Walgreens Boots Alliance (WBA) beat Wall Street estimates on its adjusted earnings per share and sales for the first quarter of fiscal year 2025 on Friday, even as questions remain about its future as a public company.
The company reported $39.5 billion in revenue for the quarter, up 7% from the same quarter last 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 season medicine, as the winter respiratory virus season has not been as bad as in previous years.
The stock traded higher Friday, up 27% to $11.70 per share, on the news the company is moving ahead with its separation of the VillageMD healthcare services business. Walgreens has pursued a shift in strategy since CEO Tim Wentworth took over in late 2023.
VillageMD has been performing poorly, resulting in an operating loss for Walgreens' books. This quarter it performed slightly better, along with the company's pharmacy benefits manager, Shields. Together, they reported a loss of $325 million, compared to a $436 million loss in the prior period.
The company is still evaluating what to do with New Jersey-based Summit Health and CityMD urgent care centers, which were also part of the VillageMD controlling stake acquisition in 2021.
The company has faced a number of pressures, which spurred a round of store closures amid a tough retail environment. Front-of-store sales have typically been a drag on all retail pharmacies in recent years as customers pivot to shopping online and through other avenues.
Wentworth highlighted some improvements in the store experience, including a digital waiting list for prescription pick-up to help customers avoid taking up pharmacists' time while they are trying to get prescriptions filled.
Wentworth said this would allow customers a chance to shop while they wait. If they do, the customers will face groupings of products; for example, some might focus on women's health. It's a way of meeting customers' needs where they are, he said.
Walgreens is still in the process of closing about 450 low-performing stores, 67 of which were closed as of the first quarter.
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