Walgreens will shut about 1,200 areas over the following three years as the pharmacy chain seeks to turnaround a struggling U.S. enterprise that contributed to a $3 billion quarterly loss.

The corporate mentioned Tuesday that about 500 retailer closures will come within the present fiscal yr and may instantly assist adjusted earnings and free money movement. Walgreens didn’t say the place the shop closings would happen.

Walgreens operates about 8,500 shops in america and some thousand abroad. All the shops that shall be closed are in america.

Walgreens Boots Alliance Inc. leaders mentioned in late June that they had been finalizing a turnaround plan for its U.S. enterprise, and that push might outcome within the closing of a whole lot of underperforming shops.

The plan introduced Tuesday contains the closing of 300 shops that had been authorized underneath a earlier cost-cutting plan.

Walgreens CEO Tim Wentworth mentioned in a press release that fiscal 2025, which started final month, shall be an essential “rebasing yr” for the pharmacy chain.

“This turnaround will take time, however we’re assured it can yield important monetary and shopper advantages over the long run,” he mentioned.

Walgreens, like its opponents, has been struggling for years with tight reimbursement for the prescriptions it sells in addition to different challenges like rising prices to function its shops. Plus drugstore chains have been coping with extra competitors from on-line retail big Amazon and Walmart and Goal.

Rival CVS Well being Corp. is wrapping up a three-year plan to shut 900 shops. One other main chain, Ceremony Assist Corp., emerged from a chapter reorganization earlier this yr after whittling its retailer depend all the way down to about 1,300 areas.

Walgreens additionally has been backing away from a plan so as to add major care clinics subsequent to some if its shops after launching an aggressive growth underneath earlier CEO Rosalind Brewer.

The Deerfield, Illinois, firm mentioned in August that it was reviewing its U.S. healthcare enterprise, and it would promote all or a part of its VillageMD clinic enterprise. That announcement got here lower than two years after the corporate mentioned it would spend billions to broaden the enterprise.

The corporate began 2024 by reducing the dividend it pays shareholders to get extra cash to develop its enterprise. The pharmacy chain then slashed its forecast for fiscal 2024 in June.

Walgreens mentioned Tuesday that its web loss swelled to greater than $3 billion within the ultimate quarter of 2024. The corporate mentioned a softer U.S. retail and pharmacy efficiency harm. It additionally booked some hefty costs tied to opioid litigation settlements the corporate had acknowledged in earlier quarters and an fairness funding in China.

The efficiency topped Wall Road expectations. Analysts anticipate, on common, earnings of 36 cents per share on $35.75 billion in income within the fiscal fourth quarter, in keeping with FactSet.

The corporate additionally mentioned it expects adjusted earnings within the new fiscal yr to fall between $1.40 and $1.80 per share, with development in its U.S. healthcare and worldwide companies countering the U.S. retail pharmacy decline.

For the fiscal 2025, analysts anticipate adjusted earnings of $1.72 per share.

Leerink Companions analyst Michael Cherny mentioned in a analysis observe the corporate’s fourth-quarter efficiency and 2025 forecast weren’t as dangerous as they might have been. However the data launched Tuesday “doesn’t reply any of the large questions surrounding the (Walgreens Boots Alliance) story and the improved working path ahead underneath nonetheless new CEO Tim Wentworth.”

Walgreens shares rose nearly 4% Tuesday earlier than the opening bell.

The inventory had shed almost two thirds of their worth to date this yr, falling to $9 as of Monday’s shut.