Walgreens plans to close 1,200 stores as part of turnaround strategy

The company reported a $1.7 billion net loss, and will focus on investing in its remaining stores.

Walgreens has announced a long-term turnaround plan that includes closing 1,200 stores over the next three years, with 500 planned for this fiscal year. 

While it remains unclear if any of the about 100 locations in Puerto Rico will be affected, the pharmacy chain’s former rival, CVS, sold its 22 stores on the island to Caribe Pharmacy Holdings earlier this year, telling the Associated Press that “multiple factors, including local market dynamics and population shifts,” were factors behind the decision.

Walgreens also reported a $1.7 billion net loss for fiscal year 2024, largely due to a one-time accounting charge. The chain, which operates 8,500 stores in the U.S., said it will focus on improving profitability by “optimizing our footprint,” cutting costs and improving its cash flow. 

CEO Tim Wentworth emphasized that the company, Walgreens Boots Alliance, plans to invest in its remaining stores to better serve consumers. 

“This turnaround will take time, but we are confident it will yield significant financial and consumer benefits over the long term,” Wentworth said.

He also told analysts that about 6,000 of its stores are profitable, providing a solid foundation to build on, according to the AP.

In its earnings report, Walgreens said it is concentrating on its core pharmacy and health care services, improving retail store efficiency, and investing in growth areas such as digital capabilities, while cutting expenses. 

The company is also reviewing its U.S. health care operations, which could include selling parts of its VillageMD clinic business. 

“Fiscal 2025 will be an important rebasing year as we advance our strategy to drive value creation,” Wentworth added.