Walgreens slashes profit outlook as demand for COVID shots, tests wanes
Walgreens fiscal third-quarter results missed Wall Street analysts' expectations
W.H.O. issues updated guidance on COVID vaccines for kids
Fox News’ Lucas Tomlinson reports on updated COVID vaccine guidance from the World Health Organization (W.H.O.).
Walgreens Boots Alliance cut its profit forecast for the year as the pharmacy chain continued to face "significantly lower" demand for COVID tests and vaccines.
During the three-month period ending in June, the company administered fewer than 1 million COVID shots, a huge drop-off from the 4.7 million that were administered the same time a year ago.
Meanwhile, Walgreens administered 2.4 million vaccines during the quarter, a decline from the 11.8 million vaccines administrated during the same period a year ago.
CVS, WALGREENS, OTHER PHARMACIES START ROLLING OUT LATEST COVID BOOSTER
The lower demand for COVID-related services coupled with "a more cautious and value-driven consumer, and a recently weaker respiratory season created margin pressures in the quarter," CEO Rosalind Brewer said in a statement.
Miami Beach, Florida, Walgreens pharmacy, bilingual Covid-19 vaccine check-in waiting area sign. (Jeffrey Greenberg/Universal Images Group via Getty Images) / Getty Images)
Brewer said the company's revised guidance is an "appropriately cautious forward view in light of consumer spending uncertainty, while still demonstrating clear drivers of a return to operating growth next fiscal year."
Shares of the pharmacy chain tumbled on the news.
WALGREENS BOOTS ALLIANCE CUTTING HUNDREDS OF CORPORATE JOBS
During the third quarter, the company reported that sales in U.S. retail stores that were open for at least a year slipped 0.2%, which included a "headwind from lower levels of OTC [over the counter] test kits.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WBA | WALGREENS BOOTS ALLIANCE INC. | 8.66 | +0.36 | +4.34% |
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Adjusted operating income decreased $4 million to $1 billion from the year-ago quarter, which reflected a 22% headwind from lower COVID-19 vaccination and testing volumes as well as continued reimbursement pressure and increased labor costs.
Walgreens now expects fiscal 2023 earnings per share of $4.00 to $4.05, down from $4.45 to $4.65.