COR · 10-Q · 2026Q2 · Full report

Interest Rate Exposure

Cencora, Inc. · 2026-08-05 · Importance 65 · Surprise 82

Net interest expense increased 65.4% year over year to $353.6 million in the nine months ended June 30, 2026, primarily because of debt issued to finance the OneOncology acquisition and the May 2025 issuance of €1.0 billion of senior notes. In February 2026, Cencora borrowed $1.5 billion under variable-rate term loans and issued $3.0 billion of senior notes; the variable-rate loans bear interest based on Term SOFR, Daily Simple SOFR, or an alternate base rate plus rating-based margins. As of June 30, 2026, total debt was $11.7 billion, including $1.6 billion of variable-rate debt, with $8.7 billion of additional variable-rate facility availability.

Key facts

• Interest expense, net increased by $58.9 million, or 72.0%, from the prior year quarter due to increased interest expense and decreased interest income. source
• For every $100 million of cash invested that is in excess of variable-rate debt, a 10-basis point decrease in interest rates would increase our annual net interest expense by $0.1 million. source
• There are no assurances that such instruments will be available in the combinations we want and/or on terms acceptable to us. source
• Interest expense was $154.5 million for the three months ended June 30, 2026 at a weighted average interest rate of 4.23%; interest income was $(13.8) million at a weighted average interest rate of 3.06%; interest expense, net was $140.7 million. source
• Interest expense was $402.2 million for the nine months ended June 30, 2026 at a weighted average interest rate of 4.15%; interest income was $(48.7) million at a weighted average interest rate of 3.29%; interest expense, net was $353.6 million. source
• The unfavorable impact of a hypothetical decrease in interest rates on cash and cash equivalents would be partially offset by the favorable impact of such a decrease on variable-rate debt. source
• We manage interest rate risk by using a combination of fixed-rate and variable-rate debt. source
• We periodically evaluate financial instruments to manage our exposure to fixed and variable interest rates. source