Cencora (COR) Q3 FY26 earnings call: guidance and Q&A

What drove the reacceleration in the U.S. pharma business this quarter, and is management comfortable with the Street's 14% growth estimate for FY27?

Eva Boratto attributed U.S. outperformance to strength in MSOs (One Oncology, RCA) and underlying core business trends, with double-digit organic operating income growth excluding One Oncology contribution and customer loss. Bob Mauch reiterated confidence in long-term guidance but declined to comment on specific Street estimates for FY27.

“Excluding the loss, as you said, of Florida Cancer and the contribution from One Oncology, our operating income growth was up double digits, a meaningful acceleration from the 7% last quarter.”

asked by Lisa Gill · answered by Eva Boratto

Can you provide more color on the strength in U.S. healthcare operating profit, specifically separating the impact of Part B versus Part D biosimilars in the specialty business?

Bob Mauch explained that biosimilars are generally positive for Cencora. Part D biosimilars offer less service opportunity, while Part B biosimilars in the buy-and-bill infusion space (supported by MSOs and GPOs) provide a larger profit opportunity due to extensive wraparound services. Eva Boratto added that utilization trends saw a sequential rebound, with strong sales in specialty products, including oncology and retina.

“biosimilars are good for Cencora. Part D much less so, but still good even though we'll have revenue pressure from time to time with those switches. But Part B will always be good, and we feel very confident about the durability of that over the long term.”

asked by Glen Santangelo · answered by Robert Mauch

What operational improvements are being seen in One Oncology, where is the integration, and how sustainable is its above-average growth rate?

Bob Mauch outlined three phases of MSO value creation: integration (significant progress), sharing capabilities (early days for clinical trials), and developing new services (future). He noted continuous physician additions. Eva Boratto stated One Oncology is expected to be EPS neutral on a 12-month basis, and its operating income is modestly better than initial expectations.

“In One Oncology, it's in the earlier innings, which is why we have so much optimism about the opportunity.”

asked by Elizabeth Anderson · answered by Robert Mauch

What drove the sequential improvement in U.S. Healthcare Solutions growth from Q2 to Q3, and what is the impact of changes in the 340B program?

Eva Boratto reiterated that the Q2 to Q3 acceleration was due to underlying utilization strength and highlighted that Q4 implied guidance suggests strong double-digit growth, with U.S. having the strongest organic growth of the year. Bob Mauch stated Cencora is assessing recent 340B guidance, focusing on potential unintended consequences for patient access and cost-effectiveness, and believes policies are not intended to negatively impact physician reimbursement.

“our Q4 implied guidance also implies strong double-digit growth. across our reportable segments. And as you think about that in the U.S., we'll have fully lapped the One Oncology customer loss, and will have an easier expense comp.”

asked by Allen Lutz · answered by Eva Boratto

How will proposed changes in ASP rules impact Cencora's MSO and GPO businesses, and can this be quantified?

Bob Mauch stated that Cencora believes policies under consideration are not intended to negatively impact physician reimbursement, especially given the community physician's role as the most accessible and lowest-cost site of care. He cited the globe demonstration project as an example where discounts are directly paid to the government, avoiding impact on reimbursement.

“the policies that are under consideration or being tested are not intended to impact physician reimbursement.”

asked by Kevin Caliendo · answered by Robert Mauch