Cardinal Health (CAH) Baird Global Healthcare Conference 2025 summary

Strategic growth and performance

• Achieved strong revenue growth, with 22% ex-Optum in Pharma Specialty Solutions and $10B in new business, carrying $7B into fiscal 2026.

• Specialty segment has maintained a 14%+ CAGR over four to five years, now a $40B business, with growth rates expected to remain stable despite policy changes.

• Operating income grew 11% for the quarter and 12% for the year, with guidance raised to 11%-13% profit growth for fiscal 2026 due to strong demand and non-repetition of year-end anomalies.

• Organic growth with a major customer reached 23% this year, attributed to strong partnerships and industry trends like GLP-1 growth and store closures among competitors.

• Recent M&A, including the Solaris Health MSO deal, aligns with strategic priorities and is expected to be accretive within 12 months of closing.

Diversified business initiatives

• Cardinal Health branded products saw 5-6% volume growth, with plans to outpace market growth and add $50M in annual profitability over the next three years.

• Transformation of the Global Medical Products and Distribution (GMPD) business is ongoing, with improved profitability and cash flow following a period of significant losses.

• Diversified businesses—Nuclear & Precision Health Solutions, At-Home Solutions, and OptiFreight Logistics—are leaders in their fields, contributing 20% of adjusted operating income and benefiting from secular growth trends.

• At-Home Solutions is expanding with new distribution centers and is well-positioned for competitive bidding in diabetes, with only 15% exposure to CGM fee-for-service.

• Compliance and scale advantages are expected to drive further market share as the industry consolidates, especially in at-home and diabetes segments.

Capital allocation and outlook

• Over $10B in cash flow expected in the next three years, with $2.75B to $3.25B projected for the coming year.

• Capital allocation remains disciplined, focused on long-term shareholder value creation.

• Continued investment in diversified and specialty businesses, with further M&A and integration synergies anticipated.