Why It Issues: A messy pivot from pharmacy to well being providers.
Walgreens has been shifting away from pharmacy and retail to focus extra on well being care providers, with combined outcomes. The corporate’s shares sank additional on Friday, dropping to close a 14-year low. The corporate stated its revenue this 12 months could be “at or near the low end” of its forecasts.
“The group, which previously grew through various pharmacy acquisitions, is now looking to consolidate and focus its efforts on the U.S. health care sector,” Neil Saunders, managing director of GlobalData, stated in an electronic mail. “While the wisdom of this move is debatable, health care is not Ms. Brewer’s forte.”
Earlier than becoming a member of Walgreens, Ms. Brewer was the chief working officer of Starbucks and beforehand served as chief government of Sam’s Membership, a division of Walmart.
Throughout Ms. Brewer’s tenure, along with opening extra docs’ workplaces inside its shops, she oversaw the difficult rollout of the Covid-19 vaccine at pharmacies and enforcement of pandemic security requirements inside shops.
In a press release, Ms. Brewer stated she was pleased with what she had achieved and stated the corporate was “on track to be a leading consumer-centric health care company.”
Quotable: “The worst time” for an government departure.
The announcement of Ms. Brewer’s exit got here just a little over a month after the corporate’s chief monetary officer, James Kehoe, left to turn out to be a finance chief on the expertise agency FIS.
As Walgreens leans extra into the well being care enterprise, it faces a number of hurdles, business specialists stated. In a word to purchasers, Deutsche Financial institution’s analysts stated the challenges included managing tough pharmacy reimbursements, reworking its enterprise mannequin to give attention to main care and coping with opioid legal responsibility points.
“The departure of the two key executives comes at possibly the worst time,” the Deutsche Financial institution analysts wrote. “We cannot recall a time in our coverage experience where we have seen both the C.E.O. and the C.F.O. depart a large-cap company in such a short span where there were not other issues at the company.”
What’s Subsequent: The seek for a everlasting successor.
Walgreens stated a seek for a everlasting chief was underway.
Stefano Pessina, the corporate’s government chairman, stated in a press release that Ms. Graham was the “ideal person to serve as interim C.E.O.” Ms. Graham was beforehand chief government of Amylin Prescribed drugs, chairman of Guidant Company and began her profession at Eli Lilly.
It’s uncommon for a lady to exchange one other feminine chief government. This 12 months, gender variety has fallen throughout the high ranks of retail firms. Of the 86 retail firms within the Fortune 1000, 13 had a girl as chief government as of July 2023, down barely from the 12 months earlier than, based on the chief recruiting agency Heidrick & Struggles.
