Walgreens (WBA) Q1 2025 Quarterly Earnings

Green graves on Friday it reported fiscal first-quarter earnings and revenue that were above expectations, as it closes stores and cuts other costs to steer itself out of a rough spot.

Here's what Walgreens said for the three months ended Nov. 30 compared to Wall Street expectations, based on a survey of analysts by LSEG:

• Earnings per share: 51 cents adjusted versus 37 cents expected
• Income: $39.46 billion vs $37.36 billion expected

Even after the big hits, Walgreens maintained its fiscal 2025 adjusted earnings guidance of $1.40 to $1.80 per share. The company did not include annual sales guidance in its release. In October, Walgreens said it expects revenue for the fiscal year of $147 billion to $151 billion.

The company's shares were up more than 20% in morning trading.

“We have begun the fiscal year by making progress on our financial and strategic priorities, despite a challenging environment for our consumer,” Walgreens CEO Tim Wentworth said during Friday's earnings call.

“Importantly, we began to make progress on the opportunities that we consider necessary for our long-term turnaround,” he said, adding that the “cornerstone” of that effort is stabilize its US retail pharmacy business.

Walgreens capped off a rocky year marked by pharmacy reimbursement pressuresmarter consumer spending at its stores and related challenges push into primary careamong other issues. The results will come among reports that the company is in talks to sell itself to the private equity firm Sycamore Partners.

In the first fiscal quarter, Walgreens posted sales of $39.46 billion, up 7.5% from the same period a year ago, as its three business segments grew.

The company reported a net loss of $265 million, or 31 cents per share, for the first fiscal quarter. It compares with a net loss of $67 million, or 8 cents per share, for the prior year.

Walgreens said the loss was largely driven by a higher operating loss, which reflects its multi-year plan to close underperforming stores. That includes 1,200 over the next three years, with 500 in fiscal 2025 alone.

Walgreens has about 8,500 retail pharmacy locations across the U.S., according to their website. The company plans to “significantly accelerate the pace of our store closings from the first quarter,” Wentworth said.

Excluding certain items, adjusted earnings were 51 cents per share for the quarter.

In addition to closing the stores, Wentworth said Walgreens is “modernizing how we forecast, allocate and schedule labor” in its stores. The company is launching a new check-in model in approximately 200 locations in January to improve the in-store experience for customers, patients and employees.

The changes will schedule workers based on store-specific demand patterns, while also accounting for team member availability and preferences, he said.

Wentworth noted, however, that turning around the consumer retail business has been “more challenging with the continued decline in consumer discretionary spending. Consumers are facing pressure from inflation and higher interest rates, and continue to exhibit value-seeking behavior, Wenworth said.

“We are advancing several elements of our sales strategy,” he said. “While we are seeing early green shoots, we still have a lot of work to do here.”