Cardinal Health, Inc. (CAH)

Cardinal Health, the Ohio drug wholesaler, said on October 1, 2026 that it had signed a binding letter of intent to extend its distribution agreement with CVS Health through June 30, 2032 3.

CVS Health was its largest customer in fiscal 2026 and made up 28 percent of revenue 2. Neither company disclosed financial terms, and Pharmaceutical Commerce noted the extension keeps each of its distributors tied to its largest customer for roughly six more years 4.

In the same release the company reaffirmed its fiscal 2027 outlook for non-GAAP earnings per share of $12.40 to $12.60, which it put at 13% to 15% growth 3. Non-GAAP means the company leaves out items it treats as outside its ongoing business 2.

That follows a year in which revenue rose 14 percent to $254.2 billion, mostly from branded and specialty drug sales to existing and new customers 2.

The company said it may give further updates on its first quarter earnings call on November 5, 2026 3.

Cardinal Health buys drugs and medical supplies from manufacturers and sells them to pharmacies, hospitals and clinics, so its revenue is huge and its profit margin thin 2. In fiscal 2020 it booked a GAAP operating loss of $4.1 billion, mainly from a $5.63 billion pre-tax charge for lawsuits by states and local governments over the distribution of prescription opioid pain medications 12. Revenue that year still rose 5 percent to $152.9 billion, driven by drug distribution and specialty customers 12.

In fiscal 2022 revenue grew 12 percent to $181.4 billion, again led by branded drug sales, yet the company posted a GAAP operating loss of $596 million 11. The cause was $2.1 billion in non-cash goodwill charges in its medical business, a write-down of what it had paid for past acquisitions 11.

The company recorded further goodwill charges of $1.2 billion in fiscal 2023 and $675 million in fiscal 2024 10. In March 2024 it bought Specialty Networks for $1.2 billion in cash to add services for independent specialty doctors 10.

In April 2024 the company announced that its drug distribution contracts with OptumRx would expire at the end of June 2024 10. OptumRx had generated 17 percent of consolidated revenue in fiscal 2024, though at a meaningfully lower operating margin than the rest of the segment 10.

Pharma segment revenue fell 3 percent to $204.6 billion in fiscal 2025, primarily because of the expiration of the OptumRx contracts, partly offset by branded and specialty drug growth 9. In the same fiscal year the company began buying doctor-practice networks and home-care suppliers 9.

It paid $1.1 billion in cash for Integrated Oncology Network in December 2024 9. It paid about $2.8 billion in cash for a 73 percent stake in GI Alliance in January 2025 9. Advanced Diabetes Supply Group cost $1.1 billion in cash in April 2025 9.

GI Alliance is a management services organization, a company that runs the business side of doctors' practices 9.

In fiscal 2026 revenue rose 14 percent to $254.2 billion and non-GAAP operating earnings rose 30 percent to $3.6 billion, largely from branded and specialty drugs, the generics program and the practice-network deals 2. In November 2025 the company paid about $1.9 billion in cash for Solaris Health, a urology network, bringing its stake in The Specialty Alliance to about 76 percent 2.

A $184 million goodwill charge hit the oncology network unit called Navista and Integrated Oncology Network, and a $122 million charge cut the value of its 16 percent stake in the Outcomes business 2.

The company had $4.3 billion accrued at the end of fiscal 2026 for national opioid settlements and expected most remaining payments through 2038 2. In February 2026 the U.S. Supreme Court ruled the IEEPA tariffs unlawful, and the company recorded a receivable of about $200 million for expected refunds 2.

Drug distribution and specialty services

The Pharmaceutical and Specialty Solutions segment, called Pharma, is the core 2. It sells branded and generic drugs and over-the-counter goods to chain and independent drugstores, hospitals and other providers in the United States 2. Its revenue was $234.8 billion in fiscal 2026, up 15 percent, and its segment profit was $2,783 million 2.

That is about 92.4 percent (computed) of the company's $254.2 billion in revenue, but only a thin slice of profit per dollar sold 2. Revenue is large because the company buys and resells drugs at close to cost, and its fees come from manufacturers and from its generic drug program 2.

Its Specialty businesses sell high-cost drugs for conditions such as cancer and arthritis and support doctor practices through management services organizations 2. The Specialty Alliance covers gastroenterology and urology practices, and Navista covers oncology 2. Solaris Health alone brought more than 750 providers across more than 250 locations in 14 states 2.

The 10-K says GLP-1 weight-loss and diabetes drugs lifted revenue in fiscal 2026 but did not meaningfully add to segment profit 2. Branded drug rules also bear on the business, including the Inflation Reduction Act and an April 2026 tariff proclamation on branded drug imports 2.

Medical products

The Global Medical Products and Distribution segment makes and sources Cardinal Health brand exam and surgical gloves, syringes, wound care, gowns, drapes and similar supplies, and also distributes other makers' products to hospitals and labs 2. Revenue was $12.7 billion, about flat, and segment profit rose to $258 million from $135 million 21.

The company says its own-brand products are generally higher margin 2. Tariffs are a cost here, and the 10-K says price increases have not fully offset them 2.

Nuclear medicine, home care and logistics

The Other group had revenue of $6.8 billion, up 26 percent, and segment profit of $707 million 2. It holds Nuclear and Precision Health Solutions, which runs nuclear pharmacies and contract-manufactures Xofigo, a radiopharmaceutical cancer treatment, and OptiFreight Logistics, which handles shipping for providers 2.

At-Home Solutions includes Edgepark and Advanced Diabetes Supply Group, which supply patients with chronic conditions at home, and a business that delivers supplies for home medical equipment providers 2. Advanced Diabetes Supply Group served about 500,000 patients a year when it was bought 9.

In July 2026 the company agreed to buy Strive Medical and AdaptHealth's diabetes business for a combined $360 million in cash, MedTech Dive reported 5. The diabetes unit serves more than 225,000 patients a year and Strive more than 20,000 customers 5.

Customers and suppliers

CVS Health accounted for 28 percent of fiscal 2026 revenue, and the five largest customers together for 43 percent 2. Sales to members of the two largest buying groups, Vizient and Premier, were 29 percent of revenue 2.

On the supply side, the five largest suppliers accounted for 39 percent of revenue and the largest supplier alone for about 13 percent 2. The company and CVS also run Red Oak Sourcing, a venture that negotiates generic drug supply contracts for both and runs through June 2029 2.

Rivals

In drug distribution the 10-K names McKesson Corporation and Cencora, Inc. as national rivals, along with regional wholesalers, specialty distributors and third-party logistics firms 2. Competition turns on price, service and breadth of products 2.

People and places

Jason Hollar has been chief executive since September 2022, after serving as chief financial officer from May 2020 to August 2022 7. Aaron Alt became chief financial officer in February 2023 7. Patricia Hemingway Hall, a retired health insurance chief executive, became board chair in March 2026 after Gregory Kenny retired 7.

Anita Zielinski, formerly of Baxter, is to become chief accounting officer on November 5, 2026, succeeding Mary Scherer 6. The company had about 63,900 employees at June 30, 2026, of whom about 18,100 were outside the United States 2.

Headquarters are an owned building at 7000 Cardinal Place in Dublin, Ohio 2. The medical segment also runs factories in Canada, Costa Rica, the Dominican Republic, Germany, Japan, Malaysia, Malta, Mexico, Puerto Rico and Thailand 2.

Open problems

The company paid $417 million toward opioid litigation in fiscal 2026 and a sixth annual payment of $374 million in July 2026 under the National Opioid Settlement Agreement 2. It also faces product liability claims over Cordis IVC filters, with $29 million accrued at June 30, 2026 2.

The 10-K says the President recently indicated that generic drugs would face 100% tariffs starting in 2028 and 200% in 2029, and it calls the plan's implementation uncertain 2.

The umbrella, in words

The main brands are Cardinal Health (own-brand medical products), Edgepark and Advanced Diabetes Supply Group (home supplies), The Specialty Alliance (urology and gastroenterology practices), Navista (oncology practices), OptiFreight (shipping) and Wavemark (inventory technology) 2.

Its subsidiaries exhibit lists majority-owned subsidiaries, such as Allegiance Corporation and Aero-Med, LLC, and says those left off are not significant subsidiaries 8.

The company owns about 76 percent of The Specialty Alliance, and physicians and managers hold the rest as units 2. Through GI Alliance it holds a call right to buy up to 100 percent of the remaining equity from the third anniversary of the January 2025 closing 9. It holds a 16 percent equity interest in Outcomes 2.

The 2026 proxy statement lists Vanguard Capital Management at 7.6 percent, Wellington Management Group at 6.4 percent, State Street at 6.3 percent and Vanguard Portfolio Management at 6.0 percent 7. These are asset managers, and none holds a majority of the shares 7.

The company reports its first quarter results on November 5, 2026, and said it may give further updates then 3.

Shareholders meet virtually on Thursday, November 12, 2026, at 8:00 Eastern time 7. They are asked to elect 11 directors, approve executive pay in an advisory vote and ratify Ernst & Young as auditor 7.

For fiscal 2027 the company guides to non-GAAP earnings per share of $12.40 to $12.60 1. It expects Pharma revenue to grow 3% to 5% and segment profit 8% to 11% 1. For medical products it expects revenue growth of 2% to 4% and segment profit of $200 million to $220 million 1.

For the Other group it expects revenue growth of 11% to 13% and segment profit growth of 15% to 18% 1. It also lists about $700 million of capital spending, about $1 billion of share repurchases and adjusted free cash flow of $3.5 billion to $4.0 billion 1.

The company also keeps a long-term goal of 12% to 14% non-GAAP earnings per share growth 3. Its board raised the repurchase authorization by $5.0 billion to $6.4 billion in total as of August 2026 1.

Guidance includes the finished Strive Medical purchase and the announced AdaptHealth diabetes purchase 1. MedTech Dive reported that the company did not disclose a closing date and expects the two deals to add to earnings within a year of closing 5.

A new Indianapolis distribution center is set to open in 2027, and the company announced a long-term renewal of its Kroger wholesale contract 1. The board declared a quarterly dividend of $0.5158 a share, payable on October 15, 2026 1.

Opioid settlement payments continue, with most of the remaining amounts expected through 2038 2. The company also expects capital spending of about $700 million in fiscal 2027, mainly for manufacturing, distribution and technology projects 2.

Past

Cardinal Health's revenue grew from $130 billion in fiscal 2017 to $254 billion in fiscal 2026, up 7.7% a year over the ten filed years; it rose in 8 of 9 years; the deepest fall was 2% from fiscal 2024 to fiscal 2025; net income was positive in 8 of 10 of those years. Over the three fiscal years to 2026-06-30, the diluted share count shrank about 3.3% a year, and dividends and buybacks returned about 38% of its operating cash flow over three years. Its officers and directors filed 35 sales and 0 purchases of their own stock on the open market in the year to 2026-09-30. 1

Present

In its latest annual figures on file, for the fiscal year ended 2026-06-30, Cardinal Health reported revenue of $254 billion and a profit of $1.7 billion. Return on equity is not read because shareholders' equity was below zero; gross profitability is about 17 cents per dollar of everything the company owns; leverage is about 105 cents per dollar of assets; net share issuance shows the share count shrank 2.1% over the year. Its revenue of $254 billion in fiscal 2026 ranks in the top 25% by size among 10 graded names in its industry family; a net margin of 0.7% ranks in the top 35%; revenue growth of 7.4% a year over the last three filed years ranks in the bottom 45%. The chief executive is Hollar, Jason M. , filing under that title since 2023-05-17, 3.4 years. 6 officer or director changes were reported on Form 8-K since 2023-10-21, against the 20 people in charge now. 21

Future

A quarterly report (Form 10-Q) for the quarter ending 2026-09-30 is due by 2026-11-09. An annual report (Form 10-K) for the fiscal year ending 2027-06-30 is due by 2027-08-29. Cash of $4.9 billion against debt of $7.0 billion leaves negative 3.7% of its assets as net cash, ranking in the top 35% of its family; cash from operations less capital spending is 1.8% of revenue, ranking in the top 35%; a gross margin of 3.8% ranks in the bottom 35%. Revenue grew 7.4% a year over the last three filed years against 7.7% over all ten, slowing and ranking in the top 44% of its family; the newest year grew 14.2%, ranking in the top 31%; capital spending grew 10.5% a year, ranking in the top 6%. Revenue of $254 billion in fiscal 2026 came in 9.6% above the $232 billion its prior three years' pace pointed to, ranking in the top 21% of its family; net income of $1.7 billion against a prior three-year average of $914 million ranks in the top 21%; a net margin of 0.7% against 0.4% before ranks in the top 36%. 31

How the company operates

Cardinal Health is a distribution business in the Wholesale-Drugs, Proprietaries & Druggists' Sundries industry. The company reported three lines of business in fiscal 2025: Pharmaceutical and Specialty Solutions at $205 billion, GMPD at $13 billion, and All Other at $5.4 billion; the largest line is 92% of revenue. By geography in fiscal 2026, United States revenue was 99% and International was 1%. 21

New moves

On 2026-10-01, Cardinal Health filed a Form 8-K disclosing investor information under Regulation FD. On 2026-08-11, the company filed a Form 8-K reporting a major agreement signed, a major agreement ended, and new debt or an obligation taken on. On 2026-08-05, the company filed a Form 8-K reporting an officer or director change. 3