why is walgreens closing stores

Walgreens is closing stores mainly because many locations are no longer profitable, and the company is trying to shrink and “rebalance” its footprint after years of rising costs and weak margins.

What’s going on overall?

Walgreens has announced a multi‑year plan to shut roughly 1,200 U.S. stores (out of about 8,600), with hundreds already closed in 2025 and more scheduled into 2026. Executives describe this as a turnaround and “footprint optimization” effort aimed at cutting costs, improving profitability, and focusing on stronger locations.

In practical terms, that means many customers will see their neighborhood Walgreens disappear, with prescriptions transferred to nearby stores or mail delivery.

The main reasons Walgreens is closing stores

Think of the closures as the result of several pressures hitting at once:

1. Unprofitable stores
   • Walgreens’ CEO has said that nearly a quarter of remaining stores are not profitable.

 * Closures are being concentrated on locations that are losing money, overlapping with another Walgreens nearby, or struggling with high theft and safety issues.

2. Lower reimbursement for prescriptions
   • Insurance companies and pharmacy benefit managers (PBMs) have been paying pharmacies less for filling prescriptions, which crushes margins.

 * Because prescription profits are so thin, stores rely heavily on front‑of‑store retail sales (snacks, cosmetics, convenience items) to stay afloat, and many locations are not generating enough of that extra revenue.

3. Higher operating costs
   • Labor, rent, utilities, and security costs have been rising, making marginal stores even harder to justify.

 * In some urban areas, stores have reported significant losses from shoplifting and general security concerns, which the company factors into closure decisions.

4. Changing competition and customer behavior
   • Supermarkets, big‑box stores, and warehouse clubs have expanded pharmacy services, pulling away prescription and retail sales from traditional drugstores.

 * Online and mail‑order pharmacies, often owned or partnered with the same health‑care conglomerates, have reduced foot traffic in physical stores.

5. Over‑expansion in the past
   • Walgreens spent years building very dense networks in some cities—sometimes having multiple stores within a couple of miles.

 * The company now openly says this overlap is “excessive,” so it’s trimming back to a smaller, more efficient network.

6. Financial pressure and recent losses
   • The parent company has reported large losses in recent years and labeled 2025 a “rebasing” year to reset its cost structure.

 * Store closures are a central part of that turnaround plan to stabilize the retail pharmacy business after a period of weak performance.

What this means for customers and communities

Walgreens usually tries to shift prescriptions from a closed store to another nearby location and sometimes offers free prescription delivery for a period after the closure. For customers who live in areas with few pharmacies, though, these shutdowns can create or worsen “pharmacy deserts” where basic medications and in‑person pharmacy services become much harder to access.

On the ground, people on forums and Reddit describe a mix of frustration and resignation: employees worry about their jobs, customers complain about high prices and locked‑up merchandise, and some say the chain expanded too far and is now paying the price.

Forum‑style snapshot of the debate

“They’re closing the ones that aren’t profitable, are too close to each other, or have insane theft.”

“We close stores all the time. The difference now is they’re not opening new ones in their place.”

“Everything is overpriced there… and half the stuff is behind a cage anyway.”

These comments aren’t official data, but they echo the same themes Walgreens executives cite: too many marginal locations, not enough profit, and rising friction in how the stores operate.

Quick fact list

• Planned closures: About 1,200 U.S. stores over ~3 years.

• Already shut (recent years): Roughly 500 in fiscal 2025 alone, plus many more over the last decade.

• Targeted locations: Underperforming, overlapping, or high‑theft stores.

• Core drivers: Low reimbursement on drugs, rising costs, theft, online competition, and past over‑expansion.

• Impact: Fewer nearby pharmacies for some communities and more reliance on mail‑order or distant locations.

TL;DR: Walgreens is closing stores not because it’s “going out of business,” but because many locations don’t make money in today’s tougher pharmacy and retail environment, so the company is aggressively shrinking to a smaller, more profitable network.

Information gathered from public forums or data available on the internet and portrayed here.