CVS Health Corp. announced Thursday it will significantly reduce its “density” by closing 300 stores a year over the next three years, as the drugstore chain said it plans to sharpen its focus on locations that offer more health care options than retail alone, such as primary care services.
The plan will result in almost 10% of all existing CVS stores shuttering, starting in the spring of 2022.
CVS said it plans to focus on “new store formats” that provide greater customer engagement, like enhancing its “HealthHUB” locations, which offer in-store medical screenings.
The price for CVS stock was trading at $93.68 on Thursday morning, up more than 1% from Wednesday’s close.
“Our retail stores are fundamental to our strategy and who we are as a company,” CVS CEO Karen Lynch said in a statement.
CVS is the biggest drugstore chain in the U.S., with nearly 10,000 stores operating across all 50 states, which employ about 300,000 people. The chain has massively grown over the past several years, with its number of stores almost doubling from around 5,000 in 2005. The company has also broadened its scope beyond drugstores, such as its acquisition of health insurance giant Aetna in 2018. CVS now has a market cap of more than $123 billion.
Closing 900 locations could mean Walgreens will overtake CVS as the biggest drugstore chain in terms of number of retail locations. Walgreens operates 9,021 stores across the U.S., according to its website.