Walgreens Boots Alliance (WBA) beat Wall Street estimates on Friday in adjusted earnings per share and revenue for the first quarter of fiscal 2025, even as questions remain about the company’s future as a publicly traded company. company.
The company reported revenue of $39.5 billion for the quarter, up 7% from the prior-year quarter and above Bloomberg consensus estimates of $37.3 billion. Walgreens also reported adjusted earnings per share of $0.51, compared to consensus estimates of $0.38 per share.
The company saw lower-than-expected sales of vaccines and over-the-counter flu medications as the winter season for respiratory viruses was not as bad as in previous years.
Shares traded higher Friday, up 27% to $11.70 per share, following news that the company is moving forward with the spin-off of its VillageMD healthcare services division. Walgreens has made a change in strategy since CEO Tim Wentworth took over at the end of 2023.
Closing: January 10th at 4:00:01 PM EST
VillageMD is performing poorly, resulting in an operating loss on Walgreens’ books. It performed slightly better this quarter, along with the company’s pharmacy benefits manager, Shields. Together they reported a loss of $325 million, compared to a loss of $436 million in the previous period.
The company is still evaluating what to do with the New Jersey-based Summit Health and CityMD urgent care centers, which were also part of the 2021 acquisition of VillageMD stakes.
The company has faced a number of issues, leading to a series of store closures in a difficult retail environment. Front-of-store sales have typically been a drag for all pharmacies in recent years as customers transition online and through other avenues.
Wentworth highlighted some improvements to the shopping experience, including a digital prescription collection waitlist to help customers avoid taking up pharmacists’ time while trying to get prescriptions filled.
Wentworth said this would give customers the chance to shop while they wait. If they do, customers will have to deal with groups of products; For example, some might focus on women’s health. It’s a way to meet customers’ needs wherever they are, he said.
Walgreens is still in the process of closing approximately 450 underperforming stores, 67 of which were already closed in the first quarter.
“This turnaround – we have said it will take time … and we are committed to our vision of a retail pharmacy-led organization,” Wentworth said on an earnings call on Friday, noting there is a “level of urgency, discipline and focus throughout the organization.