Aug 11, 2026 earnings call — Pharma and Specialty drive results; tariff refund noted
Q4 revenue was $63.7 billion and diluted EPS was $2.91, including a $0.31 EPS benefit from an IEEPA tariff refund.
Revenue $63.7B (est $65.2B) · EPS $2.91 (est $2.42)
Key quotes
"Fourth quarter revenue for the segment grew 6% to $58.8 billion."
"In the quarter, we recorded a onetime $100 million net operating earnings benefit from IEEPA tariff refunds in our GMPD segment."
"I will note that we are announcing today that the Cardinal Health Board of Directors has authorized a $5 billion increase to our share repurchase authority."
Analyst Q&A 10
Pharma / Specialty growth outlook
Q (Erin Wilson Wright · Morgan Stanley): They asked what drove the quarter's Pharma and Specialty growth, what will continue, and what is assumed in fiscal 2027 guidance.
A: Management said Pharma momentum came from demand across key product categories, Specialty growth at higher margins, and generics above targets. They expect that momentum to continue in fiscal year '27 but are not assuming outsized demand and have not assumed material M&A; they did include 2 to 3 percentage points of benefit from M&A already done.
"From a guidance perspective, we continue -- we expect all of those to continue into our fiscal year '27." — Aaron Alt (CFO)
Specialty growth and services mix
Q (Elizabeth Anderson · Evercore): They asked how Specialty growth will transition in fiscal '27 and whether services will take more focus after integration.
A: Management said Specialty grew over 25% in fiscal '26 driven by distribution and M&A, and they expect continued strong growth in fiscal '27 but not to the same extent. They highlighted Biopharma Solutions, MSOs, and services adding to broad-based growth and noted the Investor Day target to reach $1 billion by '28.
"We -- at our Investor Day a year ago, we guided to getting that business to $1 billion by '28." — Jason Hollar (CEO)
Regulation and 340B impact
Q (Lisa Gill · JPMorgan): They asked which regulatory changes are being watched besides IRA, and what 340B changes could mean for hospital customers and volume.
A: Management said they are tightly engaged with customers, manufacturers and the administration and are tracking and influencing policy. They support efforts to improve access and affordability and think actions that increase affordability can drive volume; they believe their role supplying product should not change and they will adapt to transactional changes.
"So we absolutely support the administration's efforts to that improved access and affordability." — Jason Hollar (CEO)
Investment priorities and capacity
Q (Eric Percher · Nephron): They asked how fiscal '27 investment priorities compare to fiscal '26, and whether capacity builds in Specialty are for existing customers or new wins.
A: Management said they continue multiyear investments focused on faster-growing, specialized and fragmented areas like Specialty, MSOs, and at-Home to scale capabilities and improve margins. On capacity, they watch bottlenecks like refrigeration and automation to avoid being late, tying investments to long-term growth plans rather than a build-it-and-they-will-come approach.
"So I think we're in the very early innings of that scaling of these capabilities." — Jason Hollar (CEO)
Generics and Pharma profit
Q (Allen Lutz · BofA): They asked how much Pharma revenue softness was due to brand-to-generic conversion and whether generics drove the quarter's EBIT acceleration and what to expect in fiscal '27.
A: Management said generics were a positive contributor to results for the quarter and the year and that generic conversions improved profitability. They expect continued generics benefit to Pharma profit delivery in '27 and noted revenue has been variable but profit was strong.
"You are right to call out that generics was a positive part of our delivery certainly for the quarter and for the year as well." — Aaron Alt (CFO)
Largest customer renewal and disaggregation risk
Q (George Hill · DB): They asked for color on renewing/extending the largest customer and about risks from disaggregation of services and new vendors entering with tech services.
A: Management clarified the renewal mention referred to GMPD, not CVS distribution, and said they have a long-standing, broad strategic relationship with CVS across many areas. They argued distributors continue to add value by moving product and taking ownership and risk, so while models may evolve they expect to remain a key partner.
"We have a lot of strategic collaboration with them throughout the enterprise." — Jason Hollar (CEO)
Other segment growth drivers
Q (Stephen Baxter · Wells Fargo): They asked whether Other's faster EBIT growth than revenue is from mix or synergies, what drives revenue acceleration, and about nuclear's role.
A: Management said Other's profit growth comes across all three businesses, supported by investments and expected strong demand; revenue should accelerate as investments roll forward and trends continue. They noted the Strive and Adapt diabetes acquisitions will contribute 2% of profit growth and highlighted double-digit Theranostics and PET growth plus OptiFreight volume growth.
"And the combination of the Strive and Adapt's diabetes businesses are going to contribute 2% of the profit growth to the Other business over the course of the year." — Aaron Alt (CFO)
Outsized vs strong demand and tax rate
Q (Kevin Caliendo · UBS): They asked how to quantify 'outsized' versus 'strong' demand and whether the 19% to 20% tax rate is the new baseline going forward.
A: Management confirmed the 19% anticipated tax rate for '26 is expected to be durable into '27 but deferred longer-term tax rate comments. They said they will not give a mathematical formula for 'strong' versus 'outsized' demand and will report if they see outsized demand; Jason added Specialty and generics planning assumptions as context.
"With respect to the tax rate, I spent last quarter commenting that we expected the 19% anticipated rate for '26 to be durable into '27." — Aaron Alt (CFO)
GMPD input cost pressures and strategy
Q (Lucas Romanski · TD Cowen): They asked what input cost pressures GMPD is seeing, how tariffs offset inputs, and how GMPD fits in strategy after recovery improvements.
A: Management said input cost pressure is mainly from oil and petroleum products like diesel and oil-based commodities including polyethylene, polypropylene and resins, and they are watching these costs closely. They noted tariff tailwinds largely offset commodity risk in guidance, warned that sustained elevated costs would push results toward the low end of GMPD guidance, and said the GMPD recovery plan remains in place with opportunities to grow Cardinal Health brand volume and simplify operations.
"If these types of costs and rates stay elevated for the duration of our fiscal year, it's likely we'd be closer to that bottom end of our guidance range for GMPD." — Jason Hollar (CEO)
IRA WACC and brands growth math
Q (Eric Coldwell · Baird): They asked whether the same WACC price changes are embedded in fiscal '27 PSS revenue growth and probed implied core brand growth after repayments to customers.
A: Management said they assumed the same percent impact from the IRA in '27 and included lapping of prior WACC changes in their revenue guide. They said some impacts are not fully defined as rebates or WACC reductions, but normalized Cardinal Health brand growth has been at or a little above mid-single-digit rates over recent quarters.
"So maybe on the first part of your question, I would just point out that we're assuming the same percent impact in '27 from the IRA impact." — Aaron Alt (CFO)