McKesson Corporation (NYSE:MCK) stock rose 2.90% (As on November 2, 11:27:20 AM UTC-4, Source: Google Finance) after the company misses the earnings estimates for the second quarter of FY 23. U.S. Pharmaceutical Segment second-quarter revenues were $60.1 billion, an increase of 12%, driven by increased volume of specialty products, including higher volumes from retail national account customers, and market growth, partially offset by branded to generic conversions. Prescription Technology Solutions Segment second-quarter revenues were $1.0 billion, an increase of 9%, driven by growth in prescription volumes in our third-party logistics business and higher technology service revenues. Medical-Surgical Solutions Segment second-quarter revenues were $2.8 billion, a decrease of 9%, driven by lower sales of COVID-19 tests, partially offset by growth in the primary care business. International Segment second-quarter revenues were $6.2 billion. On an FX-Adjusted basis, revenues were $6.9 billion, a decrease of 25%, driven by the divestitures of McKesson’s UK and Austrian businesses.
MCK in the second quarter of FY 23 has reported the adjusted earnings per share of $6.06, missing the analysts’ estimates for the adjusted earnings per share of $6.07, according to figures compiled by Thomson Reuters. The company had reported the adjusted revenue growth of 5.4 percent to $70.16 billion in the second quarter of FY 23. This is primarily driven by growth in the U.S. Pharmaceutical segment, resulting from increased specialty product volumes, including retail national account customers, and market growth, partially offset by lower revenues in the International segment as a result of the progress on the planned divestiture of McKesson’s European business.
McKesson raised fiscal 2023 Adjusted Earnings per Diluted Share guidance to $24.45 to $24.95 from the previous range of $23.95 to $24.65 to reflect operating business performance and increased contribution from the U.S. government’s COVID-19 vaccine distribution, kitting, and storage programs and COVID-19 tests. Fiscal 2023 Adjusted Earnings per Diluted Share guidance indicates 11% to 14% forecasted growth compared to prior year.
On the other hand, McKesson progressed in its planned exit of business operations within the European region and has completed divestitures in 11 of the 12 countries. After entering into an agreement in July 2021 to sell certain McKesson Europe businesses in France, Italy, Ireland, Portugal, Belgium, and Slovenia to the PHOENIX Group, McKesson closed the transaction on October 31, 2022. McKesson signed an agreement in principle to extend its pharmaceutical distribution partnership with CVS Health through June 2027.