Walgreens is preparing to close nearly 500 locations across the United States and United Kingdom.
CNN reports the pharmacy chain has announced plans to shutter 150 stores in the U.S. and 300 more in the U.K. The closures are expected to take place by the end of Walgreens' next fiscal year in August 2024.
According to Walgreens Boots Alliance CFO James Keho, the decision was made in an attempt to cut costs, with Keho noting Walgreens is expected to save $3.3 billion by the end of 2023 and is projected to save “at least” $800 million in 2024.
“We are optimizing the model through our micro fulfillment centers, tech-enabled centralization of in-store activities and telepharmacy solutions,” Kehoe told CNN.
Meanwhile, CEO Rosalind Gates Brewer attributed Walgreens' cost-cutting efforts to a lack of profits due to the decline in COVID-19 testing.
"We had called out COVID as a wildcard heading into the quarter and have unfortunately seen less patient willingness to vaccinate," Brewer explained.
With the vaccine behind them, Brewer believes the company, whose profit fell 59 percent to $118 million in the fiscal third quarter as of May 2023, forecasts “an appropriately cautious forward view in light of consumer spending uncertainty, while still demonstrating clear drivers of a return to operating growth next fiscal year.”
The news arrives a few months after Bed Bath & Beyond announced plans to close hundreds of stores.
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