Walgreens Announces Plan to Shut Down 1,200 Outlets across Regions

As a result of financial losses, Walgreens is closing 1,200 shops in a span of three years. The company is shifting gears to a new direction that is more based on changing habits of consumers.

The US pharmacy retail chain Walgreens Boots Alliance has said it plans to close 1200 retail stores within three years, after reporting an operational loss of $978 million from June to August 2024, compared with a loss of $450 million in the same period last year.

Cuts would mean approximately one out of every eight (more than 8000) Walgreens outlets spread across the US and about 500 of these particular cuts will be in FY 2025. Tim Wentworth, CEO, commented on an earning call that shutting down the stores is always a very difficult decision; however some steps have to be taken in view of the relevant long term viability of the company. “We have to improve our ways of coping with changes that come our way,” he stated.

This particular strategy seeks to establish a ‘healthier store base’, with plans to redeploy affected employees in different locations. Walgreens is concentrating its development activities on the stores which remain so as to shift with the changes in consumer behavior especially in its quest to become a health care destination due to competition from CVS Health and Amazon.

Last year, the reduction in operating expenses exceeded the previous expectations of $1 billion over the last fiscal year. Analysts warn that these shutdowns may only be the tip of the recovery path itself.

Meanwhile, Walgreens’ share price jumped 12.8 per cent following the earnings announcement. This reaction indicates that both stock markets and insiders were especially bullish on the company’s strategies for new business directions – ultimately banking on the fact that Walgreens’ success will continue despite the changing retail pharmacy landscape.