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Walgreens to shutter ‘significant’ amount of stores, cites ‘worse than expected consumer environment’

June 27, 2024 | | Print Article

Walgreens is set to close a “significant” number of its stores because of underperformance and reduced profits under Bidenomics.

Walgreens CEO Tim Wentworth said on a phone call Thursday that “changes are imminent” for the brand’s many underperforming stores and that an upcoming strategic review will “include the closure of a significant portion of these … stores,” according to CNN.

“We are at a point where the current pharmacy model is not sustainable and the challenges in our operating environment require we approach the market differently,” he added.

The announcement came after Walgreens released its latest revenue report.

“In the three months ended May 31, Walgreens’ revenue increased 2.6% year-over-year to $36.4 billion, which included a 2.3% year-over-year rise in its domestic retail pharmacy segment to $28.5 billion,” according to Kiplinger. “The company said earnings per share (EPS) slumped 36.6% to 63 cents from the year-ago period.”

This precipitated Wentworth’s announcement, which in turn precipitated a huge sell-off of Walgreens’ stock:

Walgreens “shares plunged to the lowest levels in nearly three decades in early Thursday trading, potentially shedding more than $5 billion in value, after slashing its full-year profit forecast and unveiling plans for a ‘significant multiyear’ program of store closures,” according to TheStreet.

That’s a lot of money to lose.

In defending himself, Wentworth cited marketplace dynamics.

“We continue to face a difficult operating environment, including persistent pressures on the U.S. consumer and the impact of recent marketplace dynamics which have eroded pharmacy margins,” he said.

“Our results and outlook reflect these headwinds, despite solid performance in both our International and U.S. Healthcare segments,” he added.

Walgreens meanwhile released an official statement citing “a worse than expected U.S. consumer environment,” according to Fox Business Network host Charles V. Payne.

But what exactly does that mean? Critics believe what Wentworth and his company are trying to say is that Bidenomics is ruining them.

“Over the past four years our nation’s drug stores have begun to quietly disappear,” one critic tweeted. “First Rite Aid went bankrupt, then CVS closed over 900 stores, and now Walgreens is closing over 2,000 locations. Could the industry survive four more years of Biden’s failed policies?”

“Now Walgreens is closing stores? Bidenomics is NOT working for the American people!” another critic added

See more responses below:

It’s true, as noted by critics, that Bidenomics isn’t just affecting Walgreens. It’s affecting damn near every store, including Family Dollar, CVS, Macy’s Rite Aid, 7-Eleven, etc.

“Researchers say well over 3,400 retail stores are closing this year, which is about a 22% increase compared to last year at this time,” according to Fox News affiliate station KCPQ.

Here’s the kicker: “One of the main causing factors cited is inflation,” KCPQ notes.

And who’s to blame for that?

Exactly …

To Neil Saunders, the managing director of GlobalData, none of this is particularly surprising.

“The numbers from US retail – where sales plunged by 4 percent – are particularly disappointing, although not entirely surprising,” he said, according to the Daily Mail.

“This long-established trend has been exacerbated by the cost-of-living crisis which has seen customers shopping around more for the best deals and bargains,” he added.

Vivek Saxena
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