$CAH · CARDINAL HEALTH INC
Cardinal Health filed its Q1 FY2027 Form 10-Q for the quarter ended September 30, 2026. Revenue increased 5% to $67.5B, driven by branded and specialty pharmaceutical sales growth. GAAP diluted EPS rose 27% to $2.38 and non-GAAP diluted EPS rose 28% to $3.26; GAAP operating earnings grew 13% to $753M and non-GAAP operating earnings grew 17% to $1.0B. Net income was $554M.
- Revenue rose 5% to $67.5B, led by Pharma segment growth of 6% to $62.6B.
- Non-GAAP diluted EPS rose 28% to $3.26 from $2.55 a year earlier.
- GAAP diluted EPS rose 27% to $2.38 from $1.88.
- Gross margin increased 12% to $2.6B, with gross margin rate up 23 basis points.
- Company paid approximately $200M in IEEPA tariffs since February 2025, primarily in GMPD.
Shares rose 3.55% to $261.93 in regular trading, with extended-hours last trade at $267.98 (+2.31% vs close), indicating a positive reaction to the earnings beat.
A 28% non-GAAP EPS jump and 23bps gross margin expansion show the generics and MSO strategy paying off despite tariff and GLP-1 headwinds.
Pharma distribution peers face similar GLP-1 demand and tariff headwinds; Cardinal's generics program and MSO platform acquisitions drove margin expansion.
Tariffs on branded pharmaceuticals and IEEPA tariffs (about $200M paid to date) could raise costs or disrupt supply. GLP-1 demand growth is moderating and unpredictable, with limited profit contribution.