Walgreens in the red: 14% of US pharmacies to close

Walgreens, an American pharmacy chain part of the WBA group (Walgreens Boots Alliance) intends to close 1,200 of its shops by 2027: of the maxi-cut, 500 will already be in the fiscal year 2025. The company has about 8,700 shops in the US and a third of them are unprofitable, according to the AP news agency.

Walgreens' announcement was accompanied by the presentation of its quarterly results as of 31 August, where revenues rose 6% to $37.55 billion while losses amounted to $3 billion. Walgreens Boots Alliance executives had stated at the end of June that they were finalising a restructuring plan for their US operations that would result in the closure of hundreds of shops. The plan announced today also includes the closure of 300 shops included in an earlier cost-cutting plan. Walgreens CEO Tim Wentworth said that the 2025 fiscal year, which began last month, will be a major "rebasing year" for the pharmacy chain. "This turnaround will take time, but we are confident it will bring significant financial and consumer benefits in the long term," he said.

Walgreens, like its competitors, has struggled for years with the rigid prescription reimbursement system, as well as other challenges such as the rising cost of running its shops. In addition, pharmacy chains have faced increased competition from Amazon, Walmart and Target, which have jumped into the parapharmacy market. Even rival CVS, a large pharmacy chain in the US, is concluding a three-year plan to close 900 shops. Another large company, Rite Aid, emerged from a bankruptcy reorganisation earlier this year after reducing the number of its shops to around 1,300 locations.

Walgreens also backtracked on a plan to add primary care clinics next to some of its shops after embarking on an aggressive expansion plan under former CEO Rosalind Brewer.