Walgreens plans to close at least 1,200 stores over the next three years as the pharmacy giant seeks to reduce costs and turn around operations under a new leader.
One of the largest drugstore chains in the country, Walgreens said about 500 stores are slated to close as early as fiscal year 2025.
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In June, the company had announced its intention to close a "significant" number of underperforming stores across the U.S. as it contended with profitability challenges and declining margins. But CEO Tim Wentworth, who took over in October 2023, didn't give an estimate at the time of how many stores would be affected. He noted that a "meaningful percent" of the underperforming locations would shutter.
Wentworth said in June that there is a "difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins."
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In its latest earnings report on Tuesday, Wentworth said that the company's fiscal fourth-quarter and full-year results "reflected our disciplined execution on cost management."
Walgreens reported revenue of $37.55 billion for the fiscal fourth quarter, up 6% from the same period a year ago and beating Wall Street estimates of $35.75 billion.
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The company also reported a net loss of $3 billion, or $3.48 per share, for the quarter.
Shares of Walgreens Boost Alliance rose more than 4% in premarket trading on Tuesday.
In fiscal 2025, Wentworth said 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."
