McKesson (MCK) Q2 2025 earnings summary

Executive summary

• Quarterly revenue reached $93.7 billion, up 21% year-over-year, driven by strong U.S. Pharmaceutical segment growth, higher specialty product volumes, and onboarding of a new strategic partner.

• Adjusted EPS rose 13% to $7.07, while GAAP EPS fell to $1.87 due to significant charges related to the sale of Canadian retail businesses and restructuring.

• Fiscal 2025 Adjusted EPS guidance was raised to $32.40–$33.00, reflecting 18–20% growth over the prior year.

• Strategic moves included the acquisition of a controlling interest in Core Ventures, the sale of Rexall and Well.ca, and the launch of InspireGene/InspiroGene for cell and gene therapies.

• $2.2 billion was returned to shareholders in the first half via share repurchases and dividends.

Financial highlights

• Adjusted net income was $915 million, up 9% year-over-year; net income attributable to the company was $241 million, down 64% due to a $643 million charge for Canadian retail assets and $227 million in restructuring charges.

• Gross profit was $3.25 billion, up 7% year-over-year; gross margin was 3.47%.

• Operating cash flow for the first six months was $720 million; free cash flow was $335 million.

• $1.5 billion was spent on share repurchases and $80 million on dividends in Q2; dividends per share increased 15% year-over-year to $0.71.

• Debt to capital ratio increased to 158.8% due to share repurchases and dividends.

Outlook and guidance

• Fiscal 2025 Adjusted EPS guidance raised to $32.40–$33.00, including $0.53 from year-to-date equity investment gains.

• Revenue growth expected at 15%–17%, operating profit growth at 13%–15%.

• Segment revenue growth guidance: U.S. Pharmaceutical 16%–19%, Prescription Technology Solutions 8%–12%, Medical-Surgical Solutions 1%–5%, International 5%–9%.

• Share repurchase target for fiscal 2025 increased to $3.2 billion.

• Restructuring initiatives expected to incur $650 million–$700 million in charges, substantially complete by fiscal 2028.