MCK Q3 Earnings & Sales Top Estimates, 2026 View Up

McKesson Corporation MCK reported third-quarter fiscal 2026 adjusted earnings per share (EPS) of $9.34, which beat the Zacks Consensus Estimate of $9.31 by 0.3%. The bottom line improved 16.3% on a year-over-year basis. The EPS growth was driven by strong operational growth across the business, including contributions from acquisitions in the Oncology & Multispecialty segment.

GAAP EPS was $9.59 compared with $6.95 in the year-ago quarter. The significant improvement in EPS was due to a pre-tax credit within the North American Pharmaceutical segment related to the Rite Aid bankruptcy

Revenue Details

Revenues of $106.16 billion beat the Zacks Consensus Estimate by 0.5%. The top line surged 11.4% year over year, primarily driven by increased prescription volumes from retail national account customers and growth in the distribution of oncology and specialty products, including contributions from Oncology & Multispecialty segment.

Higher contributions from the Prescription Technology Solutions segment also aided the top line.

Shares of MCK have gained 36.1% in the past six months compared to the industry’s 17.1% rise. The S&P 500 Index has increased 11.1% in the same time frame.

Q3 Segmental Analysis

The company started reporting under new reportable segments and organizational structure, effective from the second quarter of fiscal 2026. The current reporting segments are North American Pharmaceutical, Oncology & Multispecialty, Prescription Technology Solutions and Medical-Surgical Solutions.

Revenues from the North American Pharmaceutical segment totaled $88.3 billion, up 9% year over year. Per management, the upside was primarily driven by increased prescription volumes, including higher volumes from retail national account customers and specialty products.

The U.S. Pharmaceutical and Specialty Solutions segment reported an adjusted operating profit of $872 million, up 6% from the prior-year quarter’s level. This was due to growth in the distribution of specialty products to health systems.

Revenues from the Oncology & Multispecialty segment amounted to $13 billion, up 37% year over year. This improvement can be attributed to growth in provider solutions and specialty distribution, and contributions from acquisitions.

Adjusted operating profit at the segment totaled $366 million, up 57% from the year-ago reported figure.

Revenues from the Prescription Technology Solutions segment totaled $1.5 billion, up 9% year over year. This uptick was due to increased prescription volumes in the third-party logistics and technology services businesses.

The segment reported an adjusted operating profit of $277 million, up 18% year over year, driven by higher demand for access solutions.

Revenues from the Medical-Surgical Solutions segment totaled $3 billion, up 1% year over year. Sales were driven by higher volumes of specialty pharmaceuticals.

The Medical-Surgical segment reported an adjusted operating profit of $265 million, down 10% year over year. This is due to reduced volumes across physician office settings and a milder incidence of illness for the season.

Margins

Adjusted gross profit in the reported quarter was $3.66 billion, up 9.6% on a year-over-year basis. The figure represented 3.45% of net revenues, down nearly 5 basis points (bps) year over year.

The company reported an adjusted operating income of $1.81 billion, up 13.4% from the year-ago quarter’s figure. Operating margin was 1.9%, expanding nearly 22 bps year over year.

Financial Update

Cash and cash equivalents totaled $2.96 billion compared with $4 billion in the second quarter of fiscal 2026.

Cumulative net cash provided by operating activities amounted to $2.73 billion against cumulative net cash used in operating activities of $1.66 billion in the year-earlier period.

Fiscal 2026 Guidance

McKesson raised its EPS guidance to $38.80-$39.20 from $38.35-$38.85 for fiscal 2026. The company now expects total revenues to grow 12-16% compared with the previous guidance of 11-15%.

McKesson Corporation Price, Consensus and EPS Surprise

McKesson Corporation price-consensus-eps-surprise-chart | McKesson Corporation Quote

Summing Up

McKesson exited the third quarter of fiscal 2026 on a positive note, with earnings and sales beating estimates.The company’s quarterly performance remained broad-based, with contributions from all major segments. Specialty distribution was again a standout, supported by strong volumes and continued market share gains in community oncology.

MCK’s oncology and multispecialty platforms, together with its expanding suite of biopharma services programs, continue to drive demand among customers. The portfolio transformation also advanced, with progress toward separating the Medical-Surgical Solutions business and continued momentum from recent acquisitions in oncology and eye care. MCK expects to complete the spin-off of the Medical-Surgical Solutions business by the second half of calendar 2027. The company completed the divestiture of its retail and distribution businesses in Norway, marking the final phase of its full exit from European operations.

Management once again raised full-year guidance, underscoring confidence in sustained demand, strong specialty and technology platforms, and a streamlined portfolio.

MCK’s Zacks Rank and Stocks to Consider

McKesson currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader medical space are Align Technology ALGN, Phibro Animal Health PAHC and AtriCure ATRC, each presently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Align Technology shares have gained 28.3% in the past six months. Estimates for the company’s first-quarter 2026 EPS have remained constant at $2.32 in the past 30 days. ALGN’s earnings beat estimates in three of the trailing four quarters and missed in one quarter, delivering an average surprise of 6.16%. In the last reported quarter, it posted an earnings surprise of 10.03%.

Estimates for Phibro Animal Health’s third-quarter fiscal 2026 EPS have remained constant at 69 cents in the past 30 days. Shares of the company have risen 88.8% in the past six months. PAHC’s earnings surpassed estimates in each of the trailing four quarters, the average surprise being 20.15%. In the last reported quarter, it delivered an earnings surprise of 26.09%.

AtriCure shares have declined 0.8% in the past six months. Estimates for the company’s fourth-quarter 2025 loss per share have remained stable at 4 cents in the past 30 days. ATRC’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 67.06%. In the last reported quarter, it posted an earnings surprise of 90.91%.

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

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