Final week, Walgreens Boots Alliance, Inc. reported working losses of $6.9 billion in its earnings report for the 2023 fiscal 12 months ending on August 31, $6.8 billion of which the retailer says was associated to opioid lawsuit claims and litigation.
Amid the losses, Walgreens is now unveiling an aggressive cost-cutting plan, together with closing 60 of its clinics, Axios reported.
The corporate additionally acknowledged that it confronted challenges reminiscent of a weaker respiratory virus season, lowered COVID-19 vaccine demand, and a difficult financial setting for customers, as acknowledged by its executives in an earnings name.
As a part of the cost-cutting measures, Walgreens will shut 60 VillageMD clinics and unprofitable shops (the variety of tales isn’t offered), and make changes to in-store working hours primarily based on native market tendencies.
On the company degree, the corporate added it’s suspending nonessential initiatives and requiring all distant employees to return to the Deerfield, IL workplace by the top of November.
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The corporate has additionally been grappling with fierce competitors from CVS Well being, Walmart, and Amazon, all of that are specializing in increasing its major care companies.
“Walgreens has misplaced buyer share in areas like magnificence and private care. A few of it’s because costs stay too excessive and are uncompetitive – one thing an increasing number of customers will not tolerate within the present setting,” GlobalData Managing Director Neil Saunders advised Reuters.
Within the wake of the cost-cutting information, Walgreens shares surged by 7%, Axios added.
Walgreens Names New CEO
Walgreens additionally appointed healthcare business veteran Tim Wentworth as CEO final week.
Wentworth was the CEO of pharmacy profit administration firm, Categorical Scripts, and an government at Cigna. He’ll lead efforts to diversify Walgreens’ healthcare companies, Reuters reported.
The choice comes virtually two months after former CEO Roz Brewer resigned after slightly over two and a half years on the job. Ginger Graham, lead unbiased director at Walgreens, had been working because the interim CEO.
Wentworth retired in 2021 however in the end determined to re-enter the workforce to tackle the position of Walgreens’ first-in-command.
“What made me determine to come back again was an opportunity to guide this iconic model and firm at a time when it is not in a gentle state,” Wentworth advised CNBC.
