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Speaker 1: Walgreen shares a touch higher on the day after the

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Speaker 1: company reported earnings, with profit and sales topping estimates. In

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Speaker 1: the court of Gone, however, the company narrowed its fiscal

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Speaker 1: twenty twenty four guidance and cited a challenging retail environment.

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Speaker 1: Delight to say that joining us now is Walgreens Boots

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Speaker 1: Alliance CEO Tim Wentworth. Let's get right to that consumer point.

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Speaker 1: You outlined a picture where there is some hesitance from

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Speaker 1: the consumer, retail spending perhaps not as strong, and that

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Speaker 1: was based principally at the core of your outlook. What

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Speaker 1: is happening?

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Speaker 2: Well, I think what you see is that the consumer

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Speaker 2: continues to behave in ways that show that they're challenged,

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Speaker 2: They are seeking value, they are willing to bog purchase

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Speaker 2: and do other things. So when you look across the

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Speaker 2: retail spectrum, you'll see some folks doing better than others

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Speaker 2: if they're in the super high value part of the ecosys.

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Speaker 2: In our case, obviously, we count on folks to come

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Speaker 2: in and to not only visit our pharmacies, but also

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Speaker 2: come in by impulse items, get last minute items, get

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Speaker 2: seasonal items, and a lot of those things. Our purchases

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Speaker 2: that you've got to get the value equation right on

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Speaker 2: or else they feel discretionary to folks. And so we

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Speaker 2: have been re engineering our experience, our SKUs, and our

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Speaker 2: product line and our pricing strategy and promotion strategy to

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Speaker 2: bring back those that we've lost and to keep the

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Speaker 2: ones that we've got. And what you see is we

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Speaker 2: are anticipating the second half that is not going to

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Speaker 2: mean if we dissipate, although I also don't think it's

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Speaker 2: going to get worse. I think we've got ourselves positioned

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Speaker 2: to now build from the second half of this year

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Speaker 2: back to a place where consumers will begin again to

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Speaker 2: prefer Walgreens more often than they do.

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Speaker 1: Tay Tim, does that consume a behavior extend to both

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Speaker 1: your store footprints and your digital offerings or are you

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Speaker 1: seeing any discrepancy in those two marketplaces.

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Speaker 2: No, it's interesting. Our digital offerings have really proven to

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Speaker 2: be not only robust, but important parts of holding up

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Speaker 2: our underlying value, both value to our shareholders but also

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Speaker 2: value to the consumer. So we see meaningful increases of

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Speaker 2: same day delivery. You know, eighty percent of our deliveries

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Speaker 2: are actually done within an hour, not a day, not

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Speaker 2: two hours, eighty percent within a day slightly over eighty percent.

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Speaker 2: And so we have seen the investments in both the

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Speaker 2: underlying technology to enable the consumer to interface with us

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Speaker 2: that way and then the underlying ecosystem to get it

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Speaker 2: reliably to them has meaningfully brought consumers back into the fold.

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Speaker 1: Tim A big part of that technology is built and

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Speaker 1: executed on by door Dash. I know that you are

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Speaker 1: only a little period into your ten year CEO of Woolgreens,

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Speaker 1: but what have you made of door Dash in the

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Speaker 1: relationship there?

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Speaker 2: Yeah, we are really pleased. I will confess to you

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Speaker 2: coming in, I wasn't certain how to sort of think

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Speaker 2: about that. We were not in a position to build

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Speaker 2: a distribution system store door all the way to people's

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Speaker 2: houses with our own vehicles and so forth. It's not necessary.

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Speaker 2: DoorDash has been a great partner. They deliver it, they

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Speaker 2: communicate phenomenally. If you haven't actually used the experience, I

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Speaker 2: recommend everyone give it a try. The communications from both

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Speaker 2: Walgreens and from door Dash throughout the journey of the

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Speaker 2: product that you've ordered is phenomenal, and so they have

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Speaker 2: been great. I am super happy with the results that

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Speaker 2: we're getting with them.

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Speaker 1: Tim. I scanned through the transcripts if You're earning school

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Speaker 1: a few times and I was looking for one thing

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Speaker 1: artificial intelligence. I saw the word automation. How big was

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Speaker 1: the temptation to try and tell a Walgreens AI story,

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Speaker 1: And frankly, that has been the pressure of this earning

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Speaker 1: season for CEOs across all sectors.

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Speaker 2: So ed, if you know me at all, you'll know

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Speaker 2: that I won't use buzzwords if I could possibly avoid it,

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Speaker 2: and I won't say things that don't have deep meaning.

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Speaker 2: And as it relates to AI, there are some very

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Speaker 2: very interesting things we are doing in our business, both

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Speaker 2: within our own four walls and working with others that

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Speaker 2: we are super excited about in terms of everything from

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Speaker 2: load balancing to inventory management. Ultimately too, I think some

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Speaker 2: of the work that people are doing in stores. So

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Speaker 2: there's a fairly wide landscape of things that we are

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Speaker 2: using AI as a tool for. But it's a tool

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Speaker 2: and it needs use cases that were and by the ways,

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Speaker 2: you know, we have we've got years of machine learning

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Speaker 2: applicability to certain things, right, But as we look at

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Speaker 2: predicting consumer behavior, as we look at meeting consumers where

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Speaker 2: they want to be before they even know that we're

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Speaker 2: we're going to be there those sorts of things. And

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Speaker 2: again in terms of a very complex operating model where

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Speaker 2: we can actually improve service, improve working capital, integrate our

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Speaker 2: stores with our micro fulfillment centers. We think there's some

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Speaker 2: really interesting things that we can do there. I just

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Speaker 2: spoke with Alex Karp this week from palent here, who

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Speaker 2: clearly doing some interesting things there. And that's one of

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Speaker 2: a number of folks that we're working with to actually

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Speaker 2: again really get at meaningful things that we can do

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Speaker 2: in the business leveraging AI.

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Speaker 1: Please keep us posted on Bloomberg Technology about the relationship

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Speaker 1: with Palenteer in the future. You know, I recently spoke

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Speaker 1: with with Dottr Karp as well. Listen, this is the

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Speaker 1: early innings of what people are calling the reinvention era

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Speaker 1: of Walgreens. You have your strategic business review next month,

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Speaker 1: but pharmacy does seem to be kind of a core

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Speaker 1: pillar of that in our world. It's a world that

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Speaker 1: Amazon is increasingly moving into. Just explain the strategy, the

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Speaker 1: early stages of it for pharmacy for our audience.

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Speaker 2: So I think what you've got to look at to

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Speaker 2: understand our pharmacy strategy is what are the possibilities and

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Speaker 2: the things today that we're doing in the back of

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Speaker 2: our stores. So it's more than just delivering acute meds

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Speaker 2: to folks when they need them because they've they've got

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Speaker 2: a short term problem. It's more than just filling laun

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Speaker 2: term maintenance medications, neither mailing to the patient or having

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Speaker 2: them come in and pick it up. It's more than vaccines.

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Speaker 2: Even now we're doing test and treat, we're doing some

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Speaker 2: other things, not to mention some workflow changes that just

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Speaker 2: free up pharmacists time so that they can consult with patients.

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Speaker 2: And I think that's the big difference when I look

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Speaker 2: at it, Tim the other player.

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Speaker 1: Yes, Tim, I'm sorry to interrupt you. Tim Wentworth, wal

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Speaker 1: Greens Boots Alliance CEO