Walgreens sees 'most difficult' quarter since formation of Boots alliance

US pharmacy chain Walgreens Boots Alliance fell short of expectations on Tuesday as its quarterly earnings and revenue missed analysts' expectations.

Walgreens, which lowered its full-year forecasts following its "most difficult" quarter in nearly five years, saw net income drop 14% to $1.16bn, or $1.24 per share.

On an adjusted basis, Walgreens earned $1.64 per share, well below the $1.72bn expected on the street. Net sales rose 4.6% to $34.53bn, also below expectations of $34.56bn.

Walgreens now expects full-year earnings to be broadly flat, compared to the group's previous forecasts of 7% to 12% growth.

Walgreens and rival CVS had previously warned that profits looked set to dwindle this year as the Trump administration moved to pressure drugmakers and pharmacy benefits managers to lower consumer prices, cutting into profits for both drugstore chains.

Chief executive Stefano Pessina said: "The market challenges and macro trends we have been discussing for some time accelerated, resulting in the most difficult quarter we have had since the formation of Walgreens Boots Alliance."

Looking forward, Walgreens hopes to improve its profitability by expanding its planned $1bn worth of annual cost cuts by 2022 to at least $1.5bn by streamlining its operations and digitising some business functions.

In addition to the cost-cutting, Walgreens revealed plans last week to combat its thinning profits by selling cannabidiol-based creams, patches and sprays in around 1,500 stores across nine states around the US.

As of 1400 GMT, Walgreens shares had slid 8.49% in pre-market trading to $58.10 each.