Walgreens is shuttering 1,200 stores over the next three years due to a variety of factors, including poor performance, theft, and pharmacy reimbursement issues. The closures are in addition to the 600-plus underperforming locations the company already closed.
The pharmacy giant, owned by Walgreens Boots Alliance, made the announcement during its fourth-quarter earnings call earlier this week. Walgreens Boots Alliance CEO Tim Wentworth told investors that of the more than 8,000 U.S. Walgreens retail stores, 6,000 are profitable.
“Fiscal 2025 will be an important rebasing year as we advance our strategy to drive value creation. This turnaround will take time, but we are confident it will yield significant financial and consumer benefits over the long term,” Wentworth said in a statement.
He added that the company is strengthening 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.”
Approximately 500 locations are set to shut down in the current fiscal year, which runs through September 2025. The company did not disclose the locations shuttering, only that stores not generating profits or those with expiring leases are being eyed first.
Closure news aside, Walgreens reported a fourth quarter operating loss of nearly $1 billion with sales and profit that beat Wall Street’s expectations. The company said it cut $1 billion in costs during fiscal 2024.
About Walgreens Boots Alliance
The U.S. Retail Pharmacy segment of Walgreens Boots Alliance is anchored by two retail, pharmacy and healthcare brands: Walgreens and Duane Reade. Together, they form one of the largest drugstore chains in the U.S.
The stores sell prescription and non-prescription drugs, as well as a wide assortment of retail products, including health and wellness, beauty, personal care and consumables and general merchandise. The pharmacies filled approximately 800 million prescriptions in fiscal 2023, including immunizations.