Walgreens Boots Alliance on Thursday raised its outlook for the year and laid out its strategy to drive growth, after a stronger-than-expected fiscal third quarter. The shares closed down 7% at $48.71 on concerns about the slowing pace of Covid-19 vaccinations and scepticism of whether the drugstore can execute its turnaround strategy.
The company is in the midst of a transformation led by its CEO, Roz Brewer, former chief operating officer of Starbucks. Even before the pandemic, drugstore chains were under pressure as online retailers like Amazon stole away sales of everyday items, like toothbrushes and shampoo, along with pharmacy sales. The global health crisis stimulated that e-commerce transition, caused foot traffic to fall and forced companies to come up with new ways to stay relevant.
Rox Brewer said that she is committed to making investments needed to build the pharmacy of the future. She added that many customers feel overwhelmed as they try to manage their care while juggling multiple doctor appointments and medical conditions. Walgreens Boots Alliance can help by offering simpler, personalized and digital solutions.Walgreens Boots Alliance on Thursday shared more details about its strategic priorities. The drugstore chain said it will turn itself into a neighbourhood health destination as it opens primary-care clinics with VillageMD at hundreds of its stores and will use automation to free up time for pharmacists to help customers.
The company plans to focus on digital, so more people use its app and receive personalized offers that inspire purchases. It will continue to work toward reducing annual costs by more than $2 billion by the next fiscal year.The drugstore chain said it now predicts about 10% growth in adjusted earnings per share for the year, due to rebounding sales and the boost from Covid-19 shots. It had formerly forecast growth in the mid-to-high single digits. So far, the company said it has administered more than 25 million vaccines.