Cardinal Health (NYSE: CAH) Q4 FY2026: Adjusted EPS of $2.91 Beats by 19%, FY2027 Guidance Set at $12.40-$12.60

Cardinal Health (NYSE: CAH) reported fourth-quarter fiscal year 2026 results on August 11, 2026, posting adjusted EPS of $2.91 against a consensus estimate of $2.44, a 19.1% beat, while quarterly revenue rose 5.8% year over year to $63.7 billion. The company also issued fiscal year 2027 non-GAAP EPS guidance of $12.40 to $12.60, representing 13% to 15% growth and exceeding its previously stated long-term EPS growth framework.

Q4 FY2026 Results

• Revenue: $63.7 billion in Q4 FY2026, up from $60.2 billion in Q4 FY2025, a 5.8% year-over-year increase, driven by brand and specialty pharmaceutical sales growth from existing customers.
• Adjusted EPS: $2.91 in Q4, up 39.9% from $2.08 in Q4 FY2025, including a one-time net operating profit benefit of $100 million from IEEPA tariff refunds in the Global Medical Products and Distribution (GMPD) segment. Excluding that item, adjusted EPS grew 25% to $2.60.
• GAAP EPS: $1.70, up 70.0% from $1.00 in Q4 FY2025, with GAAP operating income rising to $729 million from $428 million.
• Non-GAAP operating income: $935 million, up 30.0% from $719 million, with the GAAP-to-adjusted divergence reflecting items including tariff refund treatment and tax rate differences.
• Full-year FY2026 results: Revenue of $254.2 billion (up 14% from $222.6 billion in FY2025); non-GAAP diluted EPS of $11.26, up 37% from $8.24; fiscal year 2026 operating cash flow of $5.2 billion and adjusted free cash flow of $5.0 billion.

What Drove the Results

Adjusted EPS of $2.91 beat the $2.44 consensus by $0.47, or 19.1%. The Pharmaceutical and Specialty Solutions segment, which accounts for the largest share of revenue at $58.8 billion in Q4 (up 6% year over year), grew segment profit 21% to $645 million, driven by brand and specialty product contributions and generics program performance.

The GMPD segment saw Q4 revenue decline 2% to $3.1 billion, but segment profit rose substantially to $150 million from $70 million in the prior year, primarily from the recognition of IEEPA tariff refunds. The "Other" category, encompassing Nuclear and Precision Health Solutions, OptiFreight Logistics, and at-Home Solutions, grew Q4 revenue 7% to $1.7 billion and segment profit 14% to $183 million. For the full fiscal year, all five operating segments grew profit double-digits, according to CEO Jason Hollar's statement accompanying the release.

The GAAP effective tax rate improved to 27.9% in Q4 from 36.9% in Q4 FY2025, and the non-GAAP effective tax rate fell to 22.5% from 26.3%, each contributing to the EPS improvement alongside a reduced share count following in-year buybacks.

Capital Allocation and Strategic Developments

Cardinal Health completed an incremental $350 million accelerated share repurchase program in FY2026, bringing total fiscal year repurchases to $1.4 billion. The board of directors approved a new $5.0 billion increase to the share repurchase authorization, bringing the total authorization to $6.4 billion as of August 2026. The company also announced a new $4.0 billion revolving credit facility replacing three prior facilities, a long-term renewal of its wholesaler distribution contract with Kroger, and a new Indianapolis distribution center featuring robotics and automation set to open in 2027. A quarterly dividend of $0.5158 per share was declared, payable October 15, 2026, to shareholders of record on October 1, 2026. FY2027 capital expenditures are guided at approximately $700 million.

Wall Street View

Analyst sentiment on Cardinal Health heading into the print was firmly positive, with the Wall Street consensus skewed toward buy-side ratings. The FY2027 non-GAAP EPS guidance range of $12.40 to $12.60 came in above the company's own previously articulated long-term growth framework, which may prompt upward estimate revisions across the coverage universe.

Investor Takeaway

The Q4 FY2026 report reflects a year in which Cardinal Health grew non-GAAP operating income 30% on 14% revenue growth while also deploying $1.4 billion in share repurchases. The FY2027 guidance of 13% to 15% non-GAAP EPS growth, paired with a $5.0 billion incremental buyback authorization, suggests the capital return program will remain a meaningful component of total shareholder return even as the company invests approximately $700 million in capital expenditures and integrates the recently completed Strive Medical acquisition and announced Diabetes Health business acquisition from AdaptHealth. Shares traded at $241.98 on August 11, 2026, a gain of 2.02%, while the S&P 500 gained 0.09%.