Walgreens Announces $1 Billion in Cost Cuts to Address Profit Woes
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Walgreens forecasts $1 billion in cost cuts by 2024 after profit outlook disappoints Wall Street. Measures include store closures, AI supply chain efficiency, and $600M less in capital spending.
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Shares rose 5% as cost cuts provided optimism, though they are still down 40% YTD amid weak prescription demand, loss of market share, and high inflation hurting sales.
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Q4 adjusted EPS of $0.67 missed estimates of $0.69. New permanent CEO Tim Wentworth named this week.
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Walgreens booked $6.8 billion pre-tax charge last year for opioid litigation. Plans to close 150 U.S. stores were announced in June.
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Q4 retail sales fell 4.3% in U.S., total prescriptions including vaccinations down 0.5%. Company losing beauty/personal care market share over uncompetitive pricing.