Strategic Acquisition of Solaris Health Accelerates Urology Expansion
Cardinal Health announced the acquisition of Solaris Health, the leading urology managed services organization, to expand its urology alliance physician network.
The Solaris Health acquisition adds over 750 providers across 14 states, significantly bolstering Cardinal's urology MSO platform.
This move positions Cardinal as a multi-specialty leader, with a focus on autoimmune, urology, and oncology therapeutic areas.
The acquisition complements other recent urology-focused acquisitions, creating a diversified revenue stream and strengthening market presence.
Management highlighted the strategic fit of Solaris within their broader urology and specialty care growth initiatives.
The deal is expected to be slightly accretive to EPS within the first 12 months post-close, with funding through a mix of cash and debt.
Adjusted free cash flow was $2.5 billion for the year, $500 million above expectations.
Cardinal Health grew operating earnings by 19% in Q4 and 15% for fiscal year 2025, with EPS growth of 13% in Q4 and over 9% for the year.
Fiscal year 2025 revenue decreased 2% to $223 billion due to contract expiration but increased 18% excluding it; operating earnings grew 15% to $2.8 billion.
GMPD segment revenue grew 3% to $3.2 billion with a record Q4 segment profit of $70 million.
Gross profit grew 17% to $2.2 billion in Q4, with a 50 basis point improvement in rate due to favorable product, customer, and business mix.
Other growth businesses saw 37% revenue growth to $1.6 billion and 44% profit growth to $160 million in Q4.
Pharma segment revenue was flat at $55.4 billion in Q4 but increased 22% excluding contract expiration; segment profit grew 11% to $535 million.
SG&A increased 16% to $1.5 billion in Q4, primarily due to acquisitions; on an organic basis, SG&A grew 4%.
Total company revenue was flat at $60.2 billion in Q4, but adjusted for a customer contract expiration, revenue increased 21%.
Medtronic's Strategic Portfolio Reorientation and Growth Initiatives
Medtronic announced a new strategic focus on higher growth areas, including M&A, portfolio optimization, and increased R&D investments, aiming for sustained outsized earnings growth.
The company has appointed two new independent board members with deep med tech experience to support its growth and operational strategies.
New governance committees focused on growth and operational efficiency have been established to support management and accelerate strategic initiatives.
Management emphasized a shift towards more aggressive capital allocation and portfolio reorientation to unlock value and drive higher growth.
The upcoming Investor Day in mid-2026 will detail the new long-term financial targets and strategic outlook, signaling a significant strategic reset.
Leadership Transition and Strategic Reassessment Under New CEO
Bernd Brust emphasized his recent appointment as CEO and outlined a comprehensive review of the company's strategy, structure, and financial plans within his first 60 days.
The new leadership identified the need for organizational change, cost reduction, and operational discipline to unlock Maravai's full potential.
Brust's background includes leading successful life sciences companies and focusing on innovation, which signals a strategic shift for Maravai.
The CEO's approach involves realigning the company around core assets, streamlining operations, and focusing on high-impact initiatives.
Management acknowledged the heavy organizational layers and excess expenditure, leading to a plan to reduce costs by over $50 million annually.
Leadership expressed confidence that these changes will position the company for sustainable, profitable growth in the future.
Dafinchi
