People walk past a Walgreens on November 3, 2024 in Brookline, Massachusetts.
Danielle Defries | CNBC
Walgreens On Friday, it reported fiscal first-quarter earnings and revenue that beat expectations, as it closed stores and cut other costs to steer itself out of a difficult situation.
Here's what Walgreens reported for the three-month period ending Nov. 30 compared to what Wall Street was expecting, based on a survey of analysts conducted by LSEG:
- EPS: 51 cents were revised versus 37 cents expected
- profit: $39.46 billion compared to $37.36 billion expected
Even after the big beat, Walgreens maintained its fiscal 2025 adjusted earnings guidance of between $1.40 and $1.80 per share. The company did not include annual sales guidance in its release. In October, Walgreens said it expects fiscal year revenue of between $147 billion to $151 billion.
The company capped off a rocky past year marked by Pharmacy reimbursement pressureWeak consumer spending and related challenges Payment to primary careamong other issues. Results come amid reports The company is in talks to sell itself to private equity firm Sycamore Partners.
During its fiscal first quarter, Walgreens generated sales of $39.46 billion, up 7.5% from the same period last year, with all three of its business segments growing.
The company reported a net loss of $265 million, or 31 cents per share, in its fiscal first quarter. This compares to a net loss of $67 million, or 8 cents per share, in the same period a year earlier.
Walgreens said the loss was primarily driven by higher operating losses, which reflects its multi-year plan to close underperforming stores. This includes 1,200 over the next three years, including 500 in fiscal year 2025 alone.
Walgreens has about 8,500 retail pharmacy locations across the United States, according to it Website.
Excluding certain items, adjusted earnings were 51 cents per share during the quarter.
The first-quarter results “reflect our disciplined execution against our priorities for 2025: stabilizing retail pharmacy by improving our footprint, controlling operating costs, improving cash flow and continuing to address reimbursement models,” Walgreens CEO Tim Wentworth said in a statement. .
“Although our transformation will take time, the progress we have made early reinforces our belief in a sustainable retail pharmacy-led operating model,” he added.
Growth across business units
Walgreens reported growth across its three business segments in its fiscal first quarter.
The US retail pharmacy division generated sales of $30.87 billion, an increase of 6.6% from the same period last year. Analysts were expecting sales of $29.21 billion, according to estimates compiled by StreetAccount.
This unit operates the company's pharmacies, which sell prescription and non-prescription medicines as well as health, wellness, beauty, personal care and nutritional products.
Walgreens said pharmacy sales for the quarter increased 10.4% and comparable pharmacy sales increased 12.7% compared to the same period a year earlier due to brand-name drug price inflation, among other factors.
Total prescriptions dispensed this quarter, including vaccines, were 316.3 million, an increase of 1.5% from the same period last year. Retail sales decreased by 6.2% compared to the same quarter of the previous year, and comparable retail sales decreased by 4.6%. The company cited a weaker cough, cold and flu season and lower sales in discretionary product categories.
Sales of the company's healthcare unit in the United States jumped to $2.17 billion in the first fiscal quarter, an increase of more than 12% over the same period last year. Analysts were expecting sales of $2.09 billion, according to estimates compiled by StreetAccount.
This partly reflects growth in primary care provider VillageMD and specialty pharmacy company Shields Health Solutions. Specialty pharmacies are designed to deliver medications with unique handling, storage and distribution requirements, often to patients with complex conditions.
Walgreens' international unit, which operates more than 3,000 retail stores abroad, had sales of $6.43 billion in its fiscal first quarter. This represents an increase of 10.2% over the same period last year.
Analysts expected revenue of $5.85 billion for the period, according to StreetAccount.
The company said sales from its UK-based drugstore chain, Boots, increased by 4.5%.
