Cardinal Health, Inc.

Strong Q4 & FY performance driven by Pharma/Specialty (and volume demand) - Q4 revenue: $63.7B (+6% YoY); enterprise operating income: $935M (+30%); gross profit: $2.6B (+16%). - Profit & EPS: Operating earnings +30% in the quarter and EPS +40%. Diluted EPS $2.91 in Q4 (+40% YoY). - FY results: Revenue $254B (+14%), operating earnings $3.6B (+30%), adjusted free cash flow (AFCF) $5B, cash on hand $4.9B. - Service levels: Management emphasized record/near-record service levels while navigating regulatory and macro changes—important for investors given distributor margin/quality sensitivity.

Earnings tailwind from IEEPA tariff refunds (non-recurring) that investors should normalize - In Q4, GMPD recorded a one-time $100M net operating earnings benefit related to IEEPA tariff refunds. - Management said the tariff refund-related EPS lift was $0.31, about 15 percentage points of the total 40% EPS growth. - For FY’27 guidance comparability, they explicitly base the outlook on a baseline that excludes the $0.31 onetime EPS from the Q4 refund recognition.

FY’27 guidance: solid growth, with cautious assumptions (no “outsized” demand) and segment-by-segment expectations - Core outlook: EPS growth 13%–15% vs. the adjusted FY’26 baseline, implying FY’27 EPS $12.40–$12.60. - Long-term: reconfirmed 12%–14% annual EPS growth rate guidance. - Pharma segment: Revenue +3% to +5%; segment profit +8% to +11%. - Key assumptions affecting growth rate: no outsized demand like FY’26 peaks, annualization of 2026 IRA WACC changes and 2027 IRA price changes (management expects no adverse profit impact, with revenue impact consistent with H2’26), and stable customer renewal/book of business. - GMPD (Global Medical Products & Distribution): Revenue +2% to +4%; segment profit $200M–$220M (growth of about $50M off ex-tariff-refund FY’26). - Guidance assumes a modest tariff tailwind, but stresses monitoring geopolitical risk (see “risks” below). - Other growth businesses: Revenue +11% to +13% and segment profit +15% to +18%, with accelerating growth through the year and contributions from tuck-in acquisitions.