Walgreens (WBA) Q1 2025 Earnings
People walk by a Walgreens on November 3, 2024 in Brooklyn, Massachusetts.
Danielle DeVries | CNBC
Walgreens On Friday, it reported revenue and earnings that beat expectations for its fiscal first quarter, as it closes stores and cuts other costs to get out of trouble.
Based on LSEG’s survey of analysts, here’s Walgreens’ report for the three-month period ended Nov. 30, compared to Wall Street’s expectations:
- Earnings per share: Adjusted to 51 cents vs. 37 cents expected
- Income: $39.46 billion versus $37.36 billion expected
Even after the big hits, Walgreens maintained guidance for fiscal 2025 adjusted earnings of $1.40 to $1.80 a share. The company did not include annual sales guidance in its release. In October, Walgreens said it expected revenue of $147 billion to $151 billion for the fiscal year.
Shares rose nearly 10% in premarket trading.
It ended a rocky year marked by the company compensatory pressure in pharmacysofter consumer spending and related issues push to primary careamong other things. Results are coming between reports the company is in talks to sell itself to private equity firm Sycamore Partners.
In the fiscal first quarter, Walgreens posted sales of $39.46 billion, up 7.5% year-over-year as its three business segments grew.
The company reported a net loss of $265 million, or 31 cents per share, for the fiscal first quarter. That compares with a net loss of $67 million, or 8 cents per share, for the year-earlier period.
Walgreens said the loss was primarily related to higher operating losses, reflecting its multi-year plan to close underperforming stores. This includes 1,200 over the next three years and 500 in fiscal year 2025 alone.
According to Walgreens, there are approximately 8,500 retail pharmacies in the United States website.
Adjusted earnings, excluding certain items, were 51 cents per share for the quarter.
The first-quarter results “reflect our disciplined execution against our 2025 priorities: stabilizing retail pharmacy by optimizing our footprint, controlling operating costs, improving cash flow and continuing to address reimbursement models,” Walgreens CEO Tim Wentworth said in a statement.
He added that “while our turnaround will take time, our initial progress reinforces our belief in a sustainable, retail pharmacy-led operating model.”
Growth by business units
Walgreens posted growth in three business segments in its fiscal first quarter.
The company’s retail pharmacy division in the US had sales of $30.87 billion, an increase of 6.6% compared to the same period last year. Analysts had expected sales of $29.21 billion, according to estimates compiled by StreetAccount.
This division manages the company’s pharmacies, which sell prescription and non-prescription drugs, as well as health and wellness, beauty, personal care and nutritional products.
Walgreens said pharmacy sales rose 10.4% in the quarter and comparable pharmacy sales rose 12.7% from the prior period due to price inflation on brand name drugs, among other factors.
Total prescriptions filled in the quarter, including vaccines, rose 1.5% year-over-year to 316.3 million. Retail sales fell 6.2% compared to the previous quarter, while comparable retail sales fell 4.6%. The company cited a weak cough, cold and flu season and lower sales in discretionary product categories.
Sales from the company’s US healthcare division rose to $2.17 billion in the fiscal first quarter, up 12% year-over-year. Analysts had expected sales of $2.09 billion, according to estimates compiled by StreetAccount.
This partly reflects growth at primary care provider VillageMD and specialty pharmacy company Shields Health Solutions. Specialty pharmacies are designed to deliver medications with unique processing, storage, and dispensing requirements for patients with often complex conditions.
Walgreens’ international division, which has more than 3,000 retail stores overseas, had sales of $6.43 billion in the first quarter of its fiscal year. This means an increase of 10.2% compared to the same period last year.
Analysts had expected revenue of $5.85 billion for the period, according to StreetAccount.
The company reported a 4.5% increase in sales at UK-based pharmacy chain Boots.
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