CARDINAL HEALTH INC
For the period ended Mar 31, 2026. Filed Apr 30, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed Apr 30, 2026
CAH$271.72+1.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-12-31; filed 2026-02-05.
0000721371-26-000006
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsExplanation and Reconciliation of Non-GAAP Financial MeasuresCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-04-30.
0000721371-26-000018
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsExplanation and Reconciliation of Non-GAAP Financial MeasuresThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 133 previous paragraphs and 155 current paragraphs.
91 unchanged; 38 reworded; 25 added; 3 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 34 previous and 38 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
GAAP operating earnings for the three and nine months ended March 31, 2026 decreased 30 percent to $509 million and increased 2 percent to $1.9 billion from the comparative prior-year periods, respectively. GAAP operating earnings for the three and nine months ended March 31, 2026 was unfavorably impacted by the $184 million pre-tax non-cash goodwill impairment charge related to the Navista & ION reporting unit within the Pharma segment recognized in the current quarter, the $106 million and $165 million of net recoveries in class action antitrust litigation recognized in the comparative prior-year periods, respectively, and higher cash and share-based compensation costs resulting from the timing of acquisitions within The Specialty Alliance. See "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 4 of the "Notes to the Condensed Consolidated Financial Statements" for further information on the goodwill impairment.
Current report
In February 2025, the United States imposed tariffs under the International Emergency Economic Powers Act ("IEEPA") on certain goods, materials and products imported into the United States from countries where we do business. In February 2026, the U.S. Supreme Court ruled that the IEEPA tariffs were unlawful but did not establish a mechanism for issuing refunds. Subsequent to this ruling, U.S. Customs and Border Protection ("CBP") worked to establish a phased process to administer refunds required by the Supreme Court ruling; however, uncertainty remains concerning the timing, scope and administrative process to receive refunds for all IEEPA tariffs paid. In April 2026, CBP launched its program to administer Phase 1 refund requests; however, substantially all of our IEEPA tariffs paid will fall under Phase 2 or later phases. As of the date hereof, CBP has not communicated a date on which the refund process for such Phase 2 or later phases will be established or available.
Current report
We have taken actions to reduce the impact of IEEPA and other tariffs on our financial results, including through cost optimization initiatives and by increasing prices on impacted products to customers; however, these measures have not fully offset the negative impact. As of the third quarter of fiscal year 2026, we have paid approximately $200 million in IEEPA tariffs, primarily related to products that we source, manufacture or distribute in our GMPD segment. In the event that we receive refunds of IEEPA tariffs from the government, we expect to return to those customers the portion of those refunds that reflect the estimated increased prices paid related to IEEPA tariffs.
Current report
We have not recognized any financial impact related to potential tariff refunds or payments to our customers as of March 31, 2026. The ultimate resolution of this matter could positively impact our results of operations in future periods, including GMPD segment profit and consolidated operating income.
Current report
Following the Supreme Court IEEPA ruling, the U.S. government replaced IEEPA tariffs with tariffs imposed under Section 122 of the Trade Act of 1974. We continue to evaluate the impact of these and other tariffs, including tariffs imposed under Sections 301 and 232 of the Trade Act of 1974.
Current report
Pharma segment revenue for the three months ended March 31, 2026 increased 11 percent to $56.1 billion from the comparative prior-year quarter, primarily due to branded and specialty pharmaceutical sales growth from existing customers.
Current report
GMPD segment revenue for the three months ended March 31, 2026 was flat at $3.1 billion compared to the prior-year quarter. This reflected lower distribution volumes, offset by Cardinal Health brand growth.
Current report
GMPD segment revenue for the nine months ended March 31, 2026 increased 2 percent to $9.6 billion from the comparative prior-year period, primarily due to Cardinal Health brand growth, partially offset by lower distribution volumes.
Current report
Pharma segment profit for the three months ended March 31, 2026 increased 18 percent to $784 million from the comparative prior-year quarter, primarily due to increased contribution from branded and specialty pharmaceutical products and the performance of our generics program.
Current report
GMPD segment profit for the three months ended March 31, 2026 decreased 36 percent to $25 million from the comparative prior-year quarter, primarily due to the adverse net impact of tariffs.
Current report
We recognized a pre-tax goodwill impairment charge of $184 million related to the Navista & ION reporting unit within the Pharma segment during the three and nine months ended March 31, 2026, as discussed further in the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 4 of the "Notes to the Condensed Consolidated Financial Statements".
Current report
Tax Effects of Goodwill Impairment Charges
Current report
During the three months ended March 31, 2026, we recognized a pre-tax goodwill impairment charge of $184 million related to the Navista & ION reporting unit within the Pharma segment. The net tax benefit related to this charge is $23 million for fiscal 2026.
Current report
The tax effect of the goodwill impairment charge recorded during the three months ended March 31, 2026 was included in our estimated annual effective tax rate because it was not considered unusual or infrequent, given that we have recorded other goodwill impairments in prior fiscal years. The impact of the non-deductible goodwill did not materially impact the annual effective tax rate for 2026.
Current report
During the three months ended March 31, 2026, we made a partial principal payment of $100 million for the Floating Rate Term Loan due 2028 with available cash.
Current report
Goodwill
Current report
Purchased goodwill is tested for impairment annually or when indicators of impairment exist. Goodwill impairment testing involves a comparison of the estimated fair value of reporting units to the respective carrying amount, which may be performed utilizing either a qualitative or quantitative assessment. Qualitative factors are first assessed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is more likely than not that the fair value does not exceed the carrying amount, then a quantitative test is performed. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. A reporting unit is defined as an operating segment or one level below an operating segment (also known as a component).
Current report
Our reporting units are: Pharmaceutical and Specialty Solutions (excluding Navista & ION, The Specialty Alliance), Navista & ION, The Specialty Alliance, GMPD, Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight® Logistics.
Current report
Goodwill impairment testing involves judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists, and, if necessary, the estimation of the fair value of the applicable reporting unit. Our qualitative evaluation considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.
Current report
Navista & ION Goodwill
Current report
Due to certain reductions in our long-term financial plan assumptions during the three months ended March 31, 2026, we elected to bypass the qualitative assessment and perform quantitative goodwill impairment testing for Navista & ION. Our determination of the estimated fair value of the Navista & ION Unit is based on a combination of the income-based approach (using a
Current report
discount rate of 10.5 percent and a terminal growth rate of 3 percent), and a market-based approach. Additionally, we assigned a weighting of 80 percent to the discounted cash flow method and 20 percent to the guideline public company method. The carrying amount exceeded the estimated fair value, which resulted in a pre-tax impairment charge of $184 million for Navista & ION, which was recognized during the three months ended March 31, 2026 and is included in impairments and (gain)/loss on disposal of assets, net in our condensed consolidated statements of earnings. The impairment charge was primarily due to changes in the risk profile of the business plans, resulting in an increase in the discount rate. These changes reflect business model updates and base operational performance. The carrying value of Navista & ION at March 31, 2026 after recognizing the impairment charge was $1.1 billion, of which $909 million was goodwill. See Note 4 of the "Notes to Condensed Consolidated Financial Statements" for further discussion.
Current report
While we consider the assumptions used in our determination of the estimated fair value of Navista & ION to be reasonable and appropriate, they are complex and subjective, and additional adverse changes in one key assumption or a combination of key assumptions during fiscal 2026 may significantly affect future estimates. These assumptions include, among other things, a failure to meet expected earnings or other financial plans, including the execution of new opportunities as a result of the business model change, a decrease in future cash flows, an increase in the discount rate or a decrease in the terminal growth rate; increases in tax rates; or a significant change in industry or economic trends.
Current report
Adverse changes in key assumptions may result in a decline in fair value below the carrying value in the future and therefore, an impairment for Navista & ION goodwill in future periods, which could adversely affect our results of operations. For example, if we were to increase the discount rate by a hypothetical 0.5 percent to 11.0 percent or decrease the terminal growth rate by a hypothetical 1.0 percent to 2.0 percent, the fair value for Navista & ION would have further decreased by approximately $70 million.
Current report
2 For both the three and nine months ended March 31, 2026, impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $184 million related to the Navista & ION reporting unit within the Pharma segment. For fiscal 2026, the estimated net tax benefit related to the impairments is $23 million and is included in the annual effective tax rate. The portion of the goodwill impairment charge attributable to noncontrolling interests is $23 million.
Removed paragraphs (3)
Previous report
Non-GAAP operating earnings for the three and six months ended December 31, 2025 increased 38 percent to $877 million and to $1.7 billion from the comparative prior-year periods, respectively, primarily due to the impact of the acquisitions of MSO platforms and ADS, increased contribution from branded and specialty pharmaceutical products, and growth from existing customers within the GMPD segment.
Previous report
Recent U.S. tariffs imposed or threatened to be imposed on goods, materials, and products imported into the United States from countries where we do business and any retaliatory actions taken by such countries have resulted in us incurring substantial additional costs to source products and materials, directly and indirectly, from affected countries, resulting in raising prices on certain products and evaluating alternative sources of supply. It is also possible that we could experience supply disruptions or shortages as a result of tariffs or other protective measures.
Previous report
GMPD segment revenue for the three and six months ended December 31, 2025 increased 3 percent to $3.3 billion and $6.4 billion from the comparative prior-year periods, respectively, primarily due to volume growth from existing customers.
Reworded paragraphs (38)
Previous wording
The discussion and analysis presented below is concerned with material changes in financial condition and results of operations, including amounts and certainty of cash flows from operations and from outside sources, between the periods specified in our condensed consolidated balance sheets at December 31, 2025 and June 30, 2025, and in our condensed consolidated statements of earnings and our condensed consolidated statements of cash flows for the three and six months ended December 31, 2025 and 2024. All comparisons presented are with respect to the prior-year period, unless stated otherwise. The discussion and analysis in this Form 10-Q should be read in conjunction with the MD&A included in our 2025 Form 10-K.
Current wording
The discussion and analysis presented below is concerned with material changes in financial condition and results of operations, including amounts and certainty of cash flows from operations and from outside sources, between the periods specified in our condensed consolidated balance sheets at March 31, 2026 and June 30, 2025, and in our condensed consolidated statements of earnings and our condensed consolidated statements of cash flows for the three and nine months ended March 31, 2026 and 2025. All comparisons presented are with respect to the prior-year period, unless stated otherwise. The discussion and analysis in this Form 10-Q should be read in conjunction with the MD&A included in our 2025 Form 10-K.
Previous wording
Revenue for the three and six months ended December 31, 2025 increased 19 percent to $65.6 billion and 21 percent to $129.6 billion from the comparative prior-year periods, respectively, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.
Current wording
Revenue for the three months ended March 31, 2026 increased 11 percent to $60.9 billion from the comparative prior-year quarter, primarily due to branded and specialty pharmaceutical sales growth from existing customers. Revenue for the nine months ended March 31, 2026 increased 17 percent to $190.6 billion from the comparative prior-year period, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.
Previous wording
GAAP operating earnings for the three and six months ended December 31, 2025 increased 29 percent to $707 million and 23 percent to $1.4 billion from the comparative prior-year periods, respectively, primarily due to the impact of the acquisitions of management services organization ("MSO") platforms and Advanced Diabetes Supply Group ("ADS"), increased contribution from branded and specialty pharmaceutical products, and growth from existing customers within the GMPD segment, partially offset by acquisition-related cash and share-based compensation costs.
Current wording
Non-GAAP operating earnings for the three and nine months ended March 31, 2026 increased 18 percent to $956 million and 30 percent to $2.7 billion from the comparative prior-year periods, respectively. GAAP and non-GAAP operating earnings for the three and nine months ended March 31, 2026 were favorably impacted by increased contribution from branded and specialty pharmaceutical products, the impact of the acquisitions of management services organization ("MSO") platforms and Advanced Diabetes Supply Group ("ADS"), and the performance of our generics program.
Previous wording
GAAP diluted EPS for the three and six months ended December 31, 2025 increased 19 percent to $1.97 and 15 percent to $3.85 from the comparative prior-year periods, respectively, primarily due to the factors impacting GAAP operating earnings discussed in the preceding section, partially offset by increased interest expense.
Current wording
GAAP diluted EPS for the three months ended March 31, 2026 decreased 20 percent to $1.69 from the comparative prior-year quarter, primarily due to the factors impacting GAAP operating earnings discussed in the preceding section, partially offset by favorable changes in discrete tax items. GAAP diluted EPS for the nine months ended March 31, 2026 increased 2 percent to $5.54 from the comparative prior-year period, primarily due to the factors impacting GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items, partially offset by increased interest expense.
Previous wording
Non-GAAP diluted EPS for the three and six months ended December 31, 2025 increased 36 percent to $2.63 and $5.18 from the comparative prior-year periods, respectively, primarily due to the factors impacting non-GAAP operating earnings discussed in the preceding section, partially offset by increased interest expense.
Current wording
Non-GAAP diluted EPS for the three and nine months ended March 31, 2026 increased 35 percent to $3.17 and 36 percent to $8.35 from the comparative prior-year periods, respectively, primarily due to the factors impacting non-GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items, partially offset by increased interest expense.
Previous wording
The performance of our MSO platforms, which consists of The Specialty Alliance and Navista, positively impacted the year-over-year comparison of Pharma segment profit during the three and six months ended December 31, 2025, primarily due to the impact of the acquisitions of GI Alliance ("GIA"), Urology America, Integrated Oncology Network ("ION") and Solaris Health. The Specialty Alliance is our multi-specialty MSO platform, which is primarily comprised of GIA, Urology America, Solaris Health and other gastroenterology- and urology-focused practices. Navista is our oncology MSO platform, which is primarily comprised of ION and other oncology-focused practices. Our ability to successfully provide physician practice support and management services, and to receive the value we expect to receive from our recent acquisitions of MSO platforms, depends upon a number of factors, including: the ability to develop or acquire and integrate appropriate practice management and support expertise; the ability to support recruitment, integration, and retention of sufficient numbers of local providers and staff; ensuring the alignment of interests between Cardinal Health and the physicians; the ability to successfully support negotiations with vendors, suppliers, and payors; the reimbursement and regulatory environment; and competition from other healthcare organizations.
Current wording
The performance of our MSO platforms positively impacted the year-over-year comparison of Pharma segment profit during the three and nine months ended March 31, 2026, primarily due to the impact of the acquisitions of GI Alliance ("GIA"), Urology America, and Solaris Health. The Specialty Alliance is our multi-specialty MSO platform, which is primarily comprised of GIA, Urology America, Solaris Health and other gastroenterology- and urology-focused practices. Navista is our oncology MSO platform, which is primarily comprised of ION and other oncology-focused practices. Our ability to successfully provide physician practice support and management services, and to receive the value we expect to receive from our recent acquisitions of MSO platforms, depends upon a number of factors, including: the ability to develop or acquire and integrate appropriate practice management and support expertise; the ability to support recruitment, integration, and retention of sufficient numbers of local providers and staff; ensuring the alignment of interests between Cardinal Health and the physicians; the ability to successfully support negotiations with vendors, suppliers, and payors; the reimbursement and regulatory environment; and competition from other healthcare organizations.
Previous wording
During the three and six months ended December 31, 2025, we saw increased demand for GLP-1 pharmaceuticals and our sales increased significantly. These increased sales positively impacted our Pharma segment and consolidated revenue for the three and six months ended December 31, 2025; however, increased GLP-1 sales did not meaningfully contribute to segment profit. Future demand for these medications is unpredictable and our ability to meet demand may be impacted by supply constraints. Additionally, the recently issued Executive Order titled “Delivering Most-Favored Nation Prescription Drug Pricing to American Patients” may impact sales or profitability of branded pharmaceutical products; however, the extent of the impact is uncertain and may vary depending on the timeline for implementation and the extent of any price reductions.
Current wording
During the three and nine months ended March 31, 2026, we saw an increased demand for GLP-1 pharmaceuticals which positively impacted our Pharma segment and consolidated revenue for the three and nine months ended March 31, 2026; however, increased GLP-1 sales did not meaningfully contribute to segment profit. Future demand for these medications is unpredictable and our ability to meet demand may be impacted by supply constraints. Additionally, the recently issued Executive Order titled “Delivering Most-Favored Nation Prescription Drug Pricing to American Patients” and other administrative policies or actions may impact sales or profitability of branded pharmaceutical products; however, the extent of the impact is uncertain and may vary depending on the timeline for implementation and the extent of any price reductions.
Previous wording
The performance of our Pharma segment generics program positively impacted the year-over-year comparison of Pharma segment profit during the three and six months ended December 31, 2025. The Pharma segment generics program includes, among other things, the impact of generic pharmaceutical product launches, customer volumes, pricing changes, the Red Oak Sourcing, LLC venture ("Red Oak Sourcing") with CVS Health Corporation ("CVS Health"), and generic pharmaceutical contract manufacturing and sourcing costs.
Current wording
The performance of our Pharma segment generics program positively impacted the year-over-year comparison of Pharma segment profit during the three and nine months ended March 31, 2026. The Pharma segment generics program includes, among other things, the impact of generic pharmaceutical product launches, customer volumes, pricing changes, the Red Oak Sourcing, LLC venture ("Red Oak Sourcing") with CVS Health Corporation ("CVS Health"), and generic pharmaceutical contract manufacturing and sourcing costs.
Previous wording
We have taken action to reduce the potential impact of tariffs on our costs; however, at this time, the countries that will be subject to tariffs and the tariff rate that may be imposed on each country remains dynamic and we do not expect to be able to establish alternative sources of supply or otherwise mitigate the potential impact of tariffs on all of the products that we source, manufacture or distribute. If we are not able to offset the impact of tariffs through price increases or otherwise mitigate the impacts, our financial results could be negatively impacted. Additionally, if tariffs are modified in the future, or our preliminary information is incorrect regarding their impact, we may not be able to respond to such changes adequately or in a timely manner and our financial results could be negatively impacted. Furthermore, if our competitors do not increase prices, or increase prices to a lesser extent than we do, or are able to offset the impact of tariffs through other actions, our competitive and financial position may be adversely affected.
Current wording
Tariff rates remain dynamic and we do not expect to be able to establish alternative sources of supply or otherwise mitigate the potential impact of tariffs on all of the products that we source, manufacture or distribute. We are still incurring increased costs from tariffs, and if we are not successful at increasing prices to customers, our financial results will continue to be negatively impacted. Additionally, if tariffs are modified in the future, or our information is incorrect regarding their impact, we may not be able to respond to such changes adequately or in a timely manner and our financial results could be negatively impacted. Furthermore, if our competitors do not increase prices, or increase prices to a lesser extent than we do or are able to offset the impact of tariffs through other actions, our competitive and financial position may be adversely affected.
Previous wording
Pharma segment revenue for the three and six months ended December 31, 2025 increased 19 percent to $60.7 billion and 21 percent to $119.9 billion from the comparative prior-year periods, respectively, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.
Current wording
Pharma segment revenue for the nine months ended March 31, 2026 increased 18 percent to $176.0 billion from the comparative prior-year period, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.
Previous wording
Other segment revenue for the three and six months ended December 31, 2025 increased 34 percent to $1.7 billion and 36 percent to $3.4 billion from the comparative prior-year periods, respectively, due to growth across at-Home Solutions (including the acquisition of ADS), Nuclear and Precision Health Solutions, and OptiFreight® Logistics.
Current wording
Other segment revenue for the three and nine months ended March 31, 2026 increased 31 percent to $1.7 billion and 34 percent to $5.1 billion from the comparative prior-year periods, respectively, due to growth across at-Home Solutions (including the acquisition of ADS), Nuclear and Precision Health Solutions, and OptiFreight® Logistics.
Previous wording
Cost of products sold for the three and six months ended December 31, 2025 increased 19 percent to $63.2 billion and 20 percent to $124.9 billion from the comparative prior-year periods, respectively, primarily due to the factors affecting the changes in revenue and gross margin.
Current wording
Cost of products sold for the three and nine months ended March 31, 2026 increased 11 percent to $58.4 billion and 17 percent to $183.4 billion from the comparative prior-year periods, respectively, primarily due to the factors affecting the changes in revenue and gross margin.
Previous wording
Gross margin for the three and six months ended December 31, 2025 increased 23 percent to $2.4 billion and $4.7 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS and the increased contribution from branded and specialty pharmaceutical products.
Current wording
Gross margin for the three and nine months ended March 31, 2026 increased 18 percent to $2.5 billion and 21 percent to $7.2 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS, increased contribution from branded and specialty pharmaceutical products, and the performance of our generics program.
Previous wording
Gross margin rates for the three and six months ended December 31, 2025 grew 14 basis points to 3.65 percent and 7 basis points to 3.64 percent from the comparative prior-year periods, respectively, primarily due to the acquisition of MSO platforms, partially offset by the impact of the unfavorable changes in product mix for the Pharma segment. These changes in product mix were primarily driven by increased pharmaceutical distribution branded sales, which have a dilutive impact on our overall gross margin rate.
Current wording
Gross margin rates for the three and nine months ended March 31, 2026 grew 23 basis points to 4.10 percent and 12 basis points to 3.79 percent from the comparative prior-year periods, respectively, primarily due to the acquisition of MSO platforms, partially offset by the impact of the unfavorable changes in product mix in the Pharma segment. These changes in product mix were primarily driven by increased pharmaceutical distribution branded sales, which have a dilutive impact on our overall gross margin rate.
Previous wording
SG&A expenses for the three and six months ended December 31, 2025 increased 15 percent to $1.5 billion and $3.0 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS.
Current wording
SG&A expenses for the three and nine months ended March 31, 2026 increased 17 percent to $1.5 billion and 16 percent to $4.5 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS.
Previous wording
Pharma segment profit for the three and six months ended December 31, 2025 increased 29 percent to $687 million and 28 percent to $1.4 billion from the comparative prior-year periods, respectively, primarily due to increased contribution from branded and specialty pharmaceutical products, the acquisition of MSO platforms, and the performance of our generics program.
Current wording
Pharma segment profit for the nine months ended March 31, 2026 increased 24 percent to $2.1 billion from the comparative prior-year period, primarily due to increased contribution from branded and specialty pharmaceutical products, the acquisition of MSO platforms, and the performance of our generics program.
Previous wording
GMPD segment profit for the three and six months ended December 31, 2025 increased to $37 million and $83 million from the comparative prior-year periods, respectively, primarily due to growth from existing customers and the beneficial net impact of cost optimization initiatives, partially offset by the adverse net impact of tariffs.
Current wording
GMPD segment profit for the nine months ended March 31, 2026 increased 66 percent to $108 million from the comparative prior-year period, primarily due to growth from existing customers, partially offset by the adverse net impact of tariffs.
Previous wording
Other segment profit for the three and six months ended December 31, 2025 increased 52 percent to $179 million and 55 percent to $345 million from the comparative prior-year periods, respectively, primarily due to the performance of at-Home Solutions (including the acquisition of ADS) and OptiFreight® Logistics.
Current wording
Other segment profit for the three and nine months ended March 31, 2026 increased 34 percent to $179 million and 47 percent to $524 million from the comparative prior-year periods, respectively, primarily due to the performance of at-Home Solutions (including the acquisition of ADS), OptiFreight® Logistics, and Nuclear and Precision Health Solutions.
Previous wording
The changes in Corporate for the three and six months ended December 31, 2025 were due to the factors discussed in the "Other Components of Consolidated Operating Earnings" section that follows.
Current wording
The changes in Corporate for the three and nine months ended March 31, 2026 were due to the factors discussed in the "Other Components of Consolidated Operating Earnings" section that follows.
Previous wording
During the three and six months ended December 31, 2025, restructuring and employee severance costs were primarily related to the implementation of certain enterprise-wide cost-savings measures and certain initiatives to rationalize our manufacturing operations.
Current wording
During the three and nine months ended March 31, 2026 and 2025, restructuring and employee severance costs were primarily related to the implementation of certain enterprise-wide cost-savings measures and certain initiatives to rationalize our manufacturing operations.
Previous wording
Amortization of acquisition-related intangible assets was $84 million and $171 million for the three and six months ended December 31, 2025, respectively, and $69 million and $137 million for the three and six months ended December 31, 2024, respectively.
Current wording
Amortization of acquisition-related intangible assets was $95 million and $266 million for the three and nine months ended March 31, 2026, respectively, and $77 million and $214 million for the three and nine months ended March 31, 2025, respectively.
Previous wording
Transaction and integration costs associated with acquisitions were $46 million and $63 million for the three and six months ended December 31, 2025, respectively, and $36 million and $42 million for the three and six months ended December 31, 2024, respectively.
Current wording
Transaction and integration costs associated with acquisitions were $19 million and $82 million for the three and nine months ended March 31, 2026, respectively, and $75 million and $117 million for the three and nine months ended March 31, 2025, respectively.
Previous wording
Acquisition-related cash and share-based compensation costs were $67 million and $131 million for the three and six months ended December 31, 2025, respectively, primarily resulting from the acquisitions within The Specialty Alliance.
Current wording
Acquisition-related cash and share-based compensation costs were $112 million and $243 million for the three and nine months ended March 31, 2026 and $20 million for both the three and nine months ended March 31, 2025. The increase primarily resulted from the timing of acquisitions within The Specialty Alliance.
Previous wording
We recognized income for net recoveries in class action antitrust litigation in which we were a class member or plaintiff of $19 million during both the three and six months ended December 31, 2025 and $16 million and $59 million during the three and six months ended December 31, 2024, respectively. We recognized $15 million in opioid-related insurance recoveries during the three and six months ended December 31, 2024.
Current wording
We recognized income for net recoveries in class action antitrust litigation in which we were a class member or plaintiff of $106 million and $165 million during the three and nine months ended March 31, 2025, respectively.
Previous wording
Interest expense, net for the three and six months ended December 31, 2025 increased to $88 million and $168 million from the comparative prior-year periods, respectively, primarily due to the additional debt financing for our recent acquisitions.
Current wording
Interest expense, net for the three and nine months ended March 31, 2026 increased 36 percent to $101 million and 91 percent to $269 million from the comparative prior-year periods, respectively, primarily due to the additional debt financing for our recent acquisitions.
Previous wording
The effective tax rate was 25.2 percent and 21.4 percent for the three months ended December 31, 2025 and 2024, respectively, and 24.7 percent and 22.2 percent for the six months ended December 31, 2025 and 2024, respectively. See Note 7 of the "Notes to Condensed Consolidated Financial Statements" for additional information.
Current wording
The effective tax rate was 3.1 percent and 19.4 percent for the three and nine months ended March 31, 2026, respectively, and 23.6 percent and 22.8 percent for the three and nine months ended March 31, 2025, respectively. The effective tax rate for the three and nine months ended March 31, 2026 was primarily impacted by discrete planning benefits.
Previous wording
Our cash and equivalents balance was $2.8 billion at December 31, 2025 compared to $3.9 billion at June 30, 2025.
Current wording
Our cash and equivalents balance was $3.9 billion at both March 31, 2026 and June 30, 2025.
Previous wording
During the six months ended December 31, 2025, net cash provided by operating activities was $1.7 billion, which includes the impact of payments totaling $403 million related to the opioid litigation.
Current wording
During the nine months ended March 31, 2026, net cash provided by operating activities was $3.5 billion, which includes the impact of normal timing of payments to vendors and payments totaling $417 million related to the opioid litigation.
Previous wording
During the six months ended December 31, 2025, we deployed $1.9 billion for the Solaris Health acquisition, $500 million for debt repayment, $758 million for share repurchases, $251 million for dividends, and $239 million for capital expenditures. We issued new long-term debt and received net proceeds of approximately $1.0 billion to fund a portion of the consideration paid in connection with the Solaris Health acquisition and for general purposes.
Current wording
During the nine months ended March 31, 2026, we deployed $1.9 billion for the Solaris Health acquisition, $600 million for debt repayment, $1.0 billion for share repurchases, $371 million for dividends, and $385 million for capital expenditures. We issued new long-term debt and received net proceeds of approximately $1.0 billion to fund a portion of the consideration paid in connection with the Solaris Health acquisition and for general purposes.
Previous wording
The cash and equivalents balance at December 31, 2025 includes $505 million of cash held by subsidiaries outside of the United States.
Current wording
The cash and equivalents balance at March 31, 2026 includes $612 million of cash held by subsidiaries outside of the United States.
Previous wording
In addition to cash and equivalents and operating cash flow, other sources of liquidity at December 31, 2025 include a $3.0 billion commercial paper program, backed by a $2.0 billion revolving credit facility that expires in February 2028 and a $1.0 billion 364-Day revolving credit facility that expires in October 2026. We also have a $1.0 billion committed receivables sales facility through September 2028. At December 31, 2025, we had no amounts outstanding under our commercial paper program, revolving credit facilities, or our committed receivables sales facility.
Current wording
In addition to cash and equivalents and operating cash flow, other sources of liquidity at March 31, 2026 include a $3.0 billion commercial paper program, backed by a $2.0 billion revolving credit facility that expires in February 2028 and a $1.0 billion 364-Day revolving credit facility that expires in October 2026. We also have a $1.0 billion committed receivables sales facility through September 2028. During the three months ended March 31, 2026, under our commercial paper program and our committed receivables program, we had maximum combined total daily amounts outstanding of $2.0 billion and an average combined daily amount outstanding of $179 million. At March 31, 2026, we had no amounts outstanding under our commercial paper program, revolving credit facilities, or our committed receivables sales facility.
Previous wording
We had total long-term obligations, including the current portion and other short-term borrowings, of $9.0 billion and $8.5 billion at December 31, 2025 and June 30, 2025, respectively.
Current wording
We had total long-term obligations, including the current portion and other short-term borrowings, of $8.9 billion and $8.5 billion at March 31, 2026 and June 30, 2025, respectively.
Previous wording
During the six months ended December 31, 2025, we repaid the full principal of $500 million of the 3.75% Notes due 2025 at maturity with available cash.
Current wording
During the nine months ended March 31, 2026, we repaid the full principal of $500 million of the 3.75% Notes due 2025 at maturity with available cash.
Previous wording
We had $4.3 billion accrued at December 31, 2025 related to certain national opioid litigation settlements, as further described within Note 6 of the "Notes to Condensed Consolidated Financial Statements." We expect the majority of the remaining payment amounts to occur through 2038. During the six months ended December 31, 2025, we made our fifth annual payment of $366 million under National Opioid Settlement Agreement (the "NOSA") and other settlement payments of $37 million related to the opioid litigation. The amounts of future annual payments under the NOSA may differ from the payments that we have already made.
Current wording
We had $4.3 billion accrued at March 31, 2026 related to certain national opioid litigation settlements, as further described within Note 6 of the "Notes to Condensed Consolidated Financial Statements." We expect the majority of the remaining payment amounts to occur through 2038. During the nine months ended March 31, 2026, we made our fifth annual payment of $366 million under National Opioid Settlement Agreement (the "NOSA") and other settlement payments of $51 million related to the opioid litigation. The amounts of future annual payments under the NOSA may differ from the payments that we have already made.
Previous wording
Capital expenditures during the six months ended December 31, 2025 and 2024 were $239 million and $189 million, respectively.
Current wording
Capital expenditures during the nine months ended March 31, 2026 and 2025 were $385 million and $315 million, respectively.
Previous wording
During the six months ended December 31, 2025, we deployed $750 million for repurchases of our common shares under accelerated share repurchase ("ASR") programs. We funded the repurchases with available cash. See Note 10 of the "Notes to Condensed Consolidated Financial Statements" for additional information.
Current wording
During the nine months ended March 31, 2026, we deployed $1.0 billion for repurchases of our common shares under accelerated share repurchase ("ASR") programs. We funded the repurchases with available cash. See Note 10 of the "Notes to Condensed Consolidated Financial Statements" for additional information.
Previous wording
Critical accounting policies are those accounting policies that (i) can have a significant impact on our financial condition and results of operations and (ii) require the use of complex and subjective estimates based upon past experience and management’s judgment. Other people applying reasonable judgment to the same facts and circumstances could develop different estimates. Estimates are inherently uncertain, therefore actual results may differ, including due to the risks discussed in "Risk Factors" and other risks discussed in our 2025 Form 10-K and our other filings with the SEC since June 30, 2025. There have been no material changes to our critical accounting estimates since the filing of our 2025 Form 10-K.
Current wording
Critical accounting policies are those accounting policies that (i) can have a significant impact on our financial condition and results of operations and (ii) require the use of complex and subjective estimates based upon past experience and management’s judgment. Other people applying reasonable judgment to the same facts and circumstances could develop different estimates. Estimates are inherently uncertain, therefore actual results may differ, including due to the risks discussed in "Risk Factors" and other risks discussed in our 2025 Form 10-K and our other filings with the SEC since June 30, 2025.
Previous wording
•Acquisition-related cash and share-based compensation costs are incurred in connection with contingent cash payments or the issuance of share-based payment awards, which include service requirements, as a part of certain physician practice acquisitions. These costs include fair value adjustments for liability-classified awards. These costs are excluded because they are unrelated to the underlying operating results of our business and to facilitate comparison of our current financial results to our
Current wording
•Acquisition-related cash and share-based compensation costs are incurred in connection with contingent cash payments or the issuance of share-based payment awards, which include service requirements, as a part of certain physician practice acquisitions. These costs include fair value adjustments for liability-classified awards. These costs are excluded because they are unrelated to the underlying operating results of our business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies’ financial results. In addition, the magnitude of these expenses is significantly impacted by the timing and size of the acquisitions of physician practices.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Impairments and (Gain)/Loss on Disposal of Assets, Net
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
historical financial results and to our peer group companies’ financial results. In addition, the magnitude of these expenses is significantly impacted by the timing and size of the acquisitions of physician practices.