Cardinal Health Reports Second Quarter Fiscal Year 2025 Results and Raises Fiscal Year 2025 Outlook

Core Insights - Cardinal Health reported second quarter fiscal year 2025 revenues of $55.3 billion, a decrease of 4% from the same period in fiscal year 2024, but a 16% increase when excluding the impact of a large customer contract expiration [1][14] - GAAP operating earnings increased by 9% to $549 million, with GAAP diluted earnings per share (EPS) at $1.65, reflecting a 10% increase from $1.50 in the prior year [1][26] - The company raised its fiscal 2025 guidance for non-GAAP diluted EPS to a range of $7.85 to $8.00, up from $7.75 to $7.90, indicating confidence in future performance [10][14] Financial Performance - Total revenue for Q2 FY25 was $55.3 billion, down from $57.4 billion in Q2 FY24, marking a 4% decline [3] - Non-GAAP operating earnings rose by 9% to $635 million, driven primarily by the Pharmaceutical and Specialty Solutions segment [1][3] - Non-GAAP diluted EPS increased by 2% to $1.93, supported by a lower share count and increased operating earnings [1][3] Segment Performance - The Pharmaceutical and Specialty Solutions segment reported revenues of $50.8 billion, a 4% decrease from $53.2 billion in Q2 FY24, but a 17% increase when excluding the impact of the customer contract expiration [4][5] - Segment profit for Pharmaceutical and Specialty Solutions increased by 7% to $531 million, driven by growth in BioPharma Solutions and brand products [5] - The Global Medical Products and Distribution segment saw a 1% revenue increase to $3.2 billion, with segment profit rising to $18 million due to cost optimization initiatives [6][7] Strategic Developments - Cardinal Health completed its acquisition of a majority stake in GI Alliance, enhancing its specialty growth strategy and expanding its service offerings [2][13] - The company also finalized its acquisition of Integrated Oncology Network, which supports its Navista oncology platform [2][25] - Cardinal Health announced the start of routine production of actinium-225, increasing access to new cancer therapies [25] Fiscal Year 2025 Outlook - The company updated its guidance for the Pharmaceutical and Specialty Solutions segment profit growth to 10% to 12%, up from a previous estimate of 4% to 6% [11] - Guidance for the Global Medical Products and Distribution segment profit was adjusted to a range of $130 million to $150 million, down from $140 million to $175 million [11] - Expectations for interest and other expenses were revised to a range of $200 million to $230 million, reflecting new debt financing impacts [12]