Cardinal Health reports $554 million net income for Q1 fiscal 2027.

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For the fiscal year ended June 30 , 2026

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

For the quarterly period ended September 30, 2026

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7000 Cardinal Place , Dublin , Ohio 43017

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Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ

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 ☑ No o ☐

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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.

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Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

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 o ☐

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The aggregate market value of voting stock held by non-affiliates on December 31, 2025, was the following: $ 48,192,692,777 .

Documents Incorporated by Reference:

Portions of the registrant's Definitive Proxy Statement to be filed for its 2026 Annual Meeting of Shareholders are incorporated by reference into the sections of this Form 10-K addressing the requirements of Part III of Form 10-K.

Fiscal 2026 Form 10-K

The number of the registrant's common shares, without par value, outstanding as of July October 31, 2026, was the following: 232,575,728 231,136,655 .

Q1 Fiscal 2027 Form 10-Q

MD&A 338 changes

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Our Nuclear and Precision Health Solutions operating segment operates nuclear pharmacies and manufacturing facilities, which manufacture, prepare, and deliver radiopharmaceuticals for use in nuclear imaging, theranostics, and other procedures in hospitals and physician offices. This segment also contract manufactures a radiopharmaceutical treatment (Xofigo ® ) isotopes and treatments and holds the rights to manufacture and distribute Lymphoseek ® , a radiopharmaceutical diagnostic imaging agent.

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Cardinal Health | Fiscal 2026 Form 10-K

Fiscal 2026 Overview

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Overview of Consolidated Results

Revenue for fiscal 2026 increased 14 5 percent to $254.2 billion from the prior year, primarily prior-year quarter to $67.5 billion due to branded and specialty pharmaceutical sales growth from existing and new customers.

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Three Months Ended September 30,

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State opioid assessment related to prior fiscal years (17) —

Non-GAAP operating earnings $ 3,624 $ 2,786 30 %

Restructuring and employee severance 106 88 23 20

Amortization and other acquisition-related costs 469 464 182 104

Acquisition-related cash and share-based compensation costs 287 126 94 64

Impairments and (gain)/loss on disposal of assets, net 177 18 (4) 2

Litigation (recoveries)/charges, net (10) (185) (47) —

Non-GAAP operating earnings $ 1,001 $ 857 17 %

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GAAP operating earnings for fiscal 2026 increased 15% to $2.6 billion from the prior year. The increase in GAAP operating earnings was driven by the increased contribution from branded and specialty pharmaceuticals and the performance of our generics program in our Pharma segment, the impact of the acquisitions of MSO platforms and ADS, and growth from existing customers in our GMPD segment. This increase was partially offset by the $184 million pre-tax goodwill impairment charge recognized in fiscal 2026 related to the Navista & Integrated Oncology Network ("ION") reporting unit within our Pharma segment, higher cash and share-based compensation costs resulting from the timing of acquisitions within The Specialty Alliance, and $171 million of net recoveries in class action antitrust litigation recognized in fiscal 2025. See "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 4 of the "Notes to the Consolidated Financial Statements" for further information on the goodwill impairment.

Non-GAAP operating earnings for fiscal 2026 increased 30% to $3.6 billion from the prior year, primarily driven by the increased contribution from branded and specialty pharmaceuticals and the performance of our generics program in our Pharma segment and the impact of the acquisitions of MSO platforms and ADS.

Cardinal Health | Fiscal 2026 Form 10-K

GAAP operating earnings for the three months ended September 30, 2026 increased 13 percent from the prior-year quarter to $753 million, primarily due to the increased contributions from branded and specialty pharmaceutical products and the performance of our generics program, partially offset by an increase in acquisition-related costs.

Non-GAAP operating earnings for the three months ended September 30, 2026 increased 17 percent from the prior-year quarter to $1.0 billion, primarily due to the increased contributions from branded and specialty pharmaceutical products and the performance of our generics program.

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Three Months Ended September 30,

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State opioid assessment related to prior fiscal years (0.05) —

Impairment of equity interest in Outcomes (4)

Restructuring and employee severance 0.34 0.28 0.07 0.06

Amortization and other acquisition-related costs 1.47 1.49 0.57 0.31

Acquisition-related cash and share-based compensation costs 1.16 0.51 0.38 0.26

Impairments and (gain)/loss on disposal of assets, net (3)

Litigation (recoveries)/charges, net 0.04 (0.54) (0.13) 0.03

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(3) For fiscal 2026, impairments and (gain)/loss on disposals of assets, net included a pre-tax goodwill impairment charge of $184 million related to the Navista & ION reporting unit within the Pharma segment. Net of the $23 million tax benefit and $23 million portion attributable to noncontrolling interests, this had an adverse impact of $0.58 per share to GAAP diluted EPS.

(4) During fiscal 2026, we recognized a pre-tax impairment charge of $122 million in connection with the observed reduction of the estimated fair value of the Outcomes business, of which we hold a 16 percent equity interest.

Cardinal Health | Fiscal 2026 Form 10-K

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 its 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 6 of the "Notes to Consolidated Financial Statements" for additional information on the debt financing.

Management Service Organization Platforms

The performance of The Specialty Alliance positively impacted the year-over-year comparison of Pharma segment profit during fiscal 2026, primarily due to the impact of the acquisitions of GI Alliance ("GIA") 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. Additionally, 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.

(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 section titled "Explanation and Reconciliation of Non-GAAP Financial Measures."

Non-GAAP GAAP diluted EPS for fiscal the three months ended September 30, 2026 increased 37 27 percent to $11.26 from the prior year prior-year quarter to $2.38, primarily due to the factors impacting non-GAAP GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items. partially offset by increased interest expense.

GAAP Non-GAAP diluted EPS for fiscal the three months ended September 30, 2026 increased 12 28 percent to $7.23 from the prior year, prior-year quarter to $3.26, primarily due to the factors impacting GAAP non-GAAP operating earnings discussed in the preceding section and favorable changes in discrete tax items. partially offset by increased interest expense and the impairment of our equity interest in Outcomes.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Significant Developments in Fiscal 2026 2027 and Trends

Pharmaceutical and Specialty Solutions Segment

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There are a number of proposed and adopted U.S. government policy initiatives being considered that could directly or indirectly impact pharmaceutical manufacturer list prices for branded pharmaceutical products. The Inflation Reduction Act has and will continue to adversely impact our revenue by capping prices for certain drugs; however, our profitability has not been negatively materially impacted. Additionally, the 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. The extent of any future impacts is uncertain and may vary depending on the timeline for implementation and the extent of any price reductions.

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Cardinal Health | Fiscal 2026 Form 10-K

With respect to GLP-1 medications, during fiscal 2026, we experienced increased demand during the three months ended September 30, 2026, which positively impacted our Pharma segment revenue and consolidated revenue; however, increased GLP-1 sales did not meaningfully contribute to segment profit. Demand growth for GLP-1 medications began to moderate in fiscal year 2026 and we expect future demand growth moderation to continue; however, demand for these medications is unpredictable.

The performance financial results of our Pharma segment generics program positively impacted the year-over-year comparison of Pharma segment profit during fiscal 2026. The Pharma segment generics program includes, include, 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. Additionally, while generic pharmaceutical products are not currently subject to U.S. tariffs, it is possible that this may change in the future, which may impact our costs or decrease available supply. These risks and uncertainties may impact Pharma segment profit and consolidated operating earnings during the remainder of fiscal 2027 and beyond.

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Since February 2025, we have paid approximately $200 million in IEEPA tariffs, related to products that we source, manufacture or distribute, primarily in our GMPD segment. After receiving refunds of IEEPA tariffs from the U.S. Government, we expect to return to customers the portion of those refunds that reflect the estimated increased prices paid related to IEEPA tariffs.

During the fourth quarter of fiscal 2026, we recorded a receivable of approximately $200 million in relation to the expected refund of IEEPA tariffs from the U.S. Government. This resulted in a net benefit to operating earnings of approximately $100 million during the three months ended June 30, 2026, primarily due to the recording of a corresponding expense related to the payments to customers. The net operating earnings impact was immaterial for fiscal 2026, due to the timing of tariff related expense recognition and the IEEPA tariff refund. The ultimate resolution of this matter could impact our results of operations in future periods, including GMPD segment profit and consolidated operating income.

It is also possible that our Pharma segment could be impacted by tariffs. An April 2026 proclamation issued by the President of the United States imposed tariffs on imports of branded pharmaceutical products and associated ingredients imported into the United States. If pharmaceutical manufacturers raise their prices or stop importing certain products, we could experience increased costs or supply disruptions which may impact our financial results.

Cardinal Health | Fiscal 2026 Form 10-K

In February 2025, the United States imposed tariffs under the IEEPA on certain goods, materials, and products imported into the United States from countries where we do business. Between February 2025 and 2026, we have paid approximately $200 million in IEEPA tariffs, related to products that we source, manufacture, or distribute, primarily in our GMPD segment.

In February 2025, the United States imposed tariffs under the 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. Subsequent to this ruling, U.S. Customs and Border Protection (the "CBP") worked to establish a phased process to administer refunds required by the Supreme Court ruling. In April 2026 and June 2026, the U.S. Government launched its program to administer refund requests under Phase 1 and Phase 2, respectively, and additional phases are expected to be communicated in the future. The majority of our refund requests fall under Phase 2. Our refund requests under Phases 1 and 2 have been submitted and accepted by the CBP. We expect that the remainder of our refund requests will be submitted in later phases or through other established mechanics.

As of September 30, 2026, we have recovered the majority of refunds for the claims submitted under Phase 1 and Phase 2. We expect the remainder of claims to be submitted in future phase filings, for which the CBP has not yet opened the claims submission process. After receiving refunds of all IEEPA tariffs from the U.S. Government, we expect to return to customers the portion of those refunds that reflect the estimated increased prices paid related to IEEPA tariffs. The ultimate resolution of this matter could impact our results of operations in future periods, including GMPD segment profit and consolidated operating income.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

The tariff environment remains 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. For example, in addition to the IEEPA tariffs discussed above, our GMPD segment has experienced, and expects to continue to experience, increased costs as a result of tariffs imposed or expected to be imposed under different legal authority. including Sections 122, 232 and 301 of the Trade Act of 1974 and Section 308 of the Smoot-Hawley Tariff Act. Our GMPD segment continues to take action to reduce the impact of these tariffs and other potential 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 adverse impact and may not in the future. 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. 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.

Additionally, while generic pharmaceutical products are not currently subject to U.S. tariffs, in July 2026, the President recently issued a statement i ndicating indicating that generic pharmaceutical products will be subject to 100% tariffs beginning in 2028 and 200% tariffs beginning in 2029. There remains significant uncertainty about the ultimate implementation of this proposal; however, these potential tariffs may impact our costs or decrease available supply, which could impact Pharma segment profit and consolidated operating earnings.

The conflict in Iran has resulted in higher than anticipated costs for fuel and transportation across the enterprise as well as products manufactured or distributed by our GMPD segment. We may not be successful at offsetting these increased prices through cost-savings measures or increasing prices to customers. If we are not able to offset these increased prices, profit may be negatively impacted to a greater extent than initially expected.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

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Three Months Ended September 30,

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Pharmaceutical and Specialty Solutions $ 234,833 $ 204,644 15 %

Other 6,792 5,382 26 %

Total segment revenue 254,344 222,662 14 %

Total revenue $ 254,248 $ 222,578 14 %

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

Pharmaceutical and Specialty Solutions $ 62,582 $ 59,205 6 %

Global Medical Products and Distribution 12,719 12,636 1 3,190 3,184 — %

Other 1,764 1,641 7 %

Total segment revenue 67,536 64,030 5 %

Corporate (23) (21) N.M.

Total revenue $ 67,513 $ 64,009 5 %

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Pharma segment revenue for fiscal 2026 increased 15 6 percent to $234.8 billion from the prior year, prior-year quarter to $62.6 billion, primarily due to branded and specialty pharmaceutical sales growth from existing and new customers.

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GMPD segment revenue for fiscal 2026 was relatively flat at $12.7 billion due to Cardinal Health brand growth, offset by lower distribution volumes and the expected IEEPA tariff refund repayment to customers.

Cardinal Health | Fiscal 2026 Form 10-K

GMPD segment revenue was flat at $3.2 billion compared to the prior-year quarter. This reflected Cardinal Health brand growth, offset by a decrease from distribution.

Other segment revenue for fiscal 2026 increased 26 7 percent to $6.8 billion from the prior year prior-year quarter to $1.8 billion due to growth across at-Home Solutions (including the acquisition of ADS), Nuclear and Precision Health Solutions, at-Home Solutions, and OptiFreight ® Logistics.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

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Cost of products sold for fiscal 2026 increased 14 5 percent to $244.5 billion from the prior year, primarily prior-year quarter to $64.9 billion due to the factors affecting the changes in revenue and gross margin.

Three Months Ended September 30,

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Gross margin $ 9,774 $ 8,168 20 %

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and 258 more changes in the filing

Market risk 20 changes

We are exposed to cash flow and earnings fluctuations as a result of certain market risks. These market risks primarily relate to foreign exchange, interest rate, and commodity price-related changes. We maintain a hedging program to manage volatility related to some of these market exposures which employs operational, economic, and derivative financial instruments in order to mitigate risk. See Note 1 and Note 10 of the "Notes to Consolidated Financial Statements" for further discussion regarding our use of derivative instruments.

Foreign Exchange Rate Sensitivity

By the nature of our global operations, we are exposed to cash flow and earnings fluctuations resulting from foreign exchange rate variation. These exposures are transactional and translational in nature. The following foreign currencies represent the principal drivers of our foreign exchange exposure: Canadian dollar, euro, Thai baht, Mexican peso, Chinese renminbi, Australian dollar, British pound, Japanese yen, Philippine peso, Brazilian real, South Korean won, Costa Rican colon, Singapore dollar, Dominican peso, and Indian rupee.

We apply a Value-At-Risk ("VAR") methodology to our transactional and translational exposures. The VAR model is a risk estimation tool and is not intended to represent actual losses in fair value that could be incurred.

Transactional Exposure

Transactional exposure arises from the purchase and sale of goods and services in currencies other than our functional currency or the functional currency of our subsidiaries. At the end of each fiscal year, we perform sensitivity analyses on our forecasted transactional exposure for the upcoming fiscal year. These analyses include the estimated impact of our hedging program, which is designed to mitigate transactional exposure. Applying a VAR methodology to our transactional exposure and including the impact of our hedging program, the potential maximum loss in earnings for the upcoming fiscal year is estimated to be $15 million, which is based on a one-year horizon and a 95 percent confidence level.

Translational Exposure

We have exposure related to the translation of financial statements of our foreign operations into U.S. dollars, our functional currency. Applying a VAR methodology to our translational exposure, the potential maximum loss in earnings for the upcoming fiscal year is estimated to be $2 million, which is based on a one-year horizon and a 95 percent confidence level.

Interest Rate Sensitivity

We are exposed to changes in interest rates primarily as a result of our borrowing and investing activities to maintain liquidity and fund operations. The nature and amount of our long-term and short-term debt can be expected to fluctuate as a result of business requirements, market conditions, and other factors. Our policy is to manage exposures to interest rates using a mix of fixed and floating rate debt as deemed appropriate by management. We utilize interest rate swap instruments to mitigate our exposure to interest rate movements.

As part of our risk management program related to our debt, we perform an annual sensitivity analysis on our forecasted exposure to interest rates for the upcoming fiscal year. At June 30, 2026, a hypothetical increase or decrease of 50 basis points in interest rates would result in an increase or decrease in interest expense of $14 million, respectively.

We are also exposed to market risk from changes in interest rates related to our cash and cash equivalents, which includes marketable securities that are carried at fair value in the consolidated balance sheets. The fair value of our cash and cash equivalents is subject to change primarily as a result of changes in market interest rates and investment risk related to the issuers' credit worthiness. At June 30, 2026, a hypothetical increase or decrease of 50 basis points in interest rates would result in an increase or decrease in interest income of $19 million, respectively.

Cardinal Health | Fiscal 2026 Form 10-K

Disclosures about Market Risk

Commodity Price Sensitivity

We are directly exposed to market price changes for certain commodities, including oil-based resins, nitrile, cotton, diesel fuel, and latex. We typically purchase raw materials at either market prices or prices tied to a commodity index and some finished goods at prices based in part on a commodity price index. During fiscal 2026, the prices of certain commodities continued to experience fluctuation due in part to the conflict in Iran.

As part of our risk management program, we perform sensitivity analysis on our forecasted direct commodity exposure for the upcoming fiscal year. Our forecasted direct commodity exposure at June 30, 2026 decreased approximately $34 million from June 30, 2025. There were no outstanding commodity contracts in our hedging program at June 30, 2026.

Our forecasted direct commodity exposures for the upcoming fiscal year is $457 million. The potential gain/loss for fiscal 2026, given a hypothetical 10 percent fluctuation in commodity prices, assuming pricing collectively shifts in the same direction and there is no change in customer pricing is $46 million at June 30, 2026.

Cardinal Health | Fiscal 2026 Form 10-K

There have been no material changes in the quantitative and qualitative market risk disclosures included in the 2026 Form 10-K since the end of fiscal 2026 through September 30, 2026.

Risk factors 17 changes

Our results of operations or strategic objectives could be adversely impacted if we fail to manage and complete divestitures.

We regularly evaluate our portfolio of businesses to determine whether an asset or business may no longer help us meet our objectives or whether there may be a more advantaged owner for that business. When we decide to sell assets or a business, we may encounter difficulty finding buyers or alternative exit strategies, which could impact the achievement of our strategic objectives. We could also fail to obtain necessary regulatory approval or incur higher costs or charges than planned or incur unexpected charges and could experience greater dis-synergies than expected, which could have a negative impact on our results of operations.

Our goodwill or other long-lived assets may be further impaired, which could require us to record additional significant charges to earnings in accordance with generally accepted accounting principles.

U.S. GAAP requires us to test our goodwill for impairment on an annual basis, or more frequently if indicators for potential impairment exist. In addition, we review intangible assets with finite lives and other long-lived assets for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable.

Impairment testing involves estimates and significant judgments by management. We believe our assumptions and estimates are reasonable and appropriate; however, additional adverse changes in key assumptions, a failure to meet expected earnings or other financial plans, or unanticipated events and circumstances, an increase in the discount rate, a decrease in the terminal growth rate, increases in tax rates, or a significant change in industry or economic trends could affect the accuracy or validity of such estimates and may result in goodwill impairment. It is possible that we may record significant charges from impairment to our goodwill reporting units, intangibles, and other long-lived assets in the future. Any charge or charges could adversely affect our results of operations.

See "Critical Accounting Policies and Sensitive Accounting Estimates" in MD&A above for more information regarding goodwill impairment testing.

Cardinal Health | Fiscal 2026 Form 10-K

Risk Management and Strategy

As a large healthcare distribution and services company, we are exposed to various cybersecurity threats and cybersecurity risk management is integral to our overall enterprise risk management strategy. We identify, assess, and manage risks related to cybersecurity through documented policies, standards, and procedures. Our approach to detection, mitigation, remediation, and prevention of cybersecurity risks utilizes a range of measures including, among other elements: benchmarking to generally accepted industry standards and frameworks, such as the National Institute of Standards and Technology cybersecurity framework; use of periodic tabletop exercises to promote awareness and improve internal processes; periodic penetration testing; a dedicated staff of cybersecurity professionals; and implementation of security measures and policies intended to identify as well as assist in containing and remediating cybersecurity risks. We maintain cybersecurity incident response, exposure management, disaster recovery, and business continuity plans that govern activities such as prevention, preparation, detection coordination, remediation and recovery, and escalation to senior management and, where appropriate, relevant committees of the Board. These plans are routinely reviewed under the leadership of our Chief Information Security Officer ("CISO"). We also maintain mandatory employee cybersecurity and privacy compliance awareness training, which is supplemented by employee engagement campaigns.

We utilize third parties to assist with, and assess the effectiveness of, our cybersecurity posture, in addition to supporting incident response and mitigation where necessary. We identify and assess third party risks associated with suppliers and service providers across a range of areas, including cybersecurity, through a third-party risk management process that incorporates, among other features, the use of risk assessments and, where appropriate, contractual requirements around evaluations, security, technology, service levels, and other terms.

To date, we are not aware of cybersecurity incidents that have materially affected or are reasonably likely to materially affect Cardinal Health. However, the scope and impact of any future incident cannot be predicted. For more information, please see Item 1A "Risk Factors" for the risk factor entitled "Our business and results of operations could be adversely affected if we experience a material cyber-attack or other systems breach."

Our CISO, in coordination with our Chief Information Officer ("CIO") to whom the CISO reports, leads our approach to assessing and managing cybersecurity-related risks. Our CISO has over twenty-five years of experience in information technology ("IT"), with twenty years in IT risk management, compliance, and information security, as well as a background in leading technical infrastructure teams and roles supporting business operations.

As part of management's oversight of our cybersecurity program, we maintain an IT risk governance process that includes multiple levels of escalation from our IT Risk Advisory Board, which meets on a monthly basis and whose membership includes the CISO and IT functional area leadership, to an executive-level committee to help address cybersecurity risks at an enterprise level.

The company's Board oversees our overall risk management process. The Board has delegated to the Risk Oversight Committee of the Board primary responsibility for (i) overseeing cybersecurity and other major technology-related risks and our actions to monitor and mitigate such risks and (ii) monitoring emerging technologies such as artificial intelligence, including how such technologies are, or may be, incorporated into our operations, services and strategies and discussing risks related to these emerging technologies. The Risk Oversight Committee also monitors Cardinal Health's compliance with applicable legal and regulatory requirements, including with respect to data privacy and security. The Risk Oversight Committee receives at least quarterly updates from the CISO and CIO and the Board receives at least annual cybersecurity updates. Among other items, these updates cover a range of matters relevant to our cybersecurity program, including: the threat environment and related business risks; the state, priorities of, and investments in our cybersecurity program; the availability of cyber insurance; review of certain cybersecurity incidents that have occurred within the company and the industry; and relevant cybersecurity operational metrics.

Cardinal Health | Fiscal 2026 Form 10-K

Properties and Legal Proceedings

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 2026 Form 10-K and our filings with the SEC since June 30, 2026. 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.

Other information 7 changes

Certain Commercial Practices

Although our agreements with manufacturers sometimes require us to maintain inventory levels within specified ranges, our distribution businesses are generally not required by our customers to maintain particular inventory levels other than as needed to meet service level requirements. Certain customer contracts require us to maintain sufficient inventory to meet emergency demands, but we do not believe those requirements materially affect inventory levels.

Our customer return policies generally require that the product be physically returned, subject to restocking fees. We only allow customers to return product for credit that can be added back to inventory and resold at full value, or that can be returned to vendors for credit.

We offer market payment terms to our customers.

1 unchanged paragraph

Cardinal Health | Fiscal 2026 Form 10-K

During the quarter three months ended June September 30, 2026, no director or officer adopted , modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule10b5-1 "non-Rule 10b5-1 trading arrangement" as each term is defined in Section 408(a) Item 408 of Regulation S-K under the Exchange Act.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Financial statements 50 changes

Condensed Consolidated Statements of Cash Flows

Three Months Ended September 30,

(in millions) 2026 2025 2024

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Depreciation and amortization 956 790 710

Impairment of equity interest in Outcomes 122 — —

Share-based compensation 367 244 121

Provision for/(benefit from) deferred income taxes

Depreciation and amortization 247 233

Impairments and (gain)/loss on sale of other investments, net 21 3 2 16 5

Impairment and (gain)/loss on sale of equity interest in Outcomes, net ( 2 ) —

Impairments and (gain)/loss on disposal of assets, net 177 18 634 ( 4 ) 2

Share-based compensation 109 93

Provision for bad debts 74 53 36 14 13

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(Increase)/decrease in inventories ( 488 ) ( 1,816 ) 1,115

Increase in accounts payable 3,463 2,732 1,824

Increase in trade receivables ( 408 ) ( 833 734 ) ( 996 539 )

Increase in inventories ( 1,171 ) ( 736 )

Increase in accounts payable 2,653 2,147

Repurchases of liability-classified Specialty Alliance Units ( 45 ) 4 ) 19 ( 16 )

Other accrued liabilities and operating items, net ( 861 ) ( 587 282 ) ( 433 683 )

Net cash provided by operating activities 5,174 2,397 3,762 1,398 973

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Proceeds from investments 41 15 1

Proceeds from/(payments for) net investment hedge terminations ( 13 ) 2 34

Purchase of short-term time deposits — — ( 550 )

Proceeds from short-term investment in time deposit — 200 350

Acquisition of subsidiaries, net of cash acquired ( 1,991 ) ( 5,250 149 ) ( 1,190 41 )

Additions to property and equipment ( 649 ) ( 547 157 ) ( 511 108 )

Proceeds from investments 34 9

Proceeds from disposal of property and equipment 31 3 12 15 —

Other investing items, net ( 3 ) ( 16 ) 5

2 unchanged paragraphs

Net increase/(decrease) in cash and equivalents 982 ( 1,259 ) 1,057

Cash and equivalents at beginning of period 3,874 5,133 4,076

Supplemental Information:

Cash payments for interest $ 406 $ 315 $ 214

Net cash payments for income taxes

The accompanying notes are an integral part of these consolidated statements.

Cardinal Health | Fiscal 2026 Form 10-K

Proceeds from long-term obligations, net of issuance costs 990 3,669 1,139 — 989

Reduction of long-term obligations ( 653 ) ( 445 11 ) ( 783 512 )

Payments to noncontrolling interests, net ( 11 ) 3 ) 12 ( 3 )

Net tax proceeds/(withholding) withholding from share-based compensation ( 79 102 ) ( 13 80 ) 46

Dividends on common shares ( 491 ) ( 494 126 ) ( 499 129 )

Purchase of treasury shares ( 1,358 ) ( 765 500 ) ( 750 375 )

Net cash provided by/(used used in financing activities ( 742 ) ( 110 )

Effect of exchange rates changes on cash and equivalents ( 6 ) ( 3 ( ( 9 2 )

Net increase in cash and equivalents 408 719

Cash and equivalents at end beginning of period $ 4,856 $ 3,874 $ 5,133

Cash and equivalents at end of period $ 5,264 $ 4,593

See notes to condensed consolidated financial statements.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Note 1: Basis of Presentation and Summary of Significant Accounting Policies 26 changes

Cardinal Health, Inc. is a global healthcare services and products company providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, and physician offices. We provide pharmaceuticals and medical products and cost-effective solutions that enhance the healthcare system and supply chain efficiency. References to "we," "our," "us," and similar pronouns in these consolidated financial statements are to Cardinal Health, Inc. and its majority-owned or controlled subsidiaries, unless the context otherwise requires.

Our fiscal year ends on June 30. References to fiscal 2026, 2025, and 2024 in these consolidated financial statements are to the fiscal years ended June 30, 2026, 2025, and 2024, respectively.

1 unchanged paragraph

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. Certain prior year amounts have been reclassified to conform to the current year presentation.

1 unchanged paragraph

We consider liquid investments purchased with an initial effective maturity of three months or less to be cash equivalents. The carrying amount of cash equivalents approximates fair value.

Receivables and Allowance for Doubtful Accounts

Trade receivables are reported at their estimated collectible amounts and presented net of an allowance for doubtful accounts of $ 201 million and $ 213 million at June 30, 2026 and 2025, respectively. In addition to credit losses, the allowance also includes reserves related to customer disputes and late fees billed to customers, which are recognized within our consolidated statements of earnings as reductions of revenue. An account is considered past due on the first day after its due date. In accordance with contract terms, we generally have the ability to charge customers service fees or higher prices if an account is considered past due. We regularly monitor past due accounts and establish appropriate reserves to cover potential losses, and consider historical experience, pricing discrepancies, the current economic environment, customer credit ratings or bankruptcies, and reasonable and supportable forecasts to develop our allowance for credit losses. We review these factors quarterly to determine if any adjustments are needed to the allowance. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts.

We provide financing to various customers. Such financing arrangements range from 1 year to 5 years at interest rates that are generally subject to fluctuation. Interest income on these arrangements is recognized as it is earned. The financings may be collateralized, guaranteed by third parties or unsecured. Finance notes, net and related accrued interest were $ 28 million (current portion $ 3 million) and $ 32 million (current portion $ 7 million) at June 30, 2026 and 2025, respectively, and are included in other assets (current portion is included in prepaid expenses and other) in the consolidated balance sheets. Finance notes receivable allowance for doubtful accounts were $ 7 million and $ 2 million at June 30, 2026 and 2025, respectively. We estimate an allowance for these financing receivables based on historical collection rates and the creditworthiness of the customer. We write off any amounts deemed uncollectible against the established allowance for doubtful accounts.

Since February 2025, we have paid approximately $ 200 million in International Emergency Economic Powers Act ("IEEPA") tariffs, related to products that we source, manufacture or distribute, primarily in our GMPD segment.

During the fourth quarter of fiscal 2026, we recorded a receivable of approximately $ 200 million in relation to the expected refund of IEEPA tariffs from the government, which is included in prepaid expenses and other assets in the consolidated balance sheet. Upon receiving 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 paid related to IEEPA tariffs.

Cardinal Health | Fiscal 2026 Form 10-K

References to "we," "our," and similar pronouns in this Quarterly Report on Form 10-Q for the quarter ended September 30, 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 2027 and 2026 in these condensed consolidated financial statements are to the fiscal years ending or ended June 30, 2027 and June 30, 2026, respectively.

Our condensed consolidated financial statements are 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 the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates, judgments, and assumptions are used in the accounting and disclosure related to, among other items, allowance for doubtful accounts, inventory valuation and reserves, goodwill and other intangible asset impairment, vendor reserves, loss contingencies (including product liability and self-insurance accruals), and income taxes. 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 2027 interim period are not necessarily indicative of the results that may be expected for the full fiscal year ending June 30, 2027. 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, 2026 (the "2026 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.

We have concluded that The Specialty Alliance management services organization ("MSO") and Navista are the primary beneficiaries of certain physician practices and therefore the practices are consolidated as VIEs. The Specialty Alliance and Navista VIEs do not have a material impact on our consolidated statements of earnings or consolidated statements of cash flows. Total assets and liabilities included in the consolidated balance sheets for The Specialty Alliance and Navista VIEs were $ 1.3 billion and $ 1.1 billion, respectively, as of September 30, 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 September 30, 2026 primarily represents third-party equity interests in Navista.

Recently Issued Financial Accounting Standards And Disclosure Rules Not Yet Adopted

We assess the adoption impacts of recently issued accounting standards by the FASB on our consolidated financial statements as well as material updates to previous assessments, if any, from the 2026 Form 10-K.

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

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Note 2: Acquisitions 40 changes

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.

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. ADS is part of our at-Home Solutions operating segment and we report ADS results in Other.

Transaction and integration costs associated with the ADS acquisition were $ 23 million and $ 31 million during fiscal 2026 and 2025, respectively.

On January 30, 2025, we completed the acquisition of a 73 % ownership interest in GIA, now part of The Specialty Alliance, for a purchase price of $ 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 $ 11 million and $ 75 million during fiscal 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 $ 5 million and $ 30 million during fiscal 2026 and 2025, respectively.

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. We have accounted for the acquisition of the ownership interest in Solaris as a business combination in accordance with ASC 805.

Transaction and integration costs associated with the Solaris acquisition were $ 49 3 million during fiscal the three months ended September 30, 2026.

1 unchanged paragraph

The allocation of the fair value of assets acquired and liabilities assumed for the acquisitions of Urology America, ADS, GIA, and ION were finalized during fiscal 2026, resulting in goodwill of $ 339 million, $ 577 million, $ 3.1 billion, and $ 1.1 billion, respectively. The noncontrolling interest in ION was recognized at the acquisition-date fair value of $ 157 million. There were no significant adjustments to the allocation of the fair value of assets acquired and liabilities assumed for these acquisitions from those disclosed in our fiscal 2025 Form 10-K.

Cardinal Health | Fiscal 2026 Form 10-K

The allocation of the purchase price for the acquisition of Solaris Health is not yet finalized and is subject to adjustment as we complete the valuation analysis of this acquisition. The purchase price is also subject to adjustment based on working capital requirements as set forth in the acquisition agreement.

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:

(in millions) Solaris Health

Identifiable intangible assets:

Non-competition agreements (2)

Total identifiable intangible assets acquired

Identifiable net assets/(liabilities):

Cash and equivalents

Trade receivables, net

Prepaid expenses and other 73

Property and equipment, net 62

Accounts payable ( 106 )

Current portion of long-term obligations and other short-term borrowings —

Other accrued liabilities ( 175 )

Long-term obligations, less current portion —

Deferred income taxes and other liabilities ( 194 )

Total identifiable net assets/(liabilities) acquired 411

Noncontrolling interest —

Total net assets acquired

(1) The useful life of trade names is 10 years.

(2) The 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 rate used to arrive at the present value of the identifiable intangible assets for Solaris Health was 7 percent, and reflects the internal rate of return and uncertainty in the cash flow projections, which is reflective of market participant assumptions.

The fair value of the Solaris Health trade name intangible asset was 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 trade name and discounted to present value using an appropriate discount rate.

The fair value of the non-compete intangibles acquired from Solaris Health 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, issued in relation to the Solaris Health acquisition, were recognized at their acquisition date fair value of $ 210 million and are included in deferred income taxes and other liabilities in the condensed 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 Solaris Health acquisition was determined using a discount rate of 7.5 percent and an estimated weighted average service period of five years .

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Note 3: Restructuring and Employee Severance 17 changes

1 unchanged paragraph

Employee-related costs $ 62 $ 61 $ 95

Restructuring and employee severance costs in fiscal 2026 and 2025 primarily resulted from certain initiatives to rationalize our manufacturing operations and other cost-savings initiatives within our GMPD segment. Restructuring and employee severance costs in fiscal 2024 primarily resulted from certain projects resulting from the reviews of our strategy, portfolio, capital-allocation framework, and operations and from enterprise-wide cost-savings initiatives.

Cardinal Health | Fiscal 2026 Form 10-K

Three Months Ended September 30,

(in millions) 2026 2025 2024

Employee-related costs $ 11 $ 15

Facility exit and other costs 44 27 80 12 5

Total restructuring and employee severance $ 106 $ 88 23 $ 175 20

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 other service fees to support divestitures, costs associated with vacant facilities. and certain other divestiture-related costs.

During the three months ended September 30, 2026, restructuring and employee severance costs were primarily related to the implementation of cost-savings and other strategic initiatives. During the three months ended September 30, 2025, restructuring and employee severance costs were primarily related to the implementation of cost-savings initiatives.

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

(in millions) Employee-

Related Costs Facility Exit

and Other Costs Total

Balance at June 30, 2026 $ 55 $ — $ 55

Payments and other adjustments ( 18 ) — ( 18 )

Balance at September 30, 2026 $ 45 $ — $ 45

Note 4: Goodwill and Other Intangible Assets 34 changes

Global Medical Products and Distribution (2)

Balance at June 30, 2024 $ 3,555 — $ 1,170 $ 4,725

Goodwill acquired, net of purchase price adjustments 4,389 — 578 4,967

Foreign currency translation adjustments and other ( 1 ) — — ( 1 )

Balance at June 30, 2025 $ 7,943 $ — $ 1,748 $ 9,691

Goodwill acquired, net of purchase price adjustments 1,936 — ( 1 ) 1,935

Foreign currency translation adjustments and other — — — —

Goodwill Impairment ( 184 ) — — ( 184 )

The following table summarizes the changes in the carrying amount of goodwill for the two reportable segments and the remaining operating segments, included in Other by segment and in total:

(in millions) Pharmaceutical and Specialty Solutions Global Medical Products and Distribution Other (1)

1 unchanged paragraph

(1) At June 30, 2026, the Pharma segment accumulated goodwill impairment loss was $ 184 million related to the Navista & ION reporting unit.

(2) At June 30, 2026 and 2025, the GMPD segment accumulated goodwill impairment loss was $ 5.4 billion.

(4) At June 30, 2026 and 2025, the Nuclear and Precision Health Solutions accumulated goodwill impairment loss was $ 829 million.

Goodwill increased in fiscal 2026 primarily due to the acquisition of Solaris Health within the Pharma segment. Goodwill recognized in connection with the acquisition primarily represents 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.

We performed interim quantitative goodwill impairment testing for the Navista & ION reporting unit during the three months ended March 31, 2026, which resulted in pre-tax impairment charges of $ 184 million. 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.

We performed interim quantitative goodwill impairment testing for GMPD during fiscal 2024, which resulted in pre-tax goodwill impairment charges of $ 675 million, which was included in impairments and (gain)/loss on disposal of assets, net in our consolidated statements of earnings. GMPD had no goodwill balance remaining as of March 31, 2024.

Goodwill acquired, net of purchase price adjustments 34 — 67 101

Balance at September 30, 2026 $ 9,729 $ — $ 1,814 $ 11,543

(3) (1) Comprised of the remaining operating segments, Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight ® Logistics.

During the three months ended September 30, 2026, we did not identify any indicators of impairment within our reporting units.

Goodwill increased in the three months ended September 30, 2026 due to recent acquisitions as well as purchase accounting adjustments in the Pharma segment and at-Home Solutions.

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.

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.

1 unchanged paragraph

The following tables summarize other intangible assets by class at: June 30:

7 unchanged paragraphs

Developed technology and other 1,030 779 251 5

Total definite-life intangibles 6,349 4,184 2,165 8

Total other intangible assets $ 6,373 $ 4,184 $ 2,189 N/A

Cardinal Health | Fiscal 2026 Form 10-K

Trademarks, trade names and patents 1,128 574 554 8

Developed technology and other 928 689 239 5

Non-Competition Agreements 111 33 78 4

Total definite-life intangibles 6,272 4,150 2,122 8

Total other intangible assets $ 6,296 $ 4,150 $ 2,146 N/A

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Note 5: Long-Term Obligations and Other Short-Term Borrowings 37 changes

The following table summarizes long-term obligations and other short-term borrowings at June 30:

3.75% Notes due 2025 $ — $ 501

4.7% Notes due 2026 499 498

3.41% Notes due 2027 1,212 1,206

5.125% Notes due 2029 646 645

5.0% Notes due 2029 746 745

4.5% Notes due 2030 593 —

5.45% Notes due 2034 496 501

5.35% Notes due 2034 990 989

5.15% Notes due 2035 388 —

4.6% Notes due 2043 325 323

4.5% Notes due 2044 336 338

4.9% Notes due 2045 432 438

4.368% Notes due 2047 563 566

5.75% Notes due 2054 641 641

7.0% Debentures due 2026 124 124

Floating Rate Term Loan due 2028 699 799

Other Obligations 196 213

Less: current portion of long-term obligations and other short-term borrowings 1,882 550

Long-term obligations, less current portion $ 7,004 $ 7,977

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

Maturities of existing long-term obligations and other short-term borrowings for fiscal 2027 through 2031 and thereafter are as follows:

(in millions) Debt maturities

Total debt and finance lease obligations

During fiscal 2026, 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 fiscal 2026, we made a partial principal payment of $ 100 million for the Floating Rate Term Loan due 2028 with available cash and repaid the full principal of $ 500 million of the 3.75% Notes due 2025 at maturity with available cash.

During fiscal 2025, we issued additional debt, with the aggregate principal amount of $ 2.9 billion, to fund a portion of the consideration payable in connection with the GIA and ADS acquisitions and for general purposes. The notes issued are $ 500 million aggregate principal amount of 4.7% Notes that mature on November 15, 2026, $ 750 million aggregate principal amount of 5.0% Notes that mature on November 15, 2029, $ 1.0 billion aggregate principal amount of 5.35% Notes that mature on November 15, 2034, and $ 650 million aggregate principal amount of 5.75% Notes that mature on November 15, 2054. The proceeds of the notes issued, net of discounts, premiums, and debt issuance costs, were $ 2.9 billion.

During fiscal 2025, we repaid the full principal of $ 400 million of the 3.5% Notes due 2024 at maturity with proceeds from the debt issuance in fiscal 2024.

If we undergo a change of control, as defined in the notes, and if the notes receive specified ratings below investment grade by

Cardinal Health | Fiscal 2026 Form 10-K

We had total long-term obligations, including the current portion and other short-term borrowings, of $ 8.8 billion and $ 8.9 billion at September 30, 2026 and June 30, 2026, 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. The 7.0% Debentures represent unsecured obligations of Allegiance Corporation (a wholly-owned subsidiary), which Cardinal Health, Inc. has guaranteed. None of these obligations are subject to a sinking fund and the Allegiance Corporation obligations are not redeemable prior to maturity. 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 $ 38.3 40.9 billion and $ 34.7 38.3 billion at June September 30, 2026 and 2025, June 30, 2026, respectively.

Other Financing Arrangements

In addition to cash and equivalents and operating cash flow, other sources of liquidity at September 30, 2026 include a $ 4.0 billion commercial paper program, backed by a $ 4.0 billion revolving credit facility that expires in August 2031. At September 30, 2026, we had no amounts outstanding under our commercial paper program or our revolving credit facility.

On August 7, 2026, we entered into a consolidated $ 4.0 billion 5-year revolving credit facility, in conjunction with the terminations of the $ 2.0 billion revolving credit facility, the $ 1.0 billion 364-Day revolving credit facility, and the $ 1.0 billion committed receivables sales facility.

On September 15, 2026, we also increased our commercial paper program to $ 4.0 billion. This program is backstopped by our revolving credit facility.

Between October 29 and November 2, 2026, we entered into $ 1 billion of uncommitted revolving credit facilities.

Our revolving credit facility requires us to maintain a consolidated net leverage ratio of no greater than 4.00-to-1.00. As of September 30, 2026, we were in compliance with this financial covenant.

Note 6: Commitments, Contingent Liabilities, and Litigation 3 changes

2 unchanged paragraphs

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 SG&A expenses in our consolidated statements of earnings.

Legal proceedings 4 changes

1 unchanged paragraph

Cardinal Health | Fiscal 2026 Form 10-K

From time to time, we determine that products we distribute, source, manufacture, or market do not meet our specifications, regulatory requirements, or published standards. While we investigate and take appropriate action when we or a regulatory agency identify a potential quality or regulatory issue, there is no assurance that the issue will be resolved to the satisfaction of the regulator. 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.

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 and take appropriate corrective action.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Notes to the financial statements 33 changes

compensation expense in distribution, selling, general, and administrative ("SG&A") expenses to correspond with the same line item as the majority of the cash compensation paid to employees. If awards are modified in connection with a restructuring activity, the incremental share-based compensation expense is classified in restructuring and employee severance. See Note 14 for additional information regarding share-based compensation.

The Specialty Alliance Share-Based Compensation

The Specialty Alliance, a majority-owned subsidiary of Cardinal Health, maintains standalone share-based compensation plans. In connection with the acquisition of physician practices, The Specialty Alliance issues common units in The Specialty Alliance (collectively the "Specialty Alliance Units") to certain physicians and management. The Specialty Alliance Units contain forfeiture provisions ranging from 36 to 60 months. These forfeiture provisions provide that the unit holders forfeit all or a portion of the Specialty Alliance Units should they leave the Specialty Alliance, except in certain limited situations, effectively requiring the unit holders to stay employed with the physician practice managed by the Specialty Alliance in order to retain all of the granted Specialty Alliance Units during the forfeiture period.

These Specialty Alliance Units are classified as liabilities under Accounting Standards Codification ("ASC") 718 and are included in deferred income taxes and other liabilities in the consolidated balance sheets. The fair value of the vested Specialty Alliance Units with no future service requirement are recorded as an assumed liability at the acquisition date. The fair value of Specialty Alliance Units with a future service requirement are recognized on a straight-line basis over the requisite service period.

The fair value of the Specialty Alliance Units is remeasured at each reporting period using a discounted cash flow method. The compensation costs recognized each period reflects the change in the fair value of the liability for the portion of the awards for which the requisite service has been rendered.

See Note 14 for additional information regarding share-based compensation.

We paid cash dividends per common share of $ 2.04 , $ 2.02 , and $ 2.00 in fiscal 2026, 2025, and 2024, respectively.

We recognize revenue in an amount that reflects the consideration to which we expect to be entitled in exchange for the transfer of goods or services to customers.

Revenue in our Pharma, GMPD, Nuclear and Precision Health Solutions, and at-Home Solutions operating segments is primarily related to the distribution of pharmaceutical and medical products, which include both manufactured and sourced products, and we recognize at a point in time when title transfers to customers and we have no further obligation to provide services related to such merchandise. OptiFreight ® Logistics revenue is related to shipping, freight management, and logistics management services. Service revenues are recognized over the period that services are provided to the customer, reduced by contractual adjustments to third-party payors, discounts and implicit price concessions to customers. Revenues derived from services from all segments are immaterial for all periods presented.

We are generally the principal in a transaction, therefore our revenue is primarily recorded on a gross basis. When we are a principal in a transaction, we have determined that we control the ability to direct the use of the product or service prior to transfer to a customer, are primarily responsible for fulfilling the promise to provide the product or service to our customer, have discretion in establishing prices, and ultimately control the transfer of the product or services provided to the customer.

Sales Returns and Allowances

Revenue is recorded net of sales returns and allowances. Revenues are measured based on the amount of consideration that we expect to receive, reduced by estimates for return allowances, discounts, rebates, and other variable consideration. Sales returns are recorded based on estimates using historical data. Our customer return policies generally require that the product be physically returned, subject to restocking fees. We only allow customers to return products for credit in a condition suitable to be added back to inventory and resold at full value ("merchantable product") or returned to vendors for credit. Product returns are generally consistent throughout the year and typically are not specific to any particular product or customer.

We accrue for estimated sales returns and allowances at the time of sale based upon historical customer return trends, margin rates, and processing costs. Our accrual for sales returns is reflected as a reduction of revenue and cost of products sold for the sales price and cost, respectively. At June 30, 2026 and 2025, the accrual for estimated sales returns and allowances was $ 330 million and $ 447 million, respectively, which is reflected in trade receivables, net and inventories, net in the consolidated balance sheets. Sales returns and allowances were $ 1.8 billion for fiscal 2026, and $ 2.2 billion for both 2025, and 2024, and the net impact on net earnings in the consolidated statements of earnings was immaterial in fiscal 2026, 2025, and 2024.

We generally do not accept non-merchantable pharmaceutical product returns from our customers, so many of our customers return non-merchantable pharmaceutical products to the manufacturer through third parties. Since our customers generally do not have a direct relationship with manufacturers, our vendors pass the value of such returns to us (usually in the form of an accounts payable deduction). We, in turn, pass the value received to our customer. In certain instances, we pass the estimated value of the return to our customer prior to our receipt of the value from the vendor. Although we believe we have satisfactory protections, from time to time, we become subject to claims from customers or vendors that our administration of this overall process is deficient in some respect or our contractual terms with vendors are in conflict with our contractual terms with our customers. We maintain reserves for some of these situations based on their nature and our historical experience with their resolution.

Cardinal Health | Fiscal 2026 Form 10-K

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 corrective actions or 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.

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 certain disputes that occur in the ordinary course of business are included within segment profit.

Opioid Lawsuits and Investigations

As of September 30, 2026, we have $ 3.9 billion accrued for the opioid-related matters described below, of which $ 197 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 three months ended September 30, 2026 and fiscal 2026, we made payments totaling $ 385 million and $ 417 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.

While we continue to incur certain costs associated with these matters, during the three months ended September 30, 2026 and fiscal 2026, there were no material expenses recognized for these matters.

States & Political Subdivisions

We have resolved, without admitting liability, the opioid-related claims of all 50 states, the District of Columbia, and 5 U.S. territories. The National Opioid Settlement Agreement ("the NOSA") also resulted in the resolution of the opioid-related claims of over 99 percent of political subdivisions (together, the "Settling Governmental Entities").

To date, we have paid the Settling Governmental Entities approximately $ 2.6 billion and we expect to pay the Settling Governmental Entities additional amounts up to $ 3.7 billion through 2038.

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. In May 2026, the parties submitted additional briefing to the district court and a ruling is pending. We intend to continue to vigorously defend ourselves in this matter.

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 56 lawsuits brought by private plaintiffs pending. Of these, approximately 9 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 December 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 ongoing legal proceedings with insurers related to their obligations to reimburse us for defense and indemnity costs in connection with the lawsuits described above, including two matters currently pending in Ohio state court. Unfavorable outcomes in these matters would negatively impact our financial results and 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 fiscal 2026, we received immaterial insurance recoveries related to opioid matters, which were recorded in the Pharma segment. We have not recorded a receivable for any additional recoveries related to these insurance litigation matters as of September 30, 2026.

Cardinal Health | Q1 Fiscal 2027 Form 10-Q

Note 7: Income Taxes 24 changes

Earnings before Income Taxes and Provision for Income Taxes

The following table summarizes earnings before income taxes:

(in millions) 2026 2025 2024

U.S. operations $ 1,753 $ 1,715 $ 892

Foreign operations 421 386 309

Earnings before income taxes

The following table summarizes the components of the provision for income taxes:

(in millions) 2026 2025 2024

U.S. federal $ 164 $ 135 $ 305

U.S. state and local 123 72 68

Total current $ 378 $ 289 $ 452

U.S. federal $ 104 $ 205 $ ( 89 )

U.S. state and local ( 15 ) 39 12

and 11 more changes in the filing

Note 8: Fair Value Measurements 5 changes

1 unchanged paragraph

3 unchanged paragraphs

and 5 more changes in the filing

Note 9: Financial Instruments 15 changes

5 unchanged paragraphs

and 15 more changes in the filing

Note 10: Shareholders' Deficit 4 changes

and 4 more changes in the filing

Note 12: Segment Information 37 changes

1 unchanged paragraph

and 37 more changes in the filing

Note 13: Share-Based Compensation 5 changes

and 5 more changes in the filing

Exhibits 49 changes

and 49 more changes in the filing