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Segments of Business
 3 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
Segments of Business Segments of Business
The Company reports its financial results in four reportable segments: U.S. Pharmaceutical, RxTS, Medical-Surgical Solutions, and International. The organizational structure also includes Corporate, which consists of income and expenses associated with administrative functions and projects, and 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 the individual business activities. The Company evaluates the performance of its operating segments on a number of measures, including revenues and operating profit before interest expense and income taxes. Assets by operating segment are not reviewed by management for the purpose of assessing performance or allocating resources.
The U.S. Pharmaceutical segment distributes branded, generic, specialty, biosimilar and over-the-counter pharmaceutical drugs, and other healthcare-related products in the U.S. This segment also provides practice management, technology, clinical support, and business solutions to community-based oncology and other specialty practices. In addition, the segment sells financial, operational, and clinical solutions to pharmacies (retail, hospital, alternate sites) and provides consulting, outsourcing, technological, and other services.
The RxTS segment helps solve medication access, affordability, and adherence challenges for patients by working across healthcare to connect patients, pharmacies, providers, pharmacy benefit managers, health plans, and biopharma companies. RxTS serves our biopharma and life sciences partners, delivering innovative solutions that help people get the medicine they need to live healthier lives. RxTS also offers prescription price transparency, benefit insight, dispensing support services, third-party logistics, and wholesale distribution support across various therapeutic categories and temperature ranges to biopharma customers throughout the product lifecycle.
The Medical-Surgical Solutions segment provides medical-surgical supply distribution, logistics, and other services to healthcare providers, including physician offices, surgery centers, nursing homes, hospital reference labs, and home health care agencies. This segment offers national brand medical-surgical products as well as McKesson’s own line of high-quality products through a network of distribution centers in the U.S.
The International segment includes the Company’s operations in Canada and Norway, bringing together non-U.S.-based drug distribution services, specialty pharmacy, retail, and infusion care services. The Company’s Canadian operations deliver medicines, supplies, and information technology solutions throughout Canada and include Rexall Health retail pharmacies. The Company’s Norwegian operations provide distribution and services to wholesale and retail customers in Norway where it owns, partners, or franchises with retail pharmacies.
Financial information relating to the Company’s reportable operating segments and reconciliations to the condensed consolidated totals was as follows:
 Three Months Ended June 30,
(In millions)20242023
Segment revenues (1)
U.S. Pharmaceutical$71,715 $67,160 
Prescription Technology Solutions1,241 1,244 
Medical-Surgical Solutions2,636 2,611 
International3,691 3,468 
Total revenues$79,283 $74,483 
Segment operating profit (2)
U.S. Pharmaceutical (3)
$781 $827 
Prescription Technology Solutions (4)
203 231 
Medical-Surgical Solutions188 227 
International
90 57 
Subtotal1,262 1,342 
Corporate expenses, net (5)
(103)(204)
Interest expense(75)(47)
Income before income taxes$1,084 $1,091 
(1)Revenues from services on a disaggregated basis represent approximately 1% of the U.S. Pharmaceutical segment’s total revenues, less than 39% of the RxTS segment’s total revenues, less than 1% of the Medical-Surgical Solutions segment’s total revenues, and less than 1% of the International segment’s total revenues. The International segment reflects foreign revenues. Revenues for the remaining three reportable segments are derived in the U.S.
(2)Segment operating profit includes gross profit, net of total operating expenses, as well as other income, net, for the Company’s reportable segments.
(3)The Company’s U.S. Pharmaceutical segment’s operating profit includes the following:
•cash receipts for the Company’s share of antitrust legal settlements of $90 million and $118 million for the three months ended June 30, 2024 and 2023, respectively. These gains were recorded within “Cost of sales” in the Company’s Condensed Consolidated Statements of Operations;
•a charge of $57 million for the three months ended June 30, 2024 related to the estimated liability for opioid-related claims, as discussed in more detail in Financial Note 9, “Commitments and Contingent Liabilities;"
•a loss of $43 million for the three months ended June 30, 2024 related to one of the Company’s equity method investments, which was recorded within “Other income, net” in the Company’s Condensed Consolidated Statement of Operations; and
•a credit of $2 million and a charge of $32 million related to the last-in, first-out method of accounting for inventories for the three months ended June 30, 2024 and 2023, respectively. These amounts were recorded within “Cost of sales” in the Company’s Condensed Consolidated Statements of Operations.
(4)The Company’s RxTS segment’s operating profit for the three months ended June 30, 2023 includes a gain of $28 million resulting from a fair value adjustment of the Company’s contingent consideration liability related to the acquisition of Rx Savings Solutions, LLC completed in November 2022.
(5)Corporate expenses, net includes the following:
•a net gain of $110 million for the three months ended June 30, 2024 related to the Company’s investments in equity securities of certain U.S. growth stage companies in the healthcare industry, as discussed in more detail in Financial Note 8, “Fair Value Measurements;”
•a net charge of $55 million for the three months ended June 30, 2024 related to the estimated liability for opioid-related claims, as discussed in more detail in Financial Note 9, “Commitments and Contingent Liabilities;" and
•restructuring charges of $40 million for the three months ended June 30, 2023 for restructuring initiatives as discussed in more detail in Financial Note 2, “Restructuring, Impairment, and Related Charges, Net.”