Why was the GAAP result a loss in the fourth quarter when adjusted earnings grew?

The GAAP loss of $(1.75) per diluted share was driven mainly by a $723.9 million goodwill impairment related to PharmaLex and a $113.5 million impairment of an equity investment. Adjusted EPS of $3.84 excludes these non-cash charges along with acquisition-related amortization, deal and integration costs, and restructuring expenses, so it reflects operating performance excluding those items.

How much did the RCA acquisition contribute to growth and balance sheet changes?

RCA, acquired January 2, 2025, drove much of the margin improvement in U.S. Healthcare Solutions and the increase in operating expenses. It was financed with $1.8 billion of senior notes and a $1.5 billion term loan, which pushed long-term debt to $7.5 billion from $3.8 billion and lifted net interest expense 85.7% to $292 million for the year.

What does the new reporting structure mean for investors?

Starting in fiscal Q1 2026, Cencora reports two reportable segments, U.S. Healthcare Solutions and International Healthcare Solutions, plus an 'Other' category that is not a reportable segment. Other includes businesses under strategic review, so it may be divested. Exhibit 99.2 supplies revised historical segment data so investors can compare results on the new basis.

What are the main drivers of the fiscal 2026 outlook?

Management guides to adjusted operating income growth of 8% to 10%, with U.S. Healthcare Solutions expected to grow 9% to 11% and International Healthcare Solutions 5% to 8%. Other is expected to decline 1% to 4%. Net interest expense is projected at $315 million to $335 million, and the adjusted effective tax rate at 20% to 21%. Diluted shares are expected to be about 194 million.

Is the dividend increase and capital return program sustainable?

The quarterly dividend rises 9% to $0.60 per share, about $2.40 annualized. Fiscal 2025 cash dividends totaled $437 million, against adjusted free cash flow of about $2.97 billion, and fiscal 2026 adjusted free cash flow is guided to about $3.0 billion, so the dividend appears covered. Share repurchases slowed sharply to $435 million in fiscal 2025 from $1.49 billion in fiscal 2024, while debt rose, so buybacks may depend on deleveraging.

COR 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed November 5, 2025. Cited figures are marked; the original filing is the authoritative source.

Cencora (COR) reported fiscal Q4 2025 revenue of $83.7 billion^a, up 5.9% year over year, and fiscal 2025 revenue of $321.3 billion, up 9.3%.

GAAP results were weak in the quarter: diluted EPS was $(1.75) versus $0.02^b a year earlier, driven by a $723.9 million PharmaLex goodwill impairment, a $113.5 million equity investment impairment, and elevated acquisition-related and restructuring costs. On an adjusted basis, diluted EPS rose 15.0% to $3.84 and adjusted operating income grew 20.2% to $1.0 billion. For the full year, GAAP diluted EPS was $7.96 (up 5.7%) and adjusted diluted EPS was $16.00 (up 16.3%), with the increase largely attributable to the January 2025 acquisition of Retina Consultants of America (RCA) and continued growth in U.S. Healthcare Solutions.

Management raised its long-term adjusted EPS growth target to 9% to 13% and adjusted operating income growth to 6% to 9%, and announced a 9% increase in the quarterly dividend to $0.60^c per share. For fiscal 2026, it guides to adjusted diluted EPS of $17.45 to $17.75 (roughly 9% to 11% growth), revenue growth of 5% to 7%, and adjusted free cash flow of about $3.0 billion. The company also announced a strategic reorganization effective fiscal Q1 2026: a new reporting structure with U.S. Healthcare Solutions and International Healthcare Solutions as reportable segments, and an 'Other' category containing businesses under strategic review (MWI Animal Health, Profarma, U.S. Consulting Services and parts of PharmaLex).

Investors should weigh the strong adjusted growth against recurring GAAP charges, a sharply higher debt load (long-term debt rose to $7.5 billion^d from $3.8 billion), and the portfolio pruning now underway. The filing also notes $1 billion in planned U.S. distribution investments through 2030, including a second national distribution center and expanded cold-chain capacity to support specialty pharmaceuticals. Net interest expense rose 85.7% for the year to $292 million, reflecting acquisition financing, and fiscal 2026 net interest expense is guided to $315 million to $335 million.

02—Key points

Key Highlights

Fiscal Q4 2025 revenue rose 5.9% to $83.7 billion; fiscal 2025 revenue rose 9.3% to $321.3 billion.
GAAP diluted EPS was $(1.75) in Q4, driven by a $723.9 million PharmaLex goodwill impairment and a $113.5 million equity investment impairment; adjusted diluted EPS rose 15.0% to $3.84.
Fiscal 2025 adjusted diluted EPS grew 16.3% to $16.00; GAAP diluted EPS was $7.96, up 5.7%.
Long-term guidance raised: adjusted diluted EPS growth of 9% to 13% and adjusted operating income growth of 6% to 9%.
Fiscal 2026 adjusted diluted EPS guidance of $17.45 to $17.75, with revenue growth of 5% to 7% and adjusted free cash flow of about $3.0 billion.
Quarterly dividend increased 9% to $0.60 per share, payable December 1, 2025.
Reporting structure reorganized from Q1 2026; businesses such as MWI Animal Health and Profarma are now in 'Other' as Cencora explores strategic alternatives for them.

03—Questions

Frequently Asked Questions

Why was the GAAP result a loss in the fourth quarter when adjusted earnings grew?
The GAAP loss of $(1.75) per diluted share was driven mainly by a $723.9 million goodwill impairment related to PharmaLex and a $113.5 million impairment of an equity investment. Adjusted EPS of $3.84 excludes these non-cash charges along with acquisition-related amortization, deal and integration costs, and restructuring expenses, so it reflects operating performance excluding those items.
How much did the RCA acquisition contribute to growth and balance sheet changes?
RCA, acquired January 2, 2025, drove much of the margin improvement in U.S. Healthcare Solutions and the increase in operating expenses. It was financed with $1.8 billion of senior notes and a $1.5 billion term loan, which pushed long-term debt to $7.5 billion from $3.8 billion and lifted net interest expense 85.7% to $292 million for the year.
What does the new reporting structure mean for investors?
Starting in fiscal Q1 2026, Cencora reports two reportable segments, U.S. Healthcare Solutions and International Healthcare Solutions, plus an 'Other' category that is not a reportable segment. Other includes businesses under strategic review, so it may be divested. Exhibit 99.2 supplies revised historical segment data so investors can compare results on the new basis.
What are the main drivers of the fiscal 2026 outlook?
Management guides to adjusted operating income growth of 8% to 10%, with U.S. Healthcare Solutions expected to grow 9% to 11% and International Healthcare Solutions 5% to 8%. Other is expected to decline 1% to 4%. Net interest expense is projected at $315 million to $335 million, and the adjusted effective tax rate at 20% to 21%. Diluted shares are expected to be about 194 million.
Is the dividend increase and capital return program sustainable?
The quarterly dividend rises 9% to $0.60 per share, about $2.40 annualized. Fiscal 2025 cash dividends totaled $437 million, against adjusted free cash flow of about $2.97 billion, and fiscal 2026 adjusted free cash flow is guided to about $3.0 billion, so the dividend appears covered. Share repurchases slowed sharply to $435 million in fiscal 2025 from $1.49 billion in fiscal 2024, while debt rose, so buybacks may depend on deleveraging.

04—Continue

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