Cardinal Health's revenue miss clouds annual profit forecast raise

By Siddhi Mahatole

April 30 ‌Reuters) - Cardinal Health ​missed ​Wall Street expectations for third-quarter revenue, sending its shares down 8% on Thursday even though the company raised its ‌profit forecast for the third time in the past ⁠four months.

Pharmaceutical revenue growth was hurt by Inflation Reduction Act-related changes that impacted the ‌wholesale acquisition costs of ‌drugs, said Chief Financial Officer Aaron Alt in a call with analysts.

Still, Cardinal Health's adjusted quarterly profit of $3.17 per share beat estimates ​of $2.79, according to LSEG-compiled data.

Drug distributors have been benefiting from rising demand for biosimilars and high-margin medicines treating complex conditions such ⁠as cancer and autoimmune diseases.

Leerink Partners analyst Michael Cherny said "we are defending CAH shares as ​we see no good reason the stock should be off on today's print absent some massive rotation move that ​we see as unwarranted."

Popular weightloss drugs ‌recorded growth of more than 30%, but the pace has slowed from earlier periods.

Total third-quarter revenue rose 11% ⁠to $60.9 billion, missing expectations of $61.7 billion.

Sales at its Pharmaceutical and Specialty Solutions unit climbed 11% to $56.1 billion, below estimates of $56.32 billion.

Cardinal Health has taken steps ⁠to mitigate the impact of tariffs, including cost‑cutting measures and price increases on ​affected products, though these actions have not fully offset the hit.

CEO Jason Hollar said the company has paid about $200 million in tariffs to date, mainly tied ‌to products in its Global Medical Products and Distribution segment, where profit fell 36% to $25 million in ‌the third quarter.

The Dublin, Ohio-based company now expects full-year adjusted profit per ⁠share between $10.7 and $10.8, compared with ‌its prior view of $10.15 ​to $10.35. Analysts on average were expecting it to be $10.31 per share.

(Reporting by Siddhi Mahatole in Bengaluru; Editing by ‌Devika Syamnath)

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