Walgreens is closing 1,200 stores

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New York CNN — Walgreens is closing approximately 1,200 locations as the drug store chain struggles to contend with online competitors and declining prescription drug payments.

By 2027, about one in seven Walgreens currently open will close its doors. About 500 Walgreens will close its doors over the next year, the drug store chain announced Tuesday.

Those closures represent a significant escalation from a few months ago, when the financially struggling company announced in June it was shutting 300 underperforming locations as part of a multi-year optimization program under CEO Tim Wentworth. At the time, the company had said about a quarter of Walgreens stores were unprofitable, and the chain promised “imminent” changes.

Still, the company managed to post stronger-than-expected sales in the past quarter. Revenue at the chain rose 6% from the same quarter a year ago, but Walgreens reported a $3 billion loss largely because of a writedown of a Chinese pharmaceutical chain and a home care provider called CareCitrix.

The latest tranche of closures is “emblematic of a company that is in trouble and is trying to course correct,” according to Neil Saunders, retail analyst and managing director at GlobalData Retail.

“Walgreens spent years building its business through acquisitions and neglected the fundamentals of its stores and its retail operations,” he told CNN. “That has pushed a lot of outlets into a position where they are losing sales and are not generating a return.”

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