Cardinal Health (CAH) reported that its specialty revenue surpassed $50 billion for the first time at the end of fiscal 2026, driven by double-digit growth across the segment, which posted a 25% increase year over year. The company also provided an upgraded earnings outlook for fiscal 2027.
Speaking at the Wells Fargo 21st Annual Healthcare Conference on September 9, 2026, CFO Aaron Alt outlined a series of strategic moves and financial targets. Adjusted EPS growth for fiscal 2027 is now guided at 13% to 15%, above the company's long-range plan of 12% to 14%. M&A is expected to contribute an additional 2 to 3 percentage points to profit growth in the coming fiscal year.
In nuclear medicine, theranostics and PET growth rose close to 30% in fiscal 2026, exceeding Cardinal Health's 20% compound annual growth target. The company expects theranostics to grow from roughly 50% of nuclear revenue in fiscal 2025 to about two-thirds by fiscal 2028. More than 70 products are currently in manufacturing or commercial development with biopharma partners in the nuclear pipeline.
Gross margin performance remained a focal point. Cardinal Health's overall gross profit margin stood at 3.84%, while its GMPD segment operated at approximately a 1% margin. GMPD profit is projected at $200 million to $220 million for fiscal 2027, representing roughly 50 basis points of improvement. "In aggregate, we run a 1% margin business," Alt said. "You're not going to be successful running a 1% margin business if you aren't relentlessly focused on how do you simplify your business and bring your cost down, while driving performance."
On the acquisitions front, the Strive acquisition in urology has closed, and the AdaptHealth Diabetes Health business is expected to close after the turn of the year. Four additional tuck-in acquisitions were completed in The Specialty Alliance during the fourth quarter, and Solaris will be lapped in November. Advanced Diabetes Supply Group (ADSG) revenue grew more than 30% while utilizing only 2% of cube space.
Customer relationships saw renewals across key accounts. Cardinal Health renewed its contract with Kroger, its second-largest pharma customer, and secured a renewal of its largest GMPD customer during the fourth quarter. Its Red Oak joint venture with CVS continues through calendar 2029.
Regarding drug spend exposure in selected specialties, approximately one-third lies in gastroenterology and urology, compared to 80% to 90% in oncology. The company's at-home care focus areas include diabetes, urology, ostomy, nutrition, and delivery. Cardinal Health ended fiscal 2026 with about $5 billion in cash and plans capital investment of $700 million in fiscal 2027, along with at least $1 billion in share buybacks.
Alt characterized the demand environment as strong but measured. "We are guiding strong but not outsized demand," he said, adding that the company views access expansions—whether through patient self-pay or increased coverage—as supportive of its business.
Cardinal Health's stock was trading near $241.21, close to its 52-week high of $258.30, reflecting a 61% return over the past year.
