Key financial results
- For the fourth quarter of fiscal 2026, consolidated revenue was $88.4 billion, representing a 6% increase driven by growth in both reportable segments and other.
consolidated revenue was $88.4 billion, up 6%
- Fourth quarter adjusted diluted earnings per share reached $4.66, an increase of 21% compared to the prior year period.
adjusted diluted earnings per share of $4.66, an increase of 21%.
- Full year fiscal 2026 consolidated revenue was $337 billion, up 5%, while consolidated operating income was $4.8 billion, an increase of 14%.
consolidated revenue was $337 billion, up 5%
- Adjusted diluted EPS for the full year 2026 was $17.97, up 12% compared to the prior year.
adjusted diluted EPS of $17.97, up 12%.
Business segment results
- U.S. Healthcare Solutions: U.S. Healthcare Solutions segment revenue for the fourth quarter was $78.3 billion, an increase of 5%, driven by specialty sales and GLP-1 growth.
U.S. Healthcare Solutions revenue was $78.3 billion, an increase of 5%.
- U.S. Healthcare Solutions: U.S. Healthcare Solutions segment operating income for the fourth quarter was $998 million, up 22%.
U.S. Healthcare Solutions segment operating income was $998 million, up 22%
- International Healthcare Solutions: International Healthcare Solutions fourth quarter revenue was $7.8 billion, up 5%, and operating income was $152 million, up 16% as reported.
Revenue was $7.8 billion, up 5%
- Other: Other segment fourth quarter revenue was $2.3 billion, up 10%, and operating income was $101 million, up 36%.
Revenue in Other was $2.3 billion, up 10%
Capital allocation
- Cencora generated $3.8 billion of adjusted free cash flow during fiscal 2026, which was stronger than guidance due to volume mix and timing.
we generated $3.8 billion of adjusted free cash flow, stronger than our guidance
- The company returned $1.5 billion to shareholders in fiscal 2026 through share repurchases and dividends, and announced a 10% increase to its quarterly dividend.
return $1.5 billion to shareholders through a combination of opportunistic share repurchases and our dividend.
- Capital expenditures are expected to be approximately $1 billion in fiscal 2027 to support supply chain, digital, and MSO infrastructure.
capital expenditures to be approximately $1 billion in fiscal 2027
- Management expects to repurchase an additional $1.25 billion in shares during fiscal 2027.
an additional $1.25 billion in repurchases in fiscal 2027.
Industry trends and dynamics
- Specialty biologics now account for more than half of all pharmaceutical spending in the United States, representing an 80% increase over 5 years.
specialty biologics now accounting for more than half of all pharmaceutical spending in the United States, up 80% in 5 years.
- Over 100 new oncology products are expected to launch through the year 2030, increasing the need for specialized clinical logistics and provider support.
With over 100 new products expected to launch through 2030, Oncology illustrates the growing need
- Manufacturer list price reductions created a $2.8 billion headwind to revenue growth in the fourth quarter.
manufacturer list price reductions that represented a $2.8 billion headwind to revenue growth
Competitive landscape
- Cencora is expanding its footprint in specialty practices through platforms such as One Oncology and Retina Consultants of America.
Together, One Oncology and Retina Consultants of America, deepen our relationships with community-based specialists
- The company announced an agreement to acquire a majority interest in American Oncology Network to further extend its physician-led network.
our agreement to acquire a majority interest in American Oncology network.
- Management noted that the call did not discuss specific competitor market share shifts beyond standard operational updates.
Macroeconomic environment
- The European distribution business faces an approximate $20 million headwind in fiscal 2027 resulting from the strengthening of the U.S. dollar.
approximate $20 million headwind related to our European distribution business, resulting from the strengthening of the U.S. dollar.
- The effective tax rate was 20.2% in the fourth quarter compared to 20.6% in the prior year period.
effective tax rate was 20.2% compared to 20.6% in the prior year quarter.
- Management expects the effective tax rate for fiscal 2027 to be approximately 20%.
effective tax rate to be approximately 20% for fiscal 2027.
Growth opportunities and strategies
- Cencora introduced an updated operating model with two new reporting segments: Specialty Pharmaceutical and Provider Services, and Pharmaceutical Distribution and Services.
we introduced an updated operating model aligned with our strategy and the customers we serve.
- Specialty distribution revenue is expected to reach approximately $100 billion in fiscal 2027.
expect specialty distribution revenue to reach approximately $100 billion in fiscal 2027.
- The company entered into agreements to divest non-core businesses, including Pro Pharma and the MWI Animal Health merger with Covetrus.
entered into agreements or completed divestitures for all the businesses within other.
Financial guidance and outlook
- For fiscal 2027, Cencora expects adjusted diluted EPS to be in the range of $19.40 to $19.75, representing headline growth of 8% to 10%.
adjusted diluted EPS to be in the range of $19.40 to $19.75, reflecting headline growth of 8% to 10%.
- Consolidated revenue growth for fiscal 2027 is expected to be in the range of 3% to 5%, with operating income growth expected to be 4% to 6%.
consolidated revenue growth to be in the range of 3% to 5%. Operating income growth is expected to be in the range of 4% to 6%.
- Pharmaceutical Distribution and Services segment operating income growth is projected at 2% to 4%, while Specialty Pharmaceutical and Provider Services segment growth is projected at 18% to 21%.
- Adjusted free cash flow for fiscal 2027 is expected to be approximately $3.5 billion.
adjusted free cash flow to be approximately $3.5 billion.
Q4 FY2026 results
| Metric | Result | Change |
|---|---|---|
| Consolidated revenue | $88.4 billion | up 6% |
| Consolidated adjusted operating income | $1.2 billion | increase of 22% |
| Adjusted diluted EPS | $4.66 | increase of 21% |
| U.S. Healthcare Solutions revenue | $78.3 billion | increase of 5% |
| International Healthcare Solutions revenue | $7.8 billion | up 5% |
| Consolidated full year revenue | $337 billion | up 5% |
How management sounded
Balanced (+35 on our -100 to +100 scale). Management expressed strong confidence driven by record full-year results, solid momentum in specialty, and robust long-term targets. Management sounded more upbeat than on 20% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- The closing of the acquisitions of EyeSouth's retina business and American Oncology Network.
- The progression and mid-fiscal year close of the MWI merger with Covetrus.
- The execution and integration of the newly formed Specialty Pharmaceutical and Provider Services reporting segment.
Earlier calls
- Q3 FY2026 (Aug 5, 2026), tone Balanced: Cencora delivered 12% EPS growth driven by double-digit operating income growth and $1 billion in share repurchases, raising full year EPS guidance.
