
Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~December~~March 31, ~~2025~~2026


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ................ to ......................

Commission File Number: 1-11373

Cardinal Health, Inc.

(Exact name of registrant as specified in its charter)

Ohio

31-0958666

(State or other jurisdiction of
incorporation or organization)

(IRS Employer
Identification No.)

7000 Cardinal Place

Dublin

Ohio

43017

(Address of principal executive offices)

(Zip Code)

(614) 757-5000

(Registrant’s telephone number, including area code)


Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common shares (without par value)	CAH	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

The number of the registrant’s common shares, without par value, outstanding as of ~~January~~April 3124, 2026, was the following: ~~235~~234,~~316~~205,~~016~~855.

Cardinal Health Q2Q3 Fiscal 2026 Form 10-Q

Table of Contents

						Page
			Management's Discussion and Analysis of Financial Condition and Results of Operations			2
			Explanation and Reconciliation of Non-GAAP Financial Measures			1315
			Quantitative and Qualitative Disclosures about Market Risk			1618
			Controls and Procedures			1618
			Legal Proceedings			1719
			Risk Factors			1719
			Unregistered Sales of Equity Securities and Use of Proceeds			1720
			Other Information			1721
			Financial Statements			1822
			Exhibits			3944
			Form 10-Q Cross Reference Index			4045
			Signatures			4146

About Cardinal Health

Cardinal Health, Inc., an Ohio corporation formed in 1979, is a global healthcare services and products company providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices, and patients in the home. We provide pharmaceuticals and medical products and cost-effective solutions that enhance supply chain efficiency. We connect patients, providers, payers, pharmacists, and manufacturers for integrated care coordination.

We report our financial results in two reportable segments: Pharmaceutical and Specialty Solutions ("Pharma") segment and Global Medical Products and Distribution ("GMPD") segment. All remaining operating segments that are not significant enough to require separate reportable segment disclosures are included in Other, which is comprised of Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight® Logistics. As used in this report, “we,” “our,” “us,” and similar pronouns refer to Cardinal Health, Inc. and its majority-owned and consolidated subsidiaries, unless the context requires otherwise. Our fiscal year ends on June 30. References to fiscal 2026 and fiscal 2025 and to FY26 and FY25 are to the fiscal years ending or ended June 30, 2026 and June 30, 2025, respectively.

Forward-Looking Statements

This Quarterly Report on Form 10-Q for the quarter ended ~~December~~March 31, ~~2025~~2026 (this "Form 10-Q") (including information incorporated by reference) includes "forward-looking statements" addressing expectations, prospects, estimates, and other matters that are dependent upon future events or developments. Many forward-looking statements appear in Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A"), but there are others in this Form 10-Q, which may be identified by words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “would,” “project,” “continue,” “likely,” and similar expressions, and include statements reflecting future results or guidance, statements of outlook, and expense accruals. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those made, projected, or implied. The most significant of these risks and uncertainties are described in this Form 10-Q, including Exhibit 99.1, and in "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (“2025 Form 10-K”), our Form 10-Q for the ~~quarter~~quarters ended September 30, 2025 and December 31, 2025, and other SEC filings made since June 30, 2025. Forward-looking statements in this Form 10-Q speak only as of the date of this document. Except to the extent required by applicable law, we undertake no obligation to update or revise any forward-looking statement.

Non-GAAP Financial Measures

In the "Overview of Consolidated Results" section of MD&A, we use financial measures that are derived from our consolidated financial data but are not presented in our condensed consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). These measures are considered "non-GAAP financial measures" under the Securities and Exchange Commission ("SEC") rules. The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures are included in the “Explanation and Reconciliation of Non-GAAP Financial Measures” section following MD&A in this Form 10-Q.

1 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Overview

Management's Discussion and Analysis of Financial Condition and Results of Operations

The discussion and analysis presented below is concerned with material changes in financial condition and results of operations, including amounts and certainty of cash flows from operations and from outside sources, between the periods specified in our condensed consolidated balance sheets at ~~December~~March 31, ~~2025~~2026 and June 30, 2025, and in our condensed consolidated statements of earnings and our condensed consolidated statements of cash flows for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025. All comparisons presented are with respect to the prior-year period, unless stated otherwise. The discussion and analysis in this Form 10-Q should be read in conjunction with the MD&A included in our 2025 Form 10-K.

2 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Overview

Overview of Consolidated Results

Revenue

Revenue for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 increased 1911 percent to $6560.69 billion from the comparative prior-year quarter, primarily due to branded and 21specialty pharmaceutical sales growth from existing customers. Revenue for the nine months ended March 31, 2026 increased 17 percent to $~~129~~190.6 billion from the comparative prior-year ~~periods~~period, ~~respectively,~~ primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.

GAAP and Non-GAAP Operating Earnings

	Three Months Ended December 31,						Six Months Ended December 31,
	Three Months Ended March 31,						Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025		Change		~~2025~~2026		~~2024~~2025		Change
GAAP operating earnings	$	~~707~~509	$	~~549~~730	29(30)	%	$	1,~~375~~884	$	1,~~117~~847	232	%
State opioid assessment related to prior fiscal years	~~(17)~~—		—				(17)		—
Restructuring and employee severance	2125		928				4166		3361
Amortization and other acquisition-related costs	~~130~~114		~~105~~152				~~234~~348		~~179~~331
Acquisition-related cash and share-based compensation costs	67112		—20				~~131~~243		—20
Impairments and (gain)/loss on disposal of assets, net	~~(14)~~185		3(17)				~~(12)~~173		2(15)
Litigation (recoveries)/charges, net	~~(18)~~11		(31105)				(187)		(71176)
Non-GAAP operating earnings	$	~~877~~956	$	~~635~~807	3818	%	$	12,~~734~~690	$	12,~~260~~067	3830	%

The sum of the components and certain computations may reflect rounding adjustments.

GAAP operating earnings for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 ~~increased~~decreased 2930 percent to $~~707~~509 million and 23increased 2 percent to $1.49 billion from the comparative prior-year periods, respectively,. ~~primarily~~GAAP ~~due~~operating toearnings for the ~~impact~~three ofand ~~the~~nine ~~acquisitions~~months ofended ~~management~~March ~~services~~31, ~~organization~~2026 ~~("MSO")~~was ~~platforms~~unfavorably ~~and~~impacted ~~Advanced~~by ~~Diabetes~~the ~~Supply~~$184 ~~Group~~million ~~("ADS"),~~pre-tax ~~increased~~non-cash ~~contribution~~goodwill ~~from~~impairment ~~branded~~charge ~~and~~related ~~specialty~~to ~~pharmaceutical~~the ~~products,~~Navista ~~and~~& ~~growth~~ION ~~from~~reporting ~~existing~~unit ~~customers~~ within the ~~GMPD~~Pharma segment recognized in the current quarter, ~~partially~~the ~~offset~~$106 bymillion ~~acquisition~~and $165 million of net recoveries in class action antitrust litigation recognized in the comparative prior-~~related~~year periods, respectively, and higher cash and share-based compensation costs resulting from the timing of acquisitions within The Specialty Alliance. See "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 4 of the "Notes to the Condensed Consolidated Financial Statements" for further information on the goodwill impairment.

Non-GAAP operating earnings for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 3818 percent to $~~877~~956 million and 30 percent to $12.7 billion from the comparative prior-year periods, respectively,. ~~primarily~~GAAP ~~due~~and tonon-GAAP ~~the~~operating ~~impact~~earnings offor the ~~acquisitions~~three ofand ~~MSO~~nine ~~platforms~~months ~~and~~ended ~~ADS~~March 31, 2026 were favorably impacted by increased contribution from branded and specialty pharmaceutical products, the impact of the acquisitions of management services organization ("MSO") platforms and ~~growth~~Advanced ~~from~~Diabetes ~~existing~~Supply ~~customers~~Group ~~within~~("ADS"), and the ~~GMPD~~performance ~~segment~~of our generics program.



3			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Overview

GAAP and Non-GAAP Diluted EPS

	Three Months Ended December 31,						Six Months Ended December 31,
	Three Months Ended March 31,						Nine Months Ended March 31,
($ per share)	~~2025~~2026 (2)		~~2024~~2025 (2)		Change		~~2025~~2026 (2)		~~2024~~2025 (2)		Change
GAAP diluted EPS (1)	$	1.9769	$	12.6510	19(20)	%	$	35.8554	$	35.3544	152	%
State opioid assessment related to prior fiscal years	~~(0.05)~~—		—				(0.05)		—
Restructuring and employee severance	0.0708		0.0309				0.1321		0.1019
Amortization and other acquisition-related costs	0.4630		0.3248				01.7808		01.5402
Acquisition-related cash and share-based compensation costs	0.2746		—0.06				0.5398		—0.06
Impairments and (gain)/loss on disposal of assets, net	(0.~~06)~~59		(0.0106)				(0.~~03)~~56		(0.0104)
Litigation (recoveries)/charges, net	(0.~~04)~~06		(0.0832)				(0.~~02)~~04		(0.1951)
Non-GAAP diluted EPS (1)	$	23.6317	$	12.9335	3635	%	$	58.1835	$	36.8116	36	%

The sum of the components and certain computations may reflect rounding adjustments.

(1)Diluted earnings per share attributable to Cardinal Health, Inc. ("diluted EPS").

(2)The reconciling items are presented within this table net of tax. See quantification of tax effect of each reconciling item in our GAAP to Non-GAAP Reconciliations in the "Explanation and Reconciliation of Non-GAAP Financial Measures."

GAAP diluted EPS for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 ~~increased~~decreased 1920 percent to $1.9769 ~~and~~from 15the comparative prior-year quarter, primarily due to the factors impacting GAAP operating earnings discussed in the preceding section, partially offset by favorable changes in discrete tax items. GAAP diluted EPS for the nine months ended March 31, 2026 increased 2 percent to $35.8554 from the comparative prior-year ~~periods~~period, ~~respectively,~~ primarily due to the factors impacting GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items, partially offset by increased interest expense.

3Non-GAAP ~~Cardinal~~diluted ~~Health~~EPS |for Q2the ~~Fiscal~~three and nine months ended March 31, 2026 ~~Form~~increased 1035 percent to $3.17 and 36 percent to $8.35 from the comparative prior-Qyear periods, respectively, primarily due to the factors impacting non-GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items, partially offset by increased interest expense.



4			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Overview

Non-GAAP diluted EPS for the three and six months ended December 31, 2025 increased 36 percent to $2.63 and $5.18 from the comparative prior-year periods, respectively, primarily due to the factors impacting non-GAAP operating earnings discussed in the preceding section, partially offset by increased interest expense.

Significant Developments in Fiscal 2026 and Trends

Pharmaceutical and Specialty Solutions Segment

Solaris Health Acquisition

On November 3, 2025, we, through The Specialty Alliance, completed the acquisition of Solaris Health, a urology MSO, for a purchase price of approximately $1.9 billion in cash, subject to certain adjustments. In connection with the closing of this transaction, we issued common units in The Specialty Alliance to certain physicians and members of management which are estimated to have a grant date fair value of approximately $500 million, a portion of which will be recognized as post-combination expense within acquisition-related cash and share-based compensation costs.

Solaris Health includes more than 750 providers across more than 250 practice locations in 14 states. Solaris Health is part of The Specialty Alliance, our multi-specialty MSO platform, and their results are reported within our Pharma segment. With the closing of this transaction, we own approximately 76% of The Specialty Alliance. We funded the acquisition with a combination of cash proceeds from the recent debt financing and cash on hand. See Note 5 of the "Notes to Condensed Consolidated Financial Statements" for additional information on the debt financing.

Management Service Organization Platforms

The performance of our MSO platforms, ~~which consists of The Specialty Alliance and Navista,~~ positively impacted the year-over-year comparison of Pharma segment profit during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, primarily due to the impact of the acquisitions of GI Alliance ("GIA"), Urology America, ~~Integrated Oncology Network ("ION")~~ and Solaris Health. The Specialty Alliance is our multi-specialty MSO platform, which is primarily comprised of GIA, Urology America, Solaris Health and other gastroenterology- and urology-focused practices. Navista is our oncology MSO platform, which is primarily comprised of ION and other oncology-focused practices. Our ability to successfully provide physician practice support and management services, and to receive the value we expect to receive from our recent acquisitions of MSO platforms, depends upon a number of factors, including: the ability to develop or acquire and integrate appropriate practice management and support expertise; the ability to support recruitment, integration, and retention of sufficient numbers of local providers and staff; ensuring the alignment of interests between Cardinal Health and the physicians; the ability to successfully support negotiations with vendors, suppliers, and payors; the reimbursement and regulatory environment; and competition from other healthcare organizations.

Branded Pharmaceuticals

During the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we saw an increased demand for GLP-1 pharmaceuticals ~~and~~which ~~our sales increased significantly. These increased sales~~ positively impacted our Pharma segment and consolidated revenue for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026; however, increased GLP-1 sales did not meaningfully contribute to segment profit. Future demand for these medications is unpredictable and our ability to meet demand may be impacted by supply constraints. Additionally, the recently issued Executive Order titled “Delivering Most-Favored Nation Prescription Drug Pricing to American Patients” and other administrative policies or actions may impact sales or profitability of branded pharmaceutical products; however, the extent of the impact is uncertain and may vary depending on the timeline for implementation and the extent of any price reductions.

Generics Program

The performance of our Pharma segment generics program positively impacted the year-over-year comparison of Pharma segment profit during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026. The Pharma segment generics program includes, among other things, the impact of generic pharmaceutical product launches, customer volumes, pricing changes, the Red Oak Sourcing, LLC venture ("Red Oak Sourcing") with CVS Health Corporation ("CVS Health"), and generic pharmaceutical contract manufacturing and sourcing costs.

The frequency, timing, magnitude, and profit impact of generic pharmaceutical customer volumes, pricing changes, customer contract renewals, generic pharmaceutical manufacturer pricing changes, and generic pharmaceutical contract manufacturing and sourcing costs all impact Pharma segment profit and are subject to risks and uncertainties. These risks and uncertainties may impact Pharma segment profit and consolidated operating earnings during the remainder of fiscal 2026 and beyond.

45 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Overview

Tariffs

~~Recent~~In ~~U.S.~~February ~~tariffs~~2025, the United States imposed ortariffs ~~threatened~~under tothe beInternational ~~imposed~~Emergency Economic Powers Act ("IEEPA") on certain goods, materials, and products imported into the United States from countries where we do business. ~~and~~In ~~any~~February ~~retaliatory~~2026, ~~actions~~the ~~taken~~U.S. bySupreme ~~such~~Court ~~countries~~ruled ~~have~~that ~~resulted~~the inIEEPA ustariffs ~~incurring~~were ~~substantial~~unlawful ~~additional~~but ~~costs~~did not establish a mechanism for issuing refunds. Subsequent to ~~source~~this ~~products~~ruling, U.S. Customs and ~~materials~~Border Protection ("CBP") worked to establish a phased process to administer refunds required by the Supreme Court ruling; however, ~~directly~~uncertainty ~~and~~remains ~~indirectly~~concerning the timing, ~~from~~scope ~~affected~~and ~~countries~~administrative process to receive refunds for all IEEPA tariffs paid. In April 2026, ~~resulting~~CBP inlaunched ~~raising~~its ~~prices~~program onto ~~certain~~administer ~~products~~Phase ~~and~~1 ~~evaluating~~refund ~~alternative~~requests; ~~sources~~however, ofsubstantially ~~supply.~~all Itof isour ~~also~~IEEPA ~~possible~~tariffs ~~that~~paid wewill ~~could~~fall ~~experience~~under ~~supply~~Phase ~~disruptions~~2 or ~~shortages~~later asphases. As of the date hereof, CBP has not communicated a ~~result~~date ofon ~~tariffs~~which the refund process for such Phase 2 or ~~other~~later ~~protective~~phases ~~measures~~will be established or available.

We have taken ~~action~~actions to reduce the ~~potential~~ impact of IEEPA and other tariffs on our ~~costs;~~financial ~~however~~results, atincluding ~~this~~through ~~time,~~cost ~~the~~optimization ~~countries~~initiatives ~~that~~and ~~will~~by beincreasing ~~subject~~prices toon ~~tariffs~~impacted ~~and~~products ~~the~~to ~~tariff~~customers; ~~rate~~however, ~~that~~these ~~may~~measures behave ~~imposed~~not onfully ~~each~~offset ~~country~~the ~~remains~~negative ~~dynamic~~impact. ~~and~~As weof dothe ~~not~~third ~~expect~~quarter toof befiscal ~~able~~year to2026, ~~establish~~we ~~alternative~~have ~~sources~~paid ofapproximately ~~supply~~$200 ormillion ~~otherwise~~in ~~mitigate~~IEEPA ~~the potential impact of~~ tariffs, onprimarily ~~all~~related ofto ~~the~~ products that we source, manufacture or distribute. Ifin weour ~~are~~GMPD ~~not~~segment. ~~able~~In ~~to offset~~ the ~~impact~~event ofthat ~~tariffs~~we ~~through~~receive ~~price~~refunds ~~increases~~of orIEEPA ~~otherwise mitigate the impacts, our financial results could be negatively impacted. Additionally, if~~ tariffs ~~are~~from ~~modified in~~ the ~~future~~government, ~~or our preliminary information is incorrect regarding their impact,~~ we ~~may~~expect ~~not be able~~ to ~~respond~~return to ~~such~~those ~~changes~~customers ~~adequately~~the orportion inof athose ~~timely~~refunds ~~manner~~that ~~and~~reflect ~~our~~the ~~financial~~estimated ~~results~~increased ~~could be negatively impacted. Furthermore, if our competitors do not increase~~ prices, orpaid ~~increase~~related ~~prices~~ to aIEEPA ~~lesser extent than we do, or are able to offset the impact of~~ tariffs ~~through other actions, our competitive and financial position may be adversely affected~~.

5We ~~Cardinal~~have ~~Health~~not |recognized Q2any ~~Fiscal~~financial impact related to potential tariff refunds or payments to our customers as of March 31, 2026. ~~Form~~The ~~10-Q~~ultimate resolution of this matter could positively impact our results of operations in future periods, including GMPD segment profit and consolidated operating income.

Following the Supreme Court IEEPA ruling, the U.S. government replaced IEEPA tariffs with tariffs imposed under Section 122 of the Trade Act of 1974. We continue to evaluate the impact of these and other tariffs, including tariffs imposed under Sections 301 and 232 of the Trade Act of 1974.

Tariff rates remain dynamic and we do not expect to be able to establish alternative sources of supply or otherwise mitigate the potential impact of tariffs on all of the products that we source, manufacture or distribute. We are still incurring increased costs from tariffs, and if we are not successful at increasing prices to customers, our financial results will continue to be negatively impacted. Additionally, if tariffs are modified in the future, or our information is incorrect regarding their impact, we may not be able to respond to such changes adequately or in a timely manner and our financial results could be negatively impacted. Furthermore, if our competitors do not increase prices, or increase prices to a lesser extent than we do or are able to offset the impact of tariffs through other actions, our competitive and financial position may be adversely affected.



6			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Results of Operations

Results of Operations

Revenue

	Three Months Ended December 31,						Six Months Ended December 31,
	Three Months Ended March 31,						Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025		Change		~~2025~~2026		~~2024~~2025		Change
Pharmaceutical and Specialty Solutions	$	6056,~~669~~111	$	50,~~849~~433	1911	%	$	~~119~~175,~~874~~985	$	98149,~~839~~272	2118	%
Global Medical Products and Distribution	3,~~259~~148		3,~~154~~160		3—	%	69,~~443~~591		69,~~277~~437		32	%
Other	1,~~724~~706		1,~~283~~304		3431	%	35,~~365~~071		23,~~469~~773		3634	%
Total segment revenue	6560,~~652~~965		5554,~~286~~897		1911	%	~~129~~190,~~682~~647		~~107~~162,~~585~~482		2117	%
Corporate	(25)		(2219)		N.M.		(4671)		(4463)		N.M.
Total revenue	$	6560,~~627~~940	$	5554,~~264~~878	1911	%	$	~~129~~190,~~636~~576	$	~~107~~162,~~541~~419	2117	%

Pharmaceutical and Specialty Solutions

Pharma segment revenue for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 increased 1911 percent to $6056.71 billion ~~and 21 percent to $119.9 billion~~ from the comparative prior-year ~~periods~~quarter, ~~respectively,~~ primarily due to branded and specialty pharmaceutical sales growth from existing ~~and new~~ customers.

Pharma segment revenue for the nine months ended March 31, 2026 increased 18 percent to $176.0 billion from the comparative prior-year period, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.

Global Medical Products and Distribution

GMPD segment revenue for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 ~~increased~~was 3flat ~~percent~~at to $3.31 billion ~~and~~compared ~~$6.4 billion~~to ~~from~~ the ~~comparative~~ prior-year ~~periods,~~quarter. ~~respectively,~~This ~~primarily~~reflected ~~due~~lower todistribution ~~volume~~volumes, ~~growth~~offset ~~from~~by ~~existing~~Cardinal ~~customers~~Health brand growth.

GMPD segment revenue for the nine months ended March 31, 2026 increased 2 percent to $9.6 billion from the comparative prior-year period, primarily due to Cardinal Health brand growth, partially offset by lower distribution volumes.

Other

Other segment revenue for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 3431 percent to $1.7 billion and 3634 percent to $35.41 billion from the comparative prior-year periods, respectively, due to growth across at-Home Solutions (including the acquisition of ADS), Nuclear and Precision Health Solutions, and OptiFreight® Logistics.

~~Cost~~7 ofCardinal ~~Products~~Health ~~Sold~~| Q3 Fiscal 2026 Form 10-Q

Cost of products sold for the three and six months ended December 31, 2025 increased 19 percent to $63.2 billion and 20 percent to $124.9 billion from the comparative prior-year periods, respectively, primarily due to the factors affecting the changes in revenue and gross margin.

6 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


MD&A			Results of Operations

Cost of Products Sold

Cost of products sold for the three and nine months ended March 31, 2026 increased 11 percent to $58.4 billion and 17 percent to $183.4 billion from the comparative prior-year periods, respectively, primarily due to the factors affecting the changes in revenue and gross margin.

Gross Margin

Three Months Ended December 31,

Six Months Ended December 31,

Three Months Ended March 31,

Nine Months Ended March 31,

(in millions)

~~2025~~2026

~~2024~~2025

Change

~~2025~~2026

~~2024~~2025

Change

Gross margin

2,~~397~~498

12,~~941~~123

2318

47,~~716~~214

35,~~843~~966

2321

Gross margin for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 2318 percent to $2.45 billion and 21 percent to $4.7.2 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS, ~~and the~~ increased contribution from branded and specialty pharmaceutical products, and the performance of our generics program.

Gross margin rates for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 grew 1423 basis points to 34.6510 percent and 712 basis points to 3.6479 percent from the comparative prior-year periods, respectively, primarily due to the acquisition of MSO platforms, partially offset by the impact of the unfavorable changes in product mix ~~for~~in the Pharma segment. These changes in product mix were primarily driven by increased pharmaceutical distribution branded sales, which have a dilutive impact on our overall gross margin rate.

Distribution, Selling, General and Administrative ("SG&A") Expenses

Three Months Ended December 31,

Six Months Ended December 31,

Three Months Ended March 31,

Nine Months Ended March 31,

(in millions)

~~2025~~2026

~~2024~~2025

Change

~~2025~~2026

~~2024~~2025

Change

SG&A expenses

1,~~504~~542

1,~~306~~315

1517

24,~~965~~507

23,~~583~~898

1516

SG&A expenses for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 1517 percent to $1.5 billion and 16 percent to $34.05 billion from the comparative prior-year periods, respectively, primarily due to the acquisitions of MSO platforms and ADS.

78 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Results of Operations

Segment Profit

We evaluate segment performance based on segment profit, among other measures. See Note 12 of the "Notes to Condensed Consolidated Financial Statements" for additional information on segment profit.

	Three Months Ended December 31,						Six Months Ended December 31,
	Three Months Ended March 31,						Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025		Change		~~2025~~2026		~~2024~~2025		Change
Pharmaceutical and Specialty Solutions	$	~~687~~784	$	~~531~~662	2918	%	$	12,~~354~~138	$	1,~~061~~723	2824	%
Global Medical Products and Distribution	3725		1839		~~N.M.~~(36)	%	83108		2665		~~N.M.~~66	%
Other	179		~~118~~134		5234	%	~~345~~524		~~222~~356		5547	%
Total segment profit	~~903~~988		~~667~~835		3518	%	12,~~782~~770		12,~~309~~144		3629	%
Corporate	(~~196~~479)		(~~118~~105)		N.M.		(~~407~~886)		(~~192~~297)		N.M.
Total consolidated operating earnings	$	~~707~~509	$	~~549~~730	29(30)	%	$	1,~~375~~884	$	1,~~117~~847	232	%

Pharmaceutical and Specialty Solutions

Pharma segment profit for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 increased 2918 percent to $~~687~~784 million ~~and 28 percent to $1.4 billion~~ from the comparative prior-year ~~periods~~quarter, ~~respectively,~~ primarily due to increased contribution from branded and specialty pharmaceutical products, ~~the acquisition of MSO platforms,~~ and the performance of our generics program.

Pharma segment profit for the nine months ended March 31, 2026 increased 24 percent to $2.1 billion from the comparative prior-year period, primarily due to increased contribution from branded and specialty pharmaceutical products, the acquisition of MSO platforms, and the performance of our generics program.

Global Medical Products and Distribution

GMPD segment profit for the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 ~~increased~~decreased to36 ~~$37~~percent ~~million~~to ~~and~~ $8325 million from the comparative prior-year ~~periods~~quarter, ~~respectively,~~ primarily due to ~~growth from existing customers and~~ the ~~beneficial net impact of cost optimization initiatives, partially offset by the~~ adverse net impact of tariffs.

GMPD segment profit for the nine months ended March 31, 2026 increased 66 percent to $108 million from the comparative prior-year period, primarily due to growth from existing customers, partially offset by the adverse net impact of tariffs.

Other

Other segment profit for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 5234 percent to $179 million and 5547 percent to $~~345~~524 million from the comparative prior-year periods, respectively, primarily due to the performance of at-Home Solutions (including the acquisition of ADS), ~~and~~ OptiFreight® Logistics, and Nuclear and Precision Health Solutions.

Corporate

The changes in Corporate for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 were due to the factors discussed in the "Other Components of Consolidated Operating Earnings" section that follows.

89 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Results of Operations

Other Components of Consolidated Operating Earnings

In addition to revenue, gross margin, and SG&A expenses discussed previously, consolidated operating earnings were impacted by the following:

	Three Months Ended December 31,				Six Months Ended December 31,
	Three Months Ended March 31,				Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025		~~2025~~2026		~~2024~~2025
Restructuring and employee severance	$	2125	$	928	$	4166	$	3361
Amortization and other acquisition-related costs	~~130~~114		~~105~~152		~~234~~348		~~179~~331
Acquisition-related cash and share-based compensation costs	67112		—20		~~131~~243		—20
Impairments and (gain)/loss on disposal of assets, net	~~(14)~~185		3(17)		~~(12)~~173		2(15)
Litigation (recoveries)/charges, net	~~(18)~~11		(31105)		(187)		(71176)

Restructuring and Employee Severance

During the three and ~~six~~nine months ended ~~December~~March 31, 2026 and 2025, restructuring and employee severance costs were primarily related to the implementation of certain enterprise-wide cost-savings measures and certain initiatives to rationalize our manufacturing operations.

Amortization and Other Acquisition-Related Costs

Amortization of acquisition-related intangible assets was $8495 million and $~~171~~266 million for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, respectively, and $6977 million and $~~137~~214 million for the three and ~~six~~nine months ended ~~December~~March 31, ~~2024~~2025, respectively.

Transaction and integration costs associated with acquisitions were $4619 million and $6382 million for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, respectively, and $3675 million and $42117 million for the three and ~~six~~nine months ended ~~December~~March 31, ~~2024~~2025, respectively.

Acquisition-related Cash and Share-based Compensation Costs

Acquisition-related cash and share-based compensation costs were $67112 million and $~~131~~243 million for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025,~~2026 ~~respectively~~and $20 million for both the three and nine months ended March 31, 2025. The increase primarily ~~resulting~~resulted from the timing of acquisitions within The Specialty Alliance.

Impairments and (Gain)/Loss on Disposal of Assets, Net

We recognized a pre-tax goodwill impairment charge of $184 million related to the Navista & ION reporting unit within the Pharma segment during the three and nine months ended March 31, 2026, as discussed further in the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 4 of the "Notes to the Condensed Consolidated Financial Statements".

Litigation (Recoveries)/Charges, Net

We recognized income for net recoveries in class action antitrust litigation in which we were a class member or plaintiff of $19106 million ~~during both the three~~ and ~~six months ended December 31, 2025 and~~ $16165 million ~~and $59 million~~ during the three and ~~six~~nine months ended ~~December~~March 31, ~~2024~~2025, respectively. ~~We recognized $15 million in opioid-related insurance recoveries during the three and six months ended December 31, 2024.~~

Earnings Before Income Taxes

In addition to the items discussed above, earnings before income taxes were impacted by the following:

Three Months Ended December 31,

Six Months Ended December 31,

Three Months Ended March 31,

Nine Months Ended March 31,

(in millions)

~~2025~~2026

~~2024~~2025

Change

~~2025~~2026

~~2024~~2025

Change

Other (income)/expense, net

~~(11)~~16

3(9)

N.M.

(215)

(211)

N.M.

Interest expense, net

88101

3574

~~N.M.~~36

~~168~~269

67141

~~N.M.~~91

Interest Expense, Net

Interest expense, net for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 increased 36 percent to $88101 million and 91 percent to $~~168~~269 million from the comparative prior-year periods, respectively, primarily due to the additional debt financing for our recent acquisitions.



10			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Results of Operations

Provision for Income Taxes

The effective tax rate was 253.21 percent and 2119.4 percent for the three and nine months ended ~~December~~March 31, ~~2025 and 2024~~2026, respectively, and 2423.76 percent and 22.28 percent for the ~~six~~three and nine months ended ~~December~~ March 31, 2025 ~~and 2024~~, respectively. ~~See~~The ~~Note~~effective 7tax ofrate for the ~~"Notes~~three toand ~~Condensed~~nine ~~Consolidated~~months ~~Financial~~ended ~~Statements"~~March ~~for~~31, ~~additional~~2026 ~~information~~was primarily impacted by discrete planning benefits.

9Tax ~~Cardinal~~Effects ~~Health~~of |Goodwill Q2Impairment ~~Fiscal 2026 Form 10-Q~~Charges

During the three months ended March 31, 2026, we recognized a pre-tax goodwill impairment charge of $184 million related to the Navista & ION reporting unit within the Pharma segment. The net tax benefit related to this charge is $23 million for fiscal 2026.

The tax effect of the goodwill impairment charge recorded during the three months ended March 31, 2026 was included in our estimated annual effective tax rate because it was not considered unusual or infrequent, given that we have recorded other goodwill impairments in prior fiscal years. The impact of the non-deductible goodwill did not materially impact the annual effective tax rate for 2026.



11			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Liquidity and Capital Resources

Liquidity and Capital Resources

We currently believe that, based on available capital resources and projected operating cash flow, we have adequate capital resources to fund our operations and expected future cash needs as described below. In addition to those disclosed, if we decide to engage in one or more acquisitions, depending on the size and timing of such transactions, we may need to access capital markets for additional financing.

Cash and Equivalents

Our cash and equivalents balance was $23.89 billion at ~~December~~both March 31, ~~2025~~2026 ~~compared~~and ~~to $3.9 billion at~~ June 30, 2025.

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, net cash provided by operating activities was $13.75 billion, which includes the impact of normal timing of payments to vendors and payments totaling $~~403~~417 million related to the opioid litigation.

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we deployed $1.9 billion for the Solaris Health acquisition, $~~500~~600 million for debt repayment, $~~758~~1.0 ~~million~~billion for share repurchases, $~~251~~371 million for dividends, and $~~239~~385 million for capital expenditures. We issued new long-term debt and received net proceeds of approximately $1.0 billion to fund a portion of the consideration paid in connection with the Solaris Health acquisition and for general purposes.

At ~~December~~March 31, ~~2025~~2026, our cash and equivalents were held in cash depository accounts with major banks or invested in high quality, short-term liquid investments.

Changes in working capital, which impact operating cash flow, can vary significantly depending on factors such as the timing of customer payments, inventory purchases, payments to vendors, and tax payments in the regular course of business, as well as fluctuating working capital needs driven by customer and product mix.

The cash and equivalents balance at ~~December~~March 31, ~~2025~~2026 includes $~~505~~612 million of cash held by subsidiaries outside of the United States.

Other Financing Arrangements and Financial Instruments

Credit Facilities and Commercial Paper

In addition to cash and equivalents and operating cash flow, other sources of liquidity at ~~December~~March 31, ~~2025~~2026 include a $3.0 billion commercial paper program, backed by a $2.0 billion revolving credit facility that expires in February 2028 and a $1.0 billion 364-Day revolving credit facility that expires in October 2026. We also have a $1.0 billion committed receivables sales facility through September 2028. During the three months ended March 31, 2026, under our commercial paper program and our committed receivables program, we had maximum combined total daily amounts outstanding of $2.0 billion and an average combined daily amount outstanding of $179 million. At ~~December~~March 31, ~~2025~~2026, we had no amounts outstanding under our commercial paper program, revolving credit facilities, or our committed receivables sales facility.

In September 2025, we renewed our committed receivables sales facility program through Cardinal Health 23 Funding, LLC ("CHF") through September 2028.

In October 2025, we renewed the 364-Day revolving credit facility, under which we have access to $1.0 billion of committed liquidity through October 2026.

Our revolving credit and committed receivables sales facilities require us to maintain a consolidated net leverage ratio of no more than 3.75-to-1. As of ~~December~~March 31, ~~2025~~2026, we were in compliance with this financial covenant.

Long-Term Debt and Other Short-Term Borrowings

In August 2025, we issued additional debt, with the aggregate principal amount of $1.0 billion, to fund a portion of the consideration payable in connection with the Solaris Health acquisition and for general purposes. The notes issued are $600 million aggregate principal amount of 4.5% Notes that mature on September 15, 2030 and $400 million aggregate principal amount of 5.15% Notes that mature on September 15, 2035. The proceeds of the notes issued, net of discounts, premiums, and debt issuance costs, were approximately $1.0 billion.

During the ~~six~~three months ended ~~December~~March 31, ~~2025~~2026, we ~~repaid~~made ~~the~~a ~~full~~partial principal payment of $~~500~~100 million offor the ~~3.75%~~Floating ~~Notes~~Rate ~~due~~Term ~~2025~~Loan atdue ~~maturity~~2028 with available cash.

10During ~~Cardinal~~the ~~Health~~nine |months Q2ended ~~Fiscal~~March 31, 2026, ~~Form~~we ~~10-Q~~repaid the full principal of $500 million of the 3.75% Notes due 2025 at maturity with available cash.



12			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


MD&A			Liquidity and Capital Resources

Capital Deployment

Opioid Litigation Settlements

We had $4.3 billion accrued at ~~December~~March 31, ~~2025~~2026 related to certain national opioid litigation settlements, as further described within Note 6 of the "Notes to Condensed Consolidated Financial Statements." We expect the majority of the remaining payment amounts to occur through 2038. During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we made our fifth annual payment of $366 million under National Opioid Settlement Agreement (the "NOSA") and other settlement payments of $3751 million related to the opioid litigation. The amounts of future annual payments under the NOSA may differ from the payments that we have already made.

Capital Expenditures

Capital expenditures during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025 were $~~239~~385 million and $~~189~~315 million, respectively.

Dividends

On each of May 5, 2025, August 15, 2025, ~~and~~ November 4, 2025, and February 12, 2026, our Board of Directors approved a quarterly dividend of $0.5107 per share, or $2.04 per share on an annualized basis, which were paid on July 15, 2025, October 15, 2025, ~~and~~January 15, ~~January~~2026, and April 15, 2026 to shareholders of record on July 1, 2025, October 1, 2025, ~~and~~ January 2, 2026 and April 1, 2026, respectively.

Share Repurchases

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we deployed $~~750~~1.0 ~~million~~billion for repurchases of our common shares under accelerated share repurchase ("ASR") programs. We funded the repurchases with available cash. See Note 10 of the "Notes to Condensed Consolidated Financial Statements" for additional information.

Solaris Health Acquisition

On November 3, 2025, we, through The Specialty Alliance, completed the acquisition of Solaris Health, a urology MSO, for a purchase price of approximately $1.9 billion in cash, subject to certain adjustments. In connection with the closing of this transaction, we issued common units in The Specialty Alliance to certain physicians and management which are estimated to have a grant date fair value of approximately $500 million, a portion of which will be recognized as post-combination expense. See Note 2 of the "Notes to Condensed Consolidated Financial Statements" for additional information.

1113 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


MD&A			Other Items

Other Items

The MD&A in the 2025 Form 10-K addresses our contractual obligations and cash requirements, as of and for the fiscal year ended June 30, 2025. Other than the considerations noted above in connection with the Solaris Health acquisition and our debt issuance, there have been no subsequent material changes outside of the ordinary course of business to those items. See Note 2 and Note 5 of the "Notes to Condensed Consolidated Financial Statements" for additional information.

Critical Accounting Policies and Sensitive Accounting Estimates

Critical accounting policies are those accounting policies that (i) can have a significant impact on our financial condition and results of operations and (ii) require the use of complex and subjective estimates based upon past experience and management’s judgment. Other people applying reasonable judgment to the same facts and circumstances could develop different estimates. Estimates are inherently uncertain, therefore actual results may differ, including due to the risks discussed in "Risk Factors" and other risks discussed in our 2025 Form 10-K and our other filings with the SEC since June 30, 2025. ~~There have been no material changes to our critical accounting estimates since the filing of our 2025 Form 10-K.~~

~~12 Cardinal Health | Q2 Fiscal 2026 Form 10-Q~~Goodwill

Purchased goodwill is tested for impairment annually or when indicators of impairment exist. Goodwill impairment testing involves a comparison of the estimated fair value of reporting units to the respective carrying amount, which may be performed utilizing either a qualitative or quantitative assessment. Qualitative factors are first assessed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is determined that it is more likely than not that the fair value does not exceed the carrying amount, then a quantitative test is performed. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. A reporting unit is defined as an operating segment or one level below an operating segment (also known as a component).

Our reporting units are: Pharmaceutical and Specialty Solutions (excluding Navista & ION, The Specialty Alliance), Navista & ION, The Specialty Alliance, GMPD, Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight® Logistics.

Goodwill impairment testing involves judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists, and, if necessary, the estimation of the fair value of the applicable reporting unit. Our qualitative evaluation considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

Navista & ION Goodwill

Due to certain reductions in our long-term financial plan assumptions during the three months ended March 31, 2026, we elected to bypass the qualitative assessment and perform quantitative goodwill impairment testing for Navista & ION. Our determination of the estimated fair value of the Navista & ION Unit is based on a combination of the income-based approach (using a

discount rate of 10.5 percent and a terminal growth rate of 3 percent), and a market-based approach. Additionally, we assigned a weighting of 80 percent to the discounted cash flow method and 20 percent to the guideline public company method. The carrying amount exceeded the estimated fair value, which resulted in a pre-tax impairment charge of $184 million for Navista & ION, which was recognized during the three months ended March 31, 2026 and is included in impairments and (gain)/loss on disposal of assets, net in our condensed consolidated statements of earnings. The impairment charge was primarily due to changes in the risk profile of the business plans, resulting in an increase in the discount rate. These changes reflect business model updates and base operational performance. The carrying value of Navista & ION at March 31, 2026 after recognizing the impairment charge was $1.1 billion, of which $909 million was goodwill. See Note 4 of the "Notes to Condensed Consolidated Financial Statements" for further discussion.

While we consider the assumptions used in our determination of the estimated fair value of Navista & ION to be reasonable and appropriate, they are complex and subjective, and additional adverse changes in one key assumption or a combination of key assumptions during fiscal 2026 may significantly affect future estimates. These assumptions include, among other things, a failure to meet expected earnings or other financial plans, including the execution of new opportunities as a result of the business model change, a decrease in future cash flows, an increase in the discount rate or a decrease in the terminal growth rate; increases in tax rates; or a significant change in industry or economic trends.

Adverse changes in key assumptions may result in a decline in fair value below the carrying value in the future and therefore, an impairment for Navista & ION goodwill in future periods, which could adversely affect our results of operations. For example, if we were to increase the discount rate by a hypothetical 0.5 percent to 11.0 percent or decrease the terminal growth rate by a hypothetical 1.0 percent to 2.0 percent, the fair value for Navista & ION would have further decreased by approximately $70 million.



14			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Explanation and Reconciliation of Non-GAAP Financial Measures

Explanation and Reconciliation of Non-GAAP Financial Measures

The "Overview of Consolidated Results" section within MD&A in this Form 10-Q contains financial measures that are not calculated in accordance with GAAP.

In addition to analyzing our business based on financial information prepared in accordance with GAAP, we use these non-GAAP financial measures internally to evaluate our performance, engage in financial and operational planning, and determine incentive compensation because we believe that these measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of our underlying, ongoing business. We provide these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on our financial and operating results on a year-over-year basis and in comparing our performance to that of our competitors. However, the non-GAAP financial measures that we use may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by us should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth below should be carefully evaluated.

Exclusions from Non-GAAP Financial Measures

Management believes it is useful to exclude the following items from the non-GAAP measures presented in this report for its own and for investors’ assessment of the business for the reasons identified below:

•LIFO charges and credits are excluded because the factors that drive last-in first-out ("LIFO") inventory charges or credits, such as pharmaceutical manufacturer price appreciation or deflation and year-end inventory levels (which can be meaningfully influenced by customer buying behavior immediately preceding our fiscal year-end), are largely out of our control and cannot be accurately predicted. The exclusion of LIFO charges and credits from non-GAAP metrics facilitates comparison of our current financial results to our historical financial results and to our peer group companies’ financial results. We did not recognize any LIFO charges or credits during the periods presented.

•State opioid assessments related to prior fiscal years is the portion of state assessments for prescription opioid medications that were sold or distributed in periods prior to the period in which the expense is incurred. This portion is excluded from non-GAAP financial measures because it is retrospectively applied to sales in prior fiscal years and inclusion would obscure analysis of the current fiscal year results of our underlying, ongoing business. Additionally, while states' laws may require us to make payments on an ongoing basis, the portion of the assessment related to sales in prior periods are contemplated to be one-time, nonrecurring items. Income from state opioid assessments related to prior fiscal years represents reversals of accruals due to changes in estimates or when the underlying assessments were invalidated by a ~~Court~~court or reimbursed by manufacturers.

•Restructuring and employee severance costs are excluded because they are not part of the ongoing operations of our underlying business and include, but are not limited to, costs related to divestitures, closing and consolidating facilities, changing the way we manufacture or distribute our products, moving manufacturing of a product to another location, changes in production or business process outsourcing or insourcing, employee severance, and realigning operations.

•Amortization and other acquisition-related costs, which include transaction costs, integration costs, and changes in the fair value of contingent consideration obligations, are excluded because they are not part of the ongoing operations of our underlying business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies' financial results. Additionally, costs for amortization of acquisition-related intangible assets and amortization as a result of basis differences in equity method investments are non-cash amounts, which are variable in amount and frequency and are significantly impacted by the timing and size of acquisitions, so their exclusion facilitates comparison of historical, current, and forecasted financial results. We also exclude other acquisition-related costs, which are directly related to an acquisition but do not meet the criteria to be recognized on the acquired entity’s initial balance sheet as part of the purchase price allocation. These costs are also significantly impacted by the timing, complexity, and size of acquisitions.

•Acquisition-related cash and share-based compensation costs are incurred in connection with contingent cash payments or the issuance of share-based payment awards, which include service requirements, as a part of certain physician practice acquisitions. These costs include fair value adjustments for liability-classified awards. These costs are excluded because they are unrelated to the underlying operating results of our business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies’ financial results. In addition, the magnitude of these expenses is significantly impacted by the timing and size of the acquisitions of physician practices.

1315 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Explanation and Reconciliation of Non-GAAP Financial Measures

historical financial results and to our peer group companies’ financial results. In addition, the magnitude of these expenses is significantly impacted by the timing and size of the acquisitions of physician practices.

•Impairments and gain or loss on disposal of assets, net are excluded because they do not occur in or reflect the ordinary course of our ongoing business operations and are inherently unpredictable in timing and amount, and in the case of impairments, are non-cash amounts, so their exclusion facilitates comparison of historical, current, and forecasted financial results.

•Litigation recoveries or charges, net are excluded because they often relate to events that may have occurred in prior or multiple periods, do not occur in or reflect the ordinary course of our business and are inherently unpredictable in timing and amount.

The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded. The gross, tax and net impact of each item are presented with our GAAP to non-GAAP reconciliations.

Definitions

Growth rate calculation: growth rates in this report are determined by dividing the difference between current-period results and prior-period results by prior-period results.

Non-GAAP operating earnings: operating earnings excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net.

Non-GAAP earnings before income taxes: earnings before income taxes excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net.

Non-GAAP net earnings attributable to non-controlling interests: net earnings attributable to non-controlling interests excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, each net of tax.

Non-GAAP net earnings attributable to Cardinal Health, Inc.: net earnings attributable to Cardinal Health, Inc. excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, each net of tax.

Non-GAAP effective tax rate: provision for income taxes adjusted for the tax impacts of (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) restructuring and employee severance, (4) amortization and other acquisition-related costs, (5) acquisition-related cash and share-based compensation costs, (6) impairments and (gain)/loss on disposal of assets, net, and (7) litigation (recoveries)/charges, net, divided by (earnings before income taxes adjusted for the items above).

Non-GAAP diluted earnings per share attributable to Cardinal Health, Inc.: non-GAAP net earnings attributable to Cardinal Health, Inc. divided by diluted weighted-average shares outstanding.

1416 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Explanation and Reconciliation of Non-GAAP Financial Measures

GAAP to Non-GAAP Reconciliation

(in millions, except per common share amounts)	Operating Earnings		Operating Earnings Growth Rate		Earnings Before Income Taxes		Provision for Income Taxes		Net (Earnings)/Loss Attributable to Non-controlling Interests		Net Earnings1		Net Earnings1 Growth Rate		Diluted EPS1		Diluted EPS1 Growth Rate
	Three Months Ended December 31, 2025
	Three Months Ended March 31, 2026
GAAP	$	~~707~~509	29(30)	%	$	~~630~~392	$	~~159~~12	$	~~(4)~~19	$	~~467~~399	17(21)	%	$	1.9769	19(20)	%
State opioid assessments related to prior fiscal years	(17)				(17)		(4)				(13)				(0.05)
Restructuring and employee severance	25				25		6		—		19				0.08
Restructuring and employee severance	21				21		5				16				0.07
Amortization and other acquisition-related costs	114				114		43		—		71				0.30
Amortization and other acquisition-related costs	130				130		20				110				0.46
Acquisition-related cash and share-based compensation costs	112				112		4		—		108				0.46
Acquisition-related cash and share-based compensation costs	67				67		4				63				0.27
Impairments and (gain)/loss on disposal of assets, net 2	185				185		22		(23)		140				0.59
Impairments and (gain)/loss on disposal of assets, net	(14)				(14)		(3)				(11)				(0.06)
Litigation (recoveries)/charges, net	11				11		(2)		—		13				0.06
Litigation (recoveries)/charges, net	(18)				(18)		(8)				(10)				(0.04)
Non-GAAP	$	956	18	%	$	840	$	86	$	(4)	$	750	32	%	$	3.17	35	%
Non-GAAP	$	877	38	%	$	799	$	171	$	(4)	$	624	33	%	$	2.63	36	%
	Three Months Ended March 31, 2025
	Three Months Ended December 31, 2024
GAAP	$	730	98	%	$	665	$	157	$	(2)	$	506	94	%	$	2.10	96	%
GAAP	$	549	9	%	$	511	$	110	$	(1)	$	400	9	%	$	1.65	10	%
Restructuring and employee severance	28				28		7				21				0.09
Restructuring and employee severance	9				9		2				7				0.03
Amortization and other acquisition-related costs	152				152		34		(2)		116				0.48
Amortization and other acquisition-related costs	105				105		27				78				0.32
Acquisition-related cash and share-based compensation costs	20				20		1		(4)		15				0.06
Impairments and (gain)/loss on disposal of assets, net	3(17)				3(17)		1(4)				2(13)				(0.0106)
Litigation (recoveries)/charges, net	(31105)				(31105)		(1227)				(1978)				(0.0832)
Non-GAAP	$	~~635~~807	921	%	$	~~597~~741	$	~~127~~166	$	(17)	$	~~468~~568	111	%	$	12.9335	213	%
	Six Months Ended December 31, 2025
	Nine Months Ended March 31, 2026
GAAP	$	1,~~375~~884	232	%	$	1,~~228~~620	$	~~303~~315	$	~~(8)~~11	$	~~917~~1,316	12—	%	$	35.8554	152	%
State opioid assessments related to prior fiscal years	(17)				(17)		(4)		—		(13)				(0.05)
Restructuring and employee severance	4166				4166		915		—		3251				0.1321
Amortization and other acquisition-related costs	~~234~~348				~~234~~348		4992		—		~~185~~256				01.7808
Acquisition-related cash and share-based compensation costs	~~131~~243				~~131~~243		59		—		~~126~~234				0.5398
Impairments and (gain)/loss on disposal of assets, net	(12)				(12)		(3)				(9)				(0.03)
Impairments and (gain)/loss on disposal of assets, net 2	173				173		19		(23)		131				0.56
Litigation (recoveries)/charges, net	(187)				(187)		(1416)		—		~~(4)~~9				(0.~~02)~~04
Non-GAAP	$	12,~~734~~690	3830	%	$	12,~~587~~426	$	~~344~~430	$	(812)	$	1,~~235~~984	33	%	$	58.1835	36	%
	Six Months Ended December 31, 2024
	Nine Months Ended March 31, 2025
GAAP	$	1,~~117~~847	N.M.		$	1,~~052~~717	$	~~234~~391	$	(24)	$	~~816~~1,322	N.M.		$	35.3544	N.M.
Restructuring and employee severance	3361				3361		815				2546				0.1019
Amortization and other acquisition-related costs	~~179~~331				~~179~~331		4781		(2)		~~132~~248				01.5402
Impairments and (gain)/loss on disposal of assets, net	2				2		—				2				0.01
Acquisition-related cash and share-based compensation costs	20				20		1		(4)		15				0.06
Litigation (recoveries)/charges, net	(71)				(71)		(24)				(47)				(0.19)
Impairments and (gain)/loss on disposal of assets, net	(15)				(15)		(4)				(11)				(0.04)
Non-GAAP	$	1,260	10	%	$	1,195	$	266	$	(2)	$	927	4	%	$	3.81	6	%
Litigation (recoveries)/charges, net	(176)				(176)		(51)				(125)				(0.51)
Non-GAAP	$	2,067	14	%	$	1,937	$	431	$	(10)	$	1,495	6	%	$	6.16	8	%

1 Attributable to Cardinal Health, Inc.

2 For both the three and nine months ended March 31, 2026, impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $184 million related to the Navista & ION reporting unit within the Pharma segment. For fiscal 2026, the estimated net tax benefit related to the impairments is $23 million and is included in the annual effective tax rate. The portion of the goodwill impairment charge attributable to noncontrolling interests is $23 million.

The sum of the components and certain computations may reflect rounding adjustments.

We apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.

1517 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Other

Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in the quantitative and qualitative market risk disclosures included in the 2025 Form 10-K since the end of fiscal 2025 through ~~December~~March 31, ~~2025~~2026.

Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We evaluated, with the participation of our principal executive officer and principal financial officer, the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the "Exchange Act")) as of ~~December~~March 31, ~~2025~~2026. Based on this evaluation, our principal executive officer and principal financial officer have concluded that as of ~~December~~March 31, ~~2025~~2026, our disclosure controls and procedures were effective to provide reasonable assurance that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to management as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended ~~December~~March 31, ~~2025~~2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Modification of Certain Software Systems

The Pharma segment is in the process of modifying certain finance and operating information systems related to ongoing supply chain optimization initiatives. If these systems and processes are not effectively implemented or fail to operate as intended, it could adversely affect our internal control over financial reporting.

1618 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Other

Legal Proceedings

The legal proceedings described in Note 6 of the "Notes to Condensed Consolidated Financial Statements" are incorporated in this "Legal Proceedings" section by reference.

Risk Factors

You should carefully consider the information in this Form 10-Q and the risk factors discussed in "Risk Factors" and other risks discussed in the 2025 Form 10-K, our Form 10-Q for the ~~quarter~~quarters ended September 30, 2025 and December 31, 2025, and our other filings with the SEC since June 30, 2025. These risks could materially and adversely affect our results of operations, financial condition, liquidity, and cash flows. Our business also could be affected by risks that we are not presently aware of or that we currently consider immaterial to our operations.

Changes or uncertainty in U.S. or international trade policies and exposure to economic, political and currency, and other risks could disrupt our global operations or negatively impact our financial results.

We conduct our operations in various regions of the world outside of the United States, including Europe, Asia, and Latin America. Global developments can affect our business in many ways. Our global operations are affected by local economic environments, including inflation, recession, and competition. Additionally, divergent or unfamiliar regulatory systems and labor markets can increase the risks and burdens of operating in numerous countries.

In February 2025, the United States imposed tariffs under the International Emergency Economic Powers Act (IEEPA) on certain goods, materials and products imported into the United States from countries where we do business. In February 2026, the U.S. Supreme Court ruled that the IEEPA tariffs were unlawful but did not establish a mechanism for issuing refunds and uncertainty remains concerning the timing, scope and administrative process to receive refunds for IEEPA tariffs paid. In April 2026, Customs and Border Protection (CBP) launched its program to administer Phase 1 refund requests; however, substantially all of our IEEPA tariffs will fall under Phase 2 or later phases. CBP has not communicated a date on which the refund process for such Phase 2 or later phases will be established or available.

As of the third quarter of fiscal year 2026, we have paid approximately $200 million in IEEPA tariffs, primarily related to products that we source, manufacture or distribute in our GMPD segment. In the event that we receive refunds of IEEPA tariffs from the government, we expect to return to those customers the portion of those refunds that reflect the estimated increased prices related to IEEPA tariffs.

We have not recognized any financial impact related to potential tariff refunds or payments to our customers as of March 31, 2026. The ultimate resolution of this matter could positively impact our results of operations in future periods, including GMPD segment profit and consolidated operating income; however the timing and process for receipt of these refunds remains uncertain.

We have taken actions to reduce the impact of IEEPA and other tariffs on our financial results, including through cost optimization initiatives and by increasing prices on impacted products to customers; however, these measures have not fully offset the negative impact. Tariffs imposed or threatened to be imposed on goods, materials, and products from countries where we do business, and any retaliatory actions taken by such countries could result in us incurring substantial additional costs to source materials, directly and indirectly, from affected countries, and require us to raise prices on certain products and seek alternative sources of supply. If our competitors do not increase prices, or increase prices to a lesser extent than we do, or are able to offset the impact of tariffs through other actions, our competitive and financial position may be adversely affected. Additionally, if we are not able to find adequate alternate sources of supply, we may experience supply shortages or disruptions. Additionally, in certain circumstances, including in our Other operating segment, we may not receive increased reimbursement commensurate with the increase in costs, which may negatively impact our results of operations.

In addition, we conduct our business in U.S. dollars and various functional currencies of our foreign subsidiaries. Changes in foreign currency exchange rates could adversely affect our financial results, which are reported in U.S. dollars. We may not be able to hedge to protect us against these exposures, and any hedges may not successfully mitigate these exposures.

We are also subject to government import and export controls and regulations, including the requirement that we make a determination as to the country of origin of products that we source or manufacture outside the United States. From time to time, Customs and Border protection agencies, whether in the U.S. or other jurisdictions, have challenged these determinations. These and other actions by border protection have resulted in products being detained or delayed and supply disruptions and could result in the imposition of fines and penalties. In addition, the Uyghur Forced Labor Prevention Act, which went into effect in June 2022, prohibits the importation of any goods grown, produced, manufactured, or mined, wholly or in part, in the Xinjiang Uyghur Autonomous Region of China unless importers can provide clear and convincing evidence that goods were not made using forced labor. We have experienced supply constraints as a result



19			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Other

of these and similar regulations, and it is possible that our business or results of operations could be further negatively impacted by future determinations and disruptions.

Our business is affected by events outside of our control including public health crises, extreme weather-related events and natural disasters, geopolitical, and other catastrophic events.

We have experienced and expect to continue to experience weather-related impacts to the business, primarily driven by risks to certain physical components of our operations and risks related to the transition to a lower-carbon economy. For example, our properties have experienced physical damage resulting from adverse or extreme weather resulting in increased costs for repairs and may cause disruptions in operations. Additional risks associated with extreme weather may cause social and human effects such as shifts in populations, increased costs for critical services such as transportation, and other adverse effects. These factors may negatively impact cost or availability of certain products, commodities, or energy, and could impair our ability to secure goods and services required for the operation of our business at quantities and levels we require.

Environmental and other climate-related laws and regulations may impose costs, including increased spend associated with carbon pricing mechanisms, data gathering and reporting, third-party attestations, capital expenditures to implement lower greenhouse gas emissions technology, and other measures to reduce emissions. We cannot predict the potential impact on our competitive position, results of operations, or financial condition. A shift in customer or consumer preference towards low-carbon products and services may also place us at a competitive disadvantage if we fail to effectively adjust for these shifts. Our supply chain is subject to these same physical and transitional risks.

Events outside of our control also have, and will continue to, adversely impact our operations and financial results. These events include those related to public health crises, including epidemics or pandemics; geopolitical events or tensions, including civil unrest, trade sanctions, tariffs and other trade restrictions, armed conflicts, or terrorism; or unstable international governments and legal systems. Among other potential affects, these events may have a disruptive and unpredictable impact on our operations and those of our suppliers and vendors, or customers, hinder manufacturing and transportation, result in significant excess costs, lead to shifts in customer demand, or have a negative impact on capital markets. For example, the recent conflict in Iran has resulted increased fuel prices which may lead to increased costs for products that we source, manufacture or distribute and may also cause supply chain or manufacturing disruptions, impacting our ability to meet demand. Such events are inherently unpredictable, and our responses may involve the implementation of measures which may not be as successful as intended in mitigating adverse impacts.

Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

Period	Total Numberof SharesPurchased (1,2,3)	Average Price Paid per Share (2,3)		Total Number of SharesPurchasedas Part of Publicly Announced Programs (2,3,4)	ApproximateDollar Value ofShares That MayYet be PurchasedUnder the Program (43)(in millions)
October 2025	443,682	$	151.88	443,675	$	2,368
January 2026	22	$	216.55	—	$	1,993
November 2025	1,577,127	190.22		1,577,121	2,068
February 2026	8	237.13		—	1,993
December 2025	297,898	200.00		297,892	1,993
March 2026	928,446	215.42		928,419	1,793
Total	2928,~~318,707~~476	$	~~184~~215.1543	2928,~~318,688~~419	$	1,~~993~~793

(1)Reflects 722, 68, and 627 common shares purchased in ~~October~~January, ~~November~~February, and ~~December~~March ~~2025~~2026, respectively, through a rabbi trust as investments of participants in our Deferred Compensation Plan.

(2)On ~~November~~March 312, ~~2025~~2026, we entered into an ASR program to purchase common shares for an aggregate purchase price of $~~375~~250 million and received an initial delivery of 10.69 million common shares using a reference price of $~~190~~215.2242. The ASR program concluded on ~~December~~April 1520, ~~2025~~2026 at a volume weighted average price per common share of $~~200~~209.0055 resulting in a final delivery of 0.3 million common shares. See Note 10 of the "Notes to Condensed Consolidated Financial Statements" for additional information.

(3)On ~~August~~June 137, ~~2025~~2023, weour ~~entered~~Board ~~into an ASR program to purchase common shares for an aggregate purchase price~~ of ~~$375~~Directors ~~million~~approved ~~and received an initial delivery of 2.0 million common shares using~~ a ~~reference price of~~ $~~148~~3.~~12.~~5 billion ~~The~~share ~~ASR~~repurchase program, ~~concluded~~which will expire on ~~October~~December 31, ~~2025~~2027. atAs aof ~~volume~~March ~~weighted~~31, ~~average~~2026, ~~price~~we ~~per~~had ~~common share of~~ $~~151~~1.~~88 resulting in a final delivery of 0.4~~8 ~~million~~billion ~~common~~authorized ~~shares.~~for ~~See~~share ~~Note~~repurchases 10remaining ofunder ~~the~~this ~~"Notes to Condensed Consolidated Financial Statements" for additional information~~program.

~~(4)On~~20 ~~June~~Cardinal 7,Health ~~2023,~~| ~~our~~Q3 ~~Board~~Fiscal of2026 ~~Directors~~Form ~~approved a $3.5 billion share repurchase program, which will expire on December 31, 2027. As of December 31, 2025, we had $2.0 billion authorized for share repurchases remaining under this program.~~10-Q


Other

Other Information

Rule 10b5-1 Plan Adoptions and Modifications

During the three months ended ~~December~~March 31, ~~2025~~2026, no director or officer adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule10b5-1 trading arrangement" as each term is defined in Item 408 of Regulation S-K under the Exchange Act.

1721 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Financial Statements

Condensed Consolidated Statements of Earnings

(Unaudited)

Three Months Ended December 31,

Six Months Ended December 31,

Three Months Ended March 31,

Nine Months Ended March 31,

(in millions, except per common share amounts)

~~2025~~2026

~~2024~~2025

~~2025~~2026

~~2024~~2025

Revenue

6560,~~627~~940

5554,~~264~~878

~~129~~190,~~636~~576

~~107~~162,~~541~~419

Cost of products sold

6358,~~230~~442

5352,~~323~~755

~~124~~183,~~920~~362

~~103~~156,~~698~~453

Gross margin

2,~~397~~498

12,~~941~~123

47,~~716~~214

35,~~843~~966

Operating expenses:

Distribution, selling, general and administrative expenses

1,~~504~~542

1,~~306~~315

24,~~965~~507

23,~~583~~898

Restructuring and employee severance

2125

928

4166

3361

Amortization and other acquisition-related costs

~~130~~114

~~105~~152

~~234~~348

~~179~~331

Acquisition-related cash and share-based compensation costs

67112

—20

~~131~~243

—20

Impairments and (gain)/loss on disposal of assets, net

~~(14)~~185

3(17)

~~(12)~~173

2(15)

Litigation (recoveries)/charges, net

~~(18)~~11

(31105)

(187)

(71176)

Operating earnings

~~707~~509

~~549~~730

1,~~375~~884

1,~~117~~847

Other (income)/expense, net

~~(11)~~16

3(9)

(215)

(211)

Interest expense, net

88101

3574

~~168~~269

67141

Earnings before income taxes

~~630~~392

~~511~~665

1,~~228~~620

1,~~052~~717

Provision for income taxes

~~159~~12

~~110~~157

~~303~~315

~~234~~391

Net earnings

~~471~~380

~~401~~508

~~925~~1,305

~~818~~1,326

Less: Net earnings attributable to noncontrolling interests

(4)

(1)

(8)

(2)

Less: Net (earnings)/loss attributable to noncontrolling interests

(2)

(4)

Net earnings attributable to Cardinal Health, Inc.

~~467~~399

~~400~~506

~~917~~1,316

~~816~~1,322

Earnings per common share attributable to Cardinal Health, Inc.:

Basic

1.9869

12.6511

35.8756

35.3747

Diluted

1.9769

12.6510

35.8554

35.3544

Weighted-average number of common shares outstanding:

Basic

~~236~~235

~~242~~240

237

242

Diluted

~~237~~236

~~243~~241

238

243

Cash dividends declared per common share

0.5107

0.5056

1.~~0214~~5321

1.~~0112~~5168

See notes to condensed consolidated financial statements.

1822 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Financial Statements

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

	Three Months Ended December 31,				Six Months Ended December 31,
	Three Months Ended March 31,				Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025		~~2025~~2026		~~2024~~2025
Net earnings	$	~~471~~380	$	~~401~~508	$	~~925~~1,305	$	~~818~~1,326
Other comprehensive income/(loss):
Foreign currency translation adjustments and other	9(2)		(162)		53		(1113)
Net unrealized loss on derivative instruments, net of tax	(3)		(9)		(3)		(2)
Net unrealized gain/(loss) on derivative instruments, net of tax	(6)		6		(9)		4
Total other comprehensive income/(loss), net of tax	6(8)		~~(25)~~4		2(6)		(139)
Total comprehensive income	~~477~~372		~~376~~512		~~927~~1,299		~~805~~1,317
Less: comprehensive income attributable to noncontrolling interests	(4)		(1)		(8)		(2)
Less: comprehensive (income)/loss attributable to noncontrolling interests	19		(2)		11		(4)
Total comprehensive income attributable to Cardinal Health, Inc.	$	~~473~~391	$	~~375~~510	$	~~919~~1,310	$	~~803~~1,313

See notes to condensed consolidated financial statements.

1923 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Financial Statements

Condensed Consolidated Balance Sheets

(in millions)	~~December~~March 31, ~~2025~~2026		June 30, 2025
	(Unaudited)
Assets
Current assets:
Cash and equivalents	$	23,~~777~~937	$	3,874
Trade receivables, net	13,~~662~~648		13,242
Inventories, net	2018,~~116~~007		16,831
Prepaid expenses and other	2,~~675~~472		2,414
Assets held for sale	—		12
Total current assets	3938,~~230~~064		36,373
Property and equipment, net	2,~~877~~928		2,858
Goodwill and other intangibles, net	13,~~978~~698		12,177
Other assets	1,~~998~~999		1,714
Total assets	$	5856,~~083~~689	$	53,122
Liabilities and Shareholders’ Deficit
Current liabilities:
Accounts payable	$	3837,~~996~~834	$	34,713
Current portion of long-term obligations and other short-term borrowings	~~680~~671		550
Other accrued liabilities	3,~~638~~484		3,634
Total current liabilities	4341,~~314~~989		38,897
Long-term obligations, less current portion	8,~~347~~245		7,977
Deferred income taxes and other liabilities	9,~~122~~127		8,882
Shareholders’ deficit:
Preferred shares, without par value:
Authorized—500 thousand shares, Issued—none	—		—
Common shares, without par value:
Authorized—755 million shares, Issued—271 million shares at December 31, 2025 and June 30, 2025	2,847		2,956
Authorized—755 million shares, Issued—271 million shares at March 31, 2026 and June 30, 2025	2,815		2,956
Retained earnings	1,~~455~~732		783
Common shares in treasury, at cost: 35 million shares and 32 million shares at December 31, 2025 and June 30, 2025, respectively	(7,033)		(6,365)
Common shares in treasury, at cost: 36 million shares and 32 million shares at March 31, 2026 and June 30, 2025, respectively	(7,218)		(6,365)
Accumulated other comprehensive loss	(~~153~~161)		(155)
Total Cardinal Health, Inc. shareholders' deficit	(2,~~884~~832)		(2,781)
Noncontrolling interests	~~184~~160		147
Total shareholders’ deficit	(2,~~700~~672)		(2,634)
Total liabilities and shareholders’ deficit	$	5856,~~083~~689	$	53,122

See notes to condensed consolidated financial statements.

2024 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Financial Statements

Condensed Consolidated Statements of Shareholders' Deficit

(Unaudited)

	Common Shares			Retained Earnings/(Accumulated Deficit)		Treasury Shares			Accumulated OtherComprehensiveLoss		Noncontrolling Interests		TotalShareholders’ Deficit
(in millions)	Shares Issued	Amount				Shares	Amount
	Three Months Ended December 31, 2025
	Three Months Ended March 31, 2026
Balance at September 30, 2025	271	$	2,746	$	1,116	(33)	$	(6,582)	$	(159)	$	148	$	(2,731)
Net earnings				467							4		471
Other comprehensive income, net of tax									6				6
Acquisitions											33		33
Employee stock plans activity, net of shares withheld for employee taxes	—	26				—	3						29
Share repurchase program activity	—	75				(2)	(454)						(379)
Dividends declared				(128)									(128)
Payments to noncontrolling interests											(1)		(1)
Balance at December 31, 2025	271	$	2,847	$	1,455	(35)	$	(7,033)	$	(153)	$	184	$	(2,700)
Net earnings				399							(19)		380
Other comprehensive loss, net of tax									(8)				(8)
Acquisitions											(1)		(1)
Employee stock plans activity, net of shares withheld for employee taxes	—	18				—	16						34
Share repurchase program activity		(50)				(1)	(201)						(251)
Dividends declared				(121)									(121)
Payments to noncontrolling interests											(4)		(4)
Other		—		(1)									(1)
Balance at March 31, 2026	271	$	2,815	$	1,732	(36)	$	(7,218)	$	(161)	$	160	$	(2,672)

	Three Months Ended December 31, 2024
	Three Months Ended March 31, 2025
Balance at September 30, 2024	327	$	2,827	$	14	(85)	$	(5,963)	$	(155)	$	1	$	(3,276)
Net earnings				400							1		401
Other comprehensive loss, net of tax									(25)				(25)
Acquisitions											72		72
Employee stock plans activity, net of shares withheld for employee taxes	—	30				—	13						43
Share repurchase program activity	—	75				—	(76)						(1)
Retirement of treasury stock	(56)	—				56	—						—
Dividends declared				(128)									(128)
Payments to noncontrolling interests											(4)		(4)
Other				(3)									(3)
Balance at December 31, 2024	271	$	2,932	$	283	(29)	$	(6,026)	$	(180)	$	70	$	(2,921)
Net earnings				506							2		508
Other comprehensive income, net of tax									4				4
Acquisitions											963		963
Employee stock plans activity, net of shares withheld for employee taxes	—	13				—	22						35
Share repurchase program activity		—				(3)	(378)						(378)
Dividends declared				(123)									(123)
Payments to noncontrolling interests											(3)		(3)
Other		1		(2)							18		17
Balance at March 31, 2025	271	$	2,946	$	664	(32)	$	(6,382)	$	(176)	$	1,050	$	(1,898)

	Six Months Ended December 31, 2025
	Nine Months Ended March 31, 2026
Balance at June 30, 2025	271	$	2,956	$	783	(32)	$	(6,365)	$	(155)	$	147	$	(2,634)
Net earnings				~~917~~1,316							8(11)		~~925~~1,305
Other comprehensive income, net of tax									2				2
Other comprehensive loss, net of tax									(6)				(6)
Acquisitions											3231		3231
Employee stock plans activity, net of shares withheld for employee taxes	—	(~~109~~91)				1	89105						~~(20)~~14
Share repurchase program activity		(50)				(45)	(~~757~~958)						(~~757~~1,008)
Dividends declared				(~~245~~366)									(~~245~~366)
Payments to noncontrolling interests											(48)		(48)
Other	—	—		(1)							1		1—
Balance at December 31, 2025	271	$	2,847	$	1,455	(35)	$	(7,033)	$	(153)	$	184	$	(2,700)
Balance at March 31, 2026	271	$	2,815	$	1,732	(36)	$	(7,218)	$	(161)	$	160	$	(2,672)

	Six Months Ended December 31, 2024
Balance at June 30, 2024	327	$	2,917	$	(286)	(83)	$	(5,677)	$	(167)	$	1	$	(3,212)
Net earnings				816							2		818
Other comprehensive loss, net of tax									(13)				(13)
Acquisitions											72		72
Employee stock plans activity, net of shares withheld for employee taxes	—	15				1	30						45
Share repurchase program activity						(3)	(379)						(379)
Retirement of treasury stock	(56)	—				56	—						—
Dividends declared				(247)									(247)
Purchase of noncontrolling interests											(4)		(4)
Other											(1)		(1)
Balance at December 31, 2024	271	$	2,932	$	283	(29)	$	(6,026)	$	(180)	$	70	$	(2,921)



25			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Financial Statements


	Nine Months Ended March 31, 2025
Balance at June 30, 2024	327	$	2,917	$	(286)	(83)	$	(5,677)	$	(167)	$	1	$	(3,212)
Net earnings				1,322							4		1,326
Other comprehensive loss, net of tax									(9)				(9)
Acquisitions											1,035		1,035

Employee stock plans activity, net of shares withheld for employee taxes	—	28				1	52						80
Share repurchase program activity						(6)	(757)						(757)
Retirement of treasury stock	(56)	—				56	—						—
Dividends declared				(370)									(370)
Payments to noncontrolling interests											(7)		(7)
Other		1		(2)							17		16
Balance at March 31, 2025	271	$	2,946	$	664	(32)	$	(6,382)	$	(176)	$	1,050	$	(1,898)

See notes to condensed consolidated financial statements.

2126 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Financial Statements

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Cash flows from operating activities:
Net earnings	$	~~925~~1,305	$	~~818~~1,326
Adjustments to reconcile net earnings to net cash provided by/(used in) operating activities:
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	~~467~~715		~~374~~581
Impairments and loss on sale of other investments	520		2
Impairments and (gain)/loss on disposal of assets, net	~~(12)~~173		2(15)
Share-based compensation	~~180~~309		6091
Provision for bad debts	2747		2841
Change in operating assets and liabilities, net of effects from acquisitions and divestitures:
Increase in trade receivables	(~~198~~215)		(~~253~~367)
Increase in inventories	(31,~~279~~185)		(1,~~967~~209)
Increase/(decrease) in accounts payable	4,176		(470)
Increase in accounts payable	3,013		954
Repurchases of liability-classified Specialty Alliance Units	(2227)		—
Other accrued liabilities and operating items, net	(~~610~~673)		(~~637~~527)
Net cash provided by/(used in) operating activities	1,659		(2,043)
Net cash provided by operating activities	3,482		877
Cash flows from investing activities:
Acquisition of subsidiaries, net of cash acquired	(1,~~925~~967)		(13,~~076~~855)
Additions to property and equipment	(~~239~~385)		(~~189~~315)
Proceeds from disposal of property and equipment	31		—3
Proceeds from investments	27		7
Proceeds from short-term investment in time deposit	—		200
Other investing items, net	11(9)		1(2)
Net cash used in investing activities	(2,~~122~~303)		(13,~~064~~962)
Cash flows from financing activities:
Proceeds from long-term obligations, net of issuance costs	~~989~~991		2,869
Reduction of long-term obligations	(~~524~~637)		(~~423~~434)
Payments of noncontrolling interests, net	(4)		(4)
Payments to noncontrolling interests, net	(8)		(7)
Net tax withholding from share-based compensation	(8179)		(1512)
Dividends on common shares	(~~251~~371)		(~~250~~374)
Purchase of treasury shares, net	(~~758~~1,008)		(~~390~~765)
Net cash provided by/(used in) financing activities	(~~629~~1,112)		1,~~787~~277
Effect of exchange rate changes on cash and equivalents	(54)		~~(3)~~1
Net decrease in cash and equivalents	(1,097)		(1,323)
Net increase/(decrease) in cash and equivalents	63		(1,807)
Cash and equivalents at beginning of period	3,874		5,133
Cash and equivalents at end of period	$	23,~~777~~937	$	3,~~810~~326

See notes to condensed consolidated financial statements.

2227 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

Notes to Condensed Consolidated Financial Statements

1. Basis of Presentation and Summary of Significant Accounting Policies

Basis of Presentation

Our condensed consolidated financial statements include the accounts of all majority-owned or consolidated subsidiaries, and all significant intercompany transactions and amounts have been eliminated. The results of businesses acquired or disposed of are included in the condensed consolidated financial statements from the date of the acquisition or up to the date of disposal, respectively.

References to "we," "our," and similar pronouns in this Quarterly Report on Form 10-Q for the quarter ended ~~December~~March 31, ~~2025~~2026 (this "Form 10-Q") are to Cardinal Health, Inc. and its majority-owned or consolidated subsidiaries unless the context requires otherwise.

Our fiscal year ends on June 30. References to fiscal 2026 and 2025 in these condensed consolidated financial statements are to the fiscal years ending or ended June 30, 2026 and June 30, 2025, respectively.

Our condensed consolidated financial statements have been prepared in accordance with the U.S. Securities and Exchange Commission ("SEC") instructions to Quarterly Reports on Form 10-Q and include the information and disclosures required by accounting principles generally accepted in the United States ("GAAP") for interim financial reporting. The preparation of financial statements in conformity with GAAP requires us to make estimates, judgments and assumptions that affect amounts reported in the condensed consolidated financial statements and accompanying notes. Actual amounts may differ from these estimated amounts.

In our opinion, all adjustments necessary for a fair presentation of the condensed consolidated financial statements have been included, all such adjustments are of a normal and recurring nature. In addition, financial results presented for this fiscal 2026 interim period are not necessarily indicative of the results that may be expected for the full fiscal year ending June 30, 2026. These condensed consolidated financial statements are unaudited and, accordingly, should be read in conjunction with the audited consolidated financial statements and related notes contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (the "2025 Form 10-K").

Variable Interest Entities

We evaluate our ownership, contractual, and other interests in entities to determine if they are a variable interest entity (“VIE”), if we have a variable interest in those entities, and the nature and extent of those interests. These evaluations may involve management judgment and the use of estimates and assumptions based on available historical information, among other factors. Based on our evaluations, if we determine we are the primary beneficiary of such VIEs, we consolidate such entities into our financial statements.

Consolidated Variable Interest Entities

We consolidate a VIE when we have the power to direct the activities that most significantly impact the VIE’s economic performance and the obligation to absorb losses or the right to receive benefits that could be significant to the VIE and, as a result, are considered the primary beneficiary of the VIE.

In relation to the acquisition of The Specialty Alliance, we concluded that the The Specialty Alliance management services organization ("MSO") is the primary beneficiary of certain physician practices and therefore the practices are consolidated as VIEs. Additionally, in relation to the acquisition of Integrated Oncology Network ("ION"), we concluded that ION is the primary beneficiary of certain physician practices and therefore the practices are consolidated as VIEs. The Specialty Alliance and ION VIEs do not have a material impact on our condensed consolidated statements of earnings or condensed consolidated statements of cash flows. Total assets and liabilities included in the consolidated balance sheets for The Specialty Alliance and ION VIEs were $1.2 billion and $~~960~~776 million, respectively, as of ~~December~~March 31, ~~2025~~2026.

Noncontrolling Interests

Noncontrolling interests represent the portion of net earnings, comprehensive income, and net assets that is not attributable to Cardinal Health, Inc. Noncontrolling interests as of ~~December~~March 31, ~~2025~~2026 primarily represents third-party equity interests in ION. ~~See Note 2, for additional information on the acquisition of ION.~~

Recently Issued Financial Accounting Standards

and Disclosure Rules Not Yet Adopted

We assess the adoption impacts of recently issued accounting standards by the Financial Accounting Standards Board ("FASB") on our consolidated financial statements as well as material updates to previous assessments, if any, from the 2025 Form 10-K.

Income Tax Disclosure

In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which enhances income tax disclosures primarily related to the rate reconciliation and income taxes paid information. This guidance also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance will be effective for us in fiscal 2026 Form 10-K and will be applied on a

2328 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

~~effective for us in fiscal 2026 Form 10-K and will be applied on a~~ prospective basis. Adoption will require enhancements to our income tax disclosures but is not expected to have a significant impact on our financial reporting, or on our operational processes, controls and governance in support of the new guidance.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which requires disaggregated disclosures of certain categories of expenses which are included in any relevant income statement expense caption on an annual and interim basis. Additionally, the guidance requires the disclosure of total selling expenses and, in annual reporting periods, an entity's definition of selling expenses. This guidance will be effective for us in fiscal 2028 Form 10-K and should be applied on a prospective basis, with retrospective application permitted. We are currently evaluating the impact of adoption of this guidance on our disclosures.

Recently Adopted Financial Accounting Standards

There were no new material accounting standards adopted during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026.

2. Acquisitions

Solaris Health

Transaction and integration costs associated with the Solaris acquisition were $37 4 million and $40 44 million during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, respectively.

Advanced Diabetes Supply Group ("ADS")

On April 1, 2025, we completed the acquisition of ADS for a purchase price of approximately $1.0 billion in cash~~, subject to certain adjustments~~.

Transaction and integration costs associated with the ADS acquisition were $36 million and $713 million during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, respectively.

GI Alliance ("GIA")

On January 30, 2025, we completed the acquisition of 73% ownership interest in GIA, now part of The Specialty Alliance, for a purchase price of approximately $2.8 billion in cash. Beginning on the third anniversary of the closing, we have the ability to exercise a call right to purchase up to 100 percent of the remaining outstanding interests.

Additionally, on May 30, 2025, we, through The Specialty Alliance, completed the acquisition of Urology America for a purchase price of $381 million in cash and equity in The Specialty Alliance.

Transaction and integration costs associated with the GIA and Urology America acquisitions were $21 million and $759 million during the three months ended March 31, 2026 and ~~six~~2025, respectively, and $8 million and $69 million during the nine months ended ~~December~~March 31, 2026 and 2025, respectively.

Integrated Oncology Network ("ION")

On December 2, 2024, we completed the acquisition of ION for a purchase price of $1.1 billion in cash.

Transaction and integration costs associated with the ION acquisition were $12 million and $186 million for the three months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively, and $24 million and $2025 million during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively.

Fair Value of Assets Acquired and Liabilities Assumed

The allocation of the purchase price for the acquisitions of Solaris Health, and Urology America, ~~ADS, and GIA~~ are not yet finalized and are subject to adjustment as we complete the valuation analysis of these acquisitions. The purchase prices are also subject to adjustment based on working capital requirements as set forth in the acquisition agreements.

The allocation of the fair value of assets acquired and liabilities assumed for the ~~ION~~acquisitions ~~acquisition~~of ~~was~~ADS, GIA, and ION were finalized during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, resulting in goodwill of $1577 million, $3.1 billion, and ~~the~~$1.1 billion, ~~noncontrolling~~respectively. ~~interest~~There ~~for~~were ~~ION~~no ~~was~~significant ~~recognized~~adjustments atto the ~~acquisition-date~~allocation of the fair value of ~~$157~~assets ~~million~~acquired and liabilities assumed for these acquisitions from those disclosed in our fiscal 2025 Form 10-K.

2429 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of the acquisition date for Solaris Health, Urology America, ADS, ~~GIA~~ and ~~ION~~GIA:

(in millions)	Solaris Health		UrologyAmerica		ADS		GIA		~~ION~~
Identifiable intangible assets:
Customer intangibles (1)	$	—	$	—	$	472	$	—	$	—
Trade names (2)	~~239~~233		33		28		200		73
Non-competition agreements (3)	39		—		—		23		—
Total identifiable intangible assets acquired	~~278~~272		33		500		223		73
Identifiable net assets/(liabilities):
Cash and equivalents	55		4		14		53		10
Trade receivables, net	~~249~~236		23		~~100~~101		~~175~~176		58
Inventories	23		3		78		21		20
Prepaid expenses and other	7374		3		72		1314		7
Property and equipment, net	5481		2827		1		6775		39
Other assets	191		41		377		~~319~~312		45
Accounts payable	(105)		(20)		(104)		(89)		~~(10)~~
Current portion of long-term obligations and other short-term borrowings	—		—		—		(1)		~~(3)~~
Other accrued liabilities	(~~195~~193)		(12)		(~~397~~391)		(~~176~~174)		~~(41)~~
Long-term obligations, less current portion	—		(6)		—		(15)		~~(14)~~
Deferred income taxes and other liabilities	(164)		(45)		(~~105~~106)		(~~889~~888)		~~(50)~~
Total identifiable net assets/(liabilities) acquired	~~459~~470		5251		~~471~~472		(~~299~~293)		~~134~~
Noncontrolling interest	—		(9)		—		—		~~(157)~~
Goodwill	1,~~681~~661		~~338~~339		~~578~~577		3,~~084~~078		~~1,092~~
Total net assets acquired	$	2,~~140~~131	$	381	$	1,049	$	2,785	$	~~1,069~~

(1) The weighted-average useful life of customer intangibles is 10 years.

(2) The weighted-average useful life of trade names ranges from 2 years to 10 years.

(3) The weighted-average useful life of non-competition agreements is 5 years.

The valuation of identifiable intangible assets utilizes significant unobservable inputs and thus represents a Level 3 nonrecurring fair value measurement. The discount rates used to arrive at the present values of the identifiable intangible assets for Solaris Health, Urology America, ADS, ~~GIA,~~ and ~~ION~~GIA ranged from 7 to 20 percent and reflect their internal rates of return and uncertainty in the cash flow projections, which is reflective of market participant assumptions.

The estimated fair value of ADS customer intangibles (payor contracts) were determined using a multi-period excess earnings method, which estimates an intangible asset's value based on the present value of the incremental after-tax cash flows (or “excess earnings”) attributable only to the intangible asset.

The fair value of the Solaris Health, Urology America, ADS, ~~GIA~~ and ~~ION~~GIA trademark intangible assets were determined utilizing the relief from royalty method, an income-based approach. Under this method, a royalty rate based on observed market royalties is applied to projected revenue supporting the trademarks and discounted to present value using an appropriate discount rate.

The fair value of the non-compete intangibles acquired from Solaris Health and GIA were determined by applying the differential cash flow method which compares the present value of cash flows with and without the non-compete agreements in place.

The vested Specialty Alliance Units, formerly referred to as GIA Units, issued in relation to the GIA acquisition were recognized at their acquisition date fair value of $739 million and are included in deferred income taxes and other liabilities in the consolidated balance sheet. The Specialty Alliance Units issued and included in the purchase price of the Solaris acquisition were recognized at their acquisition date fair value of $210 million and are included in deferred income taxes and other liabilities in the consolidated balance sheet. The valuation of The Specialty Alliance Units utilizes significant unobservable inputs and thus represents a recurring Level 3 fair value measurement. The fair value of The Specialty Alliance Units in relation to the GIA acquisition was determined using a discount rate of 9.5% and an estimated weighted average service period two years. The fair value of The Specialty Alliance Units in relation to the Solaris acquisition was determined using a discount rate of 7.5% and an estimated service period of five years.

2530 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

3. Restructuring and Employee Severance

The following tables summarize restructuring and employee severance costs:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Employee-related	$	157	$	322
Facility exit and other	618		6
Total restructuring and employee severance	$	2125	$	928

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Employee-related	$	3037	$	1941
Facility exit and other	1129		1420
Total restructuring and employee severance	$	4166	$	3361

Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated, duplicate payroll costs, and retention bonuses incurred during transition periods. Facility exit and other costs primarily consist of project consulting fees, accelerated depreciation, professional project management, and costs associated with vacant facilities.

During the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, restructuring and employee severance costs were primarily related to the implementation of certain enterprise-wide cost-savings measures and certain initiatives to rationalize our manufacturing operations.

The following table summarizes activity related to liabilities associated with restructuring and employee severance:

(in millions)	Employee-Related Costs		Facility Exitand Other Costs		Total
Balance at June 30, 2025	$	79	$	—	$	79
Additions	1925		—		1925
Payments and other adjustments	(2231)		—		(2231)
Balance at December 31, 2025	$	76	$	—	$	76
Balance at March 31, 2026	$	73	$	—	$	73

4. Goodwill and Other Intangible Assets

Goodwill

The following table summarizes the changes in the carrying amount of goodwill by segment and in total:

(in millions)	Pharmaceutical and Specialty Solutions (1)		Global Medical Products and Distribution		Other (12)		Total
Balance at June 30, 2025	$	7,943	$	—	$	1,748	$	9,691
Goodwill acquired, net of purchase price adjustments	1,~~918~~909		—		—(1)		1,~~918~~908
Balance at December 31, 2025	$	9,861	$	—	$	1,748	$	11,609
Goodwill impairment	(184)		—		—		(184)
Balance at March 31, 2026	$	9,668	$	—	$	1,747	$	11,415

(1) ~~Comprised~~At ofMarch ~~the~~31, ~~remaining operating segments~~2026, ~~Nuclear~~the ~~and~~Pharmaceutical ~~Precision~~segment ~~Health~~accumulated ~~Solutions,~~goodwill ~~at-Home~~impairment ~~Solutions~~loss ~~and~~was ~~OptiFreight® Logistics~~$184 million.

~~Goodwill~~(2) ~~increased~~Comprised inof the ~~six~~remaining ~~months~~operating ~~ended December 31~~segments, ~~2025~~Nuclear ~~primarily~~and ~~due~~Precision toHealth ~~the Solaris acquisition in the Pharma segment. Goodwill recognized in connection with the acquisition primarily represent the expected benefits from the expected growth from new customers~~Solutions, ~~the~~at-Home ~~assembled~~Solutions ~~workforce of the acquired entities~~ and ~~synergies~~OptiFreight® ~~of integrating these businesses~~Logistics. ~~Substantially all of the goodwill recorded is expected to be non-deductible for income tax purposes.~~

Due to certain reductions in our long-term financial plan assumptions made during the three months ended March 31, 2026, we elected to bypass the qualitative assessment and perform quantitative goodwill impairment testing for the Navista & ION reporting unit. This quantitative testing resulted in the carrying amount of Navista & ION exceeding the fair value, resulting in a pre-tax goodwill impairment charge of $184 million. The impairment charge recognized during the three months ended March 31, 2026 was primarily due to changes in the risk profile of the business plans, resulting in an increase in the discount rate. These changes reflect business model updates and base operational performance.

Goodwill increased in the nine months ended March 31, 2026 primarily due to the Solaris acquisition in the Pharma segment. Goodwill recognized in connection with the acquisition primarily represent the anticipated benefits from the expected growth from new customers, the assembled workforce of the acquired entities and synergies of integrating these businesses. Substantially all of the goodwill recorded is expected to be non-deductible for income tax purposes.

As described in Note 2, the purchase price and assumed fair value of acquisitions is allocated to specific assets, resulting in the carrying amount approximating the fair value as of the acquisition date. Accordingly, we expect minimal excess of estimated fair value over carrying value for recent acquisitions. We will continue to evaluate acquisitions and the related reporting units for indicators of impairment.

2631 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

Other Intangible Assets

The following tables summarize other intangible assets by class at:

December 31, 2025

March 31, 2026

(in millions)

GrossIntangible

AccumulatedAmortization

NetIntangible

Weighted- Average Remaining Amortization Period (Years)

Indefinite-life intangibles:

Trademarks and patents

1425

—

1425

N/A

Total indefinite-life intangibles

1425

—

1425

N/A

Definite-life intangibles:

Customer intangibles

3,~~632~~629

2,~~720~~768

~~912~~861

Trademarks, trade names and patents

1,~~583~~581

~~503~~530

1,~~080~~051

Developed technology and other

1,030

~~752~~766

~~278~~264

Non-Competition Agreements

111

2629

8582

Total definite-life intangibles

6,~~356~~351

4,~~001~~093

2,~~355~~258

Total other intangible assets

6,~~370~~376

4,~~001~~093

2,~~369~~283

N/A


	June 30, 2025
(in millions)	Gross Intangible		Accumulated Amortization		Net Intangible
Indefinite-life intangibles:
Trademarks and patents	$	13	$	—	$	13
Total indefinite-life intangibles	13		—		13

Definite-life intangibles:
Customer intangibles	3,876		2,639		1,237
Trademarks, trade names and patents	1,340		459		881
Developed technology and other	1,030		726		304
Non-Competition Agreements	72		21		51
Total definite-life intangibles	6,318		3,845		2,473
Total other intangible assets	$	6,331	$	3,845	$	2,486

Total amortization of intangible assets was $8495 million and $6977 million for the three months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively, and $~~171~~266 million and $~~137~~214 million for the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively.

The following table summarizes the estimated amortization expense for the remainder of fiscal 2026 through fiscal 2030:

(in millions)	Estimated Amortization Expense
2026	$	~~193~~97
2027	382
2028	349
2029	327
2030	306

5. Long-Term Obligations and Other Short-Term Borrowings

The following table summarizes long-term obligations and other short-term borrowings at:

(in millions) (1)	~~December~~March 31, ~~2025~~2026		June 30, 2025
3.75% Notes due 2025	$	—	$	501
4.7% Notes due 2026	499		498
3.41% Notes due 2027	1,~~210~~214		1,206
5.125% Notes due 2029	646		645
5.0% Notes due 2029	745		745
4.5% Notes due 2030	~~594~~595		—
5.45% Notes due 2034	~~501~~500		501
5.35% Notes due 2034	990		989
5.15% Notes due 2035	~~393~~392		—
4.6% Notes due 2043	~~326~~328		323
4.5% Notes due 2044	~~339~~338		338
4.9% Notes due 2045	~~439~~437		438
4.368% Notes due 2047	~~566~~565		566
5.75% Notes due 2054	641		641
7.0% Debentures due 2026	124		124
Floating Rate Term Loan due 2028	~~799~~699		799
Other Obligations	~~215~~203		213
Total	98,~~027~~916		8,527
Less: current portion of long-term obligations and other short-term borrowings	~~680~~671		550
Long-term obligations, less current portion	$	8,~~347~~245	$	7,977

(1) Maturities are presented on a calendar year basis.

Maturities of existing long-term obligations and other short-term borrowings for the remainder of fiscal 2026 through fiscal 2030 and thereafter are as follows:

2732 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

(in millions)	Debt maturities
2026	$	2714
2027	1,~~882~~888
2028	~~839~~740
2029	~~674~~676
2030	~~766~~768
Thereafter	4,~~839~~830
Total debt and finance lease obligations	$	98,~~027~~916

Long-Term Debt

We had total long-term obligations, including the current portion and other short-term borrowings, of $98.09 billion and $8.5 billion at ~~December~~March 31, ~~2025~~2026 and June 30, 2025, respectively. All the notes represent unsecured obligations of Cardinal Health, Inc. and rank equally in right of payment with all of our existing and future unsecured and unsubordinated indebtedness. Interest is paid pursuant to the terms of the obligations. These notes are effectively subordinated to the liabilities of our subsidiaries, including trade payables of $3937.08 billion and $34.7 billion at ~~December~~March 31, ~~2025~~2026 and June 30, 2025, respectively.

During the three months ended March 31, 2026, we made a partial principal payment of $100 million for the Floating Rate Term Loan due 2028 with available cash.

During the three months ended September 30, 2025, we repaid the full principal of $500 million of the 3.75% Notes due 2025 at maturity with available cash.

If we undergo a change of control, as defined in the notes, and if the notes receive specified ratings below investment grade by each of Standard & Poor's Ratings Services, Moody's Investors Services, and Fitch Ratings, any holder of the notes, excluding the debentures, can require with respect to the notes owned by such holder, or we can offer, to repurchase the notes at 101% of the principal amount plus accrued and unpaid interest.

Other Financing Arrangements

In addition to cash and equivalents and operating cash flow, other sources of liquidity at ~~December~~March 31, ~~2025~~2026 include a $3.0 billion commercial paper program backed by a $2.0 billion revolving credit facility that expires in February 2028 and a $1.0 billion 364-Day revolving credit facility that expires in October 2026. We also had a $1.0 billion committed receivables sales facility through September 2028. During the three months ended March 31, 2026, under our commercial paper program and our committed receivables program, we had maximum combined total daily amounts outstanding of $2.0 billion and an average combined daily amount outstanding of $179 million. At ~~December~~March 31, ~~2025~~2026, we had no amounts outstanding under our commercial paper program, revolving credit facility, or our committed receivables sales facility.

In September 2025, we renewed our committed receivables sales facility program through Cardinal Health 23 Funding, LLC (“CHF”) through September 28, 2028.

In October 2025, we renewed the 364-Day revolving credit facility, under which we have access to $1.0 billion of committed liquidity through October 6, 2026.

6. Commitments, Contingent Liabilities and Litigation

Commitments

Generic Sourcing Venture with CVS Health

In July 2014, we established Red Oak Sourcing, LLC ("Red Oak Sourcing"), a U.S.-based generic pharmaceutical sourcing venture with CVS Health for an initial term of 10 years. Red Oak Sourcing negotiates generic pharmaceutical supply contracts on behalf of its participants. In August 2021, we amended our agreement to extend the term through June 2029. We are required to make quarterly payments to CVS Health for the term of the arrangement.

Contingencies

New York Opioid Stewardship Act

In 2018, the State of New York adopted the Opioid Stewardship Act (the "OSA"), which created an aggregate $100 million annual assessment on all manufacturers and distributors that was assessed based on each manufacturer or distributor's share of the total morphine milligram equivalents sold or distributed in New York, the applicability of which was ultimately limited to two years (2017 and 2018).

Since fiscal 2021, we have made certain payments to New York State for our portion of the assessment. However, we, and other distributors, challenged the OSA as unconstitutional. In May 2024, the New York Appellate Division held that the 2017 assessment was unconstitutionally retroactive, directing a refund of assessments paid for calendar year 2017, but upheld the 2018 assessment. In fiscal 2025, both parties agreed to a final settlement and in December 2025, we received payment and recognized a gain of $17 million in distribution, selling, general and administrative expenses in our condensed consolidated statements of earnings.



33			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

was unconstitutionally retroactive, directing a refund of assessments paid for calendar year 2017, but upheld the 2018 assessment. In fiscal 2025, both parties agreed to a final settlement and in December 2025, we received payment and recognized a gain of $17 million in distribution, selling, general and administrative expenses in our condensed consolidated statements of earnings.

Legal Proceedings

We become involved from time to time in disputes, litigation and regulatory matters.

From time to time, we determine that products we distribute, source, manufacture or market do not meet our specifications, regulatory requirements, or published standards. When we or a regulatory agency identify a potential quality or regulatory issue, we investigate and take appropriate corrective action. Such actions have led to product recalls, costs to repair or replace affected products, temporary interruptions in product sales, restrictions on importation, product liability claims and lawsuits and can lead to action by regulators. Even absent an identified regulatory or quality issue or product recall, we can become subject to product liability claims and lawsuits.

28 Cardinal Health | Q2 Fiscal 2026 Form 10-Q

Notes to Financial Statements

have led to product recalls, costs to repair or replace affected products, temporary interruptions in product sales, restrictions on importation, product liability claims and lawsuits and can lead to action by regulators. Even absent an identified regulatory or quality issue or product recall, we can become subject to product liability claims and lawsuits.

From time to time, we become aware through employees, internal audits or other parties of possible compliance matters, such as complaints or concerns relating to accounting, internal accounting controls, financial reporting, auditing, or other ethical matters or relating to compliance with laws such as healthcare fraud and abuse, anti-corruption or anti-bribery laws. When we become aware of such possible compliance matters, we investigate internally and take appropriate corrective action. In addition, from time to time, we receive subpoenas or requests for information from various federal or state agencies relating to our business or to the business of a customer, supplier or other industry participants. Internal investigations, subpoenas or requests for information could directly or indirectly lead to the assertion of claims or the commencement of legal proceedings against us or result in sanctions.

We have been named from time to time in qui tam actions initiated by private third parties. In such actions, the private parties purport to act on behalf of federal or state governments, allege that false claims have been submitted for payment by the government and may receive an award if their claims are successful. After a private party has filed a qui tam action, the government must investigate the private party's claim and determine whether to intervene in and take control over the litigation. These actions may remain under seal while the government makes this determination. If the government declines to intervene, the private party may nonetheless continue to pursue the litigation on his or her own purporting to act on behalf of the government.

We accrue for contingencies related to disputes, litigation and regulatory matters if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because these matters are inherently unpredictable and unfavorable developments or resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review contingencies to determine whether our accruals and related disclosures are adequate. The amount of ultimate loss may differ from these estimates.

developments or resolutions can occur, assessing contingencies is highly subjective and requires judgments about future events. We regularly review contingencies to determine whether our accruals and related disclosures are adequate. The amount of ultimate loss may differ from these estimates.

We recognize income from the favorable outcome of litigation when we receive the associated cash or assets.

We recognize estimated loss contingencies for certain litigation and regulatory matters and income from favorable resolution of litigation in litigation (recoveries)/charges, net in our condensed consolidated statements of earnings; however, losses and recoveries of lost profits from disputes that occur in the ordinary course of business are included within segment profit.

Opioid Lawsuits and Investigations

As of ~~December~~March 31, ~~2025~~2026, we have $4.3 billion accrued for the opioid-related matters described below, of which $477 million is included in other accrued liabilities and the remainder is included in deferred income taxes and other liabilities in our condensed consolidated balance sheets. During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and fiscal year 2025, we made payments totaling $~~403~~417 million and $798 million, respectively, which included our annual payments under the agreement to settle the vast majority of the opioid lawsuits filed by states and local governmental entities and payments related to the settlement agreement with the City of Baltimore and classes of third-party payors and acute care hospitals.

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and fiscal year 2025, there were no material expenses recognized for these matters.

States & Political Subdivisions

In April 2022, we along with two other national distributors (collectively, the "Distributors"), without admitting liability or wrongdoing, became parties to National Opioid Settlement Agreement ("the NOSA") to settle the vast majority lawsuits and claims brought by states and political subdivisions related to the distribution of opioid pain medications. In addition to the Distributors, parties to the NOSA include 48 states, the District of Columbia and 5 U.S. territories. The NOSA also resulted in the resolution of the opioid-related claims of over 99 percent of political subdivisions in settling states (together with settling states and territories, the "Settling Governmental Entities").

To date, we have paid the Settling Governmental Entities approximately $2.2 billion and we expect to pay the Settling Governmental Entities additional amounts up to $4.1 billion through 2038. As required under the NOSA, a monitor is overseeing compliance with the Injunctive Relief provisions of the NOSA until 2027 and the distributors have engaged a third-party vendor to act as a clearinghouse for data aggregation and reporting, which distributors will fund until 2032.

West Virginia subdivisions and Native American tribes were not a part of the NOSA. In July 2022, we entered into separate agreements to settle the opioid-related claims of the majority of remaining West Virginia subdivisions and Native American Tribes for approximately $124 million over eleven years and $136 million over five years, respectively.

We34 ~~have~~Cardinal ~~now~~Health ~~resolved~~| ~~the~~Q3 ~~opioid-related~~Fiscal ~~claims~~2026 ofForm ~~all 50 states and the District of Columbia; however, lawsuits brought by certain subdivisions remain outstanding.~~10-Q

In July 2022, a judgment in favor of the Distributors was entered in a bench trial before a federal judge in West Virginia in a case brought by Cabell County and City of Huntington. In October 2025, the United States Court of Appeals for the Fourth Circuit vacated the district court's judgment and remanded the case for further proceedings. A hearing is scheduled for March, 2026. We intend to vigorously defend ourselves in this matter.

29 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


Notes to Financial Statements

agreements to settle the opioid-related claims of the majority of remaining West Virginia subdivisions and Native American Tribes for approximately $124 million over eleven years and $136 million over five years, respectively.

We have now resolved the opioid-related claims of all 50 states and the District of Columbia; however, lawsuits brought by certain subdivisions remain outstanding.

In July 2022, a judgment in favor of the Distributors was entered in a bench trial before a federal judge in West Virginia in a case brought by Cabell County and City of Huntington. In October 2025, the United States Court of Appeals for the Fourth Circuit vacated the district court's judgment and remanded the case for further proceedings. The parties have submitted additional briefing to the district court. We intend to vigorously defend ourselves in this matter.

Private Plaintiffs

The NOSA does not address claims by private parties, which includes unions and other health and welfare funds, hospital systems and other healthcare providers, businesses, and individuals alleging personal injury. To date, there are approximately ~~193~~92 lawsuits brought by private plaintiffs pending. Of these, approximately 5117 are purported class actions. The causes of action asserted by these plaintiffs are similar to those asserted by public plaintiffs. We are vigorously defending ourselves in all of these matters.

Following resolution discussions with certain private plaintiffs, during the six months ended December 31, 2024, Distributors finalized agreements with classes of third-party payors and acute care hospitals. Our portion of these settlements totaled $213 million. The settlement with the class of third-party payors was approved by the court in January 2025 and was finalized in August 2025. The settlement with the class of acute care hospitals was approved by the court in March 2025 and became final in April 2025.

Insurance Litigation

We are involved in lawsuits in Ohio State court with insurers related to their obligations to reimburse us for defense and indemnity costs in connection with the lawsuits described above. AFollowing a hearing inon ~~one~~February of5, ~~these~~2026, ~~matters~~a ruling is ~~scheduled~~pending ~~for~~in ~~February~~one 5,of ~~2026~~these lawsuits. An unfavorable outcome in this matter may result in a change in loss reserves related to opioid litigation recorded by our captive insurance company, which would negatively impact cash flow.

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we received $5 million in insurance recoveries related to opioid matters, which were recorded in the Pharma segment. During fiscal 2025, we received $25 million in insurance recoveries related to opioid matters. $12 million of the recoveries from our insurers were recorded in the Pharma segment. We have not recorded a receivable for any additional recoveries related to these insurance litigation matters as of ~~December~~March 31, ~~2025~~2026.

Department of Justice Civil Investigative Demand

In November 2023, we received a Civil Investigative Demand ("CID") from the Department of Justice focused on potential violations of the Anti-Kickback Statute and False Claims Act in connection with a 2022 transaction in which we purchased a minority ownership interest in a rheumatology managed services organization and a group purchasing organization. We are cooperating with this investigation.

Cordis IVC Filter Matters

We have been named as a defendant in product liability lawsuits involving claims by plaintiffs that allege personal injuries associated with the use of inferior vena cava ("IVC") filter products. These lawsuits sought a variety of remedies, including unspecified monetary damages. The divestiture of the Cordis business did not include product liability related to the IVC filters in the U.S. and Canada, which we retained.

In April 2023, we executed a settlement agreement that will resolve approximately 4,375 claims for $275 million, which we have paid into a qualified settlement fund. Payments to qualified implantees are being made out of the qualified settlement fund and we expect continued payments as additional plaintiffs meet the procedural requirements.

We have also entered into other agreements, which, in addition to the settlement discussed above, resolved the vast majority of IVC filter product liability claims. These settlements did not resolve all IVC filter product liability claims, and we intend to continue to vigorously defend ourselves in the remaining lawsuits.

At ~~December~~March 31, ~~2025~~2026, we had a total of $3632 million accrued for losses and legal defense costs, related to the IVC filter product liability lawsuits in our condensed consolidated balance sheets, which includes the $3532 million in the qualified settlement fund.

Tax Contingency

On February 2, 2026, we received a Notice of Proposed Adjustment (NOPA) from the Internal Revenue Service (IRS), as part of our ongoing FY15-FY20 audit cycle, related to a restructuring in connection with our July 2017 acquisition of the Patient Recovery business. The IRS is asserting that the transaction should be recharacterized in a manner that could create additional federal income tax liability of approximately $160 million, plus interest. We routinely assess the likelihood of adverse outcomes resulting from audits and examinations to determine the adequacy of our tax reserves and we believe we have adequate reserves for all tax matters; however, the ultimate outcome of disputes of this nature is uncertain and if the IRS were to prevail on its assertions in connection with this matter, the assessed tax and deficiency interest would impact our financial results and cash flow.

Antitrust Litigation Proceeds

We recognized income for net recoveries in class action antitrust lawsuits in which we were a class member or plaintiff of $19 million during ~~both~~ the ~~three~~nine ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 and $16106 million ~~and $59 million during the three and six months ended December 31, 2024, respectively.~~



35			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

and $165 million during the three and nine months ended March 31, 2025, respectively.

7. Income Taxes

Fluctuations in our provision for income taxes as a percentage of pre-tax earnings (“effective tax rate”) are due to changes in international and U.S. state effective tax rates resulting from our business mix and discrete items.

Effective Tax Rate

During the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, the effective tax rate was 253.21 percent and 2419.74 percent, respectively.

During the three and ~~six~~nine months ended ~~December~~March 31, ~~2024~~2025, the effective tax rate was 2123.46 percent and 22.28 percent, respectively.

30The ~~Cardinal~~effective ~~Health~~tax |rate Q2for ~~Fiscal~~the three and nine months ended March 31, 2026 ~~Form~~was ~~10-Q~~primarily impacted by discrete planning benefits.

~~Notes~~Tax toEffects ~~Financial~~of ~~Statements~~Goodwill Impairment Charges

Unrecognized Tax Benefits

We had $~~903~~906 million and $879 million of unrecognized tax benefits, at ~~December~~March 31, ~~2025~~2026 and June 30, 2025, respectively. The ~~December~~March 31, ~~2025~~2026 and June 30, 2025 balances include $~~877~~880 million and $871 million of unrecognized tax benefits, respectively, that, if recognized, would have an impact on the effective tax rate.

At ~~December~~March 31, ~~2025~~2026 and June 30, 2025, we had $7772 million and $65 million, respectively, accrued for the payment of interest and penalties related to unrecognized tax benefits, which we recognize in the provision for income taxes in the condensed consolidated statements of earnings. These balances are gross amounts before any tax benefits and are included in deferred income taxes and other liabilities in the condensed consolidated balance sheets.

It is reasonably possible that there could be a change in the amount of unrecognized tax benefits within the next 12 months due to activities of the U.S. Internal Revenue Service ("IRS") or other taxing authorities, possible settlement of IRS and other audit issues, reassessment of existing unrecognized tax benefits or the expiration of statutes of limitations.

Other Tax Matters

We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions, and various foreign jurisdictions. With few ~~exceptions, we are subject to audit by taxing authorities for fiscal years 2015 through the current fiscal year.~~

~~On July 4~~exceptions, ~~2025,~~we ~~the~~are ~~One~~subject ~~Big Beautiful Bill Act ("OBBBA") was signed into law, which includes a broad range of tax reform provisions. The OBBBA includes changes~~ to ~~existing~~audit ~~tax~~by ~~law,~~taxing ~~including~~authorities extending or making permanent certain business and international tax measures initially established under the 2017 Tax Cuts and Jobs Act ("Tax Act"). We have evaluated the impact of the OBBBA and determined that it did not have a material effect on the Company’s financial statements for ~~the~~fiscal ~~three~~years ~~and~~2015 ~~six~~through ~~months ended December 31, 2025. We will continue to assess~~ the ~~implications~~current offiscal ~~the OBBBA as further guidance becomes available but do not expect the legislation to have a material impact on the effective tax rate in future periods~~year.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law, which includes a broad range of tax reform provisions. The OBBBA includes changes to existing tax law, including extending or making permanent certain business and international tax measures initially established under the 2017 Tax Cuts and Jobs Act ("Tax Act"). We have evaluated the impact of the OBBBA and determined that it did not have a material effect on the Company’s financial statements for the three and nine months ended March 31, 2026. We will continue to assess the implications of the OBBBA as further guidance becomes available but do not expect the legislation to have a material impact on the effective tax rate in future periods.

8. Fair Value Measurements

Assets and Liabilities Measured on a Recurring Basis

The following tables present the fair values for assets and (liabilities) measured on a recurring basis at:

	December 31, 2025
	March 31, 2026
(in millions)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	~~266~~1,815	$	—	$	—	$	~~266~~1,815
Other investments (1)	~~112~~105		—		—		~~112~~105
Liabilities:
Forward contracts (2)	—		(2521)		—		(2521)
Share-based awards (3)	—		—		(1,~~173~~265)		(1,~~173~~265)


	June 30, 2025
(in millions)	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents	$	1,672	$	—	$	—	$	1,672

Other investments (1)	108		—		—		108
Liabilities:
Forward contracts (2)	—		(48)		—		(48)
Share-based awards (3)	—		—		(843)		(843)

(1)The other investments balance includes investments in mutual funds, which offset fluctuations in deferred compensation liabilities. These mutual funds invest in the equity securities of companies with both large and small market capitalization and high quality fixed income debt securities. The fair value of these investments is determined using quoted market prices.

(2)The fair value of interest rate swaps, foreign currency contracts, and net investment hedges is determined based on the present value of expected future cash flows considering the risks involved, including non-performance risk, and using discount rates appropriate for the respective maturities. Observable Level 2 inputs are used to determine the present value of expected future cash flows. The fair value of these derivative contracts, which are subject to master netting arrangements under certain circumstances, is presented on a gross basis in prepaid expenses and other, other assets, other accrued liabilities, and deferred income taxes and other liabilities within the condensed consolidated balance sheets.



36			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

(3)The shared-based awards are liability-classified awards, as defined under ASC 718, resulting from acquisitions by The Specialty Alliance. These are presented in deferred income taxes and other liabilities within the condensed consolidated balance sheets. The fair value of The Specialty Alliance Units is determined using the discounted cash flow method which utilizes significant unobservable inputs, including the discount rate of 7.5%. Significant changes to assumptions used in the valuation may have a material impact on the fair value of The Specialty Alliance Units.

Changes in Level 3 Recurring Fair Value Measurements

The following tables reconcile the changes in fair value for the liabilities classified within Level 3 of the fair value hierarchy for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026:

31 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


(in millions)	The Specialty Alliance Units
Fair Value at December 31, 2025	$	1,173
Acquisitions	—
Vesting (1)	72
Fair Value Adjustment (1)	25
Repurchases	(5)
Fair Value at March 31, 2026	$	1,265

Notes to Financial Statements


(in millions)	The Specialty Alliance Units
Fair Value at June 30, 2025	$	843
Acquisitions	233
Vesting (1)	191
Fair Value Adjustment (1)	25
Repurchases	(27)
Fair Value at March 31, 2026	$	1,265

(in millions)	The Specialty Alliance Units
Fair Value at September 30, 2025	$	910
Acquisitions	213
Vesting (1)	66
Fair Value Adjustment (1)	(10)
Repurchases	(6)
Fair Value at December 31, 2025	$	1,173

(1)For the three and nine months ended March 31, 2026, there was $97 million and $216 million of expense, respectively, recorded to acquisition-related cash and share-based compensation costs in the condensed consolidated statements of earnings.

(in millions)	The Specialty Alliance Units
Fair Value at June 30, 2025	$	843
Acquisitions	233
Vesting (1)	119
Fair Value Adjustment (1)	—
Repurchases	(22)
Fair Value at December 31, 2025	$	1,173

(1)For the three and six months ended December 31, 2025, there was $56 million and $119 million of expense, respectively, recorded to acquisition-related cash and share-based compensation costs in the condensed consolidated statements of earnings.

9. Financial Instruments

We utilize derivative financial instruments to manage exposure to certain risks related to our ongoing operations. The primary risks managed through the use of derivative instruments include interest rate risk and currency exchange risk. We do not use derivative instruments for trading or speculative purposes. While the majority of our derivative instruments are designated as hedging instruments, we also enter into derivative instruments that are designed to hedge a risk but are not designated as hedging instruments. These derivative instruments are adjusted to current fair value through earnings at the end of each period. We are exposed to counterparty credit risk on all of our derivative instruments. Accordingly, we have established and maintain strict counterparty credit guidelines and only enter into derivative instruments with major financial institutions that are rated investment grade or better. We do not have significant exposure to ~~any one counterparty and we believe the risk of loss is remote. Additionally, we do not require collateral under these agreements.~~

any one counterparty and we believe the risk of loss is remote. Additionally, we do not require collateral under these agreements.

Interest Rate Risk Management

We are exposed to the impact of interest rate changes. Our objective is to manage the impact of interest rate changes on cash flows and the market value of our borrowings. We utilize a mix of debt maturities on our fixed-rate debt to manage changes in interest rates. In addition, we enter into interest rate swaps to further manage our exposure to interest rate variations related to our borrowings and to lower our overall borrowing costs.

Currency Exchange Risk Management

We conduct business in several major international currencies and are subject to risks associated with changing foreign exchange rates. Our objective is to reduce earnings and cash flow volatility associated with foreign exchange rate changes to allow management to focus its attention on business operations. Accordingly, we enter into various contracts that change in value as foreign exchange rates change to protect the value of existing foreign currency assets and liabilities, commitments, and anticipated foreign currency revenue and expenses.

Fair Value Hedges

We enter into pay-floating interest rate swaps to hedge the changes in the fair value of fixed-rate debt resulting from fluctuations in interest rates. These contracts are designated and qualify as fair value hedges. Accordingly, the gain or loss recorded on the pay-floating interest rate swaps is directly offset by the change in fair value of the underlying debt. Both the derivative instrument and the underlying debt are adjusted to market value at the end of each period with any resulting gain or loss recorded in interest expense, net in the condensed consolidated statements of earnings. For the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, there were no gains or losses recorded to interest expense as changes in the market value of our derivative instruments offset changes in the market value of the underlying debt.

During the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, we entered into pay-floating interest rate swaps with total notional amounts of $~~300~~400 million. These swaps have been designated as fair value hedges of our fixed rate debt and are included in deferred income taxes and other liabilities in our condensed consolidated balance sheets.

Cash Flow Hedges

We enter into derivative instruments to hedge our exposure to changes in cash flows attributable to interest rate and foreign currency fluctuations associated with certain forecasted transactions. These derivative instruments are designated and qualify as cash flow hedges. Accordingly, the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive loss and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period during which the hedged transaction affects earnings.

~~Gains~~37 ~~and~~Cardinal ~~losses~~Health ~~recognized~~| inQ3 ~~other~~Fiscal ~~comprehensive~~2026 ~~income~~Form were immaterial for both the three and six months ended December 31, 2025 and 2024, respectively. Gains and losses recognized in accumulated other comprehensive loss and reclassified into earnings were immaterial for both the three and six months ended December 31, 2025 and 2024, respectively. Gains currently included within accumulated other comprehensive loss associated with our cash flow hedges to be reclassified into net earnings within the next 12 months are immaterial.10-Q

32 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


Notes to Financial Statements

Gains and losses recognized in other comprehensive income were immaterial for both the three and nine months ended March 31, 2026 and 2025, respectively. Gains and losses recognized in accumulated other comprehensive loss and reclassified into earnings were immaterial for both the three and nine months ended March 31, 2026 and 2025, respectively. Gains currently included within accumulated other comprehensive loss associated with our cash flow hedges to be reclassified into net earnings within the next 12 months are immaterial.

Net Investment Hedges

We hedge the foreign currency risk associated with certain net investment positions in foreign subsidiaries. To accomplish this, we enter into cross-currency swaps that are designated as hedges of net investments.

In March 2026, we entered into €68 million ($80 million) cross-currency swaps maturing in March 2028.

In March 2026, we terminated the €68 million ($73 million) cross-currency swaps entered into in March 2023 and paid a settlement in cash of $7 million, recorded in other investing items, net in our condensed consolidated statements of cash flows.

In December 2025, we partially terminated the €32 million ($37 million) cross-currency swaps entered into in March 2023 and paid a settlement in cash of $3 million, recorded in other investing items, net in our condensed consolidated statements of cash flows.

In September 2025, we entered into ¥18 billion ($120 million) cross-currency swaps maturing in September 2027.

In September 2025, we terminated the ¥18 billion ($120 million) cross-currency swaps entered into in September 2023 and received settlement in cash of $3 million, recorded in other investing items, net in our condensed consolidated statements of cash flows.

In ~~December~~February 2025, we ~~partially~~entered ~~terminated~~into ~~the~~ €32100 million ($37 105 million) cross-currency swaps ~~entered~~maturing ~~into~~ in ~~March~~February ~~2023 and paid a settlement in cash of $3 million, recorded in our condensed consolidated statements of cash flows~~2027.

In February 2025, we terminated the €100 million ($107 million) cross-currency swaps entered into in March 2023 and received net settlement in cash of $2 million, recorded in other investing items, net in our condensed consolidated statements of cash flows.

Cross-currency swaps designated as net investment hedges are marked to market using the current spot exchange rate as of the end of the period, with gains and losses included in the foreign currency translation component of accumulated other comprehensive loss until the sale or substantial liquidation of the underlying net investments. To the extent the cross-currency swaps designated as net investment hedges are not highly effective, changes in carrying value attributable to the change in spot rates are recorded in earnings.

Pre-tax gains and losses from net investment hedges recorded in the foreign currency translation component of accumulated other comprehensive loss were immaterial during ~~both~~ the three ~~and six~~ months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively. Gains recognized in interest expense, net in the condensed consolidated statements of earnings for the portion of the net investment hedges excluded from the assessment of hedge effectiveness were immaterial during both the three and ~~six~~$24 ~~months~~million ~~ended December 31, 2025~~ and ~~2024, respectively.~~

immaterial during the nine months ended March 31, 2026 and 2025, respectively. Gains recognized in interest expense, net in the condensed consolidated statements of earnings for the portion of the net investment hedges excluded from the assessment of hedge effectiveness were immaterial during both the three and nine months ended March 31, 2026 and 2025, respectively.

Economic (Non-Designated) Hedges

We enter into foreign currency contracts to manage our foreign exchange exposure related to sales transactions, intercompany financing transactions and other balance sheet items subject to revaluation that do not meet the requirements for hedge accounting treatment. Accordingly, these derivative instruments are adjusted to current market value at the end of each period through earnings. The gain or loss recorded on these instruments is substantially offset by the remeasurement adjustment on the foreign currency denominated asset or liability. The settlement of the derivative instrument and the remeasurement adjustment on the foreign currency denominated asset or liability are both recorded in other income, net. We recorded immaterial gains and losses during both the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively. The principal currencies managed through foreign currency contracts are Canadian dollar, Mexican peso, Chinese renminbi, ~~Thai~~Brazilian ~~baht~~real, and ~~Philippine~~Thai ~~peso~~baht.

Fair Value of Financial Instruments

The carrying amounts of cash and equivalents, trade receivables, accounts payable, and other accrued liabilities at ~~December~~March 31, ~~2025~~2026 and June 30, 2025 approximate fair value due to their short-term maturities.

The following table summarizes the estimated fair value of our long-term obligations and other short-term borrowings compared to the respective carrying amounts at:

(in millions)	~~December~~March 31, ~~2025~~2026		June 30, 2025
Estimated fair value	$	8,~~208~~724	$	8,388
Carrying amount	98,~~027~~916		8,527

The fair value of our long-term obligations and other short-term borrowings is estimated based on either the quoted market prices for the same or similar issues or other inputs derived from available market information, which represents a Level 2 measurement.

10. Shareholders' Deficit

We repurchased $~~750~~1.0 ~~million~~billion and $~~375~~750 million of our common shares, in the aggregate, through share repurchase programs during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively. We funded the repurchases with available cash. The common shares repurchased are held in treasury to be used for general corporate purposes.

The following table presents the share repurchase programs executed during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025:

Quarter Entered	Date Concluded	Aggregate Purchase Price(in millions)	Initial Shares (in millions)	Reference Price	Final Shares (in millions)	Weighted Average Price per Common Share
Q1 FY26	10/31/2025	$375	2.0	$148.12	0.4	$151.88
Q2 FY26	12/15/2025	$375	1.6	$190.22	0.3	$200.00
Q1 FY25	10/30/2024	$375	2.7	$109.65	0.7	$110.10



38			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q

During the six months ended December 31, 2025 and 2024, we paid $8 million and $15 million for excise taxes, respectively, related to the completion of prior Accelerated Share Repurchase programs.

During the three months ended December 31, 2024, we retired 56 million of common stock shares without par value.

33 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


Notes to Financial Statements


Quarter Entered	Date Concluded	Aggregate Purchase Price (in millions)	Initial Shares (in millions)	Reference Price	Final Shares (in millions)	Weighted Average Price per Common Share
Q3 FY26	4/20/2026	$250	0.9	$215.42	0.3	$209.55
Q2 FY26	12/15/2025	$375	1.6	$190.22	0.3	$200.00
Q1 FY26	10/31/2025	$375	2.0	$148.12	0.4	$151.88
Q3 FY25	3/11/2025	$375	2.4	$125.33	0.6	$125.87
Q1 FY25	10/30/2024	$375	2.7	$109.65	0.7	$110.10

During the nine months ended March 31, 2026 and 2025, we paid $8 million and $15 million for excise taxes, respectively, related to the completion of prior Accelerated Share Repurchase programs.

During the three months ended December 31, 2024, we retired 56 million of common stock shares without par value.

Accumulated Other Comprehensive Loss

The following tables summarize the changes in the balance of accumulated other comprehensive loss by component and in total:

(in millions)	ForeignCurrencyTranslationAdjustments		UnrealizedGain/(Loss) onDerivatives,net of tax		Accumulated OtherComprehensiveLoss
Balance at June 30, 2025	$	(141)	$	(14)	$	(155)
Other comprehensive income, before reclassifications	53		3		86
Amounts reclassified to earnings	—		(612)		(612)
Total other comprehensive income/(loss) attributable to Cardinal Health, Inc., net of tax expense of $4 million	5		(3)		2
Total other comprehensive loss attributable to Cardinal Health, Inc., net of tax expense of $6 million	3		(9)		(6)
Balance at December 31, 2025	$	(136)	$	(17)	$	(153)
Balance at March 31, 2026	$	(138)	$	(23)	$	(161)

(in millions)	ForeignCurrencyTranslationAdjustments		UnrealizedGain/(Loss) onDerivatives,net of tax		Accumulated OtherComprehensiveLoss
Balance at June 30, 2024	$	(138)	$	(29)	$	(167)
Other comprehensive income/(loss), before reclassifications	(1113)		23		(910)
Amounts reclassified to earnings	—		~~(4)~~1		~~(4)~~1
Total other comprehensive loss attributable to Cardinal Health, Inc., net of tax expense of $2 million	(11)		(2)		(13)
Total other comprehensive loss attributable to Cardinal Health, Inc., net of tax benefit of $2 million	(13)		4		(9)
Balance at December 31, 2024	$	(149)	$	(31)	$	(180)
Balance at March 31, 2025	$	(151)	$	(25)	$	(176)

11. Earnings Per Share Attributable to Cardinal Health, Inc.

The following tables reconcile the number of common shares used to compute basic and diluted earnings per share attributable to Cardinal Health, Inc. ("EPS"):

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026	~~2024~~2025
Weighted-average common shares–basic	~~236~~235	~~242~~240
Effect of dilutive securities:
Employee stock options, restricted share units and performance share units	1	1
Weighted-average common shares–diluted	~~237~~236	~~243~~241

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026	~~2024~~2025
Weighted-average common shares–basic	237	242
Effect of dilutive securities:
Employee stock options, restricted share units and performance share units	1	1
Weighted-average common shares–diluted	238	243

For the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, immaterial restricted share units and performance share units were excluded from the computation of diluted EPS, as they were anti-dilutive.

12. Segment Information

We operate under two reportable segments: Pharmaceutical and Specialty Solutions ("Pharma") and Global Medical Products and Distribution ("GMPD"). All remaining operating segments that are not significant enough to require separate reportable segment disclosures are included in Other, which is comprised of Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight® Logistics. The factors for determining the reportable segments include the manner in which management evaluates performance for purposes of allocating resources and assessing performance combined with the nature of the individual business activities.

Our Pharma segment distributes branded and generic pharmaceutical, specialty pharmaceutical and over-the-counter healthcare and consumer products in the United States. This segment also provides services to pharmaceutical manufacturers and healthcare providers for specialty pharmaceutical products; provides pharmacy management services to hospitals and operates a limited number of pharmacies, including pharmacies in community health centers; repackages generic pharmaceuticals and over-the-counter healthcare products; and includes our managed services organization platforms for physician offices.



39			Cardinal Health \| Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

Our GMPD segment manufactures, sources and distributes Cardinal Health branded medical, surgical and laboratory products, which are sold in the United States, Canada, Europe, Asia and other markets. This segment also distributes a broad range of medical, surgical, and laboratory products known as national brand products to hospitals, ambulatory surgery centers, clinical laboratories and other healthcare providers in the United States and Canada.

The remaining three non-reportable operating segments included in Other are Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight® Logistics. These operating segments respectively operate nuclear pharmacies and radiopharmaceutical manufacturing facilities, distribute medical products to patients' homes in the United States, and provide supply chain services and solutions to our customers.

34 Cardinal Health | Q2 Fiscal 2026 Form 10-Q

Notes to Financial Statements

Revenue

The following tables present revenue for the two reportable segments and disaggregated revenue within the remaining operating segments, included in Other, and Corporate:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	6056,~~669~~111	$	50,~~849~~433
Global Medical Products and Distribution	3,~~259~~148		3,~~154~~160
Nuclear and Precision Health Solutions	~~440~~478		~~372~~403
at-Home Solutions	1,~~185~~128		~~835~~817
OptiFreight® Logistics	99100		7684
Other	1,~~724~~706		1,~~283~~304
Total segment revenue	6560,~~652~~965		5554,~~286~~897
Corporate (1)	(25)		(2219)
Total revenue	$	6560,~~627~~940	$	5554,~~264~~878

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	~~119~~175,~~874~~985	$	98149,~~839~~272
Global Medical Products and Distribution	69,~~443~~591		69,~~277~~437
Nuclear and Precision Health Solutions	~~876~~1,354		~~745~~1,148
at-Home Solutions	23,~~300~~428		12,~~574~~391
OptiFreight® Logistics	~~189~~289		~~150~~234
Other	35,~~365~~071		23,~~469~~773
Total segment revenue	~~129~~190,~~682~~647		~~107~~162,~~585~~482
Corporate (1)	(4671)		(4463)
Total revenue	$	~~129~~190,~~636~~576	$	~~107~~162,~~541~~419

(1)Corporate revenue consists of the elimination of inter-segment revenue and other revenue not allocated to the segments.

The following tables present revenue by geographic area:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
United States	$	6560,~~217~~542	$	54,~~858~~498
International	~~435~~423		~~428~~399
Total segment revenue	6560,~~652~~965		5554,~~286~~897
Corporate (1)	(25)		(2219)
Total revenue	$	6560,~~627~~940	$	5554,~~264~~878

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
United States	$	~~128~~189,~~828~~370	$	~~106~~161,~~749~~247
International	~~854~~1,277		~~836~~1,235
Total segment revenue	~~129~~190,~~682~~647		~~107~~162,~~585~~482
Corporate (1)	(4671)		(4463)
Total revenue	$	~~129~~190,~~636~~576	$	~~107~~162,~~541~~419

(1)Corporate revenue consists of the elimination of inter-segment revenue and other revenue not allocated to the segments.

Segment Profit

The Company's Chief Executive Officer, the chief operating decision maker ("CODM"), evaluates segment performance based on segment profit, among other measures. Segment profit is segment revenue, less segment cost of products sold, less segment distribution, selling, general and administrative ("SG&A") expenses. Segment SG&A expenses include share-based compensation expense as well as allocated corporate technology and shared function expenses, including corporate management, corporate finance, financial and customer care shared services, human resources, information technology and legal and compliance, including certain litigation defense costs. Corporate expenses are allocated to the operating segments based on headcount, level of benefit provided and other ratable allocation methodologies. The results attributable to noncontrolling interests are recorded within segment profit.

We do not allocate the following items to our segments:

•last-in first-out, or ("LIFO"), inventory charges/(credits);

•state opioid assessment related to prior fiscal years;

•restructuring and employee severance;

•amortization and other acquisition-related costs;

•acquisition-related cash and share-based compensation costs;

•impairments and (gain)/loss on disposal of assets, net;

•litigation (recoveries)/charges, net;

•other (income)/expense, net;

•interest expense, net;

•provision for/(benefit from) income taxes

In addition, certain investment spending, certain portions of enterprise-wide incentive compensation and other spending are not allocated to the segments. Investment spending generally includes the first-year spend for certain projects that require incremental investments in the form of additional operating expenses. Because approval for these projects is dependent on executive management, we retain these expenses at Corporate. Investment spending within Corporate was $15 million for both the three months ended December 31, 2025 and 2024, respectively, and $31 million and $27 million for the six months ended December 31, 2025 and 2024, respectively.

3540 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

not allocated to the segments. Investment spending generally includes the first-year spend for certain projects that require incremental investments in the form of additional operating expenses. Because approval for these projects is dependent on executive management, we retain these expenses at Corporate. Investment spending within Corporate was $17 million and $15 million for the three months ended March 31, 2026 and 2025, respectively, and $48 million and $42 million for the nine months ended March 31, 2026 and 2025, respectively.

The following tables present segment profit for the two reportable segments and the remaining operating segments, included in Other:

Three Months Ended December 31, 2025

Three Months Ended March 31, 2026

(in millions)

Pharma

GMPD

Other

Total

Segment revenue

6056,~~669~~111

3,~~259~~148

1,~~724~~706

6560,~~652~~965

Cost of product sold

5954,~~243~~595

2,~~720~~605

1,~~291~~268

6358,~~254~~468

SG&A

~~739~~732

~~502~~518

~~254~~259

1,~~495~~509

Total segment expenses

5955,~~982~~327

3,~~222~~123

1,~~545~~527

6459,~~749~~977

Segment profit

~~687~~784

3725

179

~~903~~988

Corporate (1)

(~~196~~479)

Consolidated operating earnings

~~707~~509

Three Months Ended December 31, 2024

Three Months Ended March 31, 2025

(in millions)

Pharma

GMPD

Other

Total

Segment revenue

50,~~849~~433

3,~~154~~160

1,~~283~~304

5554,~~286~~897

Cost of product sold

49,~~750~~167

2,~~624~~634

~~969~~975

5352,~~343~~776

SG&A

~~568~~604

~~512~~487

~~196~~195

1,~~276~~286

Total segment expenses

5049,~~318~~771

3,~~136~~121

1,~~165~~170

54,~~619~~062

Segment profit

~~531~~662

1839

~~118~~134

~~667~~835

Corporate (1)

(~~118~~105)

Consolidated operating earnings

~~549~~730

Six Months Ended December 31, 2025

Nine Months Ended March 31, 2026

(in millions)

Pharma

GMPD

Other

Total

Segment revenue

~~119~~175,~~874~~985

69,~~443~~591

35,~~365~~071

~~129~~190,~~682~~647

Cost of product sold

~~117~~171,~~100~~695

57,~~353~~958

23,~~512~~780

~~124~~183,~~965~~433

SG&A

12,~~420~~152

1,~~007~~525

~~508~~767

24,~~935~~444

Total segment expenses

~~118~~173,~~520~~847

69,~~360~~483

34,~~020~~547

~~127~~187,~~900~~877

Segment profit

12,~~354~~138

83108

~~345~~524

12,~~782~~770

Corporate (1)

(~~407~~886)

Consolidated operating earnings

1,~~375~~884

Six Months Ended December 31, 2024

Nine Months Ended March 31, 2025

(in millions)

Pharma

GMPD

Other

Total

Segment revenue

98149,~~839~~272

69,~~277~~437

23,~~469~~773

~~107~~162,~~585~~482

Cost of product sold

96145,~~659~~826

57,~~228~~862

12,~~853~~828

~~103~~156,~~740~~516

SG&A

1,~~119~~723

1,~~023~~510

~~394~~589

23,~~536~~822

Total segment expenses

97147,~~778~~549

69,~~251~~372

23,~~247~~417

~~106~~160,~~276~~338

Segment profit

1,~~061~~723

2665

~~222~~356

12,~~309~~144

Corporate (1)

(~~192~~297)

Consolidated operating earnings

1,~~117~~847

(1)Corporate consists of the elimination of inter-segment revenue and other revenue and expenses not allocated to the segments.

Segment Assets

The following table presents total assets for the two reportable segments and the remaining operating segments, included in Other, and Corporate:

(in millions)	~~December~~March 31,~~2025~~2026		June 30,2025
Pharmaceutical and Specialty Solutions	$	4341,~~405~~032	$	37,313
Global Medical Products and Distribution	6,~~993~~888		6,889
Other	4,~~073~~065		4,045
Corporate	34,~~612~~704		4,875
Total assets	$	5856,~~083~~689	$	53,122

The following tables present depreciation and amortization for the two reportable segments and the remaining operating segments, included in Other, and Corporate:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	6470	$	4644
Global Medical Products and Distribution	5554		6056
Other	3026		4031
Corporate	8598		4676
Total depreciation and amortization	$	~~234~~248	$	~~192~~207

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	~~125~~195	$	73117
Global Medical Products and Distribution	~~110~~164		~~109~~165
Other	5985		5889
Corporate	~~173~~271		~~134~~210
Total depreciation and amortization	$	~~467~~715	$	~~374~~581

3641 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

The following tables present additions to property and equipment for the two reportable segments and the remaining operating segments, included in Other, and Corporate:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	2337	$	1233
Global Medical Products and Distribution	2332		2128
Other	2325		2218
Corporate	6253		4447
Total additions to property and equipment	$	~~131~~147	$	99126

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Pharmaceutical and Specialty Solutions	$	5592	$	2356
Global Medical Products and Distribution	4274		4472
Other	3863		3452
Corporate	~~104~~156		88135
Total additions to property and equipment	$	~~239~~385	$	~~189~~315

The following table presents property and equipment, net by geographic area:

(in millions)	~~December~~March 31, ~~2025~~2026		June 30,2025
United States	$	2,~~445~~494	$	2,422
International	~~432~~434		436
Total property and equipment, net	$	2,~~877~~928	$	2,858

13. Share-Based Compensation

We maintain Cardinal Health Inc. corporate stock incentive plans (collectively, the “Plans”) for the benefit of certain of our officers, directors, and employees. As of ~~December~~March 31, ~~2025~~2026, we have 16 million shares authorized for issuance under the Plans. Upon vesting these units convert to common shares without restrictions or future service requirements.

The following tables provide total share-based compensation expense by type of award:

	Three Months Ended December 31,
	Three Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Restricted share unit expense	$	1621	$	18
Performance share unit expense	1511		1214
Total share-based compensation	$	3132	$	3032

	Six Months Ended December 31,
	Nine Months Ended March 31,
(in millions)	~~2025~~2026		~~2024~~2025
Restricted share unit expense	$	3455	$	3754
Performance share unit expense	2738		2337
Total share-based compensation	$	6193	$	6091

The total tax benefit related to share-based compensation was $4 million for both the three months ended ~~December~~March 31, ~~2025~~2026 and

~~and 2024~~2025, respectively, and $712 million and ~~for~~$11 ~~both~~million for the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025, respectively. Share-based compensation expense is included in selling, general, and administrative expenses in the condensed consolidated statements of earnings. Our condensed consolidated statements of cash flows present our share-based compensation expense as a reconciling adjustment between net income and net cash provided by operating activities for all periods presented.

Restricted Share Units

Restricted share units granted under the Plans generally vest in equal annual installments over three years. Restricted share units accrue cash dividend equivalents that are payable upon vesting of the awards.

The following table summarizes all transactions related to restricted share units under the Plans:

(in millions, except per share amounts)	Restricted Share Units	Weighted-AverageGrant Date FairValue per Share
Nonvested at June 30, 2025	1.4	$	86.30
Granted	0.47	~~151~~157.3786
Vested	(0.78)	8990.2340
Canceled and forfeited	—(0.1)	~~121~~123.8103
Nonvested at December 31, 2025	1.1	$	110.11
Nonvested at March 31, 2026	1.2	$	84.20

The total fair value of units vested during ~~both~~ the three months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025 were $2 million and $3 million, respectively. The total fair value of units vested during ~~both~~ the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025 were $5659 million and $67 million, respectively.

At ~~December~~March 31, ~~2025~~2026, the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested restricted share units not yet recognized was $9888 million, which is expected to be recognized over a weighted-average period of two years.

Performance Share Units

Performance share units vest over a three-year performance period based on achievement of specific performance goals. Based on the extent to which the targets are achieved and our total shareholder return relative to the S&P 500 Health Care Index, vested shares may range from zero to 240 percent of the target award amount. Performance share units accrue cash dividend equivalents that are payable upon vesting of the awards.

3742 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Notes to Financial Statements

The following table summarizes all transactions related to performance share units under the Plans (based on target award amounts):

(in millions, except per share amounts)	PerformanceShare Units	Weighted-AverageGrant Date FairValue per Share
Nonvested at June 30, 2025	1.5	$	99.45
Granted	0.56	153.66
Vested	(0.7)	92.71
Canceled and forfeited	—(0.1)	—124.97
Nonvested at December 31, 2025	1.3	$	117.36
Nonvested at March 31, 2026	1.3	$	116.86

No performance share units vested during the three months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025. The total fair value of units vested during the ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 and ~~2024~~2025 were $108 million and $4941 million, respectively.

At ~~December~~March 31, ~~2025~~2026, the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested performance share units not yet recognized was $6358 million, which is expected to be recognized over a weighted-average period of two years if the performance goals are achieved.

The Specialty Alliance Share-Based Compensation

The Specialty Alliance, a majority-owned subsidiary of Cardinal Health, maintains standalone share-based compensation plans. Share-based compensation expense associated with these awards of $5697 million and $~~119~~216 million was recognized during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 respectively. Of the expense recognized for the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026, $5495 million and $~~115~~210 million is included in acquisition-related cash and share-based compensation costs and $2 million and $46 million is included in selling, general, and administrative expenses in the condensed consolidated statements of earnings, respectively. Share-based compensation expense associated with these awards was $17 million for the three and nine months ended March 31, 2025, of which $16 million is included in acquisition-related cash and share-based compensation costs and $1 million is included in selling, general and administrative expenses in the condensed consolidated statements of earnings. The liability and associated future expenses may vary based on the changes in the estimated fair value.

The following table summarizes the fair market value of The Specialty Alliance Units as of ~~December~~March 31, ~~2025~~2026:

(in millions, except per share amounts)	The Specialty Alliance Share Units	Fair Value per Share
Nonvested at June 30, 2025	206	$	1.54
Granted	~~217~~231	1.5457
Vested	(77124)	1.5457
Canceled and forfeited	(1)	1.5457
Nonvested at December 31, 2025	345	$	1.54
Nonvested at March 31, 2026	312	$	1.57
Vested at December 31, 2025	760	$	1.54
Vested at March 31, 2026	804	$	1.57

The total fair value of The Specialty Alliance Units vested during the three and ~~six~~nine months ended ~~December~~March 31, ~~2025~~2026 was $6672 million and $~~119~~191 million, respectively. The total fair value of The Specialty Alliance Units vested during the three and nine months ended March 31, 2025 was $17 million. During both the three and nine months ended ~~December~~March 31, ~~2025~~2026, we recognized aan ~~decrease~~increase in the fair value of the liability, resulting in ~~income~~expense of $1025 million related to the vested Specialty Alliance Units, which is recognized in acquisition-related cash and share-based compensation costs.

~~related~~At ~~cash~~March 31, ~~and~~2026, ~~share~~the total pre-~~based~~tax compensation ~~costs.~~cost ~~There~~related ~~was~~to nononvested ~~change~~Specialty inAlliance ~~the~~Units ~~fair~~not ~~value~~yet ofrecognized ~~the~~was ~~liability~~$490 million, ~~during~~which ~~the~~is ~~six~~expected ~~months~~to ~~ended~~be ~~December 31,~~recognized ~~2025.~~over a weighted-average period of approximately four years.

At43 ~~December 31,~~Cardinal ~~2025,~~Health ~~the~~| ~~total~~Q3 ~~pre-tax~~Fiscal ~~compensation~~2026 ~~cost~~Form ~~related to nonvested Specialty Alliance Units not yet recognized was $531 million, which is expected to be recognized over a weighted~~10-~~average period of approximately three years.~~Q

38 Cardinal Health | Q2 Fiscal 2026 Form 10-Q


Exhibits

Exhibits

ExhibitNumber			Exhibit Description
3.1			Amended and Restated Articles of Incorporation of Cardinal Health, Inc., as amended (incorporated by reference to Exhibit 3.1 to Cardinal Health’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, File No. 1-11373)
3.2			Cardinal Health, Inc. Restated Code of Regulations (incorporated by reference to Exhibit 3.1 to Cardinal Health's Current Report on Form 8-K filed on May 11, 2023, File No. 1-11373)
10.1			364-Day Credit Agreement, dated October 7, 2025 (incorporated by reference to Exhibit 10.1 to Cardinal Health’s Current Report on Form 8-K filed on October 10, 2025, File No. 1-11373)
10.2			Third Amendment to the Cardinal Health Deferred Compensation Plan, as amended and restated on January 1, 2020
10.3			Aircraft Time Sharing Agreement, dated as of November 18th, 2025, by and between Cardinal Health, Inc. and Jason M. Hollar
31.1			Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2			Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1			Certification of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.1			Statement Regarding Forward-Looking Information
101.SCH			Inline XBRL Taxonomy Extension Schema Document
101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF			Inline XBRL Taxonomy Definition Linkbase Document
101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document
104			Cover Page Interactive Data File - formatted in Inline XBRL (included as Exhibit 101)

Cardinal Health Website

Cardinal Health uses its website as a channel of distribution for material company information. Important information, including news releases, financial information, earnings and analyst presentations, and information about upcoming presentations and events is routinely posted and accessible at ir.cardinalhealth.com. In addition, the website allows investors and other interested persons to sign up automatically to receive e-mail alerts when we post news releases, SEC filings, and certain other information on its website.

3944 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Form 10-Q Cross Reference Index

Form 10-Q Cross Reference Index

Item Number		Page
	Part I. Financial Information
Item 1	Financial Statements	1822
Item 2	Management's Discussion and Analysis of Financial Condition and Results of Operations	2
Item 3	Quantitative and Qualitative Disclosures about Market Risk	1618
Item 4	Controls and Procedures	1618
	Part II. Other Information
Item 1	Legal Proceedings	1719
Item 1A	Risk Factors	1719
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	1720
Item 3	Defaults Upon Senior Securities	N/A
Item 4	Mine Safety Disclosures	N/A
Item 5	Other Information	1721
Item 6	Exhibits	3944
	Signatures	4146


N/A			Not applicable

4045 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q


Additional Information

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Cardinal Health, Inc.
Date:	~~February~~April 530, 2026	/s/ JASON M. HOLLAR
		Jason M. Hollar
		Chief Executive Officer
Date:	~~February~~April 530, 2026	/s/ AARON E. ALT
		Aaron E. Alt
		Chief Financial Officer

4146 Cardinal Health | Q2Q3 Fiscal 2026 Form 10-Q

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