Walgreens Boots Alliance, Inc. (Nasdaq: WBA) operates an integrated healthcare, pharmacy, and retail business with approximately 12,500 locations across the U.S., Europe, and Latin America. The company reported financial results for the first quarter of fiscal 2025, which indicated a stable condition with an underlying focus on strategic turnaround initiatives despite some challenges.

For the first quarter, Walgreens Boots Alliance’s sales totaled $39.5 billion, reflecting a year-over-year increase of 7.5%—6.9% on a constant currency basis. Adjusted earnings per share (EPS) were reported at $0.51, a decrease of 23.4% compared to $0.66 in the same quarter last year, largely due to lower retail sales and prior-year gains from sale-leaseback transactions. The company reported a net loss of $265 million for the quarter, compared to a loss of $67 million in the prior year.

In the U.S. Retail Pharmacy segment, sales reached $30.9 billion, marking an increase of 6.6% year-over-year, with comparable sales up 8.5%. Pharmacy sales within the segment rose by 10.4%, while comparable pharmacy sales were up 12.7%. Total prescription volumes increased by 1.5% to 316.3 million, with growth in prescriptions excluding immunizations of 3.5%. However, retail sales saw a decline of 6.2%, primarily driven by a weaker cough, cold, and flu season, which negatively impacted the category.

Adjusted operating income for U.S. Retail Pharmacy fell by 36.4% to $441 million, impacted by the decline in retail sales and prior-year sale-leaseback gains. The International segment reported sales of $6.4 billion, a 10.2% increase enhanced by a 3.6% favorable currency impact. Adjusted operating income for this segment was up 17.9% at $168 million, benefiting from strong performance in Boots UK and growth in Germany.

The U.S. Healthcare segment’s sales reached $2.2 billion, reflecting a growth of 12% year-over-year. VillageMD sales increased by 9%, while Shields saw a significant rise of 30%. Adjusted EBITDA in the healthcare division improved to $70 million, marking a reversal from a loss of $39 million in the same period last year.

The guidance maintains an adjusted EPS outlook for fiscal year 2025 in the range of $1.40 to $1.80, indicating a focus on stabilizing core performance amid pressures. The company anticipates a decline in retail comparable sales of 4% to 5% for the full year, adjusting from a prior expectation of a 2% to 3% decline, reflecting continued challenges in consumer discretionary spending.

Operating cash flow for the quarter improved significantly, impacted by reduced capital expenditures and enhanced adjusted operating income, despite a seasonal inventory build and legal payments totaling $137 million. The free cash flow was reported at negative $424 million, an improvement from negative $788 million in the prior year, primarily driven by $223 million reduction in capital expenditures.

Overall, the results highlight a mix of challenges and growth opportunities within Walgreens Boots Alliance as the company continues to execute its strategic priorities while addressing the evolving consumer landscape.