💡 Walgreens: A bold path to turnaround! 💊

Walgreens Boots Alliance $WBA announced yesterday surprising results for the first quarter of fiscal year 2025 that exceeded Wall Street expectations !

Shares soared more than 27%! 📈

Walgreens Boots Alliance is a global leader in retail pharmacy and healthcare services. It operates in more than 25 countries and serves millions of customers every day through its retail pharmacies, digital platforms and healthcare services.

Revenues were $39.5 billion, representing year-over-year growth of 7 % beating analyst estimates of $37.3 billion.

Earnings per share (EPS) were $0.51, well ahead of expectations of $0.38.

💊 What's behind these results?
A new strategy led by CEO Tim Wentworth, who brought a clear vision to stabilize the retail pharmacy segment.

Digitisation and innovation - The introduction of a digital prescription waiting list allows customers to conveniently pick up their medicines without waiting. This system also supports the growth of complementary sales.

Portfolio restructuring - Continued process of separating VillageMD' s medical services division , which has contributed to operating losses in the past. Walgreens is also closing 450 underperforming stores, 67 of which have already been closed.

📉 Challenges on the horizon:
Lower-than-expected sales of vaccines and flu drugs due to a weaker winter season for respiratory illnesses.

A decline in gross margins on 17,3 % (from 18.7% previously).

Customer shift to online shopping and other alternatives, which remains a key issue for retail pharmacies.

📊 Key figures for each segment:
U.S.retail pharmacy sales grew by 6,6 % to $30.87 billion (est. $29.16 billion).

U.S.health care segment sales increased by 12 % to USD 2.17 billion (estimate USD 2.09 billion).

International sales increased by 10 % to USD 6.43 billion (estimate USD 5.9 billion).

🗣️ WentworthCEO said on Friday's quarterly results call : "This turnaround is not a short-term thing. But the early progress reinforces our belief in a sustainable model built on retail pharmacies. We are stabilising our operations, controlling costs and improving cash flow."

🔮 Outlook for 2025:
Walgreens expects earnings per share between $1.40-1.80, reflecting the positive impact of the new strategy, though analysts were more cautious with a consensus of $1.53.

Do you have Walgreens in your portfolio or are you considering buying shares of the company?