OAN’s Brooke Mallory
Thursday, June 27, 2024 1:50 PM
Walgreens CEO Tim Wentworth announced the company’s intention to close most of its U.S. stores over the next three years during a conference call with industry analysts on Thursday.
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Wentworth said a quarter of its 8,500 stores were “underperforming” and announced it would close a “significant proportion” of these stores.
However, Wentworth said the exact number of stores that will be closed has yet to be determined.
Wentworth also said Walgreens will implement some changes to revive its remaining underperforming stores. If that doesn’t work, “we will continue to consider closures if we don’t see improvement,” he added.
The news comes about seven months after the company launched a thorough review of its operations following concerns about theft, consumer spending and adverse trends in the pharmacy sector.
“Everything is on the table,” Wentworth said. “The current pharmacy model is at a point where it’s just not sustainable.”
The company reported earnings on Thursday that it had revenue of $28.5 billion for the three months ending in May, up slightly from the same period a year ago, but the company said that resulting profit was nevertheless well below expectations.
A long period of high prices has strained household budgets and exhausted price-sensitive consumers, contributing to the company’s current problems in the U.S. market.
“Our customers are becoming increasingly selective and price sensitive in their purchasing decisions,” Wentworth said, adding that “we remain in active discussions with our PBM and supplier partners.”
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