As the retail pharmacy giant struggles against a suffocating economy and declining profits, Walgreens has decided to shut nearly 1,200 stores nationwide.
The massive closure impacts 17 states and represents one of the largest retail downsizing efforts in recent years.
It could potentially leave many communities without accessible pharmacy services.
Meanwhile, other pharmacy chains like CVS and Rite Aid are implementing similar strategies, signaling a troubling shift in American retail that will affect countless neighborhoods.
The closing is part of a massive cost-cutting strategy that will shut approximately 1,200 Walgreens locations over the next three years.
Company executives announced that 500 stores will close during the current fiscal year, with the remaining closures to follow as the company battles financial headwinds.
Walgreens’ struggle comes amid a perfect storm of economic challenges, including higher operational costs, declining prescription reimbursements, and increasing competition from online retailers like Amazon.
The once-thriving pharmacy chain reported a staggering net loss of $3 billion for the fiscal year, despite a sales increase to $37.5 billion in the fourth quarter.
Tim Wentworth, CEO of Walgreens Boots Alliance, attempted to frame the massive closures as a strategic reset rather than a retreat.
The company’s focus now centers on optimizing its store footprint, reducing operating costs, and improving cash flow—corporate speak for desperate cost-cutting measures.
“Fiscal 2025 will be an important rebasing year as we advance our strategy to drive value creation. This turnaround will take time, but we are confident it will yield significant financial and consumer benefits over the long term,” Wentworth stated.
While the company operates approximately 8,500 stores across the United States, an analysis found that at least 54 Walgreens locations across 17 states are scheduled to close in the coming weeks and months.
Specific store closures have already been reported in once-thriving metropolitan areas like San Francisco, Chicago, and Oakland.
The pharmacy retail sector is in full retreat. CVS Health Corp plans to close 900 stores over the next three years, and Rite Aid Corp has reduced its store count to about 1,300 after emerging from bankruptcy.
This industry-wide contraction will likely leave many communities, particularly rural and underserved areas, with fewer options for prescription medications and basic healthcare needs.
For loyal Walgreens customers affected by store closures, the company states that prescriptions can be transferred to another Walgreens location through various methods.
However, this provides little comfort to elderly Americans and those with limited transportation options who rely on neighborhood pharmacies within walking distance.
The massive Walgreens downsizing reflects broader economic struggles facing American businesses under the current administration.
As the company moves towards optimizing cash flow and sustaining its U.S. operations, only time will tell if its aggressive downsizing strategy will pay off in the long run.
