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Segments of Business
 12 Months Ended
Mar. 31, 2022
Segment Reporting [Abstract]  
Segments of Business Segments of Business
Commencing with the second quarter of 2021, the Company began reporting under four reportable segments: U.S. Pharmaceutical, RxTS, Medical-Surgical Solutions, and International. Other, for retrospective periods presented, consists of the Company’s previous equity method investment in the Change Healthcare JV, which was split-off from McKesson in the fourth quarter of 2020. 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 (loss) 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. 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 site) and provides consulting, outsourcing, technological, and other services.
The RxTS segment serves McKesson’s biopharma and life sciences partners and patients to address medication challenges for patients throughout their journeys. RxTS works across healthcare to connect pharmacies, providers, payers, and biopharma companies to deliver innovative access and adherence solutions designed to benefit stakeholders and help people get the medicine they need to live healthier lives. RxTS also offers 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 more than 285,000 national brand medical-surgical products as well as McKesson’s own line of high-quality products through a network of distribution centers within the U.S.
The International segment includes the Company’s operations in Europe and Canada, bringing together non-U.S.-based drug distribution services, specialty pharmacy, retail, and infusion care services. The Company’s operations in Europe provide distribution and services to wholesale, institutional, and retail customers in 11 European countries where it owns, partners, or franchises with retail pharmacies and operates through two businesses: Pharmaceutical Distribution and Retail Pharmacy. The Company’s Canada operations deliver vital medicines, supplies, and information technology solutions throughout Canada and includes Rexall Health retail pharmacies. In 2022, the Company entered into agreements to sell the E.U. disposal group and U.K. disposal group, and completed the sale of its Austrian business. Refer to Financial Note 2, “Held for Sale,” for more information.
Other, for retrospective periods presented consists of the Company’s previous investment in the Change Healthcare JV, which was split-off from the Company in the fourth quarter of 2020.
Financial information relating to the Company’s reportable operating segments and reconciliations to the consolidated totals is as follows:
 Years Ended March 31,
(In millions)202220212020
Segment revenues (1)
U.S. Pharmaceutical$212,149 $189,274 $181,700 
Prescription Technology Solutions3,864 2,890 2,705 
Medical-Surgical Solutions11,608 10,099 8,305 
International36,345 35,965 38,341 
Total revenues$263,966 $238,228 $231,051 
Segment operating profit (loss) (2)
U.S. Pharmaceutical (3)
$2,879 $2,763 $2,745 
Prescription Technology Solutions500 395 396 
Medical-Surgical Solutions (4)
959 707 499 
International (5)
(968)(37)(161)
Other (6)
— — (1,113)
Subtotal3,370 3,828 2,366 
Corporate expenses, net (7)
(1,073)(8,645)(973)
Loss on debt extinguishment (8)
(191)— — 
Interest expense(178)(217)(249)
Income (loss) from continuing operations before income taxes$1,928 $(5,034)$1,144 
Segment depreciation and amortization (9)
U.S. Pharmaceutical$228 $211 $208 
Prescription Technology Solutions82 87 85 
Medical-Surgical Solutions 129 130 136 
International204 334 357 
Corporate117 125 136 
Total depreciation and amortization$760 $887 $922 
Segment expenditures for long-lived assets (10)
U.S. Pharmaceutical$137 $246 $109 
Prescription Technology Solutions10 22 23 
Medical-Surgical Solutions74 57 36 
International177 212 218 
Corporate137 104 120 
Total expenditures for long-lived assets$535 $641 $506 
(1)Revenues from services on a disaggregated basis represent less than 1% of the U.S. Pharmaceutical segment’s total revenues, less than 40% of the RxTS segment’s total revenues, less than 3% of the Medical-Surgical Solutions segment’s total revenues, and less than 8% of the International segment’s total revenues. The International segment reflects foreign revenues. Revenues for the remaining three reportable segments are domestic.
(2)Segment operating profit (loss) includes gross profit, net of total operating expenses, as well as other income (expense), net, for the Company’s reportable segments. For retrospective periods presented, operating loss for Other reflects equity earnings and charges from the Company’s previous equity method investment in the Change Healthcare JV, which was split-off from McKesson in the fourth quarter of 2020.
(3)The Company’s U.S. Pharmaceutical segment’s operating profit for 2022, 2021, and 2020 includes credits of $23 million, $38 million, and $252 million, respectively, related to the LIFO method of accounting for inventories. Operating profit for 2022, 2021, and 2020 also includes $46 million, $181 million, and $22 million, respectively, of cash receipts for the Company’s share of antitrust legal settlements. In addition, operating profit for 2021 includes a charge of $50 million recorded in connection with the Company’s estimated liability under the State of New York’s OSA, as further discussed in Financial Note 18, “Commitments and Contingent Liabilities.”
(4)The Company’s Medical-Surgical Solutions segment’s operating profit for 2022 and 2021 includes inventory charges of $164 million and $136 million, respectively, on certain PPE and other related products.
(5)The Company’s International segment’s operating loss for 2022, 2021, and 2020 reflects the following:
•2022 includes charges of $1.1 billion to remeasure assets and liabilities of the U.K. disposal group to fair value less costs to sell, as discussed in more detail in Financial Note 2, “Held for Sale;”
•2022 includes charges of $383 million to remeasure assets and liabilities of the E.U. disposal group to fair value less costs to sell and to impair certain assets, including internal-use software that will not be utilized in the future, as discussed in more detail in Financial Note 2, “Held for Sale;”
•2022 includes a gain of $59 million related to the sale of the Company’s Canadian health benefit claims management and plan administrative services business;
•2022 includes a gain of $42 million related to the sale of the Company’s 30% interest in its German pharmaceutical wholesale joint venture to WBA. 2021 and 2020 includes charges of $58 million and $275 million, respectively, related to the contribution of a majority of its German pharmaceutical wholesale business to the joint venture with WBA completed on November 1, 2020. See Financial Note 2, “Held for Sale,” and Financial Note 6, “Other Income, Net,” for further details;
•2021 includes a goodwill impairment charge of $69 million related to one of the Company’s reporting units in Europe, as discussed in more detail in Financial Note 11, “Goodwill and Intangible Assets, Net;” and
•2021 and 2020 includes long-lived asset impairment charges of $115 million and $112 million, respectively, primarily related to retail pharmacy businesses in Canada and Europe, as discussed in more detail in Financial Note 3, “Restructuring, Impairment, and Related Charges, Net.”
(6)Operating loss for Other for 2020 includes an impairment charge of $1.2 billion and a dilution loss of $246 million associated with the Company’s previous investment in the Change Healthcare JV, partially offset by a net gain of $414 million (pre-tax and after-tax) related to the separation of its interest in the Change Healthcare JV completed during the fourth quarter of 2020. Operating loss for 2020 also includes the Company’s proportionate share of loss from the Change Healthcare JV of $119 million.
(7)Corporate expenses, net, for 2022, 2021, and 2020 reflects the following:
•2022 includes charges of $55 million primarily related to the effect of accumulated other comprehensive loss components from the E.U. disposal group, as discussed in more detail in Financial Note 2, “Held for Sale;”
•2022 includes charges of $42 million primarily related to the effect of accumulated other comprehensive loss components from the U.K. disposal group, as discussed in more detail in Financial Note 2, “Held for Sale;”
•2022 and 2021 includes charges of $274 million and $8.1 billion, respectively, related to the estimated liability for opioid-related claims, as discussed in more detail in Financial Note 18, “Commitments and Contingent Liabilities;"
•2022 and 2021 includes net gains of $98 million and $133 million, respectively, associated with certain of the Company’s equity investments, as discussed in more detail in Financial Note 16, “Fair Value Measurements;”
•2021 includes a net gain of $131 million recorded in connection with insurance proceeds received from the settlement of the shareholder derivative action related to the Company’s controlled substances monitoring program;
•2020 includes settlement charges of $122 million for the termination of the Company’s defined benefit pension plan; and
•2020 includes a settlement charge of $82 million related to opioid claims.
(8)Loss on debt extinguishment for 2022 consists of a charge of $191 million related to the Company’s July 2021 tender offer to redeem a portion of its existing debt, as discussed in more detail in Financial Note 12, “Debt and Financing Activities.”
(9)Amounts primarily consist of amortization of acquired intangible assets purchased in connection with business acquisitions and capitalized software for internal use as well as depreciation and amortization of property, plant, and equipment, net.
(10)Long-lived assets consist of property, plant, and equipment, net and capitalized software.
Segment assets and long-lived assets by geographic areas were as follows:
 March 31,
(In millions)20222021
Segment assets
U.S. Pharmaceutical$38,346 $35,236 
Prescription Technology Solutions3,528 3,446 
Medical-Surgical Solutions5,830 5,986 
International13,717 14,987 
Corporate1,877 5,360 
Total assets$63,298 $65,015 
Long-lived assets (1)
United States$2,060 $2,110 
Foreign352 984 
Total long-lived assets$2,412 $3,094 
(1)Long-lived assets consist of property, plant, and equipment, net and capitalized software and excludes amounts classified as assets held for sale.