CVS Health Corp said on Monday it would close hundreds of stores and potentially sell another 200 in a move to cut costs and focus on an online business.
The drugstore operator will close about 370 CVS Pharmacy and Longs Drug Stores’ stores and close about 100 retail clinics by the end of the second quarter.
CVS said it would continue to operate its pharmacies and Longs drugstores under existing contracts and a final decision on whether to stay open was based on productivity and customer demand.
The company said in December it would close hundreds of drugstores as it steps up its focus on patient visits online.
CVS will instead invest in digital businesses, including its new fee-based MinuteClinic medical clinics and its newly acquired pharmacy benefit manager (PBM) MedExpress.
CVS’ PBM, which handles the prescription drugs for the US government’s Medicare and Medicaid programmes, may soon be available in more than 1,000 Walgreens stores across the United States, an industry source told Reuters in March.
CVS is also hoping to improve its competitive position by acquiring Target Corp’s pharmacies and clinics.
CVS shares were down 0.9 percent in premarket trading on Monday.
The company said it would cut its annual capital expenditures to $3.5 billion from an earlier estimate of $4.3 billion, primarily to invest in its online business and digital marketing to boost digital sales.
CVS earlier this year acquired organic and natural health foods retailer Whole Foods Market Inc for $13.7 billion.