NYSE$MCK

McKesson Corp · Q4 2023 earnings

Q4 2023 earnings · · Investor relations

Briefing

McKesson's Q4 2023 earnings increased, driven by growth in the U.S. Pharmaceutical and Prescription Technology Solutions segments, with revenue up 4% and adjusted EPS up 23%.

McKesson Corporation reported strong fourth-quarter and full-year results for fiscal year 2023. Fourth-quarter revenues increased by 4% to $68.9 billion, and adjusted earnings per diluted share increased by 23% to $7.19. The company also raised its long-term adjusted segment operating profit growth targets, reflecting confidence in its strategic growth prospects.

  • Total revenues increased 4% to $68.9 billion.
  • Earnings per diluted share from continuing operations increased to $5.71.
  • Adjusted Earnings per Diluted Share increased 23% to $7.19.
  • The company raised long-term Adjusted Segment Operating Profit growth targets.

Headline financials

Total Revenue

$68.9B

Previous: $66.1B+4.2%
EPS (adj)

$7.19

Previous: $5.83+23.3%
Capital Expenditures

$125M

Previous: $135M-7.4%
Free Cash Flow

$4.6B

Previous: $3.9B+18.0%
Net Income

$787M

Previous: $405M+94.3%
Operating Income

$980M

Previous: $633M+54.8%
Gross Profit

$3.07B

Previous: $3.32B-7.6%
Cash & Equivalents

$4.68B

Previous: $3.53B+32.4%
Total Assets

$62.3B

Previous: $63.3B-1.5%

Revenue & EPS history

McKesson · Revenue · Quarterly

$68.9B

Q4 2023+4.2%vs Q4 2022
Beat estimate in 6 of 15 quarters(40%)
ActualEstimate

Revenue by segment

McKesson · $3.9B total across 2 segments · Q4 2023

  • Medical-Surgical Solutions
    $2.7B-6.1%
  • Prescription Technology Solutions
    $1.2B+17.6%

Forward guidance

McKesson anticipates Fiscal 2024 Adjusted Earnings per Diluted Share of $26.10 to $26.90, which reflects expected growth at or above updated long-term segment targets, execution against strategic growth opportunities, and a disciplined approach to capital allocation, delivering sustainable long-term earnings growth.

Tailwinds

  • Focus on people and culture to achieve the company's mission of improving care in every setting - one product, one partner, one patient at a time.
  • Accelerate the expansion of McKesson's differentiated oncology and biopharma services platforms.
  • Drive sustainable core growth through the strong value proposition of McKesson's scaled and durable distribution business.
  • Evolve and grow the portfolio through the continued exit of Europe, as we explore strategic alternatives to exit its remaining operations in Norway.
  • McKesson is well positioned for strong growth in the years ahead and is raising long-term Adjusted Segment Operating Profit growth targets

Headwinds

  • COVID-19 related contracts with the U.S. government are scheduled to end in July 2023.
  • The contribution from Europe continues to run off as guided.
  • McKesson does not provide forward-looking guidance on a GAAP basis.
  • McKesson cannot reliably forecast LIFO inventory-related adjustments.
  • McKesson cannot reliably forecast certain litigation loss and gain contingencies.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2023

Historical avgQ4 2023

+1.2%

Avg return

Earnings day

+0.6%

Avg return

5 days after

+1.1%

Avg return

30 days after

60%

44 / 73 earnings

Positive

+16.5%

Q3 2026

Best reaction

-21.7%

Q2 2017

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2026+0.2%-3.4%+2.8%
Q3 2026+16.5%+13.8%+11.8%
Q2 2026+1.5%+1.4%-4.2%
Q1 2026-5.8%-6.4%-2.3%
Q4 2025+0.4%-1.2%+3.3%
Q3 2025-1.2%+0.6%+6.1%
Q2 2025+15.7%+17.2%+14.9%
Q1 2025-10.9%-10.3%-17.9%
Q4 2024+1.9%+5.0%+9.9%
Q3 2024-2.5%-2.4%+4.1%
Q2 2024-1.7%+1.0%+2.0%
Q1 2024+7.4%+4.2%+1.8%
Q4 2023+6.2%+6.6%+5.1%
Q3 2023-3.2%-5.4%-8.7%
Q2 2023+0.1%+1.9%-2.5%
Q1 2023+0.8%+3.7%+8.6%
Q4 2022+4.5%+3.1%-1.1%
Q3 2022+4.1%+5.2%+9.7%
Q2 2022+5.3%+6.6%+3.6%
Q1 2022-3.3%-4.6%-0.1%
Q4 2021+4.5%+4.7%+3.1%
Q3 2021+1.0%+1.9%-4.1%
Q2 2021+9.2%+12.4%+17.8%
Q1 2021+4.6%+1.2%+4.1%
Q4 2020+0.8%+3.3%+8.3%
Q3 2020+5.7%+8.6%+0.8%
Q2 2020-11.0%-7.9%-3.2%
Q1 2020+4.0%+1.5%-3.0%
Q4 2019+7.1%+0.6%+3.7%
Q3 2019+1.9%+5.4%-0.4%
Q2 2019-2.6%+2.1%-0.3%
Q1 2019-7.1%-5.8%-2.8%
Q4 2018-0.7%-3.8%+1.4%
Q3 2018-5.7%-9.7%-11.2%
Q2 2018-10.4%-8.9%-4.4%
Q1 2018-2.3%-3.1%-11.3%
Q4 2017+7.7%+11.9%+12.5%
Q3 2017-6.6%-7.6%+1.7%
Q2 2017-21.7%-18.5%-9.8%
Q1 2017-1.4%-2.1%-6.9%
Q4 2016+2.7%
Q3 2016-6.4%
Q2 2016-2.0%
Q1 2016-4.1%
Q4 2015+1.7%
Q3 2015+5.7%
Q2 2015-2.1%
Q1 2015+2.2%
Q4 2014+5.3%
Q3 2014+0.7%
Q2 2014+8.3%
Q1 2014+5.4%
Q4 2013+7.3%
Q3 2013-2.3%
Q2 2013+3.4%
Q1 2013-1.0%
Q4 2012-0.7%
Q3 2012+3.0%
Q2 2012+6.3%
Q1 2012+0.7%
Q4 2011-0.2%
Q3 2011+2.3%
Q2 2011+6.0%
Q1 2011-0.7%
Q4 2008+3.8%
Q4 2010+3.8%
Q3 2010-3.1%
Q3 2009-3.1%
Q2 2010-3.2%
Q2 2009+8.9%
Q1 2009+8.9%
Q1 2010+8.9%
Q4 2009+8.9%

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