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Jun 30, 2024
McKesson Q1 2025 Earnings Report
McKesson's financial performance for Q1 2025 was reported, revenues increased by 6% and adjusted EPS increased by 8%.
Key Takeaways
McKesson Corporation reported a 6% increase in consolidated revenues, reaching $79.3 billion. Adjusted Earnings per Diluted Share increased by 8% to $7.88. The company raised its fiscal 2025 Adjusted Earnings per Diluted Share guidance range to $31.75 to $32.55.
Consolidated revenues increased by 6% to $79.3 billion.
Earnings per diluted share decreased by $0.02 to $7.00.
Adjusted Earnings per Diluted Share increased by 8% to $7.88.
Board approved a 15% increase to the quarterly dividend, to $0.71 per share and a $4.0 billion increase to the share repurchase program.
McKesson
McKesson
McKesson Revenue by Segment
Revenue by Segment
U.S. Pharmaceutical Revenue
CapyFin.comPrescription Technology Solutions Revenue
CapyFin.comMedical-Surgical Solutions Revenue
CapyFin.comInternational Revenue
CapyFin.com Forward Guidance
McKesson is raising fiscal 2025 Adjusted Earnings per Diluted Share guidance to $31.75 to $32.55 from the previous range of $31.25 to $32.05.
Positive Outlook
- Fiscal 2025 Adjusted Earnings per Diluted Share guidance range raised to $31.75 to $32.55
- Fiscal 2025 Adjusted Earnings per Diluted Share guidance range indicates 16% to 19% growth compared to prior year.
- First quarter revenues were $79.3 billion, an increase of 6% from a year ago, primarily driven by growth in the U.S. Pharmaceutical segment, resulting from increased prescription volumes, including higher volumes from specialty products, retail national account customers, and GLP-1 medications.
- First quarter Adjusted Earnings per Diluted Share was $7.88 compared to $7.27 a year ago, an increase of 8%, driven by pre-tax gains of $110 million associated with McKesson Ventures' equity investments within corporate expenses, compared to pre-tax losses of $7 million in the first quarter of fiscal 2024, and a lower share count, partially offset by a higher tax rate.
- The Board approved a 15% increase to the dividend, marking the eighth consecutive year of a dividend increase. The Board also authorized a $4.0 billion increase to the share repurchase program.
Challenges Ahead
- First quarter results were impacted by lower contributions from access programs in our Prescription Technology Solutions segment, and slower growth, including customer mix and demand shifts, in our Medical-Surgical business.
- First quarter earnings per diluted share was $7.00 compared to $7.02 a year ago, a decrease of $0.02.
- During the first three months of the fiscal year, McKesson used cash from operations of $1.4 billion, a portion of which was used in support of onboarding new customers, and invested $167 million in capital expenditures, resulting in negative Free Cash Flow of $1.5 billion.
- McKesson does not provide forward-looking guidance on a GAAP basis
- The Company cannot reasonably forecast LIFO inventory-related adjustments, certain litigation loss and gain contingencies, restructuring, impairment and related charges, and other adjustments, which are difficult to predict and estimate.
Revenue & Expenses
Visualization of income flow from segment revenue to net income