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- **Record Growth**: Q2 revenue up 10% to $103B, EPS up 39% to $9.86, driven by oncology and RxTS segments.
- **Strategic Reorganization**: New reporting structure highlights high-growth oncology and multispecialty platforms, with 2026 EPS guidance raised to $38.35-$38.85.
- **Automation Efficiency**: 75% reduction in manual processes via automation, enabling 570 bps operating expense leverage.
- **Acquisition Synergy**: PRISM and Core Ventures contribute 30%-34% of oncology segment's 2026 profit growth, ahead of initial targets.
- **Free Cash Flow Strength**: $2.2B Q2 free cash flow supports $907M in shareholder returns, with 2026 guidance for $4.4B-$4.8B free cash flow.

**【CEO Summary Section】**
- McKesson reported record second-quarter revenues of $103 billion, a 10% year-over-year increase, driven by strong performance across all segments.
- Adjusted EPS rose 39% to $9.86, reflecting operational efficiency and strategic investments.
- The company introduced a new reporting structure, separating oncology and multispecialty businesses to enhance growth visibility.
- Guidance for fiscal 2026 EPS was raised to $38.35-$38.85, up from $38.05-$38.55, citing organic growth and acquisitions.
- Investments in automation (e.g., order storage retrieval systems) reduced manual processes by 75%, improving efficiency.
- The Medical-Surgical Solutions business is expected to be spun off by mid-2027, with 2026 guidance assuming full ownership.

**【CFO Financial Commentary】**
- Gross profit increased 9% to $3.5 billion, driven by oncology and pharmaceutical distribution growth.
- Operating expenses decreased 1% to $2 billion, with a 570 basis point improvement in operating expense ratio.
- Oncology and multispecialty segment operating profit rose 71% to $397 million, with 50% growth from PRISM and Core Ventures acquisitions.
- Prescription Technology Solutions (RxTS) operating profit grew 20% to $261 million, fueled by prior authorization services for GLP-1 medications.
- Free cash flow for the quarter was $2.2 billion, supporting $907 million in shareholder returns (share buybacks and dividends).
- Full-year revenue growth guidance is 11%-15%, with oncology and RxTS segments expected to lead at 27%-31% and 9%-13% growth rates, respectively.

**【Q&A Highlights】**
- **Margin Expansion**: RxTS segment's 20% operating profit growth reflects mix shift to higher-margin technology services (e.g., prior authorization). Oncology segment's 71% profit growth includes $51 million from market decisions and equity gains.
- **Regulatory Impact**: Drug Supply Chain Security Act implementation had minimal disruption, enhancing supply chain transparency and customer stickiness.
- **Acquisition Performance**: PRISM and Core Ventures contributed 30%-34% of oncology segment's 2026 operating profit growth, slightly ahead of initial $0.40-$0.60 EPS accretion targets.
- **Risk Factors**: Medical-Surgical Solutions segment faces quarterly volatility due to illness season products (e.g., vaccines), which caused a 4% revenue headwind in Q2.

McKesson Corporation (MCK) Q2 2026 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

MCK

MCK fundamentals

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