAAP SG&A: distribution, selling, general and administrative expenses, excluding state opioid assessment related to prior fiscal years and shareholder cooperation agreement costs.

Non-GAAP operating earnings: operating earnings excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net.

Non-GAAP earnings before income taxes: earnings before income taxes excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net.

Non-GAAP net earnings attributable to non-controlling interests: net earnings attributable to non-controlling interests excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, each net of tax.

Non-GAAP net earnings attributable to Cardinal Health, Inc.: net earnings attributable to Cardinal Health, Inc. excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, each net of tax.

Non-GAAP effective tax rate: provision for income taxes adjusted for the tax impacts of (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, divided by (earnings before income taxes adjusted for the items above).

Non-GAAP diluted earnings per share attributable to Cardinal Health, Inc.: non-GAAP net earnings attributable to Cardinal Health, Inc. divided by diluted weighted-average shares outstanding.

Non-GAAP adjusted free cash flow: net cash provided by operating activities less payments related to additions to property and equipment, excluding settlement payments and receipts related to matters included in litigation (recoveries)/charges, net, as defined above, or other significant and unusual or non-recurring cash payments or receipts.

SOURCE Cardinal Health, Inc.