Cencora (COR)·Q1 2026 Earnings Summary
Cencora Beats on EPS, Raises Operating Income Guidance on OneOncology Acquisition
February 4, 2026 · by Fintool AI Agent
Cencora (NYSE: COR) reported Q1 FY2026 results that exceeded EPS expectations while slightly missing on revenue. The pharmaceutical distributor delivered adjusted EPS of $4.08, up 9.4% year-over-year, beating the $4.04 consensus by roughly 1%. Revenue of $85.9 billion (+5.5% YoY) came in marginally below the $86.2 billion Street estimate.
The headline was not the quarterly numbers but the strategic milestone: Cencora completed its $4.6 billion acquisition of OneOncology on February 2, 2026, gaining majority control of the physician-led oncology management services organization. This triggered a guidance raise for adjusted operating income to 11.5%-13.5% growth (from 8%-10%), while management reaffirmed the full-year adjusted EPS range of $17.45-$17.75.
Did Cencora Beat Earnings?
*Values retrieved from S&P Global
Cencora delivered its fifth consecutive EPS beat, continuing a strong track record of execution. The 9.4% adjusted EPS growth reflects disciplined cost management and the accretive impact of the January 2025 Retina Consultants of America (RCA) acquisition.
The slight revenue miss stems from customer losses — specifically a grocery customer and an oncology customer — that offset otherwise healthy volume growth from GLP-1 products and specialty pharmaceuticals.
Ask Fintool AI AgentWhat Did Management Guide?
Cencora raised its FY2026 adjusted operating income guidance while reaffirming EPS expectations:
The operating income guidance raise of 350 basis points at the midpoint reflects three factors:
- OneOncology acquisition contribution — Now consolidated as a component of U.S. Healthcare Solutions
- Strong U.S. Healthcare Solutions performance — Operating income up 21% YoY
- Improved Other segment results — Certain depreciable assets fully impaired in Q1
The 65% increase in net interest expense guidance ($292M to $480-500M) reflects the debt financing used for both the RCA and OneOncology acquisitions.
What Changed From Last Quarter?
Positive Developments
- OneOncology closed — $4.6 billion acquisition completed February 2, 2026, with Cencora now owning 92% (practices and management retain 8%)
- U.S. Healthcare Solutions accelerating — Segment operating income grew 21% vs. 11.9% consolidated, driven by RCA synergies and specialty growth
- Guidance raised — First guidance increase of FY2026, signaling management confidence
- Gross margin expansion — Adjusted gross profit margin of 3.48%, up 37 bps YoY on mix shift toward specialty
Concerning Signals
- International segment pressure — Operating income down 17% constant currency, European distribution margins compressing
- Customer losses impacting revenue — Lost grocery and oncology customers cited as headwinds
- Cash burn this quarter — Adjusted free cash flow was -$2.4 billion, typical seasonal working capital build but elevated
- Consulting services weakness — Operating income in Other segment down 6.1% on customer program loss
How Did the Segments Perform?
U.S. Healthcare Solutions — The Growth Engine
The 21% operating income growth significantly outpaced consolidated growth, driven by:
- RCA acquisition — January 2025 deal now fully contributing with "better-than-expected volume, excellent trends in research, and new physicians joining the platform"
- GLP-1 tailwind — Sales increased $1 billion or 11% year-over-year
- Specialty growth — "Particularly good volumes and trends in our health systems business"
International Healthcare Solutions — Margin Pressure
The international segment was the clear weak spot. Management attributed the weakness to a timing difference: manufacturer price adjustments in a "developing market country" occurred at quarter-end this year versus quarter-beginning last year. The global specialty logistics business (World Courier) showed "operating income growth" and volume growth for a second consecutive quarter, providing a partial offset.
Other — Strategic Review Businesses
The "Other" segment contains businesses under strategic alternatives review: MWI Animal Health, Profarma, U.S. Consulting Services, and parts of PharmaLex. Consulting services took a $249 million impairment charge this quarter.
Ask Fintool AI AgentHow Did the Stock React?
Cencora shares traded relatively flat on earnings day, closing at $361.75 (-0.5%). The aftermarket quote of $360.01 suggests investors are still digesting the report.
The muted reaction likely reflects the mixed quarter — EPS beat and guidance raise balanced against revenue miss and international weakness. The stock is trading near all-time highs and has outperformed the S&P 500 over the past year.
Key Management Commentary
"Cencora began fiscal 2026 by delivering strong financial performance and advancing our strategy through the acquisition of OneOncology."
"Our ownership of OneOncology cements our specialty MSO footprint and deepens our partnership with physicians leading in cancer care. As we continue to advance our leadership in specialty and execute our pharmaceutical-centric strategy, we are well positioned to drive continued value for all our stakeholders."
— Robert P. Mauch, President & CEO
"If you back out RCA and you back out OneOncology in the first quarter, we're towards the higher end of our long-term guidance range of 7%-10%. And that's even with the headwind from the oncology customer that we lost."
— James F. Cleary, CFO
Q&A Highlights
On Core Business Performance (Excluding M&A)
Glenn Santangelo (Barclays) asked about U.S. operating income deceleration. CFO Jim Cleary clarified that the core U.S. business (excluding RCA and OneOncology) is performing at the "higher end of our long-term guidance range of 7%-10%", even absorbing the oncology customer loss headwind. Key drivers remain strong specialty sales to health systems and physician practices, and solid utilization trends across the segment.
On MSO Platform Value Drivers
Elizabeth Anderson (Evercore ISI) probed the short and long-term value accelerators from MSOs. CEO Bob Mauch highlighted:
- Short-term: Clinical trial excellence from RCA can be leveraged across the entire platform; Revenue Cycle Management as an immediate synergy opportunity
- Medium/Long-term: New capabilities and services to support physicians as specialty innovation accelerates
On Health Systems Opportunity
Lisa Gill (JP Morgan) asked about strategic partnerships with health systems. Mauch emphasized the dual strategy: community physician MSOs and health system relationships, both focused on specialty growth. Health systems customers represent a growing portion of specialty distribution, and Cencora is "the right partner for those providers."
On IRA/Drug Pricing Negotiations
Michael Cherney (Leerink Partners) asked about IRA price negotiations impact. Cleary noted that Cencora was "very successful in those discussions with manufacturers because of the value we provide in the supply chain" and maintained gross profit dollars despite list price reductions, similar to their insulin experience.
On International Weakness
Erin Wright (Morgan Stanley) pressed on international margin compression. Cleary confirmed the weakness was largely a timing difference for manufacturer price adjustments in a "developing market country" — the adjustment happened at quarter-end vs. quarter-beginning last year. Full-year guidance of 5%-8% operating income growth remains unchanged. Notably, the global specialty logistics business showed "operating income growth" in the quarter.
On MWI Animal Health Divestiture Speculation
Kevin Caliendo (UBS) referenced press reports about private equity interest in MWI. CEO Mauch would not comment on rumors but reiterated that businesses in "Other" segment are under strategic alternatives review to "prioritize growth-oriented investments." CFO Cleary added that any divestiture "might be dilutive in the short term" but would "enhance growth and returns over the long term."
On RCA Performance
Daniel Grosslight (Citi) asked about RCA's first full year. Management confirmed RCA "exceeded expectations" across the board — strong organic performance, successful tuck-in acquisitions, and particularly strong clinical trial research contribution.
On OneOncology Accounting
Charles Rhee (TD Cowen) and others asked about OneOncology ownership and below-the-line items. Key clarifications:
- Ownership: Cencora now owns 92% of OneOncology; practices and management retain 8%
- Below-the-line benefits: ~$30M annual income from UUG joint venture (non-controlling stake), plus NCI loss add-backs that largely offset ProPharma NCI
- Q2 interest expense: Expected to be ~2x Q1 levels due to OneOncology financing and seasonal working capital
What to Watch Going Forward
Near-Term Catalysts
- OneOncology integration updates — Q2 will be first full quarter of consolidated results
- Leerink Partners Global Healthcare Conference — March 8-11, 2026
- Barclays Global Healthcare Conference — March 10-12, 2026
- Q2 FY2026 earnings — Expected May 2026
Key Risks
- International segment trajectory — Continued margin pressure could weigh on consolidated results
- Customer concentration — Additional customer losses would impact growth
- Integration execution — OneOncology and RCA integration risks
- Elevated Q2 interest expense — Management guided Q2 interest expense will be ~2x Q1 levels due to seasonal working capital and OneOncology financing
- Share repurchase pause — Buybacks on hold as company prioritizes debt paydown
Capital Allocation
- Dividend: $0.60 per share quarterly, payable March 2, 2026
- Long-term EPS target: 10%-14% adjusted diluted EPS growth (constant currency)
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