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M&A Activity - Walgreens is being acquired by Sycamore [1] - The acquisition of Walgreens by Sycamore is viewed as hopeful [2] Company Performance - Walgreens reported a very good quarter [1] Market Competition & Trends - Amazon is considered a significant competitor in the drugstore market [4] - The acquisition of Walgreens may not positively impact CVS due to its smaller scale compared to CVS's other ventures [3]

Core Insights - Walgreens Boots Alliance (WBA) reported revenue of $38.99 billion for the quarter ended May 2025, marking a year-over-year increase of 7.3% [1] - The earnings per share (EPS) for the same period was $0.38, down from $0.63 a year ago, but exceeded the consensus EPS estimate of $0.34 by 11.76% [1] - The reported revenue surpassed the Zacks Consensus Estimate of $36.61 billion by 6.49% [1] Revenue Breakdown - U.S. Retail Pharmacy revenues reached $30.72 billion, exceeding the average estimate of $28.76 billion by analysts, reflecting a year-over-year change of 7.8% [4] - U.S. Healthcare revenues were reported at $2.10 billion, slightly below the estimated $2.17 billion, representing a year-over-year decline of 1.1% [4] - International revenues amounted to $6.17 billion, surpassing the average estimate of $5.74 billion, with a year-over-year increase of 7.8% [4] Operating Income Analysis - Adjusted operating income for U.S. Retail Pharmacy was $350 million, significantly higher than the average estimate of $113.67 million [4] - Adjusted operating loss for Corporate and Other was reported at -$60 million, compared to the average estimate of -$52.50 million [4] - Adjusted operating income for U.S. Healthcare was $54 million, below the average estimate of $72.85 million [4] - Adjusted operating income for International was $214 million, exceeding the average estimate of $196.39 million [4] Stock Performance - Walgreens shares have returned +1.1% over the past month, while the Zacks S&P 500 composite increased by +5.1% [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Core Insights - Walgreens Boots Alliance, Inc. (WBA) reported adjusted earnings per share (EPS) of 38 cents for Q3 fiscal 2025, a decline of 39.7% year-over-year, but exceeded the Zacks Consensus Estimate by 11.76% [1] - Total sales for Q3 reached $38.99 billion, reflecting a year-over-year increase of 7.2% and surpassing the Zacks Consensus Estimate by 6.5% [2][9] - The company has withdrawn its fiscal 2025 guidance due to a pending acquisition deal with Sycamore Partners, expected to close in late 2025 [12][13] Financial Performance - The gross profit for Q3 was $6.51 billion, up 0.75% year-over-year, despite an 8.7% increase in the cost of sales, leading to a gross margin contraction of 108 basis points to 16.7% [8][9] - Selling, general and administrative (SG&A) expenses rose 1.6% year-over-year to $6.49 billion, with an adjusted operating profit of $13 million compared to $66 million in the previous year [10] Segment Performance - U.S. Retail Pharmacy segment sales increased by 7.8% year-over-year to $30.7 billion, with comparable sales up 10.3% [4] - International revenues grew by 7.8% year-over-year to $6.2 billion, with notable increases in Germany and Boots UK [6] - U.S. Healthcare reported revenues of $2.1 billion, with mixed performance across its sub-segments [7] Market Reaction - Following the earnings announcement, Walgreens shares rose by 0.9% in pre-market trading [2]

Core Insights - Walgreens Boots Alliance (WBA) reported quarterly earnings of $0.38 per share, exceeding the Zacks Consensus Estimate of $0.34 per share, but down from $0.63 per share a year ago, indicating an earnings surprise of +11.76% [1] - The company achieved revenues of $38.99 billion for the quarter ended May 2025, surpassing the Zacks Consensus Estimate by 6.49% and up from $36.35 billion year-over-year [2] - Walgreens shares have increased by approximately 21.2% since the beginning of the year, significantly outperforming the S&P 500's gain of 3.6% [3] Earnings Outlook - The future performance of Walgreens stock will largely depend on management's commentary during the earnings call and the company's earnings outlook [4] - The current consensus EPS estimate for the upcoming quarter is $0.25 on revenues of $36.98 billion, and for the current fiscal year, it is $1.69 on revenues of $151.46 billion [7] Industry Context - The Retail - Pharmacies and Drug Stores industry, to which Walgreens belongs, is currently ranked in the top 2% of over 250 Zacks industries, indicating a favorable outlook for the sector [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked using tools like the Zacks Rank [5][6]

Group 1 - Walgreens reported Q3 profits exceeding Wall Street expectations, with revenue of $39 billion and adjusted EPS of $0.38, surpassing analyst forecasts of $36.8 billion and $0.31 respectively [1] - Walgreens is preparing to transition into a private company through a $10 billion acquisition by Sycamore Partners, expected to be completed by the end of the year [1] - The company has been facing challenges due to retail competition and reduced prescription drug payments from insurers, leading to a significant drop in market value [1] Group 2 - Walgreens withdrew its fiscal 2025 guidance and did not provide new guidance in its recent earnings report, marking a lack of communication with analysts since the acquisition announcement in March [2] - The company is divesting its medical clinic business, VillageMD, which is expected to yield up to $3 per share for shareholders upon sale [2] - Walgreens stock has seen a year-to-date increase of 21% as of the latest report [3]

Core Viewpoint - Walgreens Boots Alliance reported a narrower-than-expected loss of $175 million in its third quarter, as the company approaches the end of its tenure as a publicly traded entity [2][3]. Financial Performance - For the fiscal third quarter ending May 31, Walgreens experienced a 7% increase in sales, reaching $39 billion, despite a loss of $175 million, which is a decrease of $519 million compared to net earnings of $344 million in the same period last year [3]. - The U.S. Retail Pharmacy segment sales rose nearly 8% to $39.7 billion compared to the previous year, although retail sales within that segment decreased by 5%, leading to a 30% drop in adjusted operating income to $350 million from $501 million [5]. Strategic Developments - Walgreens is in the process of completing a sale to Sycamore Partners for over $10 billion, with a special shareholder meeting scheduled for July 11 to vote on the deal [3][4]. - The Sycamore deal includes a payment of $11.45 per share, which is 29% above the stock price from December [4]. - The total value of the Sycamore deal exceeds $23 billion when including debt and other items [7]. Operational Challenges - The company has faced significant challenges, including a disastrous rollout of in-store clinics, leading to numerous pharmacy closures and a decline in stock value [4][9]. - Walgreens has lost more than $3.2 billion, or $3.81 per share, for the nine-month period ending May 31, compared to a loss of $5.6 billion, or $6.53 per share, in the previous year [10]. Future Outlook - The CEO emphasized the need for a turnaround plan that requires time and a balanced approach to manage future cash needs while making necessary investments [6].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended May 31, 2025 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period From _______to _______ Commission File Number 001-36759 WALGREENS BOOTS ALLIANCE, INC. (Exact name of registrant as specified in its charter) Delaware 47-1758322 (State ...

Exhibit 99.1 Walgreens Boots Alliance Reports Fiscal 2025 Third Quarter Results Third quarter financial results Fiscal 2025 guidance • Given the pending transaction, pursuant to which WBA will be acquired by entities affiliated with Sycamore Partners, the company previously withdrew fiscal 2025 guidance. DEERFIELD, Ill. — June 26, 2025 — Walgreens Boots Alliance, Inc. (Nasdaq: WBA) today announced financial results for the third quarter of fiscal 2025, which ended May 31, 2025. Chief Executive Officer Tim W ...

Group 1 - Walgreens Boots Alliance, Inc. is set to release its third-quarter earnings results on June 26, with analysts expecting earnings of 34 cents per share, a decrease from 63 cents per share in the same period last year [1] - The company is projected to report quarterly revenue of $36.72 billion, slightly up from $36.35 billion a year earlier [1] - On April 21, Walgreens announced a $300 million settlement to resolve federal allegations regarding the filling of invalid prescriptions for opioids and other controlled substances [2] Group 2 - Deutsche Bank analyst downgraded Walgreens stock from Hold to Sell, reducing the price target from $11 to $9 [5] - Truist Securities maintained a Hold rating but lowered the price target from $13 to $12 [5] - UBS analyst maintained a Neutral rating and raised the price target from $9 to $10 [5] - Morgan Stanley maintained an Underweight rating and cut the price target from $9 to $7 [5]