CVS and Walgreens Report Strong Q2 Results Amid Rite Aid's Bankruptcy Woes

CVS reported strong Q2 results with an 8.4% revenue increase YoY, while Walgreens saw a 7.2% sales increase in Q3. Rite Aid filed for Chapter 11 bankruptcy for the second time and is closing all 1,281 of its store locations. The pharmacy chain's performance through H1 2025 has been mixed, with CVS demonstrating operational and financial improvement, and Walgreens experiencing weakness in its front-end sales.

Pharmacy chain performance through the first half of 2025 has shown mixed results. CVS reported strong second quarter results for the period ending June 30, 2025, as the company's total revenue increased by 8.4% compared to the same period the year before. "Our strong performance demonstrates the continued focus we have on operational and financial improvement across our businesses, led by a significant and durable recovery at Aetna, strong retention at CVS Caremark and growth and momentum at CVS Pharmacy,” CVS CEO David Joyner said in a July 31 statement [1].

Walgreens reported an increase in sales, with a 7.2% increase in third quarter sales for the period ending May 31, 2025. The company's 2025 fiscal year also showed an increase in sales of 6.3% for the first nine months ending on the same date. However, Walgreens Boots Alliance Inc. CEO Tim Wentworth noted that "Third quarter results reflect continued improvement in our U.S. Healthcare segment and benefits from our cost savings initiatives, while we continued to see weakness in our U.S. front-end sales" [1].

Rite Aid, a third drugstore chain, has not fared as well as CVS and Walgreens. Rite Aid filed for Chapter 11 bankruptcy for the second time on May 5, 2025, and began closing all of its stores, which it estimated at the time to be about 1,240 locations. The pharmacy chain filed for Chapter 11 bankruptcy for the first time on Oct. 15, 2023, and closed about 800 of its 2,100 stores at the time. Rite Aid is closing all of its store locations. Rite Aid has closed many more stores than it originally planned for when it filed for bankruptcy, as it filed its 18th notice of additional store closing locations in the U.S. Bankruptcy Court for the District of New Jersey on Aug. 22, seeking approval to close seven more stores and liquidate their assets. The additional stores increased the number of designated locations for closing in its second bankruptcy to 1,281 stores [3].

Despite these mixed results, CVS has shown resilience and growth. The company's pharmacy and consumer wellness unit reported solid results for the second quarter of 2025, with revenues up 12% year over year. Same-store basis increased more than 15%, while same-store prescription volumes jumped nearly 7%. CVS Health attributed the performance to its ability to anticipate market dynamics and act accordingly to lead the industry. It invested in technology and staffing to bolster its operations and service, while also aiming to be the preferred employer in the pharmacy market [1].

References:
[1] https://www.nasdaq.com/articles/cvs-gains-pharmacy-consumer-wellness-despite-reimbursement-woes
[3] https://www.thestreet.com/retail/iconic-retailer-wiped-out-in-chapter-11-bankruptcy-after-63-years