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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

For the fiscal year ended June 30, 2024

or

For the transition period from ________ to ________

Commission File Number: 1-11373

Cardinal Health, Inc.

(Exact name of registrant as specified in its charter)

(Address of principal executive offices) (Zip Code)

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Common shares (without par value) CAH New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YesþNo o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes oNoþ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yesþ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). YesþNo ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ Accelerated filer ☐

Non-accelerated filer ☐ Smaller reporting company ☐

Emerging growth company ☐

þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

The aggregate market value of voting stock held by non-affiliates on December 31, 2023, was the following: $24,413,491,673.

The number of the registrant’s common shares, without par value, outstanding as of July 31, 2024, was the following: 243,845,343.

Documents Incorporated by Reference:

Portions of the registrant’s Definitive Proxy Statement to be filed for its 2024 Annual Meeting of Shareholders are incorporated by reference into the sections of this Form 10-K addressing the requirements of Part III of Form 10-K.

Cardinal Health Fiscal 2024 Form 10-K

Table of Contents

Page

Introduction 2

Explanation and Reconciliation of Non-GAAP Financial Measures 22

Quantitative and Qualitative Disclosures about Market Risk 25

Business 27

Risk Factors 34

Cybersecurity 43

Properties 44

Legal Proceedings 44

Market for Registrant's Common Equity 45

Financial Statements and Supplementary Data 51

Directors, Executive Officers and Corporate Governance 87

Exhibits 89

Form 10-K Cross Reference Index 94

Signatures 95

1 Cardinal Health | Fiscal 2024 Form 10-K

Introduction

Introduction

References to Cardinal Health and Fiscal Years

As used in this report, "we," "our," "us," "Cardinal Health" and similar pronouns refer to Cardinal Health, Inc. and its majority-owned and consolidated subsidiaries, unless the context requires otherwise. Our fiscal year ends on June 30. References to fiscal 2025, 2024, 2023, 2022, 2021 and 2020 are to the fiscal years ended June 30, 2025, 2024, 2023, 2022, 2021 and 2020, respectively. Except as otherwise specified, information in this report is provided as of June 30, 2024.

Non-GAAP Financial Measures

In this report, we use financial measures that are derived from consolidated financial data but are not presented in our financial statements that are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). These measures are considered “non-GAAP financial measures” under the Securities and Exchange Commission (“SEC”) rules. The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures are included in the “Explanation and Reconciliation of Non-GAAP Financial Measures” section following MD&A in this report.

Management's Discussion and Analysis ("MD&A") of Financial Condition and Results of Operations

Our MD&A within this Form 10-K generally discusses fiscal 2024 and fiscal 2023 items and year-over-year comparisons between fiscal 2024 and fiscal 2023. This Form 10-K also includes fiscal 2022 items and discussions of year-over-year comparisons between fiscal 2023 and fiscal 2022. The periods discussed in this Form 10-K have been revised herein to correct an error identified during the preparation of this Form 10-K, as well as to correct other unrelated immaterial errors. The revisions ensure comparability across all periods reflected herein. Please refer to Note 1 of the “Notes to the Consolidated Financial Statements” for additional information about these corrections.

Important Information Regarding Forward-Looking Statements

This report (including information incorporated by reference) includes forward-looking statements addressing expectations, prospects, estimates and other matters that are dependent upon future events or developments. Many forward-looking statements appear in MD&A and Risk Factors, but there are others throughout this report, which may be identified by words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “will,” “should,” “could,” “would,” “project,” “continue,” “likely,” and similar expressions, and include statements reflecting future results or guidance, statements of outlook and expense accruals. These matters are subject to risks and uncertainties that could cause actual results to differ materially from those projected, anticipated or implied. The most significant of these risks and uncertainties are described in “Risk Factors” in this report and in Exhibit 99.1 to the Form 10-K included in this report. Forward-looking statements in this report speak only as of the date of this document. Except to the extent required by applicable law, we undertake no obligation to update or revise any forward-looking statement.

Available Information

Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports are available free of charge on our website (www.cardinalhealth.com), under the “Investor Relations — Financial Reporting — SEC Filings” caption, as soon as reasonably practicable after we electronically file them with, or furnish them to, the SEC. The SEC also maintains a website (www.sec.gov) where you can search for annual, quarterly and current reports, proxy and information statements and other information regarding us and other public companies.

Cardinal Health | Fiscal 2024 Form 10-K 2

Introduction

Management's Discussion and Analysis of Financial Condition and Results of Operations

About Cardinal Health

Cardinal Health, Inc., an Ohio corporation formed in 1979, is a global healthcare services and products company providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices and patients in the home. We provide pharmaceuticals and medical products and cost-effective solutions that enhance supply chain efficiency. We connect patients, providers, payers, pharmacists and manufacturers for integrated care coordination.

Effective January 1, 2024, we began operating under an updated organizational structure and re-aligned our financial reporting structure under two reportable segments: Pharmaceutical and Specialty Solutions ("Pharma") segment and Global Medical Products and Distribution ("GMPD") segment. All remaining operating segments that are not significant enough to require separate reportable segment disclosures are included in Other, which is comprised of Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight® Logistics.

Pharmaceutical and Specialty Solutions Segment

Our Pharmaceutical and Specialty Solutions segment distributes branded and generic pharmaceutical, specialty pharmaceutical and over-the-counter healthcare and consumer products in the United States. This segment also provides services to pharmaceutical manufacturers and healthcare providers for specialty pharmaceutical products; provides pharmacy management services to hospitals and operates a limited number of pharmacies, including pharmacies in community health centers; and repackages generic pharmaceuticals and over-the-counter healthcare products.

Global Medical Products and Distribution Segment

Our GMPD segment manufactures, sources and distributes Cardinal Health brand medical, surgical and laboratory products, which are sold in the United States, Canada, Europe, Asia and other markets. In addition to distributing Cardinal Health brand products, this segment also distributes a broad range of medical, surgical and laboratory products known as national brand products to hospitals, ambulatory surgery centers, clinical laboratories and other healthcare providers in the United States and Canada.

Cardinal Health | Fiscal 2024 Form 10-K 3

MD&A Overview

Consolidated Results

In connection with the preparation of our Consolidated Financial Statements for fiscal 2024, we identified an accounting error related to revenue recognition from third party payors within the at-Home Solutions operating segment. We evaluated the materiality of the error and determined that the impacts were not material, individually or in the aggregate, to our previously issued Consolidated Financial Statements for any of the prior quarters or annual periods in which they occurred. In this report, we present revised prior period financial statements to correct this error, as well as other unrelated immaterial errors, including an adjustment to an uncertain tax position. These other immaterial errors were previously corrected in the periods they were identified; however, they are now reflected in the periods they originated. The revisions ensure comparability across all periods reflected herein. Refer to Note 1 of the "Notes to Consolidated Financial Statements" for additional information regarding the immaterial corrections to our results of prior periods.

Overview

Revenue

Revenue increased 11 percent to $226.8 billion for fiscal 2024 and 13 percent to $205.0 billion for fiscal 2023 compared to their respective prior-year periods, primarily due to branded and specialty pharmaceutical sales growth from existing customers.

GAAP and Non-GAAP Operating Earnings/(Loss)

GAAP and Non-GAAP Operating Earnings/(Loss) Change

GAAP operating earnings/(loss) $ 1,243 $ 752 $ (607) 65 % N.M.

State opioid assessment related to prior fiscal years — (6) —

Shareholder cooperation agreement costs 1 8 —

Restructuring and employee severance 175 95 101

Amortization and other acquisition-related costs 284 285 324

Impairments and (gain)/loss on disposal of assets, net 634 1,246 2,060

Litigation (recoveries)/charges, net 78 (304) 94

The sum of the components and certain computations may reflect rounding adjustments.

We had GAAP operating earnings of $1.2 billion and $752 million during fiscal 2024 and 2023, respectively, which included $675 million and $1.2 billion pre-tax non-cash goodwill impairment charges related to the GMPD segment. See the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 5 of the "Notes to Consolidated Financial Statements" for additional detail.

GAAP operating earnings during fiscal 2023 were favorably impacted by litigation recoveries as described further in the "Results of Operations" section of this MD&A and Note 8 of the "Notes to Consolidated Financial Statements."

We had a GAAP operating loss of $607 million during fiscal 2022, which included $2.1 billion pre-tax non-cash goodwill impairment charges related to the GMPD segment. See the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 5 of the "Notes to Consolidated Financial Statements" for additional detail.

GAAP and Non-GAAP operating earnings increased during fiscal 2024, driven by increases in GMPD and Pharmaceutical and Specialty Solutions segment profit as described further in the "Results of Operations" section of this MD&A.

Non-GAAP operating earnings increased during fiscal 2023, driven by an increase in Pharmaceutical and Specialty Solutions segment profit, partially offset by a decrease in GMPD segment profit as described further in the "Results of Operations" section of this MD&A.

4 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Overview

GAAP and Non-GAAP Diluted EPS

GAAP and Non-GAAP diluted EPS Change

GAAP diluted EPS (1) $ 3.45 $ 1.26 $ (3.37) N.M. N.M.

State opioid assessment related to prior fiscal years — (0.02) —

Shareholder cooperation agreement costs — 0.02 —

Restructuring and employee severance 0.54 0.28 0.27

Amortization and other acquisition-related costs 0.85 0.80 0.87

Impairments and (gain)/loss on disposal of assets, net (4) 2.38 4.35 7.03

Litigation (recoveries)/charges, net 0.30 (0.84) 0.28

Loss on early extinguishment of debt — — 0.03

The sum of the components and certain computations may reflect rounding adjustments.

(1)Diluted earnings/(loss) per share attributable to Cardinal Health, Inc. ("diluted EPS" or "diluted loss per share").

(2)The reconciling items are presented within this table net of tax. See quantification of tax effect of each reconciling item in our GAAP to Non-GAAP Reconciliations in the section titled "Explanation and Reconciliation of Non-GAAP Financial Measures."

(3)For fiscal 2022, GAAP diluted loss per share attributable to Cardinal Health, Inc. and the EPS impact from the GAAP to non-GAAP per share reconciling items are calculated using a weighted average of 279 million common shares, which excludes potentially dilutive securities from the denominator due to their anti-dilutive effects resulting from our GAAP net loss for the period. Fiscal 2022 non-GAAP diluted EPS is calculated using a weighted average of 280 million common shares, which includes potentially dilutive shares.

(4)For fiscal 2024, 2023 and 2022, impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $675 million, $1.2 billion and $2.1 billion related to the GMPD segment, respectively. For fiscal 2024, 2023 and 2022, the net tax benefit related to these charges was $58 million, $92 million and $140 million, respectively, and were included in the annual effective tax rate.

The increases in fiscal 2024 and 2023 GAAP diluted EPS were primarily due to the factors impacting GAAP operating earnings. During fiscal 2024, 2023 and 2022, GAAP diluted EPS was adversely impacted by the goodwill impairment charges related to the GMPD segment, which had $(2.50), $(4.33) and $(6.97) per share after-tax impacts, respectively. See the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 5 and Note 9 of the "Notes to Consolidated Financial Statements" for additional detail.

During fiscal 2024, non-GAAP diluted EPS increased 29 percent to $7.53 due to the factors impacting non-GAAP operating earnings described above and a lower share count.

During fiscal 2023, non-GAAP diluted EPS increased 15 percent to $5.85 due to a lower share count, the factors impacting non-GAAP operating earnings described above and lower interest expense, net.

Cash and Equivalents

Our cash and equivalents balance was $5.1 billion at June 30, 2024 compared to $4.1 billion at June 30, 2023. During fiscal 2024, net cash provided by operating activities was $3.8 billion, which includes the impact of our annual payment of $378 million and prepayments of $239 million primarily related to the agreement to settle the vast majority of the opioid lawsuits filed by states and local governmental entities (the "National Opioid Settlement Agreement"). During fiscal 2024, we issued additional long-term debt and received net proceeds of $1.14 billion, of which $200 million is invested in short-term time deposits with initial effective maturities of more than three months and classified as prepaid expenses and other in our consolidated balance sheet as of June 30, 2024. In addition, during fiscal 2024 we deployed $1.2 billion for the Specialty Networks acquisition, $783 million for debt repayments, $750 million for share repurchases, $511 million for capital expenditures and $499 million for cash dividends.

Our cash and equivalents balance was $4.1 billion at June 30, 2023 compared to $4.7 billionat June 30, 2022. During fiscal 2023, net cash provided by operating activities was $2.8 billion, which was offset by $2.0 billion for share repurchases, $579 million for debt repayments, $525 million for cash dividends and $481 million for capital expenditures.

Cardinal Health | Fiscal 2024 Form 10-K 5

MD&A Overview

Significant Developments in Fiscal 2024 and Trends

Operating and Segment Reporting Structure Changes

Effective January 1, 2024, we began operating under an updated organizational structure and re-aligned our financial reporting structure under two reportable segments: Pharmaceutical and Specialty Solutions segment and GMPD segment. All remaining operating segments that are not significant enough to require separate reportable segment disclosures are included in Other. The following indicates the changes from the second quarter of fiscal 2024 to the new reporting structure:

•Pharmaceutical and Specialty Solutions segment: This reportable segment is comprised of all businesses formerly within our Pharmaceutical segment except Nuclear and Precision Health Solutions.

•GMPD segment: This reportable segment is comprised of all businesses formerly within our Medical segment except at-Home Solutions and OptiFreight® Logistics.

•Other: This is comprised of the remaining operating segments, Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight® Logistics.

Our previously reported segment results have been recast to conform to our new reporting structure and reflect changes in the elimination of inter-segment revenue and allocated corporate technology and shared function expenses, which are driven by the reporting structure change.

Pharmaceutical and Specialty Solutions Segment

OptumRx Contracts

On April 22, 2024, we announced that our pharmaceutical distribution contracts with OptumRx would expire at the end of June 2024. Sales to OptumRx generated 17 percent of our consolidated revenue in fiscal 2024; however, due to the class of trade, sales to OptumRx generated a meaningfully lower operating margin than the overall Pharmaceutical and Specialty Solutions segment. We expect the expiration of the OptumRx contracts to adversely impact our results of operations, including segment profit, financial condition and cash flows in fiscal 2025. In particular, we expect the unwinding of the negative net working capital associated with the contract to negatively impact operating cash flow in fiscal 2025.

Specialty Networks Acquisition

On March 18, 2024, we completed the acquisition of Specialty Networks for a purchase price of $1.2 billion in cash, subject to certain adjustments. Specialty Networks creates clinical and economic value for independent specialty providers and partners across multiple specialty group purchasing organizations ("GPOs"): UroGPO, Gastrologix and GastroGPO, and United Rheumatology. Specialty Networks’ PPS Analytics platform analyzes data from electronic medical records, practice management, imaging, and dispensing systems and transforms it into meaningful and actionable insights for providers and other stakeholders by using artificial intelligence and modern data analytics capabilities. The acquisition further expands our offerings in key therapeutic areas, accelerates our upstream data and research opportunities with biopharma manufacturers, and creates a platform for our expansion across therapeutic areas. We expect the Specialty Networks acquisition to positively impact Pharmaceutical and Specialty Solutions segment revenue and profit while increasing amortization and other acquisition-related costs during fiscal 2025 and beyond.

Branded Pharmaceuticals

During fiscal 2024, we saw increased demand for GLP-1 pharmaceuticals, and our sales increased significantly, despite periodic supply shortages. These increased sales positively impacted our Pharmaceutical segment and consolidated revenue for the year; however, GLP-1 sales did not meaningfully contribute to segment profit. Future demand for these medications is unpredictable and our ability to meet demand may be impacted by additional supply constraints.

During fiscal 2024, we began distributing commercially available COVID-19 vaccines following U.S. Food and Drug Administration (“FDA”) approval. Distribution of these vaccines had a greater than anticipated benefit to Pharmaceutical and Specialty Solutions segment profit in fiscal year 2024. Updated COVID-19 vaccines for 2025 also require FDA approval. We expect COVID-19 vaccine distribution to favorably impact Pharmaceutical and Specialty Solutions segment profit in fiscal 2025, but to a lesser extent.

Generics Program

The performance of our Pharmaceutical and Specialty Solutions segment generics program positively impacted the year-over-year comparison of Pharmaceutical and Specialty Solutions segment profit. The Pharmaceutical and Specialty Solutions segment generics program includes, among other things, the impact of generic pharmaceutical product launches, customer volumes, pricing changes, the Red Oak Sourcing, LLC venture ("Red Oak Sourcing") with CVS Health Corporation ("CVS Health") and generic pharmaceutical contract manufacturing and sourcing costs.

6 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Overview

The frequency, timing, magnitude and profit impact of generic pharmaceutical customer volumes, pricing changes, customer contract renewals, generic pharmaceutical manufacturer pricing changes and generic pharmaceutical contract manufacturing and sourcing costs all impact Pharmaceutical and Specialty Solutions segment profit and are subject to risks and uncertainties. These risks and uncertainties may impact Pharmaceutical and Specialty Solutions segment profit and consolidated operating earnings during fiscal 2025 and beyond.

Global Medical Products and Distribution Segment

Inflationary Impacts

Beginning in fiscal 2022, GMPD segment profit was negatively affected by incremental inflationary impacts, primarily related to transportation (including ocean and domestic freight), commodities and labor, and global supply chain constraints. Since that time, we have taken actions to partially mitigate these impacts, including implementing certain price increases and evolving our pricing and commercial contracting processes to provide us with greater pricing flexibility. In addition, decreases in some product-related costs have been recognized as the higher-cost inventory moved through our supply chain and was replaced by lower-cost inventory. These net inflationary impacts negatively affected GMPD segment profit during fiscal 2023. The net inflationary impacts were less significant during fiscal 2024 and had a favorable impact on GMPD segment profit on a year-over-year basis.

We expect these inflationary impacts to continue to affect GMPD segment profit in fiscal 2025 and beyond, but we expect that they will be substantially offset due to our mitigation actions. However, these inflationary costs are difficult to predict and may be greater than we expect or continue longer than our current expectations. Our actions to increase prices and evolve our contracting strategies are subject to contingencies and uncertainties and it is possible that our results of operations will be adversely impacted to a greater extent than we currently anticipate or that we may not be able to mitigate the negative impact to the extent or on the timeline we anticipate.

Volumes

GMPD segment profit was adversely impacted during fiscal 2023 in part due to lower volumes, which included our Cardinal Health brand medical products. We experienced Cardinal Health brand medical products sales growth during fiscal 2024 and expect further growth in fiscal 2025 and beyond. The timing, magnitude and profit impact of this anticipated sales growth is subject to risks and uncertainties, which may impact GMPD segment profit.

Goodwill

The change in segment structure as discussed above resulted in changes to the composition of our reporting units. Accordingly, we were required to reallocate the goodwill in reporting units affected by the change using a relative fair value approach and assess goodwill for impairment both before and after the reallocation. During the three months ended March 31, 2024, we allocated $90 million and $48 million of goodwill from the former Medical segment excluding our at-Home Solutions division (the "Medical Unit") to the GMPD reporting unit and the OptiFreight® Logistics reporting unit, respectively. We also assessed GMPD's goodwill for impairment and determined there was an impairment of GMPD’s remaining goodwill balance of $90 million, resulting in GMPD goodwill being fully impaired. See the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 5 of the "Notes to Consolidated Financial Statements" for additional detail.

Shareholder Cooperation Agreement

In September 2022, we entered into a Cooperation Agreement (the "Cooperation Agreement") with Elliott Associates, L.P. and Elliott International, L.P. (together, "Elliott") under which our Board of Directors (the "Board"), among other things, (1) appointed four new independent directors, including a representative from Elliott, and (2) formed an advisory Business Review Committee of the Board tasked with undertaking a comprehensive review of our strategy, portfolio, capital-allocation framework and operations. In May 2023, we extended the term of the Cooperation Agreement until the later of July 15, 2024 or until Elliott's representative ceases to serve on, or resigns from, the Board. In connection with this extension, the Board extended the term of the Business Review Committee until July 15, 2024. On that date, the Business Review Committee disbanded in accordance with its charter. The Cooperation Agreement remains in effect.

The evaluation and implementation of actions recommended by the Business Review Committee and the Board have impacted and may continue to impact our business, financial position and results of operations during fiscal 2025 and beyond. During fiscal 2024 and 2023, we incurred $1 million and $8 million of expenses related to the negotiation and finalization of the Cooperation Agreement and other consulting expenses, respectively. We have incurred, and may incur additional legal, consulting and other expenses related to the Cooperation Agreement.

Cardinal Health | Fiscal 2024 Form 10-K 7

MD&A Results of Operations

Results of Operations

Revenue

Revenue Change

Corporate (1) (85) (78) (68) N.M. N.M.

(1)Corporate revenue consists of the elimination of inter-segment revenue and other revenue not allocated to the segments.

Fiscal 2024 Compared to Fiscal 2023

Pharmaceutical and Specialty Solutions

Fiscal 2024 Pharmaceutical and Specialty Solutions segment revenue grew by 11 percent primarily due to branded and specialty pharmaceutical sales growth largely from existing customers, which increased revenue by $20.1 billion.

Global Medical Products and Distribution

Fiscal 2024 GMPD segment revenue increased primarily due to higher volumes from existing customers, which increased revenue by $275 million. The increase was partially offset by the adverse impact of personal protective equipment ("PPE") pricing.

Other

Fiscal 2024 Other revenue increased due to growth across the at-Home Solutions, Nuclear and Precision Health Solutions and OptiFreight® Logistics operating segments.

Fiscal 2023 Compared to Fiscal 2022

Pharmaceutical and Specialty Solutions

Fiscal 2023 Pharmaceutical and Specialty Solutions segment revenue grew by 15 percent primarily due to branded and specialty pharmaceutical sales growth from existing and net new customers, which increased revenue by $24.2 billion.

Global Medical Products and Distribution

Fiscal 2023 GMPD segment revenue decreased primarily due to lower sales, largely due to an adverse impact of PPE pricing and volumes.

Other

Fiscal 2023 Other revenue increased due to growth across the Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight® Logistics operating segments.

8 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Results of Operations

Cost of Products Sold

Cost of products sold for fiscal 2024 and 2023 increased $21.3 billion (11 percent) and $23.3 billion (13 percent) compared to their respective prior-year periods as a result of the same factors affecting the changes in revenue and gross margin.

Gross Margin

Consolidated Gross Margin Change

Fiscal 2024 Compared to Fiscal 2023

Fiscal 2024 consolidated gross margin increased primarily due to the beneficial comparison of the prior-year net inflationary impacts in the GMPD segment and the positive performance of our generics program in the Pharmaceutical and Specialty Solutions segment.

Gross margin rate declined 8 basis points during fiscal 2024 mainly due to changes in overall product mix, primarily driven by increased pharmaceutical distribution branded sales, which have a dilutive impact on our overall gross margin rate. This decline in gross margin rate was partially offset by the beneficial comparison to the prior-year net inflationary impacts in the GMPD segment.

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Fiscal 2023 Compared to Fiscal 2022

Fiscal 2023 consolidated gross margin increased primarily due to the Pharmaceutical and Specialty Solutions segment, which reflected the positive performance of our generics program and a higher contribution from branded and specialty pharmaceutical products. This increase was partially offset by the GMPD segment, primarily driven by lower volumes and unfavorable product sales mix, partially offset by a net positive contribution from PPE.

Gross margin rate declined 23 basis points during fiscal 2023 mainly due to changes in overall product mix, primarily driven by increased pharmaceutical distribution branded sales, which have a dilutive impact on our overall gross margin rate. This decline in gross margin rate was partially offset by a net positive contribution from PPE.

Cardinal Health | Fiscal 2024 Form 10-K 9

MD&A Results of Operations

Distribution, Selling, General and Administrative ("SG&A") Expenses

SG&A Expenses Change

Fiscal 2024 Compared to Fiscal 2023

Fiscal 2024 SG&A expenses increased primarily due to compensation related costs, investment projects and higher costs to support sales growth. These increases were partially offset by the beneficial impact of enterprise-wide cost-savings measures.

Fiscal 2023 Compared to Fiscal 2022

Fiscal 2023 SG&A expenses increased primarily due to higher costs to support sales growth, compensation related costs and inflationary impacts. These increases were partially offset by the beneficial impact of enterprise-wide cost-savings measures.

10 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Results of Operations

Segment Profit

We evaluate segment performance based on segment profit, among other measures. See Note 14 of the "Notes to Consolidated Financial Statements" for additional information on segment profit.

Segment Profit and Operating Earnings/(Loss) Change

Global Medical Products and Distribution 92 (147) (64) N.M. N.M.

Total consolidated operating earnings/(loss) $ 1,243 $ 752 $ (607) 65 % N.M.

Fiscal 2024 Compared to Fiscal 2023

Pharmaceutical and Specialty Solutions

Fiscal 2024 Pharmaceutical and Specialty Solutions segment profit increased primarily due to the positive performance of our generics program.

Global Medical Products and Distribution

Fiscal 2024 GMPD segment profit increased primarily due to the beneficial comparison to the prior-year inflationary impacts, net of the effects of mitigation actions.

Other

Fiscal 2024 Other segment profit increased primarily due to the performance of OptiFreight® Logistics.

Corporate

The changes in Corporate during fiscal 2024 are due to the factors discussed in the "Other Components of Consolidated Operating Earnings/(Loss)" section that follows.

Fiscal 2023 Compared to Fiscal 2022

Pharmaceutical and Specialty Solutions

Fiscal 2023 Pharmaceutical and Specialty Solutions segment profit increased primarily due to the positive performance of our generics program and an increased contribution from branded and specialty pharmaceutical products, partially offset by inflationary impacts, primarily related to increased transportation and labor costs.

Global Medical Products and Distribution

Fiscal 2023 GMPD segment profit decreased primarily due to net inflationary impacts, lower volumes and unfavorable product sales mix, partially offset by a net positive contribution from PPE.

Other

Fiscal 2023 Other segment profit increased primarily due to the performance of OptiFreight® Logistics.

Corporate

The changes in Corporate during fiscal 2023 are due to the factors discussed in the "Other Components of Consolidated Operating Earnings/(Loss)" section that follows.

Cardinal Health | Fiscal 2024 Form 10-K 11

MD&A Results of Operations

Other Components of Consolidated Operating Earnings/(Loss)

In addition to revenue, gross margin and SG&A expenses discussed previously, consolidated operating earnings/(loss) were impacted by the following:

Restructuring and employee severance $ 175 $ 95 $ 101

Amortization and other acquisition-related costs 284 285 324

Impairments and (gain)/loss on disposal of assets, net 634 1,246 2,060

Litigation (recoveries)/charges, net 78 (304) 94

Restructuring and Employee Severance

Restructuring and employee severance costs in fiscal 2024, 2023 and 2022 include costs related to the implementation of certain enterprise-wide cost-savings measures, which include certain initiatives to rationalize our manufacturing operations. The increase in fiscal 2024 restructuring costs are primarily due to estimated severance costs related to these cost-savings measures and costs related to certain projects resulting from the reviews of our strategy, portfolio, capital-allocation framework and operations. During fiscal 2023 and 2022, restructuring and employee severance included costs related to the divestiture of the Cordis business. During fiscal 2022, restructuring also included facility-exit costs related to decreasing our overall office space.

Amortization and Other Acquisition-Related Costs

Amortization of acquisition-related intangible assets was $264 million, $281 million and $311 million for fiscal 2024, 2023 and 2022, respectively.

Impairments and (Gain)/Loss on Disposal of Assets, Net

During fiscal 2024, 2023 and 2022, we recognized $675 million, $1.2 billion and $2.1 billion of pre-tax non-cash goodwill impairment charges, respectively, related to our GMPD segment, as discussed further in the "Critical Accounting Policies and Sensitive Accounting Estimates" section of this MD&A and Note 5 of the "Notes to Consolidated Financial Statements."

Litigation (Recoveries)/Charges, Net

During fiscal 2024, we recognized expense of $340 million in connection with opioid-related matters, including agreements in principle with counsel representing classes of third-party payors and acute care hospitals, the case brought by the City of Baltimore, and a settlement with the State of Alabama. This expense was partially offset by a benefit of $105 million related to certain prepayments and $34 million in insurance recoveries. We also recognized income of $117 million for net recoveries in class action lawsuits in which we were a class member or plaintiff.

During fiscal 2023, we recognized income of $130 million for net recoveries in class action lawsuits in which we were a class member or plaintiff. We recognized income of $103 million primarily related to a reduction of the reserve for the estimated settlement and defense costs for the Cordis OptEase and TrapEase inferior vena cava ("IVC") product liability due to the execution of certain settlement agreements. We also recognized income of $93 million due to net proceeds from the settlement of a shareholder derivative litigation matter.

During fiscal 2022, we recognized estimated losses and legal defense costs associated with the IVC filter product liability claims of $70 million. We also recognized income of $18 million for net recoveries in class action antitrust lawsuits in which we were a class member or plaintiff.

See Note 8 of the "Notes to Consolidated Financial Statements" for additional information.

12 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Results of Operations

Other Components of Earnings/(Loss) Before Income Taxes

In addition to the items discussed above, earnings/(loss) before income taxes was impacted by the following:

Earnings/(loss) Before Income Taxes Change

Other (income)/expense, net $ (9) $ 5 $ 22 N.M. N.M.

Loss on early extinguishment of debt — — 10 N.M. N.M.

(Gain)/Loss on sale of equity interest in naviHealth — — (2) N.M. N.M.

Interest Expense, Net

Fiscal 2024 and 2023 interest expense, net decreased primarily due to increased interest income from cash and equivalents. The decrease in Fiscal 2024 interest expense, net was partially offset by lower interest income from financial instruments.

Loss On Early Extinguishment of Debt

During fiscal 2022, we recognized a loss of $10 million in connection with the debt redemption as described further in Note 7 of the "Notes to Consolidated Financial Statements."

Provision for Income Taxes

Fluctuations in the effective tax rates are primarily due to the impact of the goodwill impairment charges recognized in fiscal 2024, 2023 and 2022 related to the GMPD segment.

A reconciliation of the provision based on the federal statutory income tax rate to our effective income tax rate from continuing operations is as follows(see Note 9 of the "Notes to Consolidated Financial Statements" for additional information):

Provision at Federal statutory rate 21.0 % 21.0 % 21.0 %

State and local income taxes, net of federal benefit 3.1 6.5 2.0

Tax effect of foreign operations (1.6) (5.4) 4.7

Nondeductible/nontaxable items (0.1) (1.1) 1.2

Impact of Divestitures — (1.9) (4.8)

Withholding Taxes 1.0 1.0 (1.1)

Change in Valuation Allowances (1.1) (5.1) 3.5

US Taxes on International Income (2) (2.1) 0.6 1.9

Impact of Resolutions with IRS and other related matters 0.4 0.3 1.6

Opioid litigation 1.0 0.1 (0.5)

Effective income tax rate 28.9 % 50.0 % (19.5) %

(1) This table reflects fiscal 2024 and 2023 pretax income with tax expense and fiscal 2022 pretax loss with tax expense.

(2) Includes the tax impact of Global Intangible Low-Taxed Income ("GILTI") tax, the Foreign-Derived Intangible Income deduction and other foreign income that is taxable under the U.S. tax code.

During fiscal 2024, 2023, and 2022, the effective tax rate was 28.9 percent, 50.0 percent and (19.5) percent, respectively. Included in the effective tax rate for fiscal 2024, 2023, and 2022, was $58 million, $92 million and $140 million, respectively, of benefit related to the goodwill impairment charges related to GMPD.

Ongoing Audits

We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and various foreign jurisdictions. With few exceptions, we are subject to audit by taxing authorities for fiscal 2015 through the current fiscal year. Tax laws are complex and subject to varying interpretations. New challenges related to future audits may adversely affect our effective tax rate or tax payments.

Cardinal Health | Fiscal 2024 Form 10-K 13

MD&A Liquidity and Capital Resources

Liquidity and Capital Resources

We currently believe that, based on available capital resources and projected operating cash flow, we have adequate capital resources to fund our operations and expected future cash needs as described below. If we decide to engage in one or more acquisitions, depending on the size and timing of such transactions, we may need to access capital markets for additional financing.

Cash and Equivalents

Our cash and equivalents balance was $5.1 billion at June 30, 2024 compared to $4.1 billion at June 30, 2023.

During fiscal 2024, net cash provided by operating activities was $3.8 billion, which includes the impact of our annual payment of $378 million and prepayments of $239 million primarily related to the National Opioid Settlement Agreement. During fiscal 2024, we issued additional long-term debt and received net proceeds of $1.14 billion, of which $200 million is invested in short-term time deposits with initial effective maturities of more than three months and classified as prepaid expenses and other in our consolidated balance sheet as of June 30, 2024. In addition, we deployed cash of $783 million for debt repayments, $750 million for share repurchases, $511 million for capital expenditures and $499 million for cash dividends. At June 30, 2024, our cash and equivalents were held in cash depository accounts with major banks or invested in high quality, short-term liquid investments.

On March 18, 2024, we completed the acquisition of Specialty Networks for a purchase price of $1.2 billion in cash, subject to certain adjustments. See Note 2 of the "Notes to Consolidated Financial Statements" for additional information.

At June 30, 2023, our cash and equivalents were $4.1 billion. During fiscal 2023, net cash provided by operating activities was $2.8 billion, which includes the impact of our second annual payment of $372 million related to the National Opioid Settlement

Agreement. In addition, we deployed $2.0 billion for share repurchases, $579 million for debt repayments, $525 million for cash dividends and $481 million for capital expenditures.

Changes in working capital, which impact operating cash flow, can vary significantly depending on factors such as the timing of customer payments, inventory purchases, payments to vendors and tax payments in the regular course of business, as well as fluctuating working capital needs driven by customer and product mix. We expect the unwinding of the negative net working capital associated with the OptumRx contract to negatively impact operating cash flow in fiscal 2025.

The cash and equivalents balance at June 30, 2024 includes $497 million of cash and equivalents held by subsidiaries outside of the United States.

In fiscal 2024, we returned $384 million of cash held by foreign subsidiaries to the United States.

At June 30, 2024, foreign earnings of approximately $1.0 billion are considered indefinitely reinvested for working capital and other offshore investment needs. The computation of tax required if those earnings are repatriated is not practicable. For amounts not considered indefinitely reinvested, we have recorded an immaterial amount of income tax expense in our consolidated financial statements in fiscal 2024.

Other Financing Arrangements and Financial Instruments

Credit Facilities and Commercial Paper

In addition to cash and equivalents and operating cash flow, other sources of liquidity at June 30, 2024 include a $2.0 billion commercial paper program, backed by a $2.0 billion revolving credit facility. We also have a $1.0 billion committed receivables sales facility. At June 30, 2024, we had no amounts outstanding under our commercial paper program, revolving credit facility or our committed receivables sales facility. During fiscal 2024, under our commercial paper program and our committed receivables program, we had maximum combined total daily amounts outstanding of $1.3 billion.

In February 2023, we extended our revolving credit facility through February 25, 2028. In September 2022, we renewed our committed receivables sales facility program through Cardinal Health Funding, LLC ("CHF") through September 30, 2025. In September 2023, Cardinal Health 23 Funding, LLC was added as a seller under our committed receivables sales facility.

Our revolving credit and committed receivables sales facilities require us to maintain a consolidated net leverage ratio of no more

than 3.75-to-1. As of June 30, 2024, we were in compliance with this financial covenant.

Long-Term Obligations

At June 30, 2024, we had total long-term obligations, including the current portion and other short-term borrowings of $5.1 billion.

In February 2024, we issued additional debt with the aggregate principal amount of $1.15 billion to fund the repayment of all of the aggregate principal amount outstanding of our 3.5% Notes due 2024 and 3.079% Notes due 2024, at their respective maturities, and for general corporate purposes. In June 2024, we repaid the full principal of $750 million of the 3.079% Notes due 2024. The notes issued are $650 million aggregate principal amount of 5.125% Notes that mature on February 15, 2029 and $500 million aggregate principal amount of 5.45% Notes that mature on February 15, 2034. The proceeds of the notes issued, net of discounts, premiums, and debt issuance costs were $1.14 billion. A portion of the proceeds was invested in short-term time deposits of $550 million with initial effective maturities of more than three months. At June 30, 2024, we had $200 million remaining in those

14 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Liquidity and Capital Resources

short-term time deposits and classified as prepaid expenses and other in our consolidated balance sheets.

During fiscal 2023, we repaid the full principal of $550 million of the 3.2% Notes due 2023. The repayment was funded with available cash.

Capital Deployment

Opioid Litigation Settlement Agreement

We have $5.4 billion accrued at June 30, 2024 related to certain opioid litigation, as further described within Note 8 of the "Notes to Consolidated Financial Statements." We expect the majority of the remaining payment amounts to occur through 2038. During fiscal 2024, we paid our third annual payment of $378 million under the National Opioid Settlement Agreement. In July 2024, we made our fourth annual payment of $366 million under the National Opioid Settlement Agreement. The amounts of future annual payments may differ from the payments that we have already made.

In January 2024, we made additional payments of approximately $239 million to prepay at a prenegotiated discount certain future payment amounts totaling approximately $344 million owed under each of the National Opioid Settlement Agreement, West Virginia Subdivisions Settlement Agreement and settlement agreements with Native American tribes and Cherokee Nation. The majority of the prepayment relates to the seventh annual payment due under the National Opioid Settlement Agreement. As a result of these prepayments, we recognized income of $105 million in litigation charges/(recoveries), net in our consolidated statements of earnings/(loss) during fiscal 2024.

Capital Expenditures

Capital expenditures during fiscal 2024 and 2023 were $511 million and $481 million, respectively.

We expect capital expenditures in fiscal 2025 to be approximately between $500 million and $550 million and primarily related to manufacturing and distribution infrastructure projects and technology investments.

Dividends

During fiscal 2024, we paid quarterly dividends totaling $2.00 per share, an increase of 1 percent from fiscal 2023.

On May 7, 2024, our Board of Directors approved a quarterly dividend of $0.5056 per share, or $2.02 per share on an annualized basis, which was paid on July 15, 2024, to shareholders of record on July 1, 2024.

Share Repurchases

During fiscal 2024 and 2023, we deployed $750 million and $2.0 billion, respectively, for repurchases of our common shares in the aggregate under accelerated share repurchase ("ASR") programs. We funded the ASR programs with available cash. See Note 12 of the "Notes to Consolidated Financial Statements" for additional information.

On June 7, 2023, our Board of Directors approved a $3.5 billion share repurchase program, which will expire on December 31, 2027. As of June 30, 2024, we had $3.5 billion remaining under our existing share repurchase authorization.

Specialty Networks Acquisition

On March 18, 2024, we completed the acquisition of Specialty Networks for a purchase price of $1.2 billion in cash, subject to certain adjustments. See Note 2 of the "Notes to Consolidated Financial Statements" for additional information.

Cardinal Health | Fiscal 2024 Form 10-K 15

MD&A Other

Contractual Obligations and Cash Requirements

At June 30, 2024, our contractual obligations and future cash requirements, including estimated payments due by period, were as follows:

(1)Represents maturities of our long-term debt obligations and other short-term borrowings excluding finance lease obligations described below. See Note 7 of the “Notes to Consolidated Financial Statements” for further information.

(2)Represents minimum finance lease obligations included within current portion of long-term obligations and other short-term borrowings and long-term obligations, less current portion in our consolidated balance sheets and further described in Note 6 of the “Notes to Consolidated Financial Statements.”

(3)Represents minimum operating lease obligations included within other accrued liabilities and deferred income taxes and other liabilities in our

consolidated balance sheets and further described in Note 6 of the “Notes to Consolidated Financial Statements.”

(4)A purchase obligation is defined as an agreement to purchase goods or services that is legally enforceable and specifies all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and approximate timing of the transaction. The purchase obligation amounts disclosed above represent estimates of the minimum for which we are obligated and the time period in which cash outflows will occur. Purchase orders and authorizations to purchase that involve no firm commitment from either party are excluded from the above table. In addition, contracts that can be unilaterally canceled with no termination fee or with proper notice are excluded from our total purchase obligations except for the amount of the termination fee or the minimum amount of goods that must be purchased during the requisite notice period. Purchase obligations and other payments also includes quarterly payments to CVS Health in connection with Red Oak Sourcing. See Note 8 of the “Notes to Consolidated Financial Statements” for additional information.

(5)Represents future cash obligations under the National Opioid Settlement Agreement as well as future cash obligations under separate settlement agreements. See Note 8 of the “Notes to Consolidated Financial Statements” for additional information.

(6)Long-term liabilities, such as unrecognized tax benefits, deferred taxes and other tax liabilities, have been excluded from the above table due to the inherent uncertainty of the underlying tax positions or because of the inability to reasonably estimate the timing of any cash outflows. See Note 9 of the "Notes to Consolidated Financial Statements" for further discussion of income taxes.

Recent Financial Accounting Standards

See Note 1 of the “Notes to Consolidated Financial Statements” for further information.

16 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Critical Accounting Policies and Sensitive Accounting Estimates

Critical Accounting Policies and Sensitive Accounting Estimates

Critical accounting policies are those accounting policies that (i) can have a significant impact on our financial condition and results of operations and (ii) require the use of complex and subjective estimates based upon past experience and management’s judgment. Other people applying reasonable judgment to the same facts and circumstances could develop different estimates. Because estimates are inherently uncertain, actual results may differ. In this section, we describe the significant policies applied in preparing our consolidated financial statements that management believes are the most dependent on estimates and assumptions.

In connection with the preparation of our Consolidated Financial Statements for fiscal 2024, we identified an accounting error related to revenue recognition from third party payors within the at-Home Solutions operating segment. We evaluated the materiality of the error and determined that the impacts were not material, individually or in the aggregate, to our previously issued Consolidated Financial Statements for any of the prior quarters or annual periods in which they occurred. Amounts have been revised to correct this error, as well as other unrelated immaterial errors, including an adjustment to an uncertain tax position. These other immaterial errors were previously corrected in the periods they were identified; however, they are now reflected in the periods they originated. See Note 1 of the "Notes to Consolidated Financial Statements" for further discussion.

Allowance for Doubtful Accounts

The allowance for doubtful accounts includes general and specific reserves. We determine our allowance for doubtful accounts by reviewing accounts receivable aging, historical write-off trends, payment history, pricing discrepancies, industry trends, customer financial strength, customer credit ratings or bankruptcies. We regularly evaluate how changes in economic conditions may affect credit risks.

A hypothetical 0.1 percent increase or decrease in the reserve as a percentage of trade receivables at June 30, 2024, would result in an increase or decrease in operating earnings of $12 million. We believe the reserve maintained and expenses recorded in fiscal 2024 are appropriate.

At this time, we are not aware of any analytical findings or customer issues that are likely to lead to a significant future

increase in the allowance for doubtful accounts as a percentage of revenue. The following table presents information regarding our allowance for doubtful accounts over the past three fiscal years.

Allowance for doubtful accounts at beginning of period $ 240 $ 207 $ 176

Reduction to allowance for customer deductions and write-offs (115) (132) (79)

Allowance for doubtful accounts at end of period $ 233 $ 240 $ 207

Allowance as a percentage of customer receivables 1.9 % 2.2 % 2.0 %

Allowance as a percentage of revenue 0.10 % 0.12 % 0.11 %

Inventories

LIFO Inventory

A portion of our inventories (50 percent and 54 percent at June 30, 2024 and 2023, respectively) are valued at the lower of cost, using the last-in, first-out ("LIFO") method, or market. These are primarily merchandise inventories at the core pharmaceutical distribution facilities within our Pharmaceutical and Specialty Solutions segment (“distribution facilities”). The LIFO impact on the consolidated statements of earnings/(loss) depends on pharmaceutical manufacturer price appreciation or deflation and our fiscal year-end inventory levels, which can be meaningfully influenced by customer buying behavior immediately preceding our fiscal year-end. Historically, prices for branded pharmaceuticals have generally tended to rise, resulting in an increase in cost of products sold, whereas prices for generic pharmaceuticals generally tend to decline, resulting in a decrease in cost of products sold.

Using LIFO, if there is a decrease in inventory levels that have experienced pharmaceutical price appreciation, the result

generally will be a decrease in future cost of products sold as our older inventory is held at a lower cost. Conversely, if there is a decrease in inventory levels that have experienced a pharmaceutical price decline, the result generally will be an increase in future cost of products sold as our older inventory is held at a higher cost.

We believe that the average cost method of inventory valuation provides a reasonable approximation of the current cost of replacing inventory within these distribution facilities. As such, the LIFO reserve is the difference between (a) inventory at the lower of LIFO cost or market and (b) inventory at replacement cost determined using the average cost method of inventory valuation. At June 30, 2024 and 2023, respectively, inventories valued at LIFO cost were $749 million and$476 million higher than the average cost value. We do not record inventories in excess of replacement cost. As such, we did not write-up the value of our inventory from average cost to LIFO cost at June 30, 2024 or 2023.

Cardinal Health | Fiscal 2024 Form 10-K 17

MD&A Critical Accounting Policies and Sensitive Accounting Estimates

FIFO Inventory

Our remaining inventory, including inventory in our GMPD segment and certain inventory in our Pharmaceutical and Specialty Solutions segment, that is not valued at the lower of LIFO cost or market is stated at the lower of cost, using the first-in, first-out ("FIFO") method, or net realizable value. We reserve for the lower of cost or net realizable value using the estimated selling prices and estimated sales demand in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Our estimates for selling prices and demand are inherently uncertain and if our assumptions decline in the future, additional inventory reserves may be required.

Excess and Obsolete Inventory

We reserve for inventory obsolescence using estimates based on historical experience, historical and projected sales trends,

specific categories of inventory, age and expiration dates of on-hand inventory and manufacturer return policies. Inventories presented in the consolidated balance sheets are net of reserves for excess and obsolete inventory which were $149 million and $139 million at June 30, 2024 and 2023, respectively. If actual conditions are less favorable than our assumptions, additional inventory reserves may be required.

Goodwill and Other Indefinite-Lived Intangible Assets

Purchased goodwill and intangible assets with indefinite lives are tested for impairment annually or when indicators of impairment exist. Goodwill impairment testing involves a comparison of the estimated fair value of reporting units to the respective carrying amount, which may be performed utilizing either a qualitative or quantitative assessment. Qualitative factors are first assessed to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. There is an option to bypass the qualitative assessment for any reporting unit in any period and proceed directly to performing the quantitative goodwill impairment test. We have elected to bypass the qualitative assessment for the annual goodwill impairment test in the current year. The quantitative goodwill impairment test involves a comparison of the estimated fair value of the reporting unit to the respective carrying amount. A reporting unit is defined as an operating segment or one level below an operating segment (also known as a component).

Goodwill impairment testing involves judgment, including the identification of reporting units, qualitative evaluation of events and circumstances to determine if it is more likely than not that an impairment exists and, if necessary, the estimation of the fair value of the applicable reporting unit. Our qualitative evaluation considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

Estimating the fair value of reporting units requires the use of estimates and significant judgments that are based on a number of factors including actual operating results. The use of alternate estimates and assumptions, changes in the industry or peer groups, or changes in weightings assigned to the discounted cash flow method, guideline public company method or guideline transaction method could materially affect the determination of fair value for each reporting unit and potentially result in goodwill impairment. If a reporting unit fails to achieve expected earnings or

operating cash flow, or otherwise fails to meet current financial plans, or if there were changes to any other key assumptions used in the tests, the reporting unit could incur a goodwill impairment in a future period.

As discussed in the Overview section of this MD&A, effective January 1, 2024, we implemented a new enterprise operating and segment reporting structure. The updated structure is comprised of two reportable segments: Pharmaceutical and Specialty Solutions segment and Global Medical Products and Distribution segment. All remaining operating segments that are not significant enough to require separate reportable segment disclosures are included in Other.

This change in segment structure resulted in changes to the composition of the former Medical Unit. Effective January 1, 2024, our reporting units are: Pharmaceutical and Specialty Solutions, GMPD, Nuclear and Precision Health Solutions, at-Home Solutions and OptiFreight® Logistics. GMPD and OptiFreight® Logistics comprised the former Medical Unit.

Accordingly, we allocated $90 million and $48 million of goodwill from the former Medical Unit to GMPD and OptiFreight® Logistics, respectively, based on the estimated relative fair values of the reporting units. We also assessed goodwill for impairment for these reporting units before and after the reallocation and determined there was no impairment for the Medical Unit and OptiFreight® Logistics during the three months ended March 31, 2024 as their fair values substantially exceeded their carrying values. However, the quantitative test resulted in an impairment of GMPD’s remaining goodwill balance of $90 million, resulting in GMPD goodwill being fully impaired as of March 31, 2024.

Our previously reported goodwill balances have been recast to conform to the new structure. Prior-period goodwill impairment charges related to the former Medical Unit were primarily driven by the performance and long-term financial plan assumptions of GMPD and have been fully allocated to GMPD under the new structure.

18 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Critical Accounting Policies and Sensitive Accounting Estimates

We also performed annual impairment testing in fiscal 2024, 2023 and 2022 for Pharmaceutical and Specialty Solutions, Nuclear and Precision Health Solutions and at-Home Solutions, and in fiscal 2024 for OptiFreight® Logistics. We concluded that there were no impairments of goodwill for these reporting units as the estimated fair value of each reporting unit exceeded its carrying amounts. GMPD had no goodwill balance remaining as of April 1, 2024. See additional detail regarding GMPD goodwill below.

During our fiscal 2024 annual impairment test, at-Home Solutions fair value exceeds its carrying amount by less than 1 percent. The decrease in at-Home Solutions fair value was primarily due to changes in operating expense estimates to better reflect the fair value from an external perspective. Our determination of estimated fair value of at-Home Solutions was based on a combination of the income-based approach (using a discount rate of 10 percent and a terminal growth rate of 3 percent) and the market-based approach. We assigned a weighting of 75 percent to the discounted cash flow method and 25 percent to the guideline public company method. The goodwill balance as of June 30, 2024 was $1.1 billion. A decrease in future cash flows, an increase in the discount rate or a decrease in the terminal growth rate, among other things, could result in a goodwill impairment for at-Home Solutions. For example, if we were to increase the discount rate by 0.5 percent to 10.5 percent, the carrying amount would have exceeded the fair value for at-Home Solutions by approximately 6 percent for fiscal 2024.

Global Medical Products and Distribution Goodwill

GMPD goodwill was fully impaired in the third quarter of fiscal 2024. Our determination of estimated fair value of GMPD was based on a combination of the income-based approach (using a discount rate of 11 percent and a terminal growth rate of 2 percent) and market-based approaches at January 1, 2024. Additionally, we assigned a weighting of 80 percent to the discounted cash flow method, 10 percent to the guideline public company method, and 10 percent to the guideline transaction method.

During the three months ended December 31, 2023, we did not identify any indicators of impairment within our reporting units.

During the three months ended September 30, 2023, we elected to bypass the qualitative assessment and perform quantitative goodwill impairment testing for the former Medical Unit due to an increase in the risk-free interest rate used in the discount rate. The carrying amount exceeded the fair value, which resulted in a pre-tax impairment charge of $585 million for the former Medical Unit, which was recognized during the three months ended September 30, 2023 and is included in impairments and (gain)/loss on disposal of assets, net in our consolidated statements of earnings/(loss). This impairment charge was driven by an increase of 1 percent in the discount rate primarily due to an increase in the risk-free interest rate.

During fiscal 2023 and 2022, we performed quantitative goodwill impairment testing for the former Medical Unit which resulted in cumulative pre-tax impairment charges $1.2 billion and $2.1 billion, respectively, which were included in impairments and (gain)/loss on disposal of assets, net in our consolidated statements of earnings/(loss).

Other indefinite-lived intangibles

The impairment test for indefinite-lived intangibles other than goodwill (primarily trademarks) involves first assessing qualitative factors to determine if it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If so, then a quantitative test is performed to compare the estimated fair value of the indefinite-lived intangible asset to the respective asset's carrying amount. Our qualitative evaluation requires the use of estimates and significant judgments and considers the weight of evidence and significance of all identified events and circumstances and most relevant drivers of fair value, both positive and negative, in determining whether it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount.

See Note 1 of "Notes to Consolidated Financial Statements" for additional information regarding goodwill and other intangible assets.

Loss Contingencies and Self-Insurance

We regularly review contingencies and self-insurance accruals to determine whether our accruals and related disclosures are adequate. Any adjustments for changes in reserves are recorded in the period in which the change in estimate occurs.

Loss Contingencies

We accrue for contingencies related to disputes, litigation and regulatory matters if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Because these matters are inherently unpredictable and unfavorable developments or outcomes can occur, assessing contingencies is highly subjective and requires judgments about future events.

Examples of such contingencies include various lawsuits related to the distribution of prescription opioid pain medications and the IVC filter lawsuits.

In connection with the opioid litigation as described further in Note 8 of the “Notes to Consolidated Financial Statements," during fiscal 2024, we have reached agreements in principle with counsel representing classes of third-party payors and acute care hospitals, and we are engaged in resolution discussions with the City of Baltimore. As of June 30, 2024, we have accrued $363 million, which reflects our current estimate of probable loss for these matters. The agreements in principle remain subject to contingencies.

Cardinal Health | Fiscal 2024 Form 10-K 19

MD&A Critical Accounting Policies and Sensitive Accounting Estimates

We develop and periodically update reserve estimates for IVC claims received to date and expected to be received in the future and related costs. In April 2023, we executed a settlement agreement that, if certain conditions are satisfied, will resolve approximately 4,375 IVC filter product liability claims for $275 million. These settlements will not resolve all IVC filter product liability claims and we intend to continue to vigorously defend ourselves in the remaining lawsuits. To project future IVC claim costs, we use a methodology based largely on recent experience, including claim filing rates, blended average payout influenced by claim severity, historical sales data, implant and injury to report lag patterns and estimated defense costs.

Self-Insurance

We self-insure through a wholly-owned insurance subsidiary for employee healthcare, certain product liability matters, auto liability, property and workers' compensation and maintain insurance for losses exceeding certain limits.

Self-insurance accruals include an estimate for expected settlements on pending claims, defense costs, administrative fees,

claims adjustment costs and an estimate for claims incurred but not reported. For certain types of exposures, we develop the estimate of expected ultimate costs to settle each claim based on specific information related to each claim if available. Other estimates are based on an assessment of outstanding claims, historical analysis and current payment trends. For claims incurred but not reported, the liabilities are calculated and derived in accordance with generally accepted actuarial practices or using an estimated lag period.

The amount of loss may differ materially from these estimates. See Note 8 of the “Notes to Consolidated Financial Statements” for additional information regarding loss contingencies and product liability lawsuits.

Provision for Income Taxes

We account for income taxes using the asset and liability method. Deferred tax assets and liabilities are measured using enacted tax rates in the respective jurisdictions in which we operate. Our income tax expense, deferred income tax assets and liabilities and unrecognized tax benefits reflect management’s assessment of estimated future taxes to be paid on items in the consolidated financial statements.

The following table presents information about our tax position at June 30:

Total deferred income tax assets (1) $ 1,491 $ 1,576

Valuation allowance for deferred income tax assets (2) (300) (421)

Net deferred income tax assets 1,191 1,155

Total deferred income tax liabilities (3,163) (3,164)

Net deferred income tax liability $ (1,972) $ (2,009)

(1) Total deferred income tax assets included $512 million and $672 million of loss and tax credit carryforwards at June 30, 2024 and 2023, respectively.

(2) The valuation allowance primarily relates to federal, state and international loss and credit carryforwards for which the ultimate realization of future benefits is uncertain.

Expiring or unusable loss and credit carryforwards and the required valuation allowances are adjusted quarterly when it is more likely than not that at least a portion of the respective deferred tax assets will not be realized. After applying the valuation allowances, we do not anticipate any limitations on our use of any of the other net deferred income tax assets described previously.

Tax benefits from uncertain tax positions are recognized when it is more likely than not that the position will be sustained upon examination of the technical merits of the position, including resolutions of any related appeals or litigation. The amount

recognized is measured as the largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement. For tax benefits that do not qualify for recognition, we recognize a liability for unrecognized tax benefits.

We operate in a complex multinational tax environment and are subject to tax treaty arrangements and transfer pricing guidelines for intercompany transactions that are subject to interpretation. Uncertainty in a tax position may arise as tax laws are subject to interpretation.

Tax Effects of Goodwill Impairment Charges

During fiscal 2024, 2023, and 2022 we recognized cumulative pre-tax goodwill impairment charges of $675 million, $1.2 billion, and $2.1 billion, respectively, related to the GMPD segment. The net tax benefits related to these charges were $58 million, $92 million, and $140 million, respectively.

We file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and various foreign jurisdictions. With few exceptions, we are subject to audit by taxing authorities for fiscal years 2015 through the current fiscal year. Tax laws are complex and subject to varying interpretations. New challenges related to future audits may adversely affect our effective tax rate or tax payments.

Our assumptions and estimates around uncertain tax positions require significant judgment; the actual amount of tax benefit related to uncertain tax positions may differ from these estimates. See Note 9 of the “Notes to Consolidated Financial Statements” for additional information regarding unrecognized tax benefits.

We believe that our estimates for the valuation allowances against deferred tax assets and unrecognized tax benefits are appropriate based on current facts and circumstances. The amount we ultimately pay when matters are resolved may differ from the

20 Cardinal Health | Fiscal 2024 Form 10-K

MD&A Critical Accounting Policies and Sensitive Accounting Estimates

amounts accrued. Changes in our current estimates due to unanticipated market conditions, tax law changes or other factors could have a material effect on our ability to utilize deferred tax assets. For a further discussion on Provision for Income Taxes, see Note 9 of the “Notes to the Consolidated Financial Statements.”

Cardinal Health | Fiscal 2024 Form 10-K 21

Explanation and Reconciliation of Non-GAAP Financial Measures

Explanation and Reconciliation of Non-GAAP Financial Measures

This report, including the "Fiscal 2024 Overview" section within MD&A, contains financial measures that are not calculated in accordance with GAAP.

In addition to analyzing our business based on financial information prepared in accordance with GAAP, we use these non-GAAP financial measures internally to evaluate our performance, engage in financial and operational planning and determine incentive compensation because we believe that these measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of our underlying, ongoing business. We provide these non-GAAP financial measures to investors as supplemental metrics to assist readers in assessing the effects of items and events on our financial and operating results on a year-over-year basis and in comparing our performance to that of our competitors. However, the non-GAAP financial measures that we use may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The non-GAAP financial measures disclosed by us should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements set forth below should be carefully evaluated.

Exclusions from Non-GAAP Financial Measures

Management believes it is useful to exclude the following items from the non-GAAP measures presented in this report for its own and for investors’ assessment of the business for the reasons identified below:

•LIFO charges and credits are excluded because the factors that drive last-in first-out ("LIFO") inventory charges or credits, such as pharmaceutical manufacturer price appreciation or deflation and year-end inventory levels (which can be meaningfully influenced by customer buying behavior immediately preceding our fiscal year-end), are largely out of our control and cannot be accurately predicted. The exclusion of LIFO charges and credits from non-GAAP metrics facilitates comparison of our current financial results to our historical financial results and to our peer group companies’ financial results. We did not recognize any LIFO charges or credits during the periods presented.

•State opioid assessments related to prior fiscal years is the portion of state assessments for prescription opioid medications that were sold or distributed in periods prior to the period in which the expense is incurred. This portion is excluded from non-GAAP financial measures because it is retrospectively applied to sales in prior fiscal years and inclusion would obscure analysis of the current fiscal year results of our underlying, ongoing business. Additionally, while states' laws may require us to make payments on an ongoing basis, the portion of the assessment related to sales in prior periods are contemplated to be one-time, nonrecurring items. Income from state opioid assessments related to prior fiscal years represents reversals of accruals due to changes in estimates or when the underlying assessments were invalidated by a Court or reimbursed by manufacturers.

•Shareholder cooperation agreement costs includes costs such as legal, consulting and other expenses incurred in relation to the agreement (the "Cooperation Agreement") entered into among Elliott Associates, L.P., Elliott International, L.P. (together, "Elliott") and Cardinal Health, including costs incurred to negotiate and finalize the Cooperation Agreement and costs incurred by the Business Review Committee of the Board of Directors, which was formed under this Cooperation Agreement. We have excluded these costs from our non-GAAP metrics because they do not occur in or reflect the ordinary course of our ongoing business operations and may obscure analysis of trends and financial performance.

•Restructuring and employee severance costs are excluded because they are not part of the ongoing operations of our underlying business and include, but are not limited to, costs related to divestitures, closing and consolidating facilities, changing the way we manufacture or distribute our products, moving manufacturing of a product to another location, changes in production or business process outsourcing or insourcing, employee severance and realigning operations.

•Amortization and other acquisition-related costs, which include transaction costs, integration costs and changes in the fair value of contingent consideration obligations, are excluded because they are not part of the ongoing operations of our underlying business and to facilitate comparison of our current financial results to our historical financial results and to our peer group companies' financial results. Additionally, costs for amortization of acquisition-related intangible assets are non-cash amounts, which are variable in amount and frequency and are significantly impacted by the timing and size of acquisitions, so their exclusion facilitates comparison of historical, current and forecasted financial results. We also exclude other acquisition-related costs, which are directly related to an acquisition but do not meet the criteria to be recognized on the acquired entity’s initial balance sheet as part of the purchase price allocation. These costs are also significantly impacted by the timing, complexity and size of acquisitions.

22 Cardinal Health | Fiscal 2024 Form 10-K

Explanation and Reconciliation of Non-GAAP Financial Measures

•Impairments and gain or loss on disposal of assets, net are excluded because they do not occur in or reflect the ordinary course of our ongoing business operations and are inherently unpredictable in timing and amount, and in the case of impairments, are non-cash amounts, so their exclusion facilitates comparison of historical, current and forecasted financial results.

•Litigation recoveries or charges, net are excluded because they often relate to events that may have occurred in prior or multiple periods, do not occur in or reflect the ordinary course of our business and are inherently unpredictable in timing and amount.

•Loss on early extinguishment of debt is excluded because it does not typically occur in the normal course of business and may obscure analysis of trends and financial performance. Additionally, the amount and frequency of this type of charge is not consistent and is significantly impacted by the timing and size of debt extinguishment transactions.

•(Gain)/Loss on sale of equity interest in naviHealth was incurred in connection with the sale of our remaining equity interest in naviHealth in fiscal 2020. The equity interest was retained in connection with the initial sale of our majority interest in naviHealth during fiscal 2019. We exclude this significant gain because gains or losses on investments of this magnitude do not typically occur in the normal course of business and are similar in nature to a gain or loss from a divestiture of a majority interest, which we exclude from non-GAAP results. The gain on the initial sale of our majority interest in naviHealth in fiscal 2019 was also excluded from our non-GAAP measures.

The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded. The gross, tax and net impact of each item are presented with our GAAP to non-GAAP reconciliations.

Definitions

Growth rate calculation: growth rates in this report are determined by dividing the difference between current period results and prior period results by prior period results.

Non-GAAP operating earnings: operating earnings/(loss) excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) impairments and (gain)/loss on disposal of assets, net and (7) litigation (recoveries)/charges, net.

Non-GAAP earnings before income taxes: earnings/(loss) before income taxes excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) impairments and (gain)/loss on disposal of assets, net, (7) litigation (recoveries)/charges, net, (8) loss on early extinguishment of debt and (9) (gain)/loss on sale of equity interest in naviHealth.

Non-GAAP net earnings attributable to Cardinal Health, Inc.: net earnings/(loss) attributable to Cardinal Health, Inc. excluding (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) impairments and (gain)/loss on disposal of assets, net, (7) litigation (recoveries)/charges, net, (8) loss on early extinguishment of debt and (9) (gain)/loss on sale of equity interest in naviHealth each net of tax.

Non-GAAP effective tax rate: provision for/(benefit from) income taxes adjusted for the tax impacts of (1) LIFO charges/(credits), (2) state opioid assessment related to prior fiscal years, (3) shareholder cooperation agreement costs, (4) restructuring and employee severance, (5) amortization and other acquisition-related costs, (6) impairments and (gain)/loss on disposal of assets, net, (7) litigation (recoveries)/charges, net, (8) loss on early extinguishment of debt and (9) (gain)/loss on sale of equity interest in naviHealth, divided by (earnings before income taxes adjusted for the nine items above).

Non-GAAP diluted earnings per share attributable to Cardinal Health, Inc.: non-GAAP net earnings attributable to Cardinal Health, Inc. divided by diluted weighted-average shares outstanding.

Cardinal Health | Fiscal 2024 Form 10-K 23

Explanation and Reconciliation of Non-GAAP Financial Measures

GAAP to Non-GAAP Reconciliations

Shareholder cooperation agreement costs 1 1 — 1 —

Impairments and (gain)/loss on disposal of assets, net 3 634 634 47 587 2.38

Litigation (recoveries)/charges, net 78 78 5 73 0.30

State opioid assessment related to prior fiscal years (6) (6) (2) (4) (0.02)

Shareholder cooperation agreement costs 8 8 2 6 0.02

Loss on early extinguishment of debt — 10 3 7 0.03

Gain on sale of equity interest in naviHealth investment — (2) — (2) —

1 Attributable to Cardinal Health, Inc.

2For fiscal 2022, GAAP diluted loss per share attributable to Cardinal Health, Inc. and the EPS impact from the GAAP to non-GAAP per share reconciling items are calculated using a weighted average of 279 million common shares, which excludes potentially dilutive securities from the denominator due to their anti dilutive effects resulting from our GAAP net loss for the period. Fiscal 2022 non-GAAP diluted EPS is calculated using a weighted average of 280 million common shares, which includes potentially dilutive shares.

3 For fiscal 2024, 2023 and 2022, impairments and (gain)/loss on disposals of assets, net includes pre-tax goodwill impairment charges of $675 million, $1.2 billion and $2.1 billion related to the GMPD segment, respectively. For fiscal 2024, 2023 and 2022, the net tax benefit related to these charges was $58 million, $92 million and $140 million, respectively, and were included in the annual effective tax rate.

4 Litigation (recoveries)/charges, net includes a one-time contingent attorneys' fee of $18 million recorded during fiscal 2022 related to the finalization of the National Opioid Settlement Agreement resulting in the settlement of the vast majority of opioid lawsuits filed by state and local governmental entities. Due to the unique nature and significance of the National Opioid Settlement Agreement, and the one-time, contingent nature of the fee, this fee was included in litigation (recoveries)/charges, net.

5 Litigation (recoveries)/charges, net for fiscal 2022 does not include a $16 million judgement for lost profits related to an ordinary course intellectual property claim, which positively impacted Pharmaceutical and Specialty Solutions segment profit.

Amounts have been revised to reflect the correction of certain unrelated immaterial misstatements.

The sum of the components and certain computations may reflect rounding adjustments.

We apply varying tax rates depending on the item's nature and tax jurisdiction where it is incurred.

24 Cardinal Health | Fiscal 2024 Form 10-K

Disclosures about Market Risk

Quantitative and Qualitative Disclosures About Market Risk

We are exposed to cash flow and earnings fluctuations as a result of certain market risks. These market risks primarily relate to foreign exchange, interest rate and commodity price-related changes. We maintain a hedging program to manage volatility related to some of these market exposures which employs operational, economic and derivative financial instruments in order to mitigate risk. See Note 1 and Note 11 of the “Notes to Consolidated Financial Statements” for further discussion regarding our use of derivative instruments.

Foreign Exchange Rate Sensitivity

By the nature of our global operations, we are exposed to cash flow and earnings fluctuations resulting from foreign exchange rate variation. These exposures are transactional and translational in nature. The following foreign currencies represent the principal drivers of our foreign exchange exposure: Canadian dollar, euro, Thai baht, Mexican peso, Chinese renminbi, Australian dollar, British pound, Japanese yen, Philippine peso, Brazilian real, South Korean won, Costa Rican colon, Singapore dollar, Dominican peso and Indian rupee.

We apply a Value-At-Risk ("VAR") methodology to our transactional and translational exposures. The VAR model is a risk estimation tool and is not intended to represent actual losses in fair value that could be incurred.

Transactional Exposure

Transactional exposure arises from the purchase and sale of goods and services in currencies other than our functional currency or the functional currency of our subsidiaries. At the end

of each fiscal year, we perform sensitivity analyses on our forecasted transactional exposure for the upcoming fiscal year. These analyses include the estimated impact of our hedging program, which is designed to mitigate transactional exposure. Applying a VAR methodology to our transactional exposure and including the impact of our hedging program, the potential maximum loss in earnings for the upcoming fiscal year is estimated to be $13 million, which is based on a one-year horizon and a 95 percent confidence level.

Translational Exposure

We have exposure related to the translation of financial statements of our foreign operations into U.S. dollars, our functional currency. Applying a VAR methodology to our translational exposure, the potential maximum loss in earnings for the upcoming fiscal year is estimated to be $4 million, which is based on a one-year horizon and a 95 percent confidence level.

Interest Rate Sensitivity

We are exposed to changes in interest rates primarily as a result of our borrowing and investing activities to maintain liquidity and fund operations. The nature and amount of our long-term and short-term debt can be expected to fluctuate as a result of business requirements, market conditions and other factors. Our policy is to manage exposures to interest rates using a mix of fixed and floating rate debt as deemed appropriate by management. We utilize interest rate swap instruments to mitigate our exposure to interest rate movements.

As part of our risk management program related to our debt, we perform an annual sensitivity analysis on our forecasted exposure to interest rates for the upcoming fiscal year. At June 30, 2024, a hypothetical increase or decrease of 50 basis points in interest rates would result in an increase or decrease in interest expense of $8 million, respectively.

We are also exposed to market risk from changes in interest rates related to our cash and cash equivalents, which includes marketable securities that are carried at fair value in the consolidated balance sheets. The fair value of our cash and cash equivalents is subject to change primarily as a result of changes in market interest rates and investment risk related to the issuers' credit worthiness. At June 30, 2024, a hypothetical increase or decrease of 50 basis points in interest rates would result in an increase or decrease in interest income of $10 million, respectively.

Cardinal Health | Fiscal 2024 Form 10-K 25

Disclosures about Market Risk

Commodity Price Sensitivity

We are directly exposed to market price changes for certain commodities, including oil-based resins, nitrile, cotton, diesel fuel and latex. We typically purchase raw materials at either market prices or prices tied to a commodity index and some finished goods at prices based in part on a commodity price index. During fiscal 2024, the prices of certain commodities continued to experience fluctuation due to inflationary impacts.

As part of our risk management program, we perform sensitivity analysis on our forecasted direct commodity exposure for the upcoming fiscal year. Our forecasted direct commodity exposure at June 30, 2024 increased approximately $37 million from June 30,

2023. There were no outstanding commodity contracts in our hedging program at June 30, 2024.

Our forecasted direct commodity exposures for the upcoming fiscal year is $577 million. The potential gain/loss given a hypothetical 10 percent fluctuation in commodity prices, assuming pricing collectively shifts in the same direction and we are unable to change customer pricing in response to those shifts or otherwise offset, for the upcoming fiscal year is $58 million at June 30, 2024.

26 Cardinal Health | Fiscal 2024 Form 10-K

Business

Business

General

Cardinal Health, Inc. is a global healthcare services and products company providing customized solutions for hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, physician offices and patients in the home. We provide medical products and pharmaceuticals and cost-effective solutions that enhance supply chain efficiency.

Pharmaceutical and Specialty Solutions Segment

In the United States, our Pharmaceutical and Specialty Solutions segment:

▪through its Pharmaceutical Distribution division, distributes branded and generic pharmaceutical and over-the-counter healthcare and consumer products to retailers (including chain and independent drug stores and pharmacy departments of supermarkets and mass merchandisers), hospitals and other healthcare providers. This division:

▪maintains prime vendor relationships that streamline the purchasing process, resulting in greater efficiency and lower costs for our retail, hospital and other healthcare provider customers;

▪provides services to pharmaceutical manufacturers, including distribution, inventory management, data reporting, new product launch support and chargeback administration;

▪distributes specialty pharmaceutical products to hospitals and other healthcare providers and provides consulting, patient support and other services for specialty pharmaceutical products to pharmaceutical manufacturers and healthcare providers;

▪provides pharmacy management services to hospitals and operates a limited number of pharmacies, including in community health centers; and

▪repackages generic pharmaceuticals and over-the-counter healthcare products.

▪through its Specialty Solutions division:

▪distributes specialty pharmaceutical products to hospitals, specialty pharmacies, and other healthcare providers and provides consulting, patient support and other services for specialty pharmaceutical products to pharmaceutical manufacturers and healthcare providers; and

▪provides services to pharmaceutical manufacturers, including distribution, inventory management, data reporting, new product launch support and chargeback administration.

See Note 14 of the “Notes to Consolidated Financial Statements” for Pharmaceutical and Specialty Solutions segment revenue, profit and assets for fiscal 2024, 2023 and 2022.

Pharmaceutical and Specialty Pharmaceutical Distribution and Services

Our Pharmaceutical Distribution division’s gross margin includes margin from our generic pharmaceutical program, from distribution services agreements with branded pharmaceutical manufacturers, including manufacturers of Specialty pharmaceutical products, and from over-the-counter healthcare and consumer products. It also includes manufacturer cash discounts.

Margin from our generic pharmaceutical program includes price discounts, rebates and service fees from manufacturers and may, in limited instances, include price appreciation. Our earnings on generic pharmaceuticals are generally highest during the period immediately following the initial launch of a product, because generic pharmaceutical selling prices are generally highest during that period and tend to decline over time.

Margin from distribution services agreements with branded pharmaceutical manufacturers is derived from compensation we receive for providing a range of distribution and related services to manufacturers. Our compensation typically is a percentage of the wholesale acquisition cost that is set by manufacturers. In addition, under a limited number of agreements, branded pharmaceutical price appreciation, which is determined by the manufacturers, also serves as part of our compensation.

Specialty pharmaceutical products include oncology, rheumatology, urology, nephrology and other pharmaceutical products. Through our Specialty Solutions division, we also distribute human-derived plasma products to hospitals, dialysis clinics, physician offices and other healthcare providers. Our use of the term “specialty pharmaceutical products” may not be comparable to the terminology used by other industry participants. We also provide consulting, patient support, logistics, group purchasing and other services to pharmaceutical manufacturers and healthcare providers.

Sourcing Venture with CVS Health Corporation

Red Oak Sourcing, LLC ("Red Oak Sourcing"), a U.S.-based generic pharmaceutical sourcing venture with CVS Health, negotiates generic pharmaceutical supply contracts on behalf of both companies. The term of Red Oak Sourcing extends through June 2029.

Cardinal Health | Fiscal 2024 Form 10-K 27

Business

Global Medical Products and Distribution Segment

Our GMPD segment manufactures and sources Cardinal Health branded general and specialty medical, surgical and laboratory products and devices. These products include exam and surgical gloves; needle, syringe and sharps disposal; compression; incontinence; nutritional delivery; wound care; single-use surgical drapes, gowns and apparel; fluid suction and collection systems; urology; operating room supply; and electrode product lines. Our Cardinal Health brand products are sold directly or through third-party distributors in the United States, Canada, Europe, Asia and other markets. These Cardinal Health brand products are generally

higher-margin products. The GMPD segment also distributes a broad range of medical, surgical and laboratory products known as national brand products and provides supply chain services and solutions to hospitals, ambulatory surgery centers, clinical laboratories and other healthcare providers in the United States and Canada and this segment also assembles and sells sterile and non-sterile procedure kits.

The GMPD segment, through its Wavemark division, also provides an automated technology platform for inventory management.

Other Operating Segments

Our Nuclear and Precision Health Solutions operating segment operates nuclear pharmacies and manufacturing facilities, which manufacture, prepare and deliver radiopharmaceuticals for use in nuclear imaging, theranostics, and other procedures in hospitals and physician offices. This segment also contract manufactures a radiopharmaceutical treatment (Xofigo®) and holds the North American rights to manufacture and distribute Lymphoseek®, a radiopharmaceutical diagnostic imaging agent.

Our at-Home Solutions operating segment has two main businesses: Edgepark, a medical supplies provider that specializes

in serving patients with chronic conditions in the home; and at-Home, a business-to-business distribution service that delivers medical supplies and over-the-counter products to home medical equipment providers, home health and hospice agencies, and e-commerce providers.

Our OptiFreight® Logistics operating segment supports the shipping and logistics needs of healthcare providers by optimizing direct shipments through integrated technology solutions. This segment serves hospitals, pharmacies, labs and surgery centers.

Acquisitions and Divestitures

Acquisitions

Over the years, we have made a number of strategic acquisitions, especially in support of Cardinal Health brand medical products and specialty pharmaceutical products and services. We expect to continue to explore acquisitions in the future.

In March 2024, we completed the acquisition of Specialty Networks, a technology-enabled multi-specialty group purchasing and practice enhancement organization, for $1.2 billion in cash. We also completed several small acquisitions during the last five fiscal years.

Date Company Location Linesof Business AcquisitionPrice(in billions)

Divestitures

Over the past five fiscal years, we have also completed several divestitures, and we may explore additional divestitures in the future.

In June 2023, we signed a definitive agreement to contribute our OutcomesTM business to Transaction Data Systems ("TDS"), a portfolio company of BlackRock Long Term Private Capital and GTCR, in exchange for a minority stake in the combined entity. The transaction closed in July 2023.

In August 2021, we completed the divestiture of the Cordis business to Hellman & Freidman ("H&F") for net proceeds of $923 million in cash. We have retained certain working capital accounts and product liability for lawsuits related to IVC filters in the U.S. and Canada, as described in Note 8 of the "Notes to the Consolidated Financial Statements." We acquired the Cordis business from Johnson & Johnson for $1.9 billion in October 2015. This divestiture also included Access Closure, Inc., a manufacturer and distributor of extravascular closure devices, that we acquired for approximately $320 million in May 2014.

28 Cardinal Health | Fiscal 2024 Form 10-K

Business

Customers

Our largest customers, CVS Health and OptumRx, accounted for 24 percent and 17 percent of our fiscal 2024 revenue, respectively. In the aggregate, our five largest customers, including CVS Health and OptumRx, accounted for 52 percent of our fiscal 2024 revenue. As announced on April 22, 2024, OptumRx's pharmaceutical distribution contracts with us expired at the end of June 2024.

We have agreements with group purchasing organizations (“GPOs”) that act as agents to negotiate vendor contracts on

behalf of their members. Our two largest GPO relationships in terms of revenue are with Vizient, Inc. and Premier, Inc. Sales to members of these two GPOs, under numerous contracts across our businesses, collectively accounted for 16 percent of our revenue in fiscal 2024.

Suppliers

We rely on many different suppliers. During fiscal 2024, products obtained from our five largest suppliers accounted for an aggregate of 36 percent of our revenue and our largest supplier’s products accounted for approximately 9 percent of revenue.

Competition

We operate in a highly competitive environment in the distribution of pharmaceuticals and consumer healthcare products. We also operate in a highly competitive environment in the manufacturing and distribution of medical devices and surgical products. We compete on many levels, including price, service offerings, support services, customer service, breadth of product lines and product quality and efficacy.

In the Pharmaceutical and Specialty Solutions segment, we compete with wholesale distributors with national reach, including McKesson Corporation and Cencora, Inc., regional wholesale distributors, self-warehousing chains, specialty distributors, third-party logistics companies and companies that provide specialty pharmaceutical services among others. In addition, the Pharmaceutical and Specialty Solutions segment has experienced

competition from a number of organizations offering generic pharmaceuticals, including telemarketers. We also compete with manufacturers that distribute their products directly to customers.

In the GMPD segment, we compete with many diversified healthcare companies and national medical product distributors, such as Medline Industries, Inc., Owens & Minor, Inc. and Becton, Dickinson and Company, as well as regional medical product distributors and companies that are focused on specific product categories.

Our other operating segments compete with companies that operate nuclear radiopharmacies and manufacturing facilities, distribute medical products to patients' homes, and third-party logistics companies.

Human Capital Management

Employees

Through our employees, we improve the lives of people every day by solving complex healthcare problems. As of June 30, 2024, we had approximately 48,900 employees globally, of which approximately:

•18,500 are based outside the United States;

•98% are full time employees;

•32,100 worked in our distribution centers, manufacturing facilities and pharmacies;

•16,800 worked in other functions, including finance, information technology, human resources and sales; and

•10% are covered by collective bargaining agreements or similar representation. The majority of these employees are based outside the United States.

Additionally, we have engaged global professional services firms to perform certain business processes on our behalf, including within finance, information technology and human resources.

Board Oversight

Our Board of Directors assesses and monitors our corporate culture and how it enables our business strategies. To inform the Board about human capital and cultural health, we have developed and annually share with the Board a culture scorecard.

Additionally, the Human Resources and Compensation Committee of the Board of Directors (the “HRCC”) is tasked with,among other things, overseeing and advising the Board about human capital management strategies and policies, including with respect to attracting, developing, retaining and motivating management and employees; workplace diversity, equity and inclusion initiatives; employee relations; and workplace safety and culture. The HRCC

Cardinal Health | Fiscal 2024 Form 10-K 29

Business

is also responsible for overseeing the management succession process.

Culture & Talent Focus

Culture

Cardinal Health’s culture is rooted in our values and behaviors and aligned to the company’s strategic framework. Providing a positive work environment supports our ability to attract, retain and develop our employees and enables business performance. We reinforce, monitor and assess our culture through a variety of programs and processes which include performance management, talent/succession planning, as well as employee engagement surveys and other listening strategies.

Talent Management and Learning

Cardinal Health’s talent management strategy has a multi-pronged approach to build capabilities, skills and competencies of leaders and employees throughout the enterprise, ensuring employees capabilities connect to business needs and outcomes. This approach includes broad based employee skill development and learning and manager development.

We monitor our turnover data on a monthly and rolling 12-month basis and benchmark against Bureau of Labor Statistics and competitor data. Although turnover levels vary by site and region, we primarily look at the connection between key operational metrics and employee turnover.

Compensation and Benefits

Our employees are essential to our success and we strive to offer comprehensive and competitive wages and benefits. The benefits we offer include annual bonuses and stock awards for eligible employees, 401(k) plans, health care and insurance benefits, paid time off, flexible work schedules, family leave, dependent care resources, employee assistance programs and many others.

Employee Feedback

Cardinal Health solicits feedback from employees through various mechanisms, including our biennial full employee engagement survey, which provides insight into the employee experience. The results of this survey are reviewed with the Board of Directors and at all levels throughout the organization.

Diversity, Equity & Inclusion

At Cardinal Health, we are focused on building a diverse workforce and an inclusive workplace that values the unique perspectives and contributions of all of our employees.

We have seven Employee Resource Groups ("ERGs") that include groups with employees of various racial and ethnic groups, members of the LGBTQ community, employees with disabilities, veterans and women, and employees who consider themselves allies. These groups work to foster an inclusive culture and help attract, develop and retain talent.

We also monitor pay equity. We define pay equity as equal pay for people of all gender identities and ethnicities who are performing substantially similar work. We have a pay equity committee, which guides the ongoing analysis and benchmarking, in regular consultation with an independent third-party, to review and help inform our salary and compensation practices. Some of the things we consider include job-related skills, tenure, experience and education level, performance rating and geography.

As of the end of fiscal year 2024, 50% of our Board of Directors were women and 25% were ethnically diverse. 50% of our executive team (made up of the CEO, his direct reports and business presidents) were women and 10% were ethnically diverse. Approximately 51% of our total employee population were women and 51% of U.S. based employees were ethnically diverse.

Worker Health & Safety

The health, safety and security of our employees and contractors is a priority for us. We employ systems designed to continually monitor our facilities and work environment to promote worker safety and identify and prevent or mitigate any potential risks. This includes procedures and equipment for security. We routinely assess facilities to closely monitor adherence to established security and safety standards. Our workers receive specialized training related to their role, work setting and equipment used in their work environment. As our processes evolve, we update relevant safety training modules, which may include new training programs.

More Information

For more information on our approach to human capital management, please refer to our annual Environmental, Social & Governance Report, which is available on our website.

Intellectual Property

We rely on a combination of trade secret, patent, copyright and trademark laws, nondisclosure and other contractual provisions and technical measures to protect our products, services and intangible assets. We hold patents, and continue to pursue patent protection throughout the world, relating to the manufacture, operation and use of various medical and surgical products, to certain distribution and logistics systems, to the production and distribution of our nuclear pharmacy products and to other service offerings. We also operate under licenses for certain proprietary

technologies, and in certain instances we license our technologies to third parties.

We believe that we have taken necessary steps to protect our proprietary rights, but no assurance can be given that we will be able to successfully enforce or protect our rights in the event that they are infringed upon by a third party. While these proprietary rights are important to our operations, we do not consider any particular patent, trademark, license, franchise or concession to be material to our overall business.

30 Cardinal Health | Fiscal 2024 Form 10-K

Business

Regulatory Matters

Our business is highly regulated in the United States, at both the federal and state level, and in foreign countries. Depending upon the specific business, we may be subject to regulation by government entities including:

•the U.S. Drug Enforcement Administration (the “DEA”);

•certain agencies within the U.S. Department of Health and Human Services, including the U.S. Food and Drug Administration (the “FDA”), the Centers for Medicare and Medicaid Services, the Office of Inspector General and the Office for Civil Rights;

•state and local health departments, insurance departments, Medicaid departments or other comparable state agencies;

•state and local boards of pharmacy and other controlled substance authorities;

•the U.S. Nuclear Regulatory Commission (the “NRC”);

•the U.S. Environmental Protection Agency and state environmental authorities;

•the U.S. Federal Trade Commission (the "FTC");

•U.S. Customs and Border Protection; and

•agencies comparable to those listed above in markets outside the United States.

These regulatory agencies have a variety of civil, administrative and criminal sanctions at their disposal for failure to comply with applicable legal or regulatory requirements. They can suspend our ability to manufacture and distribute products, restrict our ability to import products, require us to initiate product recalls, seize products or impose criminal, civil and administrative sanctions.

Distribution

State Boards of Pharmacy, FDA, DEA and various other state authorities regulate the marketing, purchase, storage and distribution of pharmaceutical and medical products under various federal and state statutes including the federal Prescription Drug Marketing Act of 1987, Drug Quality and Security Act of 2013 (the “DQSA”) and Controlled Substances Act (the "CSA"). The CSA governs the sale, packaging, storage and distribution of controlled substances. Wholesale distributors of controlled substances must hold valid DEA registrations and state-level licenses, meet various security and operating standards including effective anti-diversion programs and comply with the CSA. They must also comply with state requirements relating to controlled substances that differ from state to state.

The National Opioid Settlement Agreement, as described in Note 8 of the "Notes to Consolidated Financial Statements" includes injunctive relief terms related to settling distributors' controlled substance anti-diversion programs, including with respect to: (1) governance; (2) independence and training of the personnel operating our controlled substances monitoring program; (3) due diligence for new and existing customers; (4) ordering limits for certain products; and (5) suspicious order monitoring. A monitor

will oversee compliance with these provisions for a period of five years. In addition, the settling distributors have engaged a third-party vendor to act as a clearinghouse for data aggregation and reporting and will fund the clearinghouse for ten years. See Note 8 of the "Notes to Consolidated Financial Statements" for more information about the National Opioid Settlement Agreement and other opioid-related matters.

Manufacturing, Sourcing and Marketing

We sell our manufactured products in the United States, Canada, Europe, Asia, Latin America and other markets. The FDA and other governmental agencies in the United States, as well as foreign governmental agencies, administer requirements that cover the design, testing, safety, effectiveness, manufacturing (including good manufacturing practices), quality systems, labeling, promotion and advertising (including restrictions on promoting or advertising a product other than for the product's cleared or approved uses), distribution, importation and post-market surveillance for most of our manufactured products. We are also subject to these requirements when we source certain GMPD segment products from third-party manufacturers.

We need specific approval or clearance from, and registrations with, regulatory authorities before we can market and sell some products in the United States and certain other countries, including countries in the European Union ("EU").

In the United States, authorization to commercially market a medical device is generally received in one of two ways. The first, known as pre-market notification or the 510(k) process, requires us to demonstrate that a medical device is substantially equivalent to a legally marketed medical device. The second more rigorous process, known as pre-market approval (“PMA”), requires us to independently demonstrate that a medical device is safe and effective. Many of our Medical segment branded products are cleared through the 510(k) process and certain products must be approved through the PMA process.

In the EU, we are required to obtain CE Mark Certification in order to market medical devices. In 2017, EU regulatory bodies finalized a new Medical Device Regulation ("MDR") became effective in May 2021. Under the MDR, medical devices marketed in the EU require significant pre-market and post-market requirements.

It can be costly and time-consuming to obtain regulatory approvals, clearances and registrations of medical devices, and they might not be granted on a timely basis, if at all. For additional information, please see our Risk Factor entitled "Our business is subject to rigorous quality regulatory and licensing requirements."

Privacy and Data Protection

We are subject to various and evolving privacy laws and regulations in many jurisdictions. Because we collect, handle and maintain patient-identifiable health information, we are subject to laws that require specified privacy and security measures and that regulate the use and disclosure of such information, including the U.S. Health Insurance Portability and Accountability Act of 1996

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Business

("HIPAA"), as augmented by the Health Information Technology for Economic and Clinical Health Act as well as state laws, in the United States.

We also collect, handle and maintain other personal and financial information. Within the U.S., these activities are regulated by certain federal and state laws. Certain states have recently enacted privacy laws that grant specified rights to consumers over the use of their personal information, including increased transparency. Other states are considering adopting similar or different comprehensive privacy laws and comprehensive privacy legislation has been proposed at the U.S. federal level. Internationally, we are also subject to privacy and data protection laws that require significant compliance efforts, including the EU's General Data Protection Regulation (GDPR), Canada's Personal Information Protection and Electronic Documents Act, Japan's Act on the Protection of Personal Information and China's Personal Information Protection Law, among many others.