Walgreens will close 150 stores

Walgreens has announced that it will close 150 stores in the U.S. this year — this comes on the heels of posting a disappointing Q3.

During its third quarter financial call earlier this week, Walgreens Boots Alliance softened its fiscal year projections after the demand for COVID-19 immunizations and tests, as well as respiratory seasonal sales, was not as high as expected. 

The Northbrook, Ill.-based company’s adjusted operating income is at $3.2 billion — a drop of over 26% on a constant currency basis. 

Additionally, the company’s healthcare segment, which includes primary-care provider VillageMD and urgent care provider Summit Health, had a $113 million loss in the third quarter mainly due to the cost of expansion of VillageMD (93 more clinics were added year-over-year) and a decline in visits at Summit Health. A lighter-than-normal respiratory season kept Summit Health from seeing growth.

The company is now in a conservative mode, and announced during the financial call that it plans to raise savings from $3.5 billion to $4.1 billion. That will require making some budgetary cuts.

Earlier in the year, Walgreens announced it was cutting corporate staff by about 10%, or 504 roles. All the cuts were to take place at the Deerfield and Chicago offices.

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Compounding the financial strain is the growing number of opioid settlements. In June both CVS and Walgreens agreed to pay a multistate settlement of $17.3 billion over the next 15 years.