Walgreens Boots Alliance will close on its acquisition of home-centered care platform Carecentrix sometime this quarter. The company made the disclosure to analysts Tuesday during a fiscal second quarter earnings call with Wall Street analysts.
Carecentrix is part of Walgreens’ U.S. healthcare segment, which proved to be a bright spot for the company in the quarter, helping offset declining sales in retail pharmacy due to a drop in COVID-19 vaccinations and testing. Walgreens reported diluted earnings per share of $1.16 on revenues of $34.86 billion for the second quarter. That compares to earnings of $1.59 a share on revenues of $33.76 billion during the same quarter in 2022. The company attributed the earnings hit to pre-tax opioid-related claims and litigation, along with acquisition costs.
Despite the tough quarter, Walgreens CEO Rosiland Brewer hailed the U.S. healthcare segment as a “growth engine” for the global pharmacy retailer. Revenues at Carecentrix — which coordinates home care for providers, health plans and patients — increased 25% in the second quarter to nearly $400 million. Revenues for in-home and facility-based care provider VillageMD — in which Walgreens owns a majority stake — climbed by 30% to $1.1 billion for the quarter.
Walgreens has been on a buying binge in the healthcare space in the past year, announcing the deal to buy Carecentrix last October. One month later, it announced it was kicking in $3.5 billion to help VillageMD buy Summit Health for $8.9 billion.
While the company still has its sights set on more healthcare acquisitions, Walgreens U.S. Healthcare President John Driscoll admitted deals in the immediate future might be a bit smaller.
“I think we will continue to invest in sensible acquisitions,” Driscoll explained. “Actually what we are seeing is the opportunity to drive costs and growth synergies off of a set of assets that we think could be very impactful, particularly as we concentrate market power with more service offerings in specific markets.”
Walgreens is among a growing list of retailers moving aggressively into the healthcare space, with an eye on the home. On Monday, CVS Health announced it would close on its deal to buy tech-enabled home care platform Signify Health this week. Last month, Amazon finalized its $3.9 billion deal to buy One Medical. Earlier this month, Best Buy announced it was partnering with Atrium Health to develop hospital-at-home offerings.
