McKesson Corporation Reports First Quarter Financial Results for Fiscal Year 2024
Intellectia.AI Updated: 2024-08-08
McKesson Corporation Reports First Quarter Financial Results for Fiscal Year 2024
McKesson Corporation (NYSE: MCK) has reported its financial results for the first quarter of fiscal year 2024, which ended on June 30, 2024.
Key Financial Metrics
| Metric | Q1 FY24 | Q1 FY23 | YoY Change | Consensus Estimates |
|---|---|---|---|---|
| Revenue | $83.73B | $78.94B | +6% | $82.53B |
| Earnings Per Share | $7.00 | $7.02 | -0.3% | $7.21 |
Interpretation: McKesson Corporation reported a 6% year-over-year increase in revenue for Q1 FY24, totaling $83.73 billion and surpassing the consensus estimate of $82.53 billion. Despite this revenue growth, earnings per share (EPS) slightly declined by 0.3% to $7.00, missing the consensus estimate of $7.21. The slight EPS decline could be attributed to increased operating expenses and lower gains from antitrust settlements.
Revenue Performance by Segment
| Segment | Q1 FY24 | Q1 FY23 | YoY Change |
|---|---|---|---|
| U.S. Pharmaceutical | $71.37B | $66.77B | +7% |
| Prescription Technology Solutions (RxTS) | $915M | $918M | -0.3% |
| Medical-Surgical Solutions | $3.73B | $3.71B | +1% |
| International | $3.88B | $3.66B | +6% |
Interpretation: The U.S. Pharmaceutical segment experienced a robust 7% increase, driven by growth in specialty pharmaceuticals and higher volumes from retail national account customers. The Prescription Technology Solutions segment saw a slight decline due to decreased volumes from third-party logistics and wholesale distribution services. The Medical-Surgical Solutions saw modest growth, mainly from primary care customers, while the International segment increased 6%, driven by higher pharmaceutical distribution volumes and retail pharmacy growth in Canada and Norway.
Dividends and Share Repurchase Program
During the quarter, McKesson repurchased 1.0 million shares of common stock for $528 million. Additionally, the company paid $82 million in dividends. In July 2024, the Board approved an increase in the quarterly dividend from $0.62 to $0.71 per share of common stock and authorized an additional $4.0 billion for the share repurchase program.
Stock Price Movement
After the earnings release, McKesson's stock price experienced a 0.52% increase.
Summary
McKesson Corporation showcased strong revenue growth in Q1 FY24, particularly in the U.S. Pharmaceutical and International segments. Despite missing earnings per share expectations, the company continues to focus on enhancing shareholder value through increased dividends and an expanded share repurchase program.
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