CVS plans to close about 900 stores over the next three years, reflecting nearly 1 in 10 of its locations, as the drugstore chain continues its pivot away from retail and toward health care services.
The company announced Thursday that it would shutter 300 stores per year for the next three years.
“The company is committed to offering impacted colleagues roles in other locations or different opportunities as part of its overall workforce strategy,” CVS said in a statement.
The closures will begin in spring 2022.
A list of locations poised to close was not immediately available.
CVS spokesperson T.J. Crawford said the company would decide which locations to close based on “a number of factors,” including “local market dynamics, population shifts and store density” as well as “ensuring Aetna and Caremark coverage and the needs of underserved communities.”
CVS has been grappling for years with digital competition, which has been exacerbated by the onset of Amazon’s pharmacy efforts. The company has diversified its business by acquiring insurer Aetna and repositioning certain stores as “HealthHub” locations with a focus on clinical services and health products.
“The company has been evaluating changes in population, consumer buying patterns and future health needs to ensure it has the right kinds of stores in the right locations for consumers and for the business,” CVS said Thursday.
The closures are expected to result in an impairment charge of $1 billion to $1.2 billion in the fourth quarter.
“Our retail stores are fundamental to our strategy and who we are as a company,” CVS CEO Karen Lynch said in a statement. “We remain focused on the competitive advantage provided by our presence in thousands of communities across the country, which complements our rapidly expanding digital presence.”
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