INDEX TO MANAGEMENT’S DISCUSSION AND ANALYSIS Section Page General 34 Overview of our Business 34 Executive Summary 35 Trends and Uncertainties 36 Overview of Consolidated Results 37 Overview of Segment Results 41 New Accounting Pronouncements 43 Financial Condition, Liquidity, and Capital Resources 44 Cautionary Notice About Forward-Looking Statements 48 Available Information 48 GENERAL Management’s discussion and analysis of financial condition and results of operations, referred to as the “Financial Review,” is intended to assist the reader in the understanding and assessment of significant changes and trends related to the results of operations and financial position of McKesson Corporation together with its subsidiaries (collectively, the “Company,” “McKesson,” “we,” “our,” or “us,” and other similar pronouns). This discussion and analysis should be read in conjunction with the condensed consolidated financial statements and accompanying financial notes in Item 1 of Part I of this Quarterly Report on Form 10-Q (“Quarterly Report”) and in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended March 31, 2026 previously filed with the Securities and Exchange Commission (the “SEC”) on May 8, 2026 (“2026 Annual Report”). Our fiscal year begins on April 1 and ends on March 31. Unless otherwise noted, all references to a particular year refer to our fiscal year. Certain statements in this report constitute forward-looking statements. See “Cautionary Notice About Forward-Looking Statements” included in this Quarterly Report. Overview of Our Business: We are a diversified healthcare services leader dedicated to advancing health outcomes for patients everywhere. Our teams partner with biopharma companies, care providers, pharmacies, manufacturers, governments, and others to deliver insights, products, and services to help make quality care more accessible and affordable. We implemented a new segment reporting structure commencing in the second quarter of fiscal 2026, which resulted in four reportable segments: North American Pharmaceutical, Oncology & Multispecialty, Prescription Technology Solutions, and Medical-Surgical Solutions. Our former Norwegian operations were included in Other. All prior segment information has been recast to reflect our new segment structure and current period presentation. Our organizational structure also includes Corporate, which consists of income and expenses associated with administrative functions and projects, as well as the results of certain investments. The factors for determining the reportable segments include the manner in which management evaluates the performance of the Company combined with the nature of individual business activities. We evaluate the performance of our reportable segments on a number of measures, including revenues and operating profit before interest expense and income taxes. 34 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) The following summarizes our four reportable segments. Refer to Financial Note 13, “Segments of Business,” to the accompanying condensed consolidated financial statements included in this Quarterly Report for further information regarding our reportable segments. •North American Pharmaceutical segment provides distribution and logistics services for branded, generic, specialty, biosimilar, and over-the-counter pharmaceutical drugs along with other healthcare-related products to customers in the United States (“U.S.”) and Canada. In addition, the segment sells financial, operational, and clinical solutions to pharmacies (retail, hospital, alternate sites) and provides consulting, outsourcing, technological, and other services. •Oncology & Multispecialty segment includes provider solutions that encompass specialty drug distribution, group purchasing organizations, infusion services, direct to patient pharmacy capabilities, cell and gene therapy services with InspiroGene, technology solutions, practice consulting services, and vaccine distribution. In addition, the segment supports The U.S. Oncology Network, one of the largest networks of physician-led, integrated, community-based oncology practices dedicated to advancing high-quality, evidence-based cancer care in the U.S., and includes PRISM Vision Holdings, LLC (“PRISM Vision”), which drives patient outcomes in a retina and ophthalmology setting. Combined with Sarah Cannon Research Institute and our technology business, Ontada, this segment provides research, insights, technologies, and services that address and improve cancer and specialty care. •Prescription Technology Solutions segment combines automation and our ability to navigate the healthcare ecosystem to connect patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies to address patients’ medication access, affordability, and adherence challenges. Prescription Technology Solutions offers technology services, which includes electronic prior authorization, prescription price transparency, benefit insight, dispensing support services, and patient enrollment, in addition to third-party logistics, and wholesale distribution support across various therapeutic categories and temperature ranges to biopharma customers throughout the product lifecycle. •Medical-Surgical Solutions segment provides medical-surgical, laboratory, and pharmaceutical distribution, logistics, and other services to U.S. healthcare providers operating in the non-acute settings. These include ambulatory care environments, such as physician offices, surgery centers, and hospital reference labs, as well as extended care settings, including nursing homes, hospice and home health care agencies, government facilities, and online marketplaces and retailers. This segment offers national brand medical-surgical products as well as our own line of more than 4,000 high-quality products through a network of distribution centers within the U.S. During fiscal 2026, we announced our intention to separate this segment into an independent company. As a part of the separation strategy, on June 1, 2026, we completed a transaction under which funds managed by affiliates of Apollo Global Management, Inc. (“Apollo Funds”) acquired an approximately 13% minority ownership interest in our Medical‑Surgical Solutions segment through an investment of approximately $1.25 billion in the segment’s convertible preferred equity. We recognized a redeemable noncontrolling interest associated with the divested portion of the Medical‑Surgical Solutions segment. We retain operating control and majority ownership of Medical-Surgical Solutions and continue to consolidate this segment into our consolidated financial statements. Executive Summary: The following summary provides highlights and key factors that impacted our business, operating results, financial condition, and liquidity for the three months ended June 30, 2026, as well as other material developments: •For the three months ended June 30, 2026 compared to the prior year, revenues increased by 8%, gross profit increased by 12%, total operating expenses increased by 5%, and other income, net increased by 3%. Refer to the “Overview of Consolidated Results” section below for an analysis of these changes; •Diluted earnings per common share attributable to McKesson Corporation decreased to $5.15 from $6.25 for the three months ended June 30, 2026 compared to the respective prior year period; •In the first quarter of 2027, certain of our subsidiaries within the Medical-Surgical Solutions segment entered into, and then amended, a syndicated credit agreement for: a $750 million principal senior secured term loan due in 2031, a $250 million principal senior secured term loan due in 2028; a $2.25 billion senior secured term loan due 2032, for total proceeds received, net of discounts and debt offering expenses, of $3.2 billion; and a $1.0 billion senior secured revolving credit facility scheduled to mature in April 2031. Refer to Financial Note 8, “Debt and Financing Activities,” to the accompanying condensed consolidated financial statements in this Quarterly Report for additional information; 35 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) •On April 24, 2026, we terminated our 2022 revolving credit facility and our 364-Day credit facility and entered into a new Credit Agreement (the “2026 Credit Facility”) that provides a syndicated $5.0 billion senior unsecured credit facility. The 2026 Credit Facility matures in 2031. Refer to Financial Note 8, “Debt and Financing Activities,” to the accompanying condensed consolidated financial statements in this Quarterly Report for additional information; •As a part of our intention to separate our Medical-Surgical Solutions business into an independent company, on June 1, 2026, Apollo Funds invested approximately $1.25 billion for convertible preferred equity of Medical-Surgical Solutions business to acquire an approximately 13% interest in the business; •On April 29, 2026, our Board of Directors (the “Board”) approved the Company to repurchase up to an additional $5.0 billion shares of common stock; •During the three months ended June 30, 2026, we returned $2.6 billion of cash to shareholders through $2.5 billion of common stock repurchases and $102 million of dividend payments. The total remaining authorization outstanding for repurchases of the Company’s common stock at June 30, 2026 was $5.2 billion; and •On July 21, 2026, the Board raised our quarterly dividend from $0.82 to $0.94 per share of common stock. Trends and Uncertainties: Government Policies As described in “Item 1. Government Regulation” and “Item 1A - Risk Factors” in Part I of our 2026 Annual Report, our industry is highly regulated and is subject to risks and uncertainty caused by the volume and speed of changes to regulatory policies. Changes in regulatory posture and law may result in significant changes in healthcare policy, government funding of healthcare costs, and other laws affecting our operations, but the ultimate outcomes are difficult to predict. 36 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) RESULTS OF OPERATIONS Overview of Consolidated Results: (Dollars in millions, except per share data) Three Months Ended June 30, 2026 2025 Change Revenues $ 105,380 $ 97,827 8 % Gross profit 3,685 3,279 12 Gross profit margin 3.50 % 3.35 % 15 bp Total operating expenses $ (2,366) $ (2,243) 5 % Total operating expenses as a percentage of revenues 2.25 % 2.29 % (4) bp Other income, net $ 66 $ 64 3 % Interest expense (77) (49) 57 Income before income taxes 1,308 1,051 24 Income tax expense (276) (220) 25 Reported income tax rate 21.1 % 20.9 % 20 bp Net income 1,032 831 24 Net income attributable to noncontrolling interests (418) (47) 789 Net income attributable to McKesson Corporation $ 614 $ 784 (22) % Diluted earnings per common share attributable to McKesson Corporation $ 5.15 $ 6.25 (18) % Weighted-average diluted common shares outstanding 119.2 125.5 (5) % Any percentage changes displayed above which are not meaningful are displayed as zero percent. bp - basis point Revenues Revenues increased for the three months ended June 30, 2026 compared to the same prior year period, primarily due to market growth in our North American Pharmaceutical segment, including higher volumes from institutional healthcare providers and retail national account customers. Market growth includes growing drug utilization and newly launched products, partially offset by branded pharmaceutical price decreases and branded to generic drug conversion. Revenue growth was also favorably impacted by growth in our Oncology & Multispecialty segment primarily due to higher specialty pharmaceutical sales. Gross Profit Gross profit increased for the three months ended June 30, 2026 compared to the same prior year period primarily due to growth in our North American Pharmaceutical segment, including higher volumes from retail national account customers and institutional healthcare providers, and growth in our Oncology & Multispecialty segment, driven by growth of specialty pharmaceuticals and the addition of providers in practice management. 37 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Total Operating Expenses A summary of the components of our total operating expenses for the three months ended June 30, 2026 and 2025 is as follows: •Selling, distribution, general, and administrative expenses (“SDG&A”): consists of personnel costs, transportation costs, depreciation and amortization, lease costs, professional fee expenses, administrative expenses, provision for bad debts and related recoveries, remeasurement charges to fair value less costs to sell, and other general charges. •Claims and litigation charges, net: These charges include adjustments for estimated probable settlements related to our controlled substance monitoring and reporting, and opioid-related claims, as well as any applicable income items or credit adjustments due to subsequent changes in estimates. Legal fees to defend claims, which are expensed as incurred, are included within SDG&A. •Restructuring, impairment, and related charges, net: Charges recorded under this component include those incurred for programs in which we change our operations, the scope of a business undertaken by our business units, or the manner in which that business is conducted, as well as long-lived asset impairments. Three Months Ended June 30, (Dollars in millions) 2026 2025 Change Selling, distribution, general, and administrative expenses $ 2,264 $ 2,196 3 % Claims and litigation charges, net (34) — — Restructuring, impairment, and related charges, net 136 47 189 Total operating expenses $ 2,366 $ 2,243 5 % Percent of revenues 2.25 % 2.29 % (4) bp Any percentage changes displayed above which are not meaningful are displayed as zero percent. bp - basis point For the three months ended June 30, 2026, total operating expenses increased and total operating expenses as a percentage of revenues decreased compared to the same prior year period. Total operating expenses were impacted by the following significant items: •SDG&A for the three months ended June 30, 2026 increased due to increased operating expenses to support higher volumes and includes net charges of $68 million related to our planned separation of the Medical-Surgical Solutions business; •SDG&A for the three months ended June 30, 2025 includes a provision for bad debts of $189 million related to the bankruptcy of our customer Rite Aid Corporation (including certain of its subsidiaries, “Rite Aid”). •Claims and litigation charges, net primarily consists of a credit of $34 million for the three months ended June 30, 2026 related to our estimated liability for opioid-related claims as discussed in more detail in Financial Note 11, “Commitments and Contingent Liabilities,” to the accompanying condensed consolidated financial statements included in this Quarterly Report; •Restructuring, impairment, and related charges, net were $136 million and $47 million for the three months ended June 30, 2026 and 2025, respectively, as discussed below under “Restructuring Initiatives”; 38 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Goodwill Impairment We evaluate goodwill for impairment on an annual basis in the first fiscal quarter, and at an interim date if indicators of potential impairment exist. The annual impairment testing performed in fiscal 2027 and fiscal 2026 did not indicate any impairment of goodwill, and no goodwill impairment charges were recorded during the three months ended June 30, 2026 and 2025. However, other risks, expenses, and future developments, such as government actions, increased regulatory uncertainty, and material changes in key market assumptions, limit our ability to estimate projected cash flows, which could adversely affect the fair value of various reporting units in future periods. For additional disclosure of our policy regarding goodwill, refer to the “Critical Accounting Estimates” section within Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations in Part II of our 2026 Annual Report. Restructuring Initiatives We recorded restructuring, impairment, and related charges of $136 million and $47 million for the three months ended June 30, 2026 and 2025, respectively. These charges were included in “Restructuring, impairment, and related charges, net” in the Condensed Consolidated Statements of Operations. During the first quarter of fiscal 2027, we approved multi-year initiatives within Corporate to further optimize its operating model and align certain enterprise support functions with our long-term strategic priorities. These initiatives include organizational changes, process enhancements, and the implementation of automation solutions designed to improve efficiency and productivity. We anticipate total charges of approximately $230 million to $310 million, consisting primarily of severance and employee-related costs and exit-related costs. We recorded immaterial charges associated with these initiatives during the first quarter of fiscal 2027. These programs are expected to be substantially complete by the end of fiscal 2028. During the fourth quarter of fiscal 2026, we approved an initiative within our Prescription Technology Solutions segment to increase operational efficiencies and cost optimization efforts, with the intent of aligning with our long-term strategy. This initiative includes headcount reductions, the exit or downsizing of certain facilities, and other costs. We anticipate total charges between $200 million and $250 million, consisting primarily of employee severance and other employee-related costs, and facility and other exit-related costs, including long-lived asset impairments. We recorded charges of $61 million in the first quarter of fiscal 2027 associated with this initiative, which primarily includes asset impairments as well as severance and other employee-related costs. This program is anticipated to be substantially complete by the end of fiscal 2029. During the second quarter of fiscal 2025, we approved enterprise-wide initiatives to modernize and accelerate our technology service operating model, which were intended to improve business continuity, compliance, operating efficiency and advance investments to streamline the organization. These initiatives include cost reduction efforts and support other rationalization efforts within Corporate, and the Medical-Surgical Solutions and North American Pharmaceutical segments to help realize long-term sustainable growth. We anticipate total charges related to these initiatives of $650 million to $700 million, consisting primarily of employee severance and other employee-related costs as well as facility, exit, and other related costs, including long-lived asset impairments. These programs are anticipated to be substantially complete in fiscal 2028. We recorded charges of $45 million and $38 million for the three months ended June 30, 2026 and 2025, respectively, related to these initiatives, which primarily includes facility exit and other related costs as well as severance and other employee-related costs. Refer to Financial Note 3, “Restructuring, Impairment, and Related Charges, Net,” to the accompanying condensed consolidated financial statements included in this Quarterly Report for further information on our restructuring initiatives. Other Income, Net Other income, net was flat for the three months ended June 30, 2026 compared to the same prior year period. 39 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Interest Expense Interest expense increased for the three months ended June 30, 2026 compared to the same prior year period due to interest from increased average balances of the Company’s loan portfolio in fiscal 2027, primarily driven by the MMS Credit Agreement. Interest expense may fluctuate based on timing, amounts, and interest rates of term debt repaid and new term debt issued, as well as amounts incurred associated with financing fees. Refer to Financial Note 8, “Debt and Financing Activities,” to the accompanying condensed consolidated financial statements included in this Quarterly Report for more information. Income Tax Expense For the three months ended June 30, 2026 and 2025, we recorded income tax expense of $276 million and $220 million, respectively. Our income tax rates were 21.1% and 20.9% for the three months ended June 30, 2026 and 2025, respectively. Fluctuations in our reported income tax rates are primarily due to changes in our business mix of earnings among various taxing jurisdictions and discrete tax items recognized in the quarters. Refer to Financial Note 4, “Income Taxes,” to the accompanying condensed consolidated financial statements included in this Quarterly Report for more information. Net Income Attributable to Noncontrolling Interests Net income attributable to noncontrolling interests for the three months ended June 30, 2026 and 2025 primarily represents the proportionate results of third-party equity interests in ClarusONE Sourcing Services LLP, Vantage Oncology Holdings, LLC, and SCRI Oncology, LLC. Noncontrolling interests with redemption features, such as put rights, that are not solely within our control are considered redeemable noncontrolling interests, primarily related to our acquisitions of Core Ventures and PRISM Vision and sale of an approximately 13% noncontrolling interest in our Medical-Surgical Solutions business. On a quarterly basis, we determine the redemption value of the redeemable noncontrolling interests, which resulted in an adjustment to redemption value for the redeemable noncontrolling interests for the three months ended June 30, 2026 recorded within “Net income attributable to noncontrolling interests”. Refer to Financial Note 5, “Redeemable Noncontrolling Interests and Noncontrolling Interests,” to the accompanying condensed consolidated financial statements included in this Quarterly Report for more information on changes to our redeemable noncontrolling interests and noncontrolling interests during the first three months of fiscal 2027. The increase in net income attributable to noncontrolling interests was primarily driven by higher volumes in our ClarusONE joint venture and contributions from Core Ventures. Net income attributable to noncontrolling interest was also impacted by charges of $293 million for Medical-Surgical Solutions and $81 million for Core Ventures to remeasure the respective redeemable noncontrolling interests to redemption value. Net Income Attributable to McKesson Corporation Net income attributable to McKesson Corporation was $614 million and $784 million for the three months ended June 30, 2026 and 2025, respectively. Diluted earnings per common share attributable to McKesson Corporation was $5.15 and $6.25 for the three months ended June 30, 2026 and 2025, respectively. Our diluted earnings per share includes the cumulative effects of share repurchases during each period. Weighted-Average Diluted Common Shares Outstanding Diluted earnings per common share was calculated based on a weighted-average number of shares outstanding of 119.2 million and 125.5 million for the three months ended June 30, 2026 and 2025, respectively. Weighted-average diluted shares outstanding for the three months ended June 30, 2026 decreased from the same prior year period primarily due to the cumulative effect of share repurchases, as discussed in the “Share Repurchases Plans” section of this Financial Review. 40 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Overview of Segment Results: Segment Revenues: Three Months Ended June 30, (Dollars in millions) 2026 2025 Change Segment revenues North American Pharmaceutical $ 86,773 $ 82,729 5 % Oncology & Multispecialty 14,222 10,658 33 Prescription Technology Solutions 1,566 1,434 9 Medical-Surgical Solutions 2,819 2,701 4 Other — 305 (100) Total revenues $ 105,380 $ 97,827 8 % Any percentage changes displayed above which are not meaningful are displayed as zero percent. North American Pharmaceutical Three Months Ended June 30, 2026 vs. 2025 North American Pharmaceutical revenues for the three months ended June 30, 2026 increased $4.0 billion or 5% compared to the same prior year period. Within the segment, sales in the U.S. increased $3.7 billion primarily due to higher volumes from institutional and retail national account customers partially offset by branded pharmaceutical price decreases and branded to generic drug conversions. Oncology & Multispecialty Three Months Ended June 30, 2026 vs. 2025 Oncology & Multispecialty revenues for the three months ended June 30, 2026 increased $3.6 billion or 33% compared to the same prior year period primarily driven by higher specialty pharmaceutical sales in provider solutions. Prescription Technology Solutions Three Months Ended June 30, 2026 vs. 2025 Prescription Technology Solutions revenues for the three months ended June 30, 2026 increased $132 million or 9% compared to the same prior year period primarily due to increased volumes from third-party logistics. Medical-Surgical Solutions Three Months Ended June 30, 2026 vs. 2025 Medical-Surgical Solutions revenues for the three months ended June 30, 2026 increased $118 million or 4% compared to the same prior year period. Within the segment, sales to extended care customers increased $79 million and sales to ambulatory care customers increased $35 million driven by underlying business growth. 41 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Other Segment Expense, Segment Operating Profit and Corporate Expenses, Net: Three Months Ended June 30, (Dollars in millions) 2026 2025 Change Other segment expense, net (1) North American Pharmaceutical (2) $ 85,870 $ 82,135 5 % Oncology & Multispecialty 13,897 10,446 33 Prescription Technology Solutions (3) 1,340 1,181 13 Medical-Surgical Solutions (4) 2,697 2,480 9 Other — 292 (100) Total other segment expense, net $ 103,804 $ 96,534 8 % Segment operating profit North American Pharmaceutical $ 903 $ 594 52 % Oncology & Multispecialty 325 212 53 Prescription Technology Solutions 226 253 (11) Medical-Surgical Solutions 122 221 (45) Other — 13 (100) Subtotal 1,576 1,293 22 Corporate expenses, net (5) (191) (193) (1) Interest expense (77) (49) 57 Income before income taxes $ 1,308 $ 1,051 24 % Segment operating profit margin North American Pharmaceutical 1.04 % 0.72 % 32 bp Oncology & Multispecialty 2.29 1.99 30 Prescription Technology Solutions 14.43 17.64 (321) Medical-Surgical Solutions 4.33 8.18 (385) Other — 4.26 (426) Any percentage changes displayed above which are not meaningful are displayed as zero percent. bp - basis point (1)Other segment expense, net includes cost of sales, total operating expenses, as well as other income, net, for our reportable segments. (2)Other segment expense, net for our North American Pharmaceutical segment includes the following: •related to the bankruptcy of our customer Rite Aid, we recorded a provision for bad debts of $189 million during the three months ended June 30, 2025; (3)Other segment expense, net for our Prescription Technology Solutions segment includes the following: •charges of $61 million for the three months ended June 30, 2026 for restructuring initiatives as discussed in Financial Note 3, “Restructuring, Impairment, and Related Charges, Net,” to the accompanying condensed consolidated financial statements included in this Quarterly Report; (4)Other segment expense, net for our Medical-Surgical Solutions segment includes the following: •net charges of $45 million for the three months ended June 30, 2026 related to our planned separation of the Medical-Surgical Solutions business; (5)Corporate expenses, net includes the following: •charges of $50 million and $29 million for the three months ended June 30, 2026 and 2025 for restructuring initiatives as discussed in Financial Note 3, “Restructuring, Impairment, and Related Charges, Net,” to the accompanying condensed consolidated financial statements included in this Quarterly Report; 42 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) •a credit of $34 million for the three months ended June 30, 2026 related to our estimated liability for opioid-related claims as discussed in more detail in Financial Note 11, “Commitments and Contingent Liabilities,” to the accompanying condensed consolidated financial statements; and •net charges of $23 million for the three months ended June 30, 2026 related to our planned separation of the Medical-Surgical Solutions business. North American Pharmaceutical Three Months Ended June 30, 2026 vs. 2025 Operating profit for this segment increased for the three months ended June 30, 2026 compared to the same prior year period largely due to higher pharmaceutical distribution volumes across the segment and the absence of the prior year impact from the Rite Aid bankruptcy, partially offset by higher operating expenses to support volume growth. Oncology & Multispecialty Three Months Ended June 30, 2026 vs. 2025 Operating profit for this segment increased for the three months ended June 30, 2026 compared to the same prior year period primarily due to growth in specialty pharmaceuticals, including contributions from business acquisitions completed in the prior year, partially offset by an increase in operating expenses to support higher volumes. Prescription Technology Solutions Three Months Ended June 30, 2026 vs. 2025 Operating profit for this segment decreased for the three months ended June 30, 2026 compared to the same prior year period driven by higher restructuring charges and an increase in operating expenses to support higher volumes, partially offset by increased demand for Access Solutions. Medical-Surgical Solutions Three Months Ended June 30, 2026 vs. 2025 Operating profit for this segment decreased for the three months ended June 30, 2026 compared to the same prior year period primarily due to $45 million of charges related to our planned separation of the Medical-Surgical Solutions business, a decline in the contribution from our ambulatory care business, and an increase in operating expenses to support higher volumes. Corporate Expenses, Net Three Months Ended June 30, 2026 vs. 2025 Corporate expenses, net decreased for the three months ended June 30, 2026 compared to the same prior year period primarily due to a $34 million credit related to our estimated liability for opioid-related claims as discussed in more detail in Financial Note 11, “Commitments and Contingent Liabilities,” offset by $23 million of charges related to our planned separation of the Medical-Surgical Solutions Segment, and higher restructuring charges. New Accounting Pronouncements New accounting pronouncements that we have recently adopted as well as those that have been recently issued but not yet adopted by us are included in Financial Note 1, “Significant Accounting Policies,” to the accompanying condensed consolidated financial statements included in this Quarterly Report. 43 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) FINANCIAL CONDITION, LIQUIDITY, AND CAPITAL RESOURCES We expect our available cash generated from operations and our short-term investment portfolio, together with our existing sources of liquidity from our credit facilities, commercial paper program, and other borrowings will be sufficient to fund our short-term and long-term capital expenditures, working capital, and other cash requirements. We remain adequately capitalized, including access to liquidity from our $5 billion revolving credit facility. At June 30, 2026, we were in compliance with all debt covenants, and believe we have the ability to continue to meet our debt covenants in the future. The following table summarizes the net change in cash, cash equivalents, and restricted cash for the periods shown: Three Months Ended June 30, (Dollars in millions) 2026 2025 Change Net cash provided by (used in): Operating activities $ (220) $ (918) $ 698 Investing activities (214) (3,564) 3,350 Financing activities 1,632 1,176 456 Effect of exchange rate changes on cash, cash equivalents, and restricted cash (10) 33 (43) Net change in cash, cash equivalents, and restricted cash $ 1,188 $ (3,273) $ 4,461 Operating Activities Operating activities used cash of $220 million and $918 million during the three months ended June 30, 2026 and 2025, respectively. Cash flows from operations can be significantly impacted by factors such as the timing of receipts from customers, inventory receipts, and payments to vendors. Additionally, working capital is primarily a function of sales and purchase volumes, inventory requirements, and vendor payment terms. For the three months ended June 30, 2026, net cash used by operating activities decreased by $698 million compared to the same prior year period. This decrease was primarily due to the following: •the Company’s net income increased by $201 million and was impacted by lower net non-cash items of $44 million, compared to the same prior year period driven by factors discussed in more detail in the “Overview of Consolidated Results” section of this Financial Review; •an increase in cash of $1.8 billion related to accounts payable as a result of customary vendor payment scheduling partially offset by timing related to the day of the week on which the period ends and a decrease in cash of $103 million due to higher inventory requirements during the period compared to the prior year; •a decrease in net cash of $285 million related to accounts receivable is primarily due to the timing of collections in the current period partially offset by timing related to the day of the week on which the period ends; and •a decrease in cash driven by higher income tax payments of $701 million in the first quarter of fiscal 2027 compared to the prior year. Investing Activities Investing activities used cash of $214 million and $3.6 billion during the three months ended June 30, 2026 and 2025, respectively. Investing activities for the three months ended June 30, 2026 and 2025 includes $23 million and $3.4 billion of net cash payments for acquisitions, including $2.5 billion and $874 million for the acquisitions of the interests in Core Ventures and PRISM Vision, respectively, during the three months ended June 30, 2025 as discussed in further detail in Financial Note 2, “Business Acquisitions and Divestitures,” to the accompanying condensed consolidated financial statements in this Quarterly Report. Investing activities for the three months ended June 30, 2026 and 2025 includes $152 million and $189 million, respectively, in capital expenditures for property, plant, and equipment and capitalized software. Financing Activities Financing activities provided cash of $1.6 billion and of $1.2 billion during the three months ended June 30, 2026 and 2025, respectively, which includes $2.5 billion and $581 million of cash paid for share repurchases, respectively, as well as $102 million and $90 million of cash paid for dividends, respectively. 44 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) During the three months ended June 30, 2026, certain of our subsidiaries within the Medical-Surgical Solutions segment entered into the MMS Credit Agreement for: a $750 million principal senior secured term loan due in 2031, a $250 million principal senior secured term loan due in 2028; and a $2.25 billion senior secured term loan due 2032 for total proceeds received, net of discounts and debt offering expenses, of $3.2 billion. The net proceeds were used for a payment of principal on an intercompany loan as discussed in further detail in Financial Note 8, “Debt and Financing Activities,” to the accompanying condensed consolidated financial statements in this Quarterly Report. On May 30, 2025, we completed a public debt offering of 4.65% Notes due May 30, 2030 in a principal amount of $650 million, 4.95% Notes due May 30, 2032 in a principal amount of $650 million, and 5.25% Notes due May 30, 2035 in a principal amount of $700 million, for total proceeds received, net of discounts and debt offering expenses, of $2.0 billion. The net proceeds from these notes in addition to cash on hand were utilized to fund the purchase of our interest in Core Ventures. On June 1, 2026, Apollo Funds invested approximately $1.25 billion in convertible preferred equity of Medical-Surgical Solutions business to acquire an approximately 13% interest in Medical-Surgical Solutions. Cash used for other financing activities generally includes the cash value of shares surrendered for tax withholding and payments to noncontrolling interests. Share Repurchase Plans The Board has authorized the repurchase of common stock. We may repurchase common stock from time-to-time through open market transactions, privately negotiated transactions, accelerated share repurchase (“ASR”) programs, or by combinations of such methods, any of which may use pre-arranged trading plans that are designed to meet the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934 (“Exchange Act”). The timing of any repurchases and the actual number of shares repurchased will depend on a variety of factors, including our stock price, corporate and regulatory requirements, tax implications, restrictions under our debt obligations, other uses for capital, impacts on the value of remaining shares, cash generated from operations, and market and economic conditions. Excise taxes of $25 million and $2 million were accrued for shares repurchased during the three months ended June 30, 2026 and 2025, respectively. On July 30, 2025, we made a payment of $26 million for fiscal 2025 excise taxes previously accrued. As of June 30, 2026 and March 31, 2026, the amount accrued for excise taxes was $65 million and $40 million within “Other accrued liabilities” in our Condensed Consolidated Balance Sheets, respectively. 45 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Information regarding share repurchase activity for the three months ended June 30, 2026 and 2025 was as follows: Share Repurchases (1) (In millions, except price per share) Total Number ofShares Purchased (2) Average Price Paid Per Share (3) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs Balance at March 31, 2026 $ 2,719 April 2026 Board Authorization (4) 5,000 Share Repurchase March 2026 ASR (5) 0.7 $ 820.04 — Share Repurchase May 2026 ASR (6) 2.5 $ 754.68 (2,250) Q1 Shares repurchased - Open market (7) 0.4 $ 762.40 (294) Balance at June 30, 2026 $ 5,175 (1)This table does not include the value of equity awards surrendered to satisfy tax withholding obligations or forfeitures of equity awards. (2)The number of shares purchased reflects rounding adjustments. (3)The average price paid per share includes $25 million of excise taxes for the three months ended June 30, 2026. (4)On April 29, 2026, the Board of Directors approved the Company to repurchase up to an additional $5.0 billion shares of common stock. (5)In March 2026, we entered into an ASR program with a third-party financial institution to repurchase $2.3 billion of our common stock. The total number of shares repurchased under this ASR program was 2.7 million shares at an average price per share of $820.04. We received 2.0 million shares as the initial share settlement during the fourth quarter of fiscal 2026 and, in May 2026, we received an additional 0.7 million shares upon the completion of this ASR program. (6)In May 2026, we entered into an ASR program with a third-party financial institution to repurchase $2.3 billion of our common stock. The average price paid per share and total number of shares purchased under this program are estimates based on the initial share purchase price and initial delivery of shares under an ASR agreement and may differ from the average price paid per share and total number of shares purchased under the ASR program upon its final settlement in the second quarter of fiscal 2027. (7)Of the total dollar value, $13 million was accrued within “Other accrued liabilities” in the Company’s Condensed Consolidated Balance Sheet as of June 30, 2026 for share repurchases that were executed in late June 2026 and settled in early July 2026. Share Repurchases (1) (In millions, except price per share) Total Number ofShares Purchased (2) Average Price Paid Per Share (3) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs Balance at March 31, 2025 $ 7,469 Q1 Shares repurchased - Open market (4) 0.8 $ 709.84 (590) Balance at June 30, 2025 $ 6,879 (1)This table does not include the value of equity awards surrendered to satisfy tax withholding obligations or forfeitures of equity awards. (2)The number of shares purchased reflects rounding adjustments. (3)The average price paid per share includes $2 million of excise taxes for the three months ended June 30, 2025. (4)Of the total dollar value, $9 million was accrued within “Other accrued liabilities” in the Company’s Condensed Consolidated Balance Sheet as of June 30, 2025 for share repurchases that were executed in late June 2025 and settled in early July 2025. 46 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONTINUED) (UNAUDITED) Selected Measures of Liquidity and Capital Resources (Dollars in millions) June 30, 2026 March 31, 2026 Cash, cash equivalents, and restricted cash $ 5,256 $ 4,068 Working capital (7,519) (9,807) Debt to capital ratio (1) 156.0 % 128.0 % (1)This ratio describes the relationship and changes within our capital resources, and is computed as the sum of total debt divided by the sum of total debt and McKesson stockholders’ deficit, which excludes noncontrolling interests and accumulated other comprehensive loss. Cash equivalents, which are readily convertible to known amounts of cash, are carried at fair value. Cash equivalents are primarily invested in AAA-rated U.S. government money market funds, short-term deposits with financial institutions, and short-term commercial papers issued by non-financial institutions. Deposits with financial institutions are primarily denominated in U.S. dollars and the functional currencies of our foreign subsidiaries, including Canadian dollars. Deposits could exceed the amounts insured by the Federal Deposit Insurance Corporation in the U.S. and similar deposit insurance programs in other jurisdictions. We mitigate the risk of our short-term investment portfolio by depositing funds with reputable financial institutions and monitoring risk profiles and investment strategies of money market funds. Our cash and cash equivalents balance as of June 30, 2026 and March 31, 2026 each included approximately $1.8 billion of cash held by our subsidiaries outside of the U.S. Our primary intent is to utilize this cash for foreign operations for an indefinite period of time. Although the majority of cash held outside the U.S. is available for repatriation, doing so could subject us to foreign withholding taxes and state income taxes. We may remit foreign earnings to the U.S. to the extent it is tax efficient to do so. We do not anticipate the tax impact from remitting these earnings to be material. Following enactment of the 2017 Tax Cuts and Jobs Act, the repatriation of cash to the U.S. is generally no longer taxable for federal income tax purposes. Working capital primarily includes cash and cash equivalents, receivables, inventories, and prepaid expenses, net of drafts and accounts payable, short-term borrowings, current portion of long-term debt, current portion of operating lease liabilities, and other accrued liabilities. Our businesses require substantial investments in working capital that are susceptible to large variations during the year as a result of inventory purchase patterns and seasonal demands. Inventory purchase activity is a function of sales activity and other requirements. Consolidated working capital increased at June 30, 2026 compared to March 31, 2026 primarily due to an increase in receivables, net, driven by higher sales and timing, an increase in inventories, an increase in cash and cash equivalents and a decrease in other accrued liabilities. These were partially offset by an increase in drafts and accounts payable from increased purchasing driven by increased sales and timing. Our debt to capital ratio increased for the three months ended June 30, 2026 due to share repurchases offset by the issuance of new long-term debt and net income. On July 21, 2026, we raised our quarterly dividend from $0.82 to $0.94 per share of common stock. We anticipate that we will continue to pay quarterly cash dividends in the future. However, the payment and amount of future dividends remain within the discretion of the Board and will depend upon our future earnings, financial condition, capital requirements, legal requirements, and other factors. 47 Table of Contents MD&A Index McKESSON CORPORATION FINANCIAL REVIEW (CONCLUDED) (UNAUDITED) Capital Resources We fund our working capital requirements primarily with cash and cash equivalents, proceeds from short-term borrowings from our commercial paper issuances, and longer-term credit agreements and debt offerings. Funds necessary for future debt maturities and our other cash requirements, including any future payments that may be made related to our total estimated litigation liability of $5.7 billion as of June 30, 2026 payable under the terms of various settlement agreements for opioid-related claims, are expected to be met by existing cash balances, cash flow from operations, existing credit sources, and future borrowings. Long-term debt markets and commercial paper markets, our primary sources of capital after cash flow from operations, are open and accessible to us should we decide to access those markets. Detailed information regarding our debt and financing activities is included in Financial Note 8, “Debt and Financing Activities,” to the accompanying condensed consolidated financial statements included in this Quarterly Report. We believe that our future operating cash flow, financial assets, and access to capital and credit markets, including our credit facilities, give us the ability to meet our financing needs for the foreseeable future. However, there can be no assurance that an increase in volatility or disruption in the global capital and credit markets will not impair our liquidity or increase our costs of borrowing. CAUTIONARY NOTICE ABOUT FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2 of Part I of this report, contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. Forward-looking statements may be identified by their use of terminology such as “believes,” “expects,” “anticipates,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “projects,” “plans,” “estimates,” “targets,” or the negative of these words or other comparable terminology. The discussion of proposed acquisition or disposition transactions, financial trends, strategy, plans, assumptions, expectations, litigation outcomes, or intentions may also include forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, or implied. Although it is not possible to predict or identify all such risks and uncertainties, they include, but are not limited to, the factors discussed in the “Risk Factors” section in Item 1A of Part I of the 2026 Annual Report and in our publicly available SEC filings and press releases. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date such statements were first made. Except to the extent required by federal securities laws, we undertake no obligation to publicly release the result of any revisions to any forward-looking statements to reflect events or circumstances after the date the statements are made, or to reflect the occurrence of unanticipated events. AVAILABLE INFORMATION We routinely post on our company website, and via our social media channels, information that may be material to investors, including details and updates to information disclosed elsewhere, which may include business developments, earnings and financial performance, sustainability matters, details regarding upcoming events, and materials for presentations to investors and financial analysts. Investors are encouraged to monitor our website www.mckesson.com. Interested parties can sign up on our website, including our Investor Relations site, to receive automated e-mail alerts, such as via RSS newsfeed, when we post certain information. Interested parties can also follow our social media feed @McKesson on X. The content on any website or social media channel is not incorporated by reference into this report, unless expressly noted otherwise.