Will Strong Segmental Performance Drive MCK's Top Line in Q2?

McKesson Corporation MCK is scheduled to report second-quarter fiscal 2026 results on Nov. 5, after market close.

The company delivered an earnings surprise of 0.36% in the last reported quarter. Its earnings beat estimates in three of the trailing four quarters and missed once, delivering an average surprise of 1.50%.

McKesson is expected to report another solid quarterly performance for the fiscal second quarter of 2026, building on a strong start to the year that saw revenues jump 23% year over year to $97.8 billion and adjusted earnings per share (EPS) rise 5% to $8.26. The company raised its full-year EPS guidance to $37.10-$37.90, reflecting confidence in sustained growth across its core pharmaceutical, oncology, and biopharma services platforms.

However, the upcoming quarterly results are likely to show a more normalized pace of expansion after the first-quarter surge, driven by acquisitions, specialty drug volumes and GLP-1 therapy distribution.

McKesson’s broad-based strength continues to stem from expanding specialty pharmaceutical demand, robust execution in oncology and multi-specialty services, and digital access solutions that enhance medication affordability. The company’s automation initiatives and disciplined cost management are expected to have supported margins.

Yet, the quarterly performance might have faced mild headwinds from higher operating costs related to recent acquisitions (Core Ventures and PRISM Vision) and lingering uncertainty around healthcare policy and tariffs.

Q2 Estimates

The Zacks Consensus Estimate for earnings is pegged at $8.92 per share, implying an improvement of 26.2% year over year. The consensus mark for revenues is pegged at $104.66 billion, indicating a surge of 11.8% year over year.

Our model estimates for revenues and adjusted EPS are pinned at $103.33 billion and $8.57, respectively.

Factors Likely to Have Driven Q2 Segmental Performance

U.S. Pharmaceutical Segment

As McKesson’s largest business, the U.S. Pharmaceutical segment should have remained the primary growth driver. In the fiscal first quarter, revenues surged 25.4% to $90 billion, propelled by prescription volume growth, expanded oncology and specialty distribution, and robust GLP-1 medication sales (up 38% to $12.1 billion).

The fiscal second-quarter numbers are expected to reflect continued momentum, albeit at a steadier pace, as the company rides on the impact of onboarding a large strategic account last year. Operating profit growth might have moderated from the 16.6% seen in first-quarter due to integration costs from recent acquisitions, though efficiency gains and automation are likely to have supported profitability. Our model estimates segmental revenues to increase 11.1% to $95.21 billion.

Prescription Technology Solutions (RxTS)

McKesson’s digital solutions arm is emerging as a strong secondary growth engine. In the previously reported quarter, revenues climbed 15.6% to $1.4 billion and operating profit rose 20.6%, supported by high prior authorization volumes, especially for GLP-1 drugs, and expanding 3PL business.

These trends are expected to have persisted in the fiscal second quarter. However, management had cautioned about quarterly variability tied to new drug launches and payer requirements on its first-quarter earnings call. Still, RxTS should have continued to benefit from McKesson’s expanding connectivity with 50,000 pharmacies and nearly 1 million providers, positioning it as a key enabler of biopharma commercialization. Our model estimates segmental revenues to increase 7.4% to $1.36 billion.

Medical-Surgical and International Segments

The Medical-Surgical Solutions segment, set for separation into an independent company, likely maintained modest 2-6% top-line growth, aided by cost optimization and operational efficiencies. While growth remains slower than in the pharmaceutical business, the spin-off is aimed at unlocking value and sharpen operational focus.

International operations, solely in Canada, are expected to have been driven by higher pharmaceutical distribution volumes. However, divestiture of Canada-based Rexall and Well.ca, as well as exit from Norway, is likely to have unfavorably impacted international sales. Our model estimates revenues for the Medical-Surgical and International segments to increase 3.3% and 0.3%, respectively, to $3.04 billion and $3.72 billion.

McKesson Corporation Price and EPS Surprise

McKesson Corporation price-eps-surprise | McKesson Corporation Quote

Earnings Beat Likely

Our proven model predicts an earnings beat for McKesson this earnings season. The combination of a positive Earnings ESPand a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate ($9.02 per share) and the Zacks Consensus Estimate ($8.92), is +1.16%. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Zacks Rank: MCK sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Solventum Corporation SOLV has an Earnings ESP of +0.88% and a Zacks Rank #1 at present. The company is set to release third-quarter 2025 results on Nov. 6.

SOLV’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 13.91%. According to the Zacks Consensus Estimate, SOLV’s third-quarter EPS is expected to decline 12.8% from the year-ago reported figure.

Cencora COR has an Earnings ESP of +0.31% and a Zacks Rank #3 at present. The company is slated to release fiscal fourth-quarter fiscal 2026 results on Nov. 5.

COR’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 6.19%. According to the Zacks Consensus Estimate, COR’s fiscal fourth-quarter EPS is expected to gain 13.5% from the year-ago reported figure.

Globus Medical GMED has an Earnings ESP of +1.69% and a Zacks Rank #3 at present. The company is set to release third-quarter 2025 results on Nov. 6.

GMED’s earnings surpassed estimates in three of the trailing four quarters and missed once, with the average surprise being 10.82%. According to the Zacks Consensus Estimate, GMED’s third-quarter EPS is expected to decline 6% from the year-ago reported figure.

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This article originally published on Zacks Investment Research (zacks.com).

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