Walgreens' Q1 Tops Estimates Amid Cost Cuts
Walgreens Boots Alliance reported a better-than-expected first-quarter earnings and sales with growth across its divisions.
The company reported a loss of $265 million, or $0.31 a share, for the quarter ended Nov. 30, compared to a loss of $67 million, or $0.8 a share, in the year-ago period. Walgreens said the loss was primarily driven by higher operating losses related to its “footprint optimization program.” (Walgreens plans to close 1,200 stores during the next three years, including 500 in its current fiscal year. The company has about 8,500
U.S. retail locations.)
Adjusted earnings per share were $0.51, ahead of the $0.38 per share the Street expected. Total sales rose 7.5% to $39.46 billion, easily topping the $37.4 billion analysts expected.
By segment, U.S. retail pharmacy business sales increased 6.6% to $30.9 billion. Same-store sales rose 8.5%. Pharmacy sales rose 10.4% and pharmacy same-store sales jumped 12.7%. Retail sales fell 6.2%, with comp sales down 4.6%, reflecting a weaker cough cold flu season and lower sales in discretionary categories.
The U.S. healthcare segment had first quarter sales of $2.2 billion with growth in all businesses compared to the year-ago quarter. VillageMD sales increased 9%, CareCentrix increased 16% and Shields increased 30%. Walgreens’ international segment sales rose 10.2% to $6.4 billion. Boots’ sales grew 30%, or 23% on a constant currency basis, helped by strong Black Friday performance.
"Our first quarter results reflect our disciplined execution against our 2025 priorities: stabilizing the retail pharmacy by optimizing our footprint, controlling operating costs, improving cash flow and continuing to address reimbursement models,” said Tim Wentworth, CEO, Walgreens Boots Alliance. “While our turnaround will take time, our early progress reinforces our belief in a sustainable, retail pharmacy-led operating model."
Walgreens maintained its fiscal 2025 adjusted earnings guidance of $1.40 to $1.80 per share.
This article was originally reported by sister publication by Chain Store Age.
