Quarterly Financial Information (Unaudited)

The quarterly results of operations are not necessarily indicative of the results that may be expected for the entire year. Selected quarterly financial information for the last two years is as follows:



(In millions, except per share amounts)	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
Fiscal 2017
Revenues	$	49,733		$	49,957		$	50,130		$	48,713
Gross profit ^{(1) (2)}	2,907			2,756			2,812			2,796
Income (loss) after income taxes:
Continuing operations ^{(1) (2) (3) (4)}	$	673		$	325		$	649		$	3,630
Discontinued operations	(113		)	(1		)	(3		)	(7		)
Net income	$	560		$	324		$	646		$	3,623
Net income attributable to McKesson	$	542		$	307		$	633		$	3,588
Earnings (loss) per common share attributable to McKesson ⁽⁵⁾
Diluted
Continuing operations	$	2.88		$	1.35		$	2.86		$	16.79
Discontinued operations	(0.50		)	(0.01		)	(0.01		)	(0.03		)
Total	$	2.38		$	1.34		$	2.85		$	16.76
Basic
Continuing operations	$	2.91		$	1.36		$	2.89		$	16.95
Discontinued operations	(0.50		)	—			(0.02		)	(0.03		)
Total	$	2.41		$	1.36		$	2.87		$	16.92


(1)	Gross profit for the first, second, third and fourth quarters of 2017 includes pre-tax charge of $47 million, pre-tax credits of $43 million and $155 million and pre-tax charge of $144 million related to our last-in-first-out (“LIFO”) method of accounting for inventories.


(2)	Gross profit for the first and third quarters of 2017 includes $142 million and $2 million of cash proceeds representing our share of net settlements of antitrust class action lawsuits.


(3)	Financial results for the fourth quarter of 2017 include a pre-tax gain of $3,947 million ($3,018 million after-tax) recognized from the Healthcare Technology Net Asset Exchange, net of transaction and related expenses.


(4)	Financial results for the second quarter of 2017 include a non-cash pre-tax charge of $290 million for goodwill impairment related to the EIS reporting unit within our Technology Solutions segment.


(5)	Certain computations may reflect rounding adjustments.



(In millions, except per share amounts)	First Quarter			Second Quarter			Third Quarter		Fourth Quarter
Fiscal 2016
Revenues	$	47,546		$	48,761		$	47,899	$	46,678
Gross profit ^{(1) (2) (3)}	2,848			2,844			2,872		2,852
Income (loss) after income taxes:
Continuing operations ^{(1) (2) (3) (4)}	$	599		$	636		$	642	$	465
Discontinued operations	(10		)	(6		)	5		(21		)
Net income	$	589		$	630		$	647	$	444
Net income attributable to McKesson	$	576		$	617		$	634	$	431
Earnings (loss) per common share attributable to McKesson ⁽⁵⁾
Diluted
Continuing operations	$	2.50		$	2.65		$	2.71	$	1.97
Discontinued operations	(0.05		)	(0.02		)	0.02		(0.09		)
Total	$	2.45		$	2.63		$	2.73	$	1.88
Basic
Continuing operations	$	2.53		$	2.68		$	2.74	$	1.99
Discontinued operations	(0.04		)	(0.02		)	0.02		(0.09		)
Total	$	2.49		$	2.66		$	2.76	$	1.90


(1)	Gross profit for the first, second, third and fourth quarters of 2016 includes pre-tax charges related to our last-in-first-out (“LIFO”) method of accounting for inventories of $91 million, $91 million, $33 million and $29 million.


(2)	Gross profit for the first and third quarters of 2016 includes $59 million and $17 million of cash proceeds representing our share of net settlements of antitrust class action lawsuits.


(3)	In the fourth quarter of 2016, the Company approved a restructuring plan to reduce its operating expenses. Financial results for the fourth quarter of 2016 include pre-tax restructuring charges of $229 million within our continuing operations. Charges were recorded as follows: $26 million in cost of sales and $203 million in operating expenses.


(4)	Financial results for the first quarter of 2016 include an after-tax gain of $38 million from the sale of our nurse triage business, and for the second quarter of 2016 include an after-tax gain of $29 million from the sale of ZEE Medical business.


(5)	Certain computations may reflect rounding adjustments.