Walgreens to shut 1,200 shops as a part of turnaround effort

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Walgreens plans to shut no less than 1,200 shops over the subsequent three years because the pharmacy big seeks to scale back prices and switch round operations below a brand new chief. 

One of many largest drugstore chains within the nation, Walgreens mentioned it was concentrating on 900 to 1,000 shops primarily throughout the U.S. by the tip of fiscal 12 months 2027, which is a part of the corporate’s “multi-year footprint optimization program.” About 500 shops are slated to shut as early as fiscal 12 months 2025.

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In June, the corporate had introduced its intention to shut a “significant” variety of underperforming shops throughout the U.S. because it contended with profitability challenges and declining margins. However CEO Tim Wentworth, who took over in October 2023, did not give an estimate on the time of what number of shops could be affected. He famous {that a} “meaningful percent” of the underperforming places would shutter. 

Wentworth mentioned in June that there’s a “difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins.”

Individuals make their means close to a Walgreens pharmacy in New York Metropolis. (Leonardo Munoz/VIEWpress / Getty Photos)

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In its newest earnings report on Tuesday, Wentworth mentioned that the corporate’s fiscal fourth-quarter and full-year outcomes “reflected our disciplined execution on cost management.” 

A pharmacist works at a pc station at a Walgreens retailer in Oak Park, Illinois. (Daniel Acker/Bloomberg by way of Getty Photos / Getty Photos)

Walgreens reported income of $37.55 billion for the fiscal fourth quarter, up 6% from the identical interval a 12 months in the past and beating Wall Avenue estimates of $35.75 billion. 

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The corporate additionally reported a web lack of $3 billion, or $3.48 per share, for the quarter. 

Shares of Walgreens Enhance Alliance rose greater than 4% in premarket buying and selling on Tuesday.

Ticker Safety Final Change Change % WBA WALGREENS BOOTS ALLIANCE INC. 9.00 -0.21
-2.28%

In fiscal 2025, Wentworth mentioned Walgreens plans to focus “on stabilizing the retail pharmacy by optimizing our footprint, controlling operating costs, improving cash flow, and continuing to address reimbursement models to support dispensing margins and preserve patient access for the future.”