Walgreens to close a “meaningful percent” of stores

  • 4 months ago
TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and why Walgreens is slated to close a large number of locations.

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Transcript
00:00I'm Conway Higgins reporting from the New York Stock Exchange.
00:02Here's what we're watching on the street today.
00:05Wall Street is continuing to digest mixed corporate earnings after a slew of earnings
00:09results Wednesday.
00:11Investors are anticipating Friday's Personal Consumption and Expenditures Index, which
00:15measures consumer inflation and spending in May.
00:17This report will be closely watched for any hints into the Federal Reserve's path forward
00:22on interest rates.
00:23Markets are pricing in a more than 50 percent chance of a rate cut as soon as September.
00:30In other news, after reporting weaker-than-expected earnings and slashing its full-year profit
00:34outlook, Walgreens announced it will be closing a significant number of stores.
00:39While the company hasn't disclosed just how many of its roughly 8,600 locations will close,
00:45CEO Tim Wentworth said it will be a, quote, meaningful percent.
00:49Wentworth went on to say, quote, we continue to face a difficult operating environment,
00:54including persistent pressures on the U.S. consumer and the impact of recent marketplace
00:59dynamics, which have eroded pharmacy margins.
01:02He also said that only 75 percent of all Walgreens stores drive 100 percent of the company's
01:08profitability.
01:09However, Walgreens is not the only drugstore chain to struggle over the past several years.
01:14CVS plans to have closed around 900 locations by the end of 2024, while Rite Aid has closed
01:20or announced the closing of hundreds of stores since filing for bankruptcy in October of
01:25last year.
01:27Despite the weak quarter, Walgreens sales were up 2.6 percent year-over-year.
01:31That will do it for your daily briefing from the New York Stock Exchange.
01:34I'm Conway Gittins with The Street.

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