Walgreens said Tuesday it will close 1,200 stores across the U.S. over the next three years to try to recover from financial struggles that include billions of dollars in losses.
The company said it will shutter 500 underperforming stores in the current fiscal year, which began last month, The Associated Press reported. Walgreens did not name the store locations.
The Illinois-based company has about 8,500 stores in the U.S. and has struggled with operational costs as well as falling reimbursement rates for prescription drugs and increased competition from competitors like Amazon, Walmart and Target. Other drug store chains, including CVS and Rite Aid, have closed hundreds of stores in recent years for some of the same reasons.
The announcement of the closures came as Walgreens reported its financials for the three-month period that ended Aug. 31.
The company's fourth-quarter sales and profit beat Wall Street’s expectations and “reflected our disciplined execution on cost management, working capital initiatives and capex reduction,” company CEO Tim Wentworth said in a news release.
Walgreens said its net losses rose to more than $3 billion in the final quarter of 2024 amid declining retail and pharmacy sales, opioid litigation settlements and an equity investment in China, media outlets reported.
The company had said in June it planned to close a “significant” number of its underperforming stores by 2027.
The closures will give Walgreens a “healthier store base” and “will enable us to respond to shifts in consumer behavior and buying preferences,” Wentworth said during an earnings call on Tuesday. He said Walgreens plans to keep most of its employees at the affected stores.
