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Walgreens Boots Alliance reported quarterly earnings and revenue that missed analysts’ expectations and lowered its forecast for 2019 in what CEO Stefano Pessina called the “most difficult” quarter since acquiring European drugstore chain Alliance Boots in late 2014.
The company now expects full-year earnings for 2019 to be roughly flat, compared with its previous forecast of 7 to 12 percent growth, it said Tuesday. Walgreens’ shares slid by about 7 percent in premarket trading.
Walgreens reported adjusted earnings of $1.64 per share during the second quarter of fiscal 2019, which ended Feb. 28, missing analysts polled by Refinitiv’s expectations of $1.72 per share. Revenue also fell short, coming in at $34.53 billion. Analysts had been looking for $34.56 billion.
Walgreens reported fiscal second-quarter net income of $1.16 billion, or $1.24 per share, down from $1.35 billion, or $1.36 per share a year earlier.
On an adjusted basis, Walgreens earned $1.64 per share, below the $1.72 billion analysts had expected. Net sales rose 4.6 percent to $34.53 billion, below expectations of $34.56 billion.
Executives from Walgreens and rival CVS Health have warned investors in recent months that profits might not be all that fat this year. The Trump administration has been pressuring drugmakers and pharmacy benefits managers to lower consumer prices, both of which may cut into the bottom line for drugstore chains.
Drugstores are trying to diversify their products and experiment with new ways to get people into their stores. Walgreens last week said it will sell CBD products in about 1,500 of its stores, following CVS.
Walgreens is working with LabCorp, Humana, Sprint and others on everything from offering senior care services to selling phones in their stores. CVS is changing up its business model after buying health insurer Aetna for $70 billion late last year.