Cover Page
Cover Page | 9 Months Ended |
May 31, 2024 shares | |
Document Information [Line Items] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | May 31, 2024 |
Document Transition Report | false |
Entity File Number | 001-36759 |
Entity Registrant Name | WALGREENS BOOTS ALLIANCE, INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 47-1758322 |
Entity Address, Address Line One | 108 Wilmot Road |
Entity Address, City or Town | Deerfield |
Entity Address, State or Province | IL |
Entity Address, Postal Zip Code | 60015 |
City Area Code | 847 |
Local Phone Number | 315-3700 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding (in shares) | 863,275,037 |
Entity Central Index Key | 0001618921 |
Current Fiscal Year End Date | --08-31 |
Document Fiscal Year Focus | 2024 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
Common Stock, $0.01 par value | |
Document Information [Line Items] | |
Title of 12(b) Security | Common Stock, $0.01 par value |
Trading Symbol | WBA |
Security Exchange Name | NASDAQ |
3.600% Walgreens Boots Alliance, Inc. notes due 2025 | |
Document Information [Line Items] | |
Title of 12(b) Security | 3.600% Walgreens Boots Alliance, Inc. notes due 2025 |
Trading Symbol | WBA25 |
Security Exchange Name | NASDAQ |
2.125% Walgreens Boots Alliance, Inc notes due 2026 | |
Document Information [Line Items] | |
Title of 12(b) Security | 2.125% Walgreens Boots Alliance, Inc. notes due 2026 |
Trading Symbol | WBA26 |
Security Exchange Name | NASDAQ |
CONSOLIDATED CONDENSED BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 703 | $ 739 |
Accounts receivable, net | 5,949 | 5,381 |
Inventories | 8,578 | 8,257 |
Other current assets | 1,107 | 1,127 |
Total current assets | 16,337 | 15,503 |
Non-current assets: | ||
Property, plant and equipment, net | 9,952 | 11,587 |
Operating lease right-of-use assets | 21,020 | 21,667 |
Goodwill | 15,821 | 28,187 |
Intangible assets, net | 12,836 | 13,635 |
Equity method investments (see Note 5) | 2,961 | 3,497 |
Other non-current assets | 4,059 | 2,550 |
Total non-current assets | 66,648 | 81,125 |
Total assets | 82,985 | 96,628 |
Current liabilities: | ||
Short-term debt | 1,506 | 917 |
Trade accounts payable (see Note 16) | 13,100 | 12,635 |
Operating lease obligations | 2,384 | 2,347 |
Accrued expenses and other liabilities | 7,753 | 8,426 |
Income taxes | 292 | 209 |
Total current liabilities | 25,034 | 24,535 |
Non-current liabilities: | ||
Long-term debt | 7,407 | 8,145 |
Operating lease obligations | 21,379 | 22,124 |
Deferred income taxes | 1,221 | 1,318 |
Accrued litigation obligations | 5,890 | 6,261 |
Other non-current liabilities | 6,624 | 5,757 |
Total non-current liabilities | 42,521 | 43,605 |
Commitments and contingencies (see Note 10) | ||
Total liabilities | 67,555 | 68,140 |
Redeemable non-controlling interests | 173 | 167 |
Equity: | ||
Preferred stock $.01 par value; authorized 32 million shares, none issued | 0 | 0 |
Common stock $.01 par value; authorized 3.2 billion shares; issued 1,172,513,618 at May 31, 2024 and August 31, 2023 | 12 | 12 |
Paid-in capital | 10,639 | 10,661 |
Retained earnings | 26,571 | 33,058 |
Accumulated other comprehensive loss | (2,894) | (2,993) |
Treasury stock, at cost; 309,238,581 shares at May 31, 2024 and 308,839,832 shares at August 31, 2023 | (20,686) | (20,717) |
Total Walgreens Boots Alliance, Inc. shareholders’ equity | 13,642 | 20,020 |
Non-controlling interests | 1,615 | 8,302 |
Total equity | 15,257 | 28,322 |
Total liabilities, redeemable non-controlling interests and equity | $ 82,985 | $ 96,628 |
CONSOLIDATED CONDENSED BALANC_2
CONSOLIDATED CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | May 31, 2024 | Aug. 31, 2023 |
Equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 32,000,000 | 32,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares (in shares) | 3,200,000,000 | 3,200,000,000 |
Common stock, issued (in shares) | 1,172,513,618 | 1,172,513,618 |
Treasury stock, at cost (in shares) | 309,238,581 | 308,839,832 |
CONSOLIDATED CONDENSED STATEMEN
CONSOLIDATED CONDENSED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Common Stock | Treasury stock amount | Paid-in capital | Accumulated other comprehensive loss | Retained earnings | Non-controlling interests |
Beginning balance (in shares) at Aug. 31, 2022 | 864,639,457 | ||||||
Beginning balance at Aug. 31, 2022 | $ 29,366 | $ 12 | $ (20,683) | $ 10,950 | $ (2,805) | $ 37,801 | $ 4,091 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | (3,296) | (2,900) | (396) | ||||
Other comprehensive income, net of tax | 274 | 266 | 9 | ||||
Dividends declared and distributions | (1,298) | (1,247) | (51) | ||||
Treasury stock purchases (in shares) | (4,438,228) | ||||||
Treasury stock purchases | (150) | (150) | |||||
Employee stock purchase and option plans (in shares) | 3,060,184 | ||||||
Employee stock purchase and option plans | 34 | 102 | (68) | ||||
Stock-based compensation | 160 | 61 | 99 | ||||
Acquisition of non-controlling interests | 185 | 171 | 14 | ||||
Business combination | 4,518 | (16) | 4,534 | ||||
Other | (434) | (430) | (4) | ||||
Ending balance (in shares) at May. 31, 2023 | 863,261,413 | ||||||
Ending balance at May. 31, 2023 | 29,359 | $ 12 | (20,731) | 10,667 | (2,539) | 33,654 | 8,296 |
Beginning balance (in shares) at Feb. 28, 2023 | 862,795,720 | ||||||
Beginning balance at Feb. 28, 2023 | 29,439 | $ 12 | (20,747) | 10,629 | (2,654) | 33,952 | 8,247 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | (48) | 118 | (167) | ||||
Other comprehensive income, net of tax | 121 | 115 | 6 | ||||
Dividends declared and distributions | (417) | (416) | (1) | ||||
Employee stock purchase and option plans (in shares) | 465,693 | ||||||
Employee stock purchase and option plans | 12 | 16 | (4) | ||||
Stock-based compensation | 48 | 13 | 35 | ||||
Acquisition of non-controlling interests | 14 | 14 | |||||
Business combination | 193 | 27 | 165 | ||||
Other | (2) | 2 | (4) | ||||
Ending balance (in shares) at May. 31, 2023 | 863,261,413 | ||||||
Ending balance at May. 31, 2023 | 29,359 | $ 12 | (20,731) | 10,667 | (2,539) | 33,654 | 8,296 |
Beginning balance (in shares) at Aug. 31, 2023 | 863,673,786 | ||||||
Beginning balance at Aug. 31, 2023 | 28,322 | $ 12 | (20,717) | 10,661 | (2,993) | 33,058 | 8,302 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | (12,371) | (5,631) | (6,740) | ||||
Other comprehensive income, net of tax | 100 | 100 | 0 | ||||
Dividends declared and distributions | (862) | (855) | (7) | ||||
Treasury stock purchases (in shares) | (3,100,000) | ||||||
Treasury stock purchases | (69) | (69) | |||||
Employee stock purchase and option plans (in shares) | 2,701,251 | ||||||
Employee stock purchase and option plans | 16 | 100 | (85) | ||||
Stock-based compensation | 126 | 53 | 72 | ||||
Other | (4) | 9 | 0 | (13) | |||
Ending balance (in shares) at May. 31, 2024 | 863,275,037 | ||||||
Ending balance at May. 31, 2024 | 15,257 | $ 12 | (20,686) | 10,639 | (2,894) | 26,571 | 1,615 |
Beginning balance (in shares) at Feb. 29, 2024 | 862,713,366 | ||||||
Beginning balance at Feb. 29, 2024 | 15,192 | $ 12 | (20,705) | 10,627 | (2,897) | 26,448 | 1,708 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net earnings (loss) | 230 | 344 | (113) | ||||
Other comprehensive income, net of tax | 5 | 3 | 1 | ||||
Dividends declared and distributions | (220) | (220) | 0 | ||||
Employee stock purchase and option plans (in shares) | 561,671 | ||||||
Employee stock purchase and option plans | 9 | 19 | (10) | ||||
Stock-based compensation | 38 | 20 | 19 | ||||
Other | 2 | 2 | 0 | 0 | |||
Ending balance (in shares) at May. 31, 2024 | 863,275,037 | ||||||
Ending balance at May. 31, 2024 | $ 15,257 | $ 12 | $ (20,686) | $ 10,639 | $ (2,894) | $ 26,571 | $ 1,615 |
CONSOLIDATED CONDENSED STATEM_2
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Income Statement [Abstract] | ||||
Sales | $ 36,351 | $ 35,415 | $ 110,111 | $ 103,659 |
Cost of sales | 29,892 | 28,826 | 89,840 | 83,062 |
Gross profit | 6,460 | 6,588 | 20,271 | 20,596 |
Selling, general and administrative expenses | 6,393 | 7,123 | 21,165 | 27,215 |
Impairment of goodwill | 0 | 0 | 12,369 | 0 |
Equity earnings in Cencora | 44 | 58 | 164 | 187 |
Operating income (loss) | 111 | (477) | (13,099) | (6,431) |
Other income, net | 254 | 268 | 229 | 1,812 |
Earnings (loss) before interest and income tax provision (benefit) | 365 | (209) | (12,870) | (4,619) |
Interest expense, net | 113 | 173 | 351 | 425 |
Earnings (loss) before income tax provision (benefit) | 251 | (382) | (13,221) | (5,044) |
Income tax provision (benefit) | 20 | (330) | (836) | (1,707) |
Post-tax (loss) earnings from other equity method investments | (1) | 4 | 15 | 18 |
Net earnings (loss) | 230 | (48) | (12,370) | (3,320) |
Net loss attributable to non-controlling interests | (114) | (166) | (6,739) | (420) |
Net earnings (loss) attributable to Walgreens Boots Alliance, Inc. | $ 344 | $ 118 | $ (5,631) | $ (2,900) |
Earnings Per Share, Basic [Abstract] | ||||
Total (in dollars per share) | $ 0.40 | $ 0.14 | $ (6.53) | $ (3.36) |
Earnings Per Share, Diluted [Abstract] | ||||
Total (in dollars per share) | $ 0.40 | $ 0.14 | $ (6.53) | $ (3.36) |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 863.1 | 863.1 | 862.9 | 863.1 |
Diluted (in shares) | 864.3 | 863.8 | 862.9 | 863.1 |
CONSOLIDATED CONDENSED STATEM_3
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Net earnings (loss) | $ 230 | $ (48) | $ (12,370) | $ (3,320) |
Other comprehensive income, net of tax: | ||||
Pension/post-retirement obligations | (5) | (5) | 85 | (15) |
Unrealized gain (loss) on cash flow hedges and other | 0 | (1) | 5 | (4) |
Net investment hedges loss | (8) | (31) | (6) | (104) |
Share of other comprehensive (loss) income of equity method investments | (4) | 12 | 29 | 104 |
Cumulative translation adjustments | 21 | 147 | (14) | 294 |
Total other comprehensive income | 5 | 121 | 100 | 274 |
Total comprehensive income (loss) | 235 | 73 | (12,270) | (3,046) |
Comprehensive loss attributable to non-controlling interests | (112) | (161) | (6,739) | (411) |
Comprehensive income (loss) attributable to Walgreens Boots Alliance, Inc. | $ 347 | $ 233 | $ (5,532) | $ (2,634) |
CONSOLIDATED CONDENSED STATEM_4
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2024 | May 31, 2023 | |
Cash flows from operating activities: | ||
Net earnings (loss) | $ (12,370) | $ (3,320) |
Adjustments to reconcile net loss to net cash (used for) provided by operating activities: | ||
Depreciation and amortization | 1,837 | 1,652 |
Deferred income taxes | (1,242) | (2,098) |
Stock compensation expense | 143 | 348 |
Earnings from equity method investments | (179) | (206) |
Impairment of goodwill, intangibles and long-lived assets | 13,618 | 815 |
Gain on sale of equity method investments | (847) | (1,691) |
Gain on sale-leaseback transactions | (268) | (825) |
Loss on variable prepaid forward contracts | 733 | 26 |
Other | (151) | (124) |
Changes in certain assets and liabilities: | ||
Accounts receivable, net | (592) | (411) |
Inventories | (315) | 326 |
Other current assets | 58 | (184) |
Trade accounts payable | 446 | 627 |
Accrued expenses and other liabilities | (474) | (588) |
Income taxes | 167 | 216 |
Accrued litigation obligations | (330) | 6,835 |
Other non-current assets and liabilities | (548) | (179) |
Net cash (used for) provided by operating activities | (314) | 1,219 |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (1,135) | (1,633) |
Proceeds from sale-leaseback transactions | 773 | 1,549 |
Proceeds from sale of other assets | 1,726 | 3,798 |
Business, investment and asset acquisitions, net of cash acquired | (206) | (7,072) |
Other | (53) | 110 |
Net cash provided by (used for) investing activities | 1,106 | (3,249) |
Cash flows from financing activities: | ||
Net change in short-term debt with maturities of 3 months or less | (1) | 147 |
Proceeds from debt | 23,074 | 5,240 |
Payments of debt | (23,128) | (5,232) |
Acquisition of non-controlling interests | 0 | (1,316) |
Proceeds from issuance of non-controlling interests | 0 | 2,735 |
Proceeds from variable prepaid forward contracts | 424 | 644 |
Treasury stock purchases | (69) | (150) |
Cash dividends paid | (1,044) | (1,244) |
Other | (168) | (251) |
Net cash (used for) provided by financing activities | (912) | 573 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 3 | 17 |
Changes in cash, cash equivalents and restricted cash: | ||
Net decrease in cash, cash equivalents and restricted cash | (117) | (1,441) |
Cash, cash equivalents and restricted cash at beginning of period | 856 | 2,558 |
Cash, cash equivalents and restricted cash at end of period | $ 740 | $ 1,117 |
Accounting policies
Accounting policies | 9 Months Ended |
May 31, 2024 | |
Accounting Policies [Abstract] | |
Accounting policies | Accounting policies Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. and its subsidiaries (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest and certain variable interest entities (“VIEs”) for which the Company is the primary beneficiary. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2023, as amended by Form 10-K/A for the fiscal year ended August 31, 2023 filed on November 22, 2023. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. Adverse global macroeconomic conditions, the impact of opioid-related claims and litigation settlements, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payor and customer relationships and terms, strategic transactions including acquisitions and dispositions, asset impairments, changes in laws and regulations in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. Certain amounts in the Consolidated Condensed Financial Statements and accompanying notes may not sum due to rounding. Percentages have been calculated using unrounded amounts for all periods presented. Certain prior period data has been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. Adoption of new accounting pronouncements Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for business combinations completed in fiscal years beginning after December 15, 2022 (fiscal 2024). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's results of operations, cash flows, or financial position. Liabilities — Supplier Finance Programs In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Topic 405-50) - Disclosure of Supplier Finance Program Obligations. This ASU requires that a buyer in a supplier finance program disclose sufficient information about the program to allow a user of financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. This ASU is expected to improve financial reporting by requiring new disclosures about the programs, thereby allowing financial statement users to better consider the effect of the programs on an entity’s working capital, liquidity, and cash flows. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal 2024), except for the amendment on roll forward information which is effective for fiscal years beginning after December 15, 2023 (fiscal 2025). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's disclosures within these Consolidated Condensed Financial Statements. New accounting pronouncements not yet adopted Leases — Common Control Arrangements In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements. The ASU amends the accounting for leasehold improvements in common control arrangements by requiring a lessee in a common control lease arrangement to amortize leasehold improvements that it owns over the improvements’ useful life to the common control group, regardless of the lease term, if the lessee continues to control the use of the underlying asset through a lease. Further, a lessee that no longer controls the use of the underlying asset will derecognize the remaining carrying amount of the improvements through an adjustment to equity, reflecting the transfer of the asset to the lessor under common control. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025), including interim periods within those fiscal years. Early adoption is permitted in any annual or interim period as of the beginning of the related fiscal year. The Company is evaluating the effect of adopting this new accounting guidance. Segment Reporting - Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures. This ASU is expected to improve disclosures related to an entity’s reportable segments and provide additional, more detailed information about a reportable segment’s expenses. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025) and interim periods within fiscal years beginning after December 15, 2024 (fiscal 2026). The amendments in this ASU must be applied on a retrospective basis to all prior periods presented in the financial statements and early adoption is permitted. The Company is currently evaluating the effect of adopting this new accounting guidance. Improvements to Income Tax Disclosures |
Acquisitions and other Investme
Acquisitions and other Investments | 9 Months Ended |
May 31, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Acquisitions and other Investments | Acquisitions and other investments Summit acquisition On January 3, 2023, Village Practice Management Company, LLC (“VillageMD”), through its parent company, following an internal reorganization, completed the acquisition of WP CityMD TopCo (“Summit”), a provider of primary, specialty and urgent care, in exchange for $7.0 billion aggregate consideration, consisting of $4.85 billion of cash consideration paid, $2.05 billion in preferred units of VillageMD issued to Summit equity holders and $100 million of cash to be paid one year following closing. The cash consideration includes $87 million of cash paid to fund acquisition-related bonuses to Summit employees which was recognized as a compensation expense of the Company. In addition, VillageMD paid off approximately $1.9 billion in net debt of Summit. In connection with the amended Agreement and Plan of Merger, and in order to finance the acquisition, the Company and Cigna Health & Life Insurance Company acquired preferred units of VillageMD in exchange for $1.75 billion and $2.5 billion in aggregate consideration, respectively. Following the Summit acquisition, the Company remains the largest and consolidating equity holder of VillageMD with ownership of approximately 53% of the outstanding equity interests on a fully diluted basis. Further, the Company entered into a credit agreement with VillageMD pursuant to which the Company provided VillageMD senior secured credit facilities in the aggregate amount of $2.25 billion, consisting of (i) a senior secured term loan facility in an aggregate original principal amount of $1.75 billion to support the acquisition of Summit; and (ii) a senior secured revolving credit facility in an aggregate original committed amount of $500 million available for general corporate purposes. In connection with the issuance of the senior secured credit facilities, the Company received a $220 million credit for certain fees payable by VillageMD in the form of preferred units of VillageMD. The intercompany facilities eliminate in consolidation. The Company accounted for this acquisition as a business combination resulting in consolidation of Summit within the U.S. Healthcare segment in its financial statements. In the three months ended February 29, 2024, the Company completed the purchase price allocation. The following table summarizes the consideration for the acquisition and the amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions): Purchase price allocation Cash consideration 1 $ 4,778 Deferred consideration 100 Summit debt paid at closing 1,963 Fair value of equity consideration 2 1,971 Fair value of non-controlling interests 13 Total $ 8,825 Identifiable assets acquired and liabilities assumed: Cash and cash equivalents $ 69 Accounts receivable, net 381 Property, plant and equipment 607 Intangible assets 3 3,359 Operating lease right-of-use assets 756 Other assets 174 Operating lease obligations (773) Deferred tax liability (735) Other liabilities (466) Total identifiable net assets $ 3,372 Goodwill $ 5,454 1. Cash consideration excludes $87 million of cash paid to fund acquisition-related bonuses to Summit employees which was recognized as compensation expense of the Company. 2. The fair value of the non-controlling interests was calculated based on the implied equity value of VillageMD, allocated to all units on an as-converted basis. 3. Intangibles acquired include provider networks and trade names with fair values of $1.9 billion and $1.5 billion, respectively. Estimated useful lives are 15 years and 11 to 15 years, respectively. The goodwill represents anticipated future growth and expansion opportunities into new healthcare offerings and new markets. $416 million of the goodwill is expected to be tax deductible. Supplemental pro forma information - Summit The following table represents unaudited supplemental pro forma consolidated sales for the three and nine months ended May 31, 2023, as if the acquisition of Summit had occurred at the beginning of each period presented. The unaudited pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company's results would have been had the acquisition occurred at the beginning of each period presented or results which may occur in the future. Three months ended May 31, Nine months ended May 31, (Unaudited, in millions) 2023 2023 Sales $ 35,415 $ 104,630 Actual sales of Summit, from the acquisition date, for the three and nine months ended May 31, 2023, included in the Consolidated Condensed Statements of Earnings are as follows: Three months ended May 31, Nine months ended May 31, (Unaudited, in millions) 2023 2023 Sales $ 730 $ 1,193 Pro forma net earnings of the Company, assuming the Summit acquisition had occurred at the beginning of each period presented, would not be materially different from the results reported. Shields acquisition On December 28, 2022, the Company acquired the non-controlling interests in Shields Health Solutions Parent, LLC (“Shields”) for $1.4 billion of cash consideration. CareCentrix acquisition On March 31, 2023, the Company acquired the non-controlling interests in CCX Next, LLC (“CareCentrix”) for approximately $378 million of cash consideration. Other acquisitions On March 3, 2023, the Company completed the acquisition of Starling MSO Holdings, LLC (“Starling”), a primary care and multi-specialty group, for total consideration of $284 million. Total consideration includes $222 million of cash consideration and $62 million of VillageMD equity issued to Starling equity holders, including employees. VillageMD equity issued to employees will be recognized as compensation expense in the future. As a result of the acquisition, the Company recognized goodwill and intangible assets of $103 million and $128 million, respectively. In the three months ended May 31, 2024, the Company completed the purchase price allocation. On May 8, 2024, The Company acquired other certain prescription files and related pharmacy inventory primarily in the United States (“U.S.”) for an aggregate purchase price of $49 million and $221 million during the three and nine months ended May 31, 2024, respectively, and $37 million and $127 million during the three and nine months ended May 31, 2023, respectively. |
Exit and disposal activities
Exit and disposal activities | 9 Months Ended |
May 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Exit and disposal activities | Exit and disposal activities Transformational Cost Management Program On December 20, 2018, the Company announced a transformational cost management program that was expected to deliver in excess of $2.0 billion of annual cost savings by fiscal 2022 (the “Transformational Cost Management Program”). The Company achieved this goal at the end of fiscal 2021. On October 12, 2021, the Company expanded and extended the Transformational Cost Management Program through the end of fiscal 2024 and increased its annual cost savings target to $3.3 billion by the end of fiscal 2024. In fiscal 2022, the Company increased its annual cost savings target from $3.3 billion to $3.5 billion, by the end of fiscal 2024. In fiscal 2023, the Company increased its annual cost savings target from $3.5 billion to $4.5 billion, by the end of fiscal 2024. We believe the Company is currently on track to achieve the savings target. The Transformational Cost Management Program, which is multi-faceted and includes divisional optimization initiatives, global smart spending, global smart organization and the transformation of the Company’s information technology (“IT”) capabilities, is designed to help the Company achieve increased cost efficiencies. To date, the Company has taken actions across all aspects of the Transformational Cost Management Program which focus primarily on the U.S. Retail Pharmacy and International reportable segments along with the Company's global functions. Divisional optimization within the Company’s segments includes activities such as optimization of stores. Through the Transformational Cost Management Program the Company plans to reduce its presence by up to 650 Boots stores in the United Kingdom (“UK”) and approximately 650 to 700 stores in the U.S. As of May 31, 2024, the Company has closed 581 and 673 stores in the UK and U.S., respectively. The Company estimates cumulative pre-tax charges to its GAAP financial results for the Transformational Cost Management Program to be between $4.1 billion and $4.4 billion, of which pre-tax charges for exit and disposal activities are estimated to be between $3.8 billion and $4.1 billion. In addition to the impacts discussed above, as a result of the actions related to store closures taken under the Transformational Cost Management Program, the Company recorded $508 million of transition adjustments to decrease retained earnings due to the adoption of the new lease accounting standard (Topic 842) that became effective on September 1, 2019. From the inception of the Transformational Cost Management Program to May 31, 2024, the Company has recognized cumulative pre-tax charges to its financial results in accordance with GAAP of $3.5 billion, which were primarily recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. These charges included $1.3 billion related to lease obligations and other real estate costs, $950 million in asset impairments, $959 million in employee severance and business transition costs and $275 million of IT transformation and other exit costs. Costs related to exit and disposal activities under the Transformational Cost Management Program for the three and nine months ended May 31, 2024 and May 31, 2023, respectively, were as follows (in millions): Three months ended May 31, 2024 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 37 $ 1 $ — $ — $ 38 Asset impairments 17 — — — 17 Employee severance and business transition costs 20 4 1 1 26 Information technology transformation and other exit costs 5 9 — — 14 Total pre-tax exit and disposal charges $ 80 $ 14 $ 1 $ 1 $ 96 Nine months ended May 31, 2024 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 192 $ 2 $ — $ — $ 194 Asset impairments 45 21 — — 66 Employee severance and business transition costs 71 4 5 6 86 Information technology transformation and other exit costs 11 10 — — 21 Total pre-tax exit and disposal charges $ 320 $ 37 $ 5 $ 6 $ 368 Three months ended May 31, 2023 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 35 $ 18 $ — $ — $ 53 Asset impairments 12 150 109 — 272 Employee severance and business transition costs 50 13 4 4 71 Information technology transformation and other exit costs 7 12 — — 19 Total pre-tax exit and disposal charges $ 104 $ 193 $ 113 $ 4 $ 414 Nine months ended May 31, 2023 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 133 $ 18 $ — $ — $ 151 Asset impairments 127 149 109 — 385 Employee severance and business transition costs 72 15 4 11 102 Information technology transformation and other exit costs 23 22 — — 45 Total pre-tax exit and disposal charges $ 354 $ 204 $ 113 $ 11 $ 682 The changes in liabilities and assets related to the exit and disposal activities under Transformational Cost Management Program include the following (in millions): Lease obligations and other real estate costs Asset impairments Employee severance and business transition costs Information technology transformation and other exit costs Total Balance at August 31, 2023 $ 10 $ — $ 70 $ 22 $ 102 Costs 194 66 86 21 368 Payments (129) — (98) (41) (268) Other (66) (66) — — (133) Balance at May 31, 2024 $ 10 $ — $ 57 $ 2 $ 69 Other exit and disposal activities During the six months ended February 29, 2024, VillageMD approved the closure of approximately 160 clinics. As a result, long-lived and intangible assets of $303 million were impaired within the U.S. Healthcare segment. The impairment charges were recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. During the three months ended February 29, 2024, management ceased development of, and abandoned, a multi-year internal software development project within the U.S. Retail Pharmacy segment. As a result, previously capitalized internally-developed software of $455 million was impaired. The impairment charge was recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. |
Leases
Leases | 9 Months Ended |
May 31, 2024 | |
Leases [Abstract] | |
Leases | Leases The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. Initial terms for leased premises in the U.S. are typically 10 to 25 years, followed by additional terms containing renewal options at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. Lease commencement is the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight line basis over the lease term. In addition to minimum fixed rentals, some leases provide for contingent rentals based on sales volume. Supplemental balance sheet information related to leases was as follows (in millions): Balance sheet supplemental information: May 31, 2024 August 31, 2023 Operating leases: Operating lease right-of-use assets $ 21,020 $ 21,667 Operating lease obligations - current $ 2,384 $ 2,347 Operating lease obligations - non-current 21,379 22,124 Total operating lease obligations $ 23,763 $ 24,472 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 675 $ 678 Lease obligations included in: Accrued expenses and other liabilities $ 71 $ 57 Other non-current liabilities 917 919 Total finance lease obligations $ 988 $ 976 Supplemental income statement information related to leases was as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of earnings supplemental information: 2024 2023 2024 2023 Operating lease cost Fixed $ 866 $ 879 $ 2,605 $ 2,545 Variable 1 228 218 653 613 Finance lease cost Amortization $ 13 $ 15 $ 45 $ 36 Interest 12 14 38 38 Sublease income 2 $ 29 $ 29 $ 84 $ 87 Impairment of right-of-use assets 13 38 194 109 Gain on sale-leaseback transactions 2 U.S. Retail Pharmacy $ 10 $ 263 $ 268 $ 647 International 3 — 30 — 178 Total gain on sale-leaseback 2 $ 10 $ 293 $ 268 $ 825 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. 3 Includes gain on sale-leaseback related to the Germany wholesale business of $30 million and $178 million for the three and nine months ended May 31, 2023, of which $6 million and $47 million, respectively, related to the optimization of warehouse locations as part of acquisition integration activities. Other supplemental information was as follows (in millions): Nine months ended May 31, Other supplemental information: 2024 2023 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,779 $ 2,668 Operating cash flows from finance leases 37 35 Financing cash flows from finance leases 52 38 Total $ 2,867 $ 2,741 Right-of-use assets obtained in exchange for new lease obligations Operating leases $ 1,235 $ 1,773 Finance leases 55 23 Total $ 1,290 $ 1,796 Weighted average lease term and discount rate for real estate leases were as follows: Weighted average lease terms and discount rates: May 31, 2024 August 31, 2023 Weighted average remaining lease term in years Operating leases 9.3 9.6 Finance leases 17.7 17.4 Weighted average discount rate Operating leases 5.55 % 5.35 % Finance leases 5.18 % 5.25 % The aggregate future lease payments for operating and finance leases as of May 31, 2024 were as follows (in millions): Future lease payments (fiscal years): Finance lease Operating lease 1,2 2024 (Remaining period) $ 32 $ 915 2025 122 3,667 2026 119 3,594 2027 116 3,508 2028 95 3,374 2029 85 3,125 Later 882 12,608 Total undiscounted minimum lease payments $ 1,452 $ 30,791 Less: Present value discount 464 7,029 Lease liability $ 988 $ 23,763 1. Total undiscounted minimum lease payments include approximately $3.6 billion of payments related to optional renewal periods that have not been contractually exercised, but are reasonably certain of being exercised. 2. Total undiscounted minimum lease payments exclude sublease rental income of approximately $597 million due to the Company under non-cancelable sublease terms. |
Leases | Leases The Company leases certain retail stores, clinics, warehouses, distribution centers, office space, land, and equipment. Initial terms for leased premises in the U.S. are typically 10 to 25 years, followed by additional terms containing renewal options at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. Lease commencement is the date the Company has the right to control the property. The Company recognizes operating lease rent expense on a straight line basis over the lease term. In addition to minimum fixed rentals, some leases provide for contingent rentals based on sales volume. Supplemental balance sheet information related to leases was as follows (in millions): Balance sheet supplemental information: May 31, 2024 August 31, 2023 Operating leases: Operating lease right-of-use assets $ 21,020 $ 21,667 Operating lease obligations - current $ 2,384 $ 2,347 Operating lease obligations - non-current 21,379 22,124 Total operating lease obligations $ 23,763 $ 24,472 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 675 $ 678 Lease obligations included in: Accrued expenses and other liabilities $ 71 $ 57 Other non-current liabilities 917 919 Total finance lease obligations $ 988 $ 976 Supplemental income statement information related to leases was as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of earnings supplemental information: 2024 2023 2024 2023 Operating lease cost Fixed $ 866 $ 879 $ 2,605 $ 2,545 Variable 1 228 218 653 613 Finance lease cost Amortization $ 13 $ 15 $ 45 $ 36 Interest 12 14 38 38 Sublease income 2 $ 29 $ 29 $ 84 $ 87 Impairment of right-of-use assets 13 38 194 109 Gain on sale-leaseback transactions 2 U.S. Retail Pharmacy $ 10 $ 263 $ 268 $ 647 International 3 — 30 — 178 Total gain on sale-leaseback 2 $ 10 $ 293 $ 268 $ 825 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. 3 Includes gain on sale-leaseback related to the Germany wholesale business of $30 million and $178 million for the three and nine months ended May 31, 2023, of which $6 million and $47 million, respectively, related to the optimization of warehouse locations as part of acquisition integration activities. Other supplemental information was as follows (in millions): Nine months ended May 31, Other supplemental information: 2024 2023 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,779 $ 2,668 Operating cash flows from finance leases 37 35 Financing cash flows from finance leases 52 38 Total $ 2,867 $ 2,741 Right-of-use assets obtained in exchange for new lease obligations Operating leases $ 1,235 $ 1,773 Finance leases 55 23 Total $ 1,290 $ 1,796 Weighted average lease term and discount rate for real estate leases were as follows: Weighted average lease terms and discount rates: May 31, 2024 August 31, 2023 Weighted average remaining lease term in years Operating leases 9.3 9.6 Finance leases 17.7 17.4 Weighted average discount rate Operating leases 5.55 % 5.35 % Finance leases 5.18 % 5.25 % The aggregate future lease payments for operating and finance leases as of May 31, 2024 were as follows (in millions): Future lease payments (fiscal years): Finance lease Operating lease 1,2 2024 (Remaining period) $ 32 $ 915 2025 122 3,667 2026 119 3,594 2027 116 3,508 2028 95 3,374 2029 85 3,125 Later 882 12,608 Total undiscounted minimum lease payments $ 1,452 $ 30,791 Less: Present value discount 464 7,029 Lease liability $ 988 $ 23,763 1. Total undiscounted minimum lease payments include approximately $3.6 billion of payments related to optional renewal periods that have not been contractually exercised, but are reasonably certain of being exercised. 2. Total undiscounted minimum lease payments exclude sublease rental income of approximately $597 million due to the Company under non-cancelable sublease terms. |
Equity method investments
Equity method investments | 9 Months Ended |
May 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity method investments | Equity method investments Equity method investments were as follows (in millions, except percentages): May 31, 2024 August 31, 2023 Carrying value Ownership percentage Carrying value Ownership percentage Cencora $ 1,896 12% $ 2,534 16% Others 1,065 8% - 50% 963 8% - 50% Total $ 2,961 $ 3,497 Cencora investment As of May 31, 2024 and August 31, 2023, the Company owned 24.4 million and 31.8 million shares of Cencora, Inc. (“Cencora”) common stock, respectively, representing approximately 12.4% and 15.9% of its outstanding common stock based on the share count publicly reported by Cencora in its most recent filings with the SEC. During the three months ended May 31, 2024 and May 31, 2023, the Company sold shares of Cencora common stock for total consideration of approximately $400 million and $50 million, respectively. These transactions resulted in the Company recording pre-tax gains, inclusive of equity method basis difference adjustments, of $88 million and $25 million, respectively, in Other income, net within the Consolidated Condensed Statements of Earnings, including $10 million and $2 million of losses, respectively, reclassified from within Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets. During the nine months ended May 31, 2024 and May 31, 2023, the Company sold shares of Cencora common stock for total consideration of approximately $1.6 billion and $3.1 billion, respectively. These transactions resulted in the Company recording pre-tax gains, inclusive of equity method basis difference adjustments, of $847 million and $1.5 billion, respectively, in Other income, net within the Consolidated Condensed Statements of Earnings, including $39 million and $152 million of losses, respectively, reclassified from within Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets. As of May 31, 2024 and August 31, 2023, the Company has pledged 20.0 million and 17.3 million shares of Cencora common stock, respectively, as collateral upon entering into variable prepaid forward (“VPF”) transactions. See Note 8. Financial instruments for further information. The Company accounts for its equity investment in Cencora using the equity method of accounting, with the net earnings attributable to the Company’s investment being classified within the operating income of its U.S. Retail Pharmacy segment. Due to the timing and availability of financial information of Cencora, the Company accounts for this equity method investment on a financial reporting lag of two months. Equity earnings from Cencora are reported as a separate line item in the Consolidated Condensed Statements of Earnings. The Level 1 fair market value of the Company’s equity investment in Cencora common stock at May 31, 2024 and August 31, 2023 was $5.5 billion and $5.6 billion, respectively. As of May 31, 2024 the carrying value of the Company’s investment in Cencora exceeded its proportionate share of the net assets of Cencora by $1.8 billion. This premium of $1.8 billion was recognized as part of the carrying value in the Company’s equity investment in Cencora. The difference is primarily related to goodwill and the fair value of Cencora intangible assets. Other investments At May 31, 2024, the Company’s other equity method investments primarily include its U.S. investment in BrightSpring Health Services, and the Company’s investments in China in Sinopharm Medicine Holding Guoda Drugstores Co., Ltd and Nanjing Pharmaceutical Company Limited. On December 15, 2022, the Company sold its ownership interest in Guangzhou Pharmaceuticals Corporation for total consideration of approximately $150 million. On March 3, 2023, the Company sold approximately 15.5 million shares of Option Care Health common stock for total consideration of approximately $469 million. The transaction resulted in the Company recording a pre-tax gain of $154 million in Other income, net in the Consolidated Condensed Statements of Earnings. In the three months ended May 31, 2023, the Company also recognized a pre-tax gain of $76 million included in Other income, net within the Consolidated Condensed Statements of Earnings, related to the change in classification of its previously held equity method investment in Option Care Health to an investment in equity security held at fair value, and the related fair value adjustments. On June 8, 2023, the Company sold the remaining 10.8 million shares of Option Care Health for total consideration of approximately $330 million. |
Goodwill and other intangible a
Goodwill and other intangible assets | 9 Months Ended |
May 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets | Goodwill and other intangible assets Goodwill and indefinite-lived intangible assets are evaluated for impairment annually during the fourth quarter, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit or intangible asset below its carrying value. During the three months ended February 29, 2024, the Company completed a quantitative impairment analysis for goodwill related to its VillageMD reporting unit within the U.S. Healthcare segment due to downward revisions in its longer term forecast received during the quarter, including the impact of closing approximately 90 additional clinics, slower than expected trends in patient panel growth and multi-specialty productivity trends, and recent changes in Medicare reimbursement models. These impacts were partly offset by cost savings initiatives. Based on this analysis, the Company recorded a goodwill impairment charge of $12.4 billion, prior to attribution of loss to non-controlling interests, in Operating loss within the Consolidated Condensed Statements of Earnings. The impairment charge reflects lower than previously expected longer term financial performance expectations, a reduction in the multiples for publicly traded peer companies, and increases in discount rates. As of May 31, 2024, the Company believes the carrying value of the VillageMD reporting unit approximates its fair value. As part of the Company’s impairment analysis, fair value of the reporting unit was determined using both the income and market approaches. The income approach requires management to estimate a number of factors, including the projected future operating results, economic projections, anticipated future cash flows and discount rates. The market approach estimates fair value using comparable marketplace fair value data from within a comparable industry grouping as well as recent guideline transactions. The determination of the fair value of the reporting units requires the Company to make significant estimates and assumptions related to the business and financial performance of the Company’s reporting units. These estimates and assumptions primarily include, but are not limited to: the selection of appropriate peer group companies, control premiums appropriate for acquisitions in the industries in which the Company competes, discount rates, terminal growth rates, forecasts of revenue, operating income, depreciation, amortization, working capital requirements and capital expenditures. Future increases in discount rates or deterioration in the observable prices for guideline companies could result in further goodwill impairment in subsequent periods. The changes in the carrying amount of goodwill by reportable segment are as follows (in millions): Goodwill roll forward: U.S. Retail Pharmacy International U.S. Healthcare Walgreens Boots Alliance, Inc. August 31, 2023 $ 10,947 $ 1,378 $ 15,863 $ 28,187 Adjustments 1 — — 19 19 Impairments — — (12,369) (12,369) Cumulative translation adjustments and other — (8) (8) (16) May 31, 2024 $ 10,947 $ 1,370 $ 3,505 $ 15,821 1 Includes measurement period adjustments related to VillageMD's fiscal 2023 acquisitions. See Note 2. Acquisitions and other investments for further information. The Company evaluates the recoverability of definite-lived intangible assets whenever events or changes in circumstances indicate that the carrying value of such an asset may not be recoverable. The evaluation of definite-lived intangible assets is performed at the lowest level of identifiable cash flows. During the three months ended February 29, 2024, as a result of the factors leading to the interim goodwill impairment analysis performed, the Company evaluated VillageMD’s other intangible and long-lived assets for impairment. The assessment resulted in an impairment charge of $266 million recognized primarily within the U.S. Healthcare segment as a component of Selling, general, and administrative expenses within the Consolidated Condensed Statements of Earnings. As part of this impairment analysis, the fair values of asset groups and intangible assets were determined using the income approach. During the three months ended May 31, 2023, as a result of pharmacy performance and the decision to close additional stores, the Company completed a quantitative impairment analysis for certain indefinite-lived intangible assets related to the Boots reporting unit within the International segment. Based on this analysis, the Company recorded an impairment loss of $431 million in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings related to pharmacy license intangible assets. The carrying amount and accumulated amortization of intangible assets consist of the following (in millions): Intangible assets: May 31, 2024 August 31, 2023 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 4,688 $ 4,658 Provider networks 2,957 3,202 Trade names and trademarks 2,303 2,300 Developed technology 469 469 Others 114 137 Total gross amortizable intangible assets $ 10,532 $ 10,767 Accumulated amortization Customer relationships and loyalty card holders 1 $ 2,014 $ 1,784 Provider networks 362 233 Trade names and trademarks 528 401 Developed technology 201 143 Others 57 48 Total accumulated amortization 3,162 2,609 Total amortizable intangible assets, net $ 7,370 $ 8,158 Indefinite-lived intangible assets Trade names and trademarks $ 4,640 $ 4,650 Pharmacy licenses 826 828 Total indefinite-lived intangible assets $ 5,466 $ 5,477 Total intangible assets, net $ 12,836 $ 13,635 1 Includes purchased prescription files. Amortization expense for intangible assets was $238 million and $717 million for the three and nine months ended May 31, 2024, respectively, and $226 million and $583 million for the three and nine months ended May 31, 2023, respectively. Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2024 is as follows (in millions): 2024 (Remaining period) 2025 2026 2027 2028 2029 Estimated annual amortization expense $ 235 $ 915 $ 875 $ 791 $ 714 $ 657 |
Debt
Debt | 9 Months Ended |
May 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt carrying values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated debt is translated to the U.S. dollar using the spot rates as of the balance sheet date. Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2024 August 31, 2023 Short-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ 290 $ — $850 million note issuance 1 0.9500% unsecured notes due 2023 — 850 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,156 — Other 2 60 68 Total short-term debt $ 1,506 $ 917 Long-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ — $ 289 December 2022 DDTL due January 2026 999 999 August 2023 DDTL due November 2026 1,000 — August 2023 RCF due August 2026 70 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 498 4.100% unsecured notes due 2050 638 793 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,445 1,444 4.650% unsecured notes due 2046 302 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 — 1,156 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 693 869 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 381 381 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 813 814 $4 billion note issuance 3 4.400% unsecured notes due 2042 252 263 Other 2 14 20 Total long-term debt, less current portion $ 7,407 $ 8,145 1 Notes, borrowings under credit facilities and commercial paper are unsecured and unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. 2 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 Notes are senior debt obligations of Walgreen Co. $850 million Note Issuance On November 17, 2021, the Company issued, in an underwritten public offering, $850 million of 0.95% notes due 2023. The notes contained a call option which allowed for the notes to be repaid, in full or in part, at 100% of the principal amount of the notes to be redeemed, in each case plus accrued and unpaid interest. On November 17, 2023, the Company repaid the note in full. Credit facilities August 2023 Revolving Credit Agreement On August 9, 2023, the Company entered into a $2.25 billion unsecured three-year revolving credit facility (the “August 2023 Revolving Credit Agreement” or “August 2023 RCF”). Interest on borrowings under the revolving credit facility accrues at applicable margins based on the Company's Index Debt Rating by Moody’s or S&P and ranges from 75 basis points to 150 basis points over specified benchmark rates for Secured Overnight Financing Rate (“SOFR”) loans, as applicable. Additionally, the Company pays commitment fees to maintain the availability under the August 2023 Revolving Credit Agreement at applicable fee rates based upon certain criteria at an annual rate on the unutilized portion of the total credit commitment. The August 2023 Revolving Credit Agreement's termination date is August 9, 2026, or earlier, subject to the Company's discretion to terminate the agreement. As of May 31, 2024, there was $70 million in borrowings outstanding under the August 2023 Revolving Credit Agreement. August 2023 Delayed Draw Term Loan On August 9, 2023, the Company entered into a $1 billion senior unsecured delayed draw term loan credit agreement (the “August 2023 DDTL”). Interest on borrowings under the August 2023 DDTL accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or S&P and ranges from 75 basis points to 150 basis points over specified benchmark rates for SOFR loans, as applicable. The August 2023 DDTL was drawn for general corporate purposes. The August 2023 DDTL matures on November 17, 2026. As of May 31, 2024, there was $1 billion in borrowings outstanding under the August 2023 DDTL. Amounts borrowed under the August 2023 DDTL that are repaid or prepaid may not be reborrowed. December 2022 Delayed Draw Term Loan On December 19, 2022, the Company entered into a $1.0 billion senior unsecured delayed draw term loan credit agreement (the “December 2022 DDTL”). Interest on borrowings under the December 2022 DDTL accrues at applicable margins based on the Company’s Index Debt Rating by Moody’s or S&P and ranges from 87.5 basis points to 150 basis points over specified benchmark rates for SOFR loans, as applicable. The December 2022 DDTL was drawn for the purpose of funding the consideration due for the purchase of Summit and paying fees and expenses related to it. The December 2022 DDTL matures on January 3, 2026. As of May 31, 2024, there was $1 billion in borrowings outstanding under the December 2022 DDTL. Amounts borrowed under the December 2022 DDTL that are repaid or prepaid may not be reborrowed. June 2022 Revolving Credit Agreements On June 17, 2022, the Company entered into a $3.5 billion unsecured five-year revolving credit facility and a $1.5 billion unsecured 18-month revolving credit facility, with designated borrowers from time to time party thereto and lenders from time to time party thereto (the “2022 Revolving Credit Agreements”). Interest on borrowings under the revolving credit facilities accrues at applicable margins based on the Company's Index Debt Rating by S&P or Moody’s and ranges from 80 basis points to 150 basis points over specified benchmark rates for SOFR loans, as applicable. Additionally, the Company pays commitment fees to maintain the availability under the revolving credit facility at applicable fee rates based upon certain criteria at an annual rate on the unutilized portion of the total credit commitment. The five-year facility’s termination date is June 17, 2027, or earlier, subject to the Company's discretion to terminate the agreement. The 18-month facility’s termination date was December 15, 2023, or earlier, subject to the Company's discretion to terminate the agreement. On August 9, 2023 the Company terminated the 18 -month facility under the 2022 Revolving Credit Agreements. All outstanding obligations under the 18 -month revolving credit facility have been paid and satisfied in full. As of May 31, 2024 , there were no borrowings outstanding under the five-year r evolving credit facility. November 2021 Delayed Draw Term Loan On November 15, 2021, the Company entered into a $5.0 billion senior unsecured multi-tranche delayed draw term loan credit facility, (the “November 2021 DDTL”) consisting of (i) a 364-day senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the “364-day loan”), (ii) a two-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $2.0 billion (the “two-year loan”) and (iii) a three-year senior unsecured delayed draw term loan facility in an aggregate principal amount of $1.0 billion (the “three-year loan”). Borrowings under the November 2021 DDTL bear interest at a fluctuating rate per annum equal to SOFR, plus an applicable margin. The applicable margins for the 364-day and two-year loans were 0.75% and 0.88%, respectively. The applicable margin for the three-year loan is 1.05%. An aggregate amount of $3.0 billion or more of the November 2021 DDTL was drawn for the purpose of funding the purchase of the increased equity interest in VillageMD, and paying fees and expenses related to the foregoing, with the remainder used for general corporate purposes. In fiscal 2023, the Company repaid the 364-day loan and the two-year loan in full. The maturity date on the three-year loan is November 24, 2024. As of May 31, 2024, there was $290 million in borrowings outstanding under the November 2021 DDTL. Amounts borrowed under the November 2021 DDTL and repaid or prepaid may not be reborrowed. Debt covenants Each of the Company’s credit facilities described above contain a covenant to maintain, as of the last day of each fiscal quarter, a ratio of consolidated debt to total capitalization not to exceed 0.60:1.00, subject to increase in certain circumstances set forth in the applicable credit agreement. The credit facilities contain various other customary financial covenants. As of May 31, 2024, the Company was in compliance with all such applicable financial covenants. Commercial paper The Company periodically borrows under its commercial paper program and may borrow under it in future periods. As of May 31, 2024 and August 31, 2023, the Company had no borrowings outstanding under the commercial paper program. Interest Interest paid by the Company was approximately $460 million and $481 million for the nine months ended May 31, 2024 and May 31, 2023, respectively. Credit ratings The Company’s senior unsecured debt ratings were lowered to BBB- with a negative outlook by Standard and Poor’s in October 2023 and Ba2 (below investment grade) with a stable outlook by Moody’s in December 2023. The reduction in the Company's credit ratings has limited impact to the cost of interest on existing debt, but has minimally increased borrowing margins under certain credit facilities that are tied to ratings grids or similar terms. The Company's current credit ratings significantly reduce the Company's ability to issue commercial paper, may increase the cost of new financing for the Company, and may decrease access to credit and debt capital markets. As of May 31, 2024, the Company had an aggregate borrowing capacity under committed revolving credit facilities of $5.8 billion, with $70 million in funds drawn under these facilities. |
Financial instruments
Financial instruments | 9 Months Ended |
May 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial instruments | Financial instruments The Company uses derivative instruments to hedge its exposure to market risks, including interest rate and currency risks, arising from operating and financing risks. The Company has non-U.S. dollar denominated net investments and uses foreign currency denominated financial instruments, specifically foreign currency derivatives and foreign currency denominated debt, to hedge its foreign currency risk. The Company economically hedges a portion of its exposure to equity price risk related to its investment in Cencora through VPF derivative contracts. The notional amounts and fair value of derivative instruments outstanding were as follows (in millions): May 31, 2024 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Cross currency interest rate swaps $ 400 $ 8 Other current assets Foreign currency forwards 283 1 Other current assets Cross currency interest rate swaps 250 10 Other non-current assets Foreign currency forwards 4 — Other non-current assets Foreign currency forwards 614 2 Other current liabilities Foreign currency forwards 2 — Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,593 $ 1 Other current assets Total return swaps 159 1 Other current assets Foreign currency forwards 2,415 9 Other current liabilities Total return swaps 43 — Other current liabilities Variable prepaid forward contracts 408 407 Other current liabilities Variable prepaid forward contracts 3,318 3,298 Other non-current liabilities August 31, 2023 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 31 $ 1 Other current assets Cross currency interest rate swaps 650 28 Other non-current assets Foreign currency forwards 805 2 Other current liabilities Cross currency interest rate swaps 102 2 Other current liabilities Foreign currency forwards 4 — Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,139 $ 6 Other current assets Total return swaps 168 1 Other current assets Foreign currency forwards 817 2 Other current liabilities Total return swaps 26 1 Other current liabilities Variable prepaid forward contracts 3,195 2,548 Other non-current liabilities Net investment hedges The Company uses cross currency interest rate swaps and foreign currency forward contracts to hedge net investments in subsidiaries with non-U.S. dollar functional currencies. For qualifying net investment hedges, changes in the fair value of the derivatives are recorded in Cumulative translation adjustments within Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets. Cash flow hedges The Company may use foreign currency forwards and interest rate swaps to hedge the variability in forecasted transactions and cash flows of certain floating-rate debt. For qualifying cash flow hedges, changes in the fair value of the derivatives are recorded in Unrealized gain (loss) on cash flow hedges within Accumulated other comprehensive loss in the Consolidated Condensed Balance Sheets, and released to the Consolidated Condensed Statements of Earnings when the hedged cash flows affect earnings. Derivatives not designated as hedges The Company enters into derivative transactions that are not designated as accounting hedges. These derivative instruments are economic hedges of foreign currency risks and equity price risk. The Company also uses total return swaps to economically hedge variability in compensation charges related to certain deferred compensation obligations. In fiscal 2023 and fiscal 2024, the Company entered into VPF transactions with third-party financial institutions and received upfront prepayments related to the forward sale of shares of Cencora common stock. The upfront prepayments are recorded within Other non-current liabilities in the Consolidated Condensed Balance Sheets as derivatives. The Company has pledged shares of Cencora common stock as collateral upon entering into the VPF transactions. The VPF transactions provide the Company with current liquidity while allowing it to maintain voting and dividend rights in the Cencora common stock, as well as the ability to participate in future stock price appreciation during the term of the contracts up to a cap price specified in the contracts. The VPF transactions are expected to settle per their respective forward settlement dates, at which time the Company will be obligated, unless it elects to settle otherwise as described below, to deliver the full number of shares of Cencora common stock specified in the contracts to settle the agreements. The Company may receive additional cash payments to be determined based on the price of the Cencora common stock at the forward settlement dates relative to the forward floor and cap price specified in the contracts. Subject to certain conditions, the Company may elect to net settle the contract by delivery of shares (or payment of the cash value thereof) in lieu of receiving any additional cash. The aggregate number of Cencora shares to be delivered in connection with the VPF transactions will not exceed the shares subject to forward sale. The terms of the VPF transactions were as follows (in millions): Transaction date Shares pledged and maximum shares subject to forward sale Prepayment amount Forward settlement date May 11, 2023 4.6 $ 644 Fourth quarter, fiscal 2025 June 15, 2023 2.2 325 Third quarter, fiscal 2025 August 3, 2023 5.3 801 First quarter, fiscal 2026 August 4, 2023 5.3 797 Third quarter, fiscal 2026 November 9, 2023 2.7 424 Fourth quarter, fiscal 2026 20.0 $ 2,991 The income (expense) due to changes in fair value of derivative instruments were recognized in the Consolidated Condensed Statements of Earnings as follows (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2024 2023 2024 2023 Total return swaps Selling, general and administrative expenses $ 2 $ 2 19 $ 2 Foreign currency forwards Other income, net 1 (14) (112) 19 (203) Variable prepaid forward Other income, net 155 (26) (733) (26) 1. Excludes remeasurement gains and losses on economically hedged assets and liabilities. Derivatives credit risk Counterparties to derivative financial instruments expose the Company to credit-related losses in the event of counterparty nonperformance, and the Company regularly monitors the credit worthiness of each counterparty. The Company and its counterparties are subject to collateral requirements for certain derivative instruments which mitigates credit risk for both parties. Derivatives offsetting The Company does not offset the fair value amounts of derivative instruments subject to master netting agreements in the Consolidated Condensed Balance Sheets. |
Fair value measurements
Fair value measurements | 9 Months Ended |
May 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements The Company measures certain assets and liabilities in accordance with Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures, which defines fair value as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. In addition, it establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels: Level 1 - Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. Level 2 - Observable inputs other than quoted prices in active markets. Level 3 - Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to Level 3 inputs. Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): May 31, 2024 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 32 $ 32 $ — $ — Cross currency interest rate swaps 2 18 — 18 — Foreign currency forwards 3 2 — 2 — Investments in equity securities 4 13 13 — — Investments in debt securities 5 84 — 84 — Total return swaps 1 — 1 — Liabilities : Variable prepaid forward 6 $ 3,705 $ — $ — $ 3,705 Foreign currency forwards 3 11 — 11 — August 31, 2023 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 11 $ 11 $ — $ — Cross currency interest rate swaps 2 28 — 28 — Foreign currency forwards 3 6 — 6 — Investments in equity securities 4 17 17 — — Investments in debt securities 5 15 — 15 — Total return swaps 1 — 1 — Liabilities : Variable prepaid forward 6 $ 2,548 $ — $ — $ 2,548 Foreign currency forwards 3 5 — 5 — Total return swaps 1 — 1 — Cross currency interest rate swaps 2 2 — 2 — 1 Money market funds are valued at the closing price reported by the fund sponsor and classified as Cash and cash equivalents within the Consolidated Condensed Balance Sheets. 2 The fair value of cross currency interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See Note 8. Financial instruments, for additional information. 3 The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates. See Note 8. Financial instruments, for additional information. 4 Fair values of quoted investments are based on current bid prices as of May 31, 2024 and August 31, 2023. 5 Includes investments in Treasury debt securities. 6 The fair value of the derivative was derived from a Black-Scholes valuation. The inputs used in valuing the derivative included observable inputs such as the floor and cap prices of the VPF, dividend yield of Cencora shares, risk free interest rate, and contractual term of the instrument, as well as unobservable inputs such as implied volatility of Cencora shares. The implied volatility ranged from 24.7% - 29.0% for the lower strike and 19.4% - 22.2% for the upper strike as of May 31, 2024, and 23.2% - 24.7% for the lower strike and 18.1% - 19.1% for the upper strike as of August 31, 2023. There were no transfers between Levels for the three and nine months ended May 31, 2024. The roll forward of the fair value of the VPF derivatives associated with the forward sale of shares of Cencora common stock, classified as Level 3, is as follows (in millions): Three months ended Nine months ended May 31, 2024 May 31, 2024 Opening balance $ (3,861) $ (2,548) VPF derivative additions — (424) Unrealized gains (losses) recorded in Other income, net 155 (733) Ending balance $ (3,705) $ (3,705) The Company reports its debt instruments under the guidance of ASC Topic 825, Financial Instruments, which requires disclosure of the fair value of the Company’s debt in the footnotes to the Consolidated Condensed Financial Statements. As of May 31, 2024 the carrying amounts and estimated fair values of long term notes outstanding including the current portion were $6.5 billion and $5.9 billion, respectively. The fair values of the notes outstanding are Level 1 fair value measures and determined based on quoted market price and translated at the May 31, 2024 rate, as applicable. The fair values and carrying values of these issuances do not include notes that have been redeemed or repaid as of May 31, 2024. The carrying value of the Company's commercial paper, credit facilities, accounts receivable and trade accounts payable approximated their respective fair values due to their short-term nature. |
Commitments and contingencies
Commitments and contingencies | 9 Months Ended |
May 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and contingencies | Commitments and contingencies The Company is involved in legal proceedings arising in the normal course of its business, including litigation, arbitration and other claims, and investigations, inspections, subpoenas, audits, claims, inquiries and similar actions by governmental authorities in pharmacy, healthcare, tax and other areas. Some of these proceedings may be class actions, and some involve claims for large or indeterminate amounts, including punitive or exemplary damages, and they may remain unresolved for several years. Legal proceedings in general, and securities, class action and multi-district litigation, in particular, can be expensive and disruptive. From time to time, the Company is also involved in legal proceedings as a plaintiff involving antitrust, tax, contract, intellectual property and other matters. Gain contingencies, if any, are recognized when they are realized. The Company has been involved or is currently involved in numerous legal proceedings, including litigation, arbitration, government investigations, audits, reviews and claims. These include routine, regular and special investigations, audits and reviews by CMS, state insurance and health and welfare departments, the U.S. Department of Justice (the “DOJ”), state Attorneys General, the U.S. Drug Enforcement Administration (the “DEA”), the U.S. Federal Trade Commission (the “FTC”) and other governmental authorities . The Company is subject to extensive regulation by national, state and local government agencies in the U.S. and other countries in which it operates. The Company’s business, compliance and reporting practices are subject to intensive scrutiny under applicable regulation, including review or audit by regulatory authorities. As a result, the Company regularly is the subject of government actions of the types described herein. The Company also may be named from time to time in qui tam actions initiated by private parties. In such an action, a private party purports to act on behalf of federal or state governments, alleges that false claims have been submitted for payment by the government and may receive an award if its claims are successful. After a private party has filed a qui tam action, the government must investigate the private party's claim and determine whether to intervene in and take control over the litigation. These actions may remain under seal while the government makes this determination. If the government declines to intervene, the private party may nonetheless continue to pursue the litigation on its own purporting to act on behalf of the government. The results of legal proceedings, including government investigations, are often uncertain and difficult to predict, and the costs incurred in these matters can be substantial, regardless of the outcome. In addition, as a result of governmental investigations or proceedings, the Company may be subject to damages, civil or criminal fines or penalties, or other sanctions, including the possible suspension or loss of licensure and suspension or exclusion from participation in government programs. The Company describes below certain proceedings involving the Company in which the amount of loss could be material or the nature of the dispute is qualitatively material. The Company accrues for legal claims when, and to the extent that, the amount or range of probable loss can be reasonably estimated. If only a range of probable loss can be determined, and no one estimate within that range is a better or more probable estimate than any other estimate, we accrue the low end of the range. The Company believes there are meritorious defenses with respect to the claims asserted against it, and it intends to defend each of these cases vigorously, but there can be no assurance as to the ultimate outcome. With respect to litigation and other legal proceedings where the Company has determined a material loss is reasonably possible, except as otherwise disclosed, the Company is not able to make a reasonable estimate of the amount or range of loss that is reasonably possible above any accrued amounts in these proceedings, due to various reasons, including: the existence of factual and legal arguments that, if successful, will eliminate or sharply reduce the possibility of loss; lack of sufficient information about the arguments and the evidence plaintiffs will advance with respect to their damages; some of the cases have been stayed; certain proceedings present novel and complex questions of public policy; legal and factual determinations and judicial and governmental procedure; the large number of parties involved; and the inherent uncertainties related to such legal proceedings. Securities Claims Relating to Rite-Aid Merger On December 11, 2017, purported Rite-Aid shareholders filed an amended complaint in a putative class action lawsuit in the U.S. District Court for the Middle District of Pennsylvania (the “M.D. Pa. class action”) arising out of transactions contemplated by the merger agreement between the Company and Rite-Aid. The amended complaint alleges that the Company and certain of its officers made false or misleading statements regarding the transactions. The plaintiffs sought monetary damages for the foregoing alleged claims. Fact and expert discovery have concluded. The Court denied both plaintiffs’ partial motion for summary judgement and the Company’s motion for summary judgment on March 31, 2023. On August 23, 2023, the Company, the other defendants in the M.D. Pa. class action, and the lead plaintiffs entered into a binding agreement to settle all claims in the M.D. Pa. class action. The settlement of approximately $193 million provides for the dismissal of the M.D. Pa. class action with prejudice. Defendants admitted no liability and denied all allegations of wrongdoing. The court granted preliminary approval of the settlement on October 23, 2023 and final approval on February 7, 2024. This settlement is fully paid. In October and December 2020, two separate purported Rite-Aid shareholders filed actions in the same court opting out of the class in the M.D. Pa. class action and making nearly identical allegations and demands for relief as those in the M.D. Pa. class action (the “Opt-out Actions”). On March 5, 2024 the parties reached an agreement to resolve this litigation. The Court has prohibited further opt-out litigation with respect to the M.D. Pa. class action. On March 19, 2021, a putative shareholder filed a derivative suit in the District Court of Delaware ( Clem v. Skinner, et al. , 21-CV-406 Del Dist. Ct.) against certain current and former Walgreens directors and officers, seeking damages based on alleged breaches of fiduciary duty and seeking contribution under Section 21D of the Exchange Act of 1934, as amended, in connection with the M.D. Pa. class action. The plaintiff's allegations in this derivative suit concern the same public statements at issue in the M.D. Pa. class action. The parties have reached an agreement in principle to resolve this matter. Claims Relating to Opioid Abuse On May 5, 2022, the Company announced that it had entered into a settlement agreement with the State of Florida to resolve all claims related to the distribution and dispensing of prescription opioid medications across the Company’s pharmacies in the State of Florida. This settlement agreement was not an admission of liability or wrong-doing and resolved all pending and future opioid litigation by state and government subdivisions in the State of Florida. The settlement amount of $683 million includes $620 million in remediation payments, which will be paid to the State of Florida in equal installments over 18 years, and will be applied as opioid remediation, as well as a one-time payment of $63 million for attorneys’ fees. In fiscal 2022, the Company recorded a $683 million liability associated with this settlement. On November 2, 2022, the Company announced that it had agreed to financial amounts and payment terms as part of settlement frameworks (the “Settlement Frameworks”) that had the potential to resolve a substantial majority of opioid-related lawsuits filed against the Company by the attorneys general of participating states and political subdivisions (the “Settling States”) and litigation brought by counsel for tribes. Under the Settlement Frameworks with the Settling States and counsel for tribes, the Company announced that it expected to settle all opioid claims against it by such Settling States, their participating political subdivisions, and participating tribes for up to approximately $4.8 billion and $155 million, respectively in remediation payments to be paid out over 15 years. The Settlement Frameworks provided for the payment of up to approximately $754 million in attorneys’ fees and costs over six years beginning in year two of the Settlement Frameworks. The Settlement Frameworks included no admission of wrongdoing or liability by the Company. As of November 30, 2022, the Company concluded that Settlement Frameworks discussions had advanced to a stage where a broad settlement of opioid claims by Settling States was probable, and for which the related loss was reasonably estimable. As a result of those conclusions and the Company’s ongoing assessment of other opioid-related claims, the Company recorded a $6.5 billion liability associated with the Settlement Frameworks and other opioid-related claims and litigation settlements during the three months ended November 30, 2022. The settlement accrual was reflected in the Consolidated Condensed Statements of Earnings within Selling, general and administrative expenses as part of the U.S. Retail Pharmacy segment. On December 9, 2022, the Company committed the Settlement Frameworks to a proposed settlement agreement (the “Proposed Settlement Agreement”) that was contingent on (1) a sufficient number of Settling States, including those that had not sued, agreeing to the Proposed Settlement Agreement following a sign-on period, and (2) following a notice period, a sufficient number of political subdivisions within Settling States, including those that had not sued, agreeing to the Proposed Settlement Agreement (or otherwise having their claims foreclosed). On June 8, 2023 the Company informed the Settling States that there was sufficient State participation, sufficient Subdivision participation, and sufficient resolution of the claims of Litigating Subdivisions in the Settling States to proceed with the multistate settlement. The Company has now resolved its litigation with all states, territories, tribes and 99.5% of litigating subdivisions within Settling States included in the Proposed Settlement or in separate agreements. Estimated liabilities for these settlements are fully accrued. Incentive payments to Settling States with non-participating political subdivisions are subject to reduction and those subdivisions are still entitled to pursue their claims against the Company. The Proposed Settlement Agreement became effective on August 7, 2023 (the “Multistate Settlement Agreement”). The Company will continue to vigorously defend against any litigation not covered by the Multistate Settlement Agreement, including private plaintiff litigation. The Company continues to believe it has strong legal defenses and appellate arguments in all of these cases. As of May 31, 2024, the Company has accrued a total of $6.6 billion liability associated with the Multistate Settlement Agreement and other opioid-related claims and litigation settlements, including $744 million and $5.9 billion of the estimated settlement liability in Accrued expenses and other liabilities, and Accrued litigation obligations, respectively, in the Consolidated Condensed Balance Sheets. The Company remains a defendant in multiple actions in federal courts alleging claims generally concerning the impacts of widespread opioid abuse, which have been commenced by various plaintiffs. In December 2017, the U.S. Judicial Panel on Multidistrict Litigation consolidated many of these cases in a consolidated multidistrict litigation, captioned In re National Prescription Opiate Litigation (MDL No. 2804, Case No. 17-MD-2804), which is pending in the U.S. District Court for the Northern District of Ohio (“N.D. Ohio”). The Company is a defendant in the following multidistrict litigation bellwether cases: • Two consolidated cases in N.D. Ohio ( Cnty. of Lake, Ohio v. Purdue Pharma L.P., et al. , Case No. 18-op-45032 ; Cnty. of Trumbull, Ohio v. Purdue Pharma L.P., et al ., Case No. 18-op-45079). In November 2021, the jury returned a verdict in favor of the plaintiffs as to liability, and a second trial regarding remedies took place in May 2022. In August 2022, the court entered orders providing for injunctive relief and requiring the defendants to pay $651 million over a 15-year period to fund abatement programs. The court found that the damages are subject to joint and several liability and as such made no determination as to apportionment. These decisions are currently on appeal. • Louisiana Assessors Ins. Fund v. AmerisourceBergen Drug Corp., et al ., 1:18-op-46223 (M.D. La.). • Pioneer Tele, Coop. Inc. Employee Benefits Plan v. Purdue Pharma LP et al ., 1:18-op-46186 (W.D. Okla.). • United Food and Comm. Workers Health and Welfare Fund of Northeastern Pennsylvania v. Purdue Pharma, LP et al. , 1:17-op-45117 (E.D. Pa.). • Sheet Metal Workers Local No. 25 Health & Welfare Fund v. Purdue Pharma, LP et al ., 1:18-op-45002 (E.D. Pa.). The Company also has been named as a defendant in multiple actions brought in state courts relating to opioid matters. Trial dates have been set in cases pending in state courts in the following states: • Maryland ( Mayor and City Council of Baltimore v. Purdue Pharma L.P., et al ., Case No. 24-C-18-000515, Circuit Court for Baltimore City, Baltimore, Maryland - September 2024). • Florida ( Florida Health Sciences Center, Inc., et al. v. Richard Sackler, et al ., Case No. CACE 19-018882, Seventeenth Judicial Circuit Court, Broward County, Florida - September 2025). The relief sought by various plaintiffs in these matters includes compensatory, abatement, restitution and punitive damages, as well as injunctive relief. Additionally, the Company has received from the U.S. Department of Justice (“DOJ”) and the Attorneys General of numerous states subpoenas, civil investigative demands, and other requests concerning opioid-related matters. The Company continues to communicate with the DOJ regarding purported violations of the federal Controlled Substances Act and the federal False Claims Act in dispensing prescriptions for opioids and other controlled substances at its pharmacies nationwide. On September 23, 2022, a putative shareholder filed a derivative suit in the United States District Court for the Northern District of Ohio ( Vladimir Gusinsky Revocable Trust v. Pessina et al ., 22-CV-1717) against certain current and former Walgreens directors and officers, seeking damages based on alleged breaches of fiduciary duty, unjust enrichment and violations of section 14A of the Securities and Exchange Act of 1934 in connection with the oversight of risks related to opioids. A motion to dismiss for improper venue was filed on December 12, 2022. That motion was granted on September 22, 2023, and the case was dismissed without prejudice. The case was refiled on November 4, 2023, in the United States District Court for the Northern District of Illinois ( Vladimir Gusinsky Revocable Trust v. Pessina et al ., 23-CV-15654). On November 14, 2023, the case was stayed to permit the parties to explore the possibility of settlement. The court granted preliminary approval of the settlement on April 17, 2024 and final approval on June 18, 2024. The settlement includes a net $28 million payment to the Company from insurers and certain corporate governance changes. Defendants admitted no liability and denied all allegations of wrongdoing. Usual and Customary Pricing Litigation The Company is defending a number of claims, lawsuits and investigations that allege that the Company’s retail pharmacies overcharged for prescription drugs by not submitting the correct usual and customary price during the claims adjudication process. The Company has accrued a total liability of $310 million for all usual and customary pricing litigation in Accrued expenses and other liabilities within the Consolidated Condensed Balance Sheets. In one such case, Humana initiated an arbitration before the American Arbitration Association on August 13, 2019, seeking monetary damages on the basis of the aforementioned allegation. At the conclusion of that matter, the arbitrator issued an award in Humana’s favor in the amount of $642 million. The Company asked a federal court to vacate that award. On December 29, 2023, the parties reached an agreement to resolve the Humana dispute for $360 million. On March 23, 2017, a putative class of employee and union benefit funds and individual insureds filed suit in the United States District Court for the Northern District of Illinois ( Russo et al. v. Walgreen Co. et al. , Case No. 1:17-cv-02246) making similar allegations and seeking monetary damages. The plaintiffs’ motion for class certification is fully briefed but stayed pending the outcome of settlement discussions. Additionally, a group of Blue Cross Blue Shield-affiliated plans filed suit in federal and state courts in Illinois making similar allegations and seeking similar damages ( BCBSM, Inc. et al v. Walgreen Co. et al. , Case 1:20-cv-01853; Healthcare Service Corp. v. Walgreen Co., et al. , Case No. 2021 L 000621). Derivative Suit Relating to Insulin Pens On March 19, 2021, a putative shareholder filed a derivative suit in the Delaware Court of Chancery ( Clem v. Skinner et al ., 2021-0240) against certain current and former Walgreens directors and officers, seeking damages based on alleged breaches of fiduciary duty and unjust enrichment in connection with certain allegedly false reimbursement claims to government healthcare payors related to insulin pens. On October 8, 2021, an amended complaint was filed. On December 17, 2021, the defendants moved to dismiss that amended complaint. On February 20, 2024 the matter was dismissed with prejudice. On March 20, 2024 plaintiff filed a notice of appeal. On May 7, 2024 plaintiff withdrew his appeal. Commercial Arbitration Award On June 10, 2022, Everly Health Solutions, formerly known as PWNHealth LLC (“Everly/PWN”), initiated an arbitration with the American Arbitration Association alleging that an agreement between Everly/PWN and the Company was exclusive, and that the Company breached the agreement when it in-sourced certain enabling services previously performed by Everly/PWN related to the ordering and oversight of Covid testing. Everly/PWN also alleged fraudulent inducement, misappropriation, and improper use of PWN’s mark. Everly/PWN sought monetary damages for its alleged claims. |
Income taxes
Income taxes | 9 Months Ended |
May 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes The effective tax rate for the three months ended May 31, 2024 was an expense of 8.0% primarily due to tax benefits related to valuation allowance releases in foreign jurisdictions. The effective tax rate for the three months ended May 31, 2023 was a benefit of 86.3%, primarily due to tax benefits from changes to deferred taxes as a result of internal legal entity restructuring related to previous business acquisitions, and additional tax benefits claimed upon filing the Company's prior year tax returns. The effective tax rate for the nine months ended May 31, 2024 was a benefit of 6.3% due to the impact of the goodwill impairment, which is primarily not deductible for tax purposes, and U.S tax on non-U.S. earnings, partially offset by tax benefits related to the initial recognition of tax basis in assets in foreign jurisdictions, net of valuation allowance. The effective tax rate for the nine months ended May 31, 2023 was a benefit of 33.8%, primarily due to tax benefits on the reduction in the valuation allowance previously recorded against deferred tax assets related to capital loss carryforwards. The reduction was primarily due to capital loss carryforwards utilized against capital gains recognized on the sale of shares in Cencora and based on forecasted capital gains. This benefit was partially offset by the impact of certain nondeductible opioid-related claims recorded in the nine months ended May 31, 2023. Income taxes paid for the nine months ended May 31, 2024 and May 31, 2023 were $238 million and $170 million, respectively. The Company is subject to income taxes and tax audits in many jurisdictions and is regularly audited by the Internal Revenue Service (the “IRS”). During the three months ended February 29, 2024, the IRS issued the Company a Revenue Agent’s Report (the “RAR”) for tax years 2014 through 2017. The Company disagrees with the RAR and has appealed certain issues. The primary disputed issue relates to the valuation of the call option exercised to acquire Alliance Boots GmbH (“Alliance Boots”), described in more detail below. On August 2, 2012, the Company acquired a 45% equity interest in Alliance Boots along with a call option to acquire the remaining 55% equity interest in Alliance Boots, initially valued at $866 million. During the fiscal year ended August 31, 2014 (“fiscal 2014”), the Company entered into an amendment to the Purchase and Option Agreement which accelerated the option period. Upon the amendment, the Company was required to fair value the amended option, which was estimated to be zero as a result of the option being out of the money at that time. As a result, the Company recognized a non-cash loss on the exercise of the call option of $866 million in its fiscal 2014 financial statements. Subsequently, the rights and obligations from the exercised option were transferred to a foreign subsidiary of the Company during the fiscal year ended August 31, 2015 as part of the Company's reorganization in connection with the acquisition of the remaining 55% equity interest in Alliance Boots. As the fair value of the transferred rights and obligations from the exercised option was estimated to be zero at the time, no income was recognized for U.S. tax purposes. The IRS disagrees with the Company’s conclusion and is seeking an additional tax of $2.7 billion plus penalties and interest. The Company intends to vigorously defend its position on the transfer pricing matter through the IRS’s administrative appeals office and, if necessary, judicial proceedings and is confident in its ability to prevail on the merits. As of May 31, 2024, we believe our reserves for uncertain tax positions are appropriate based on the technical merits of the Company’s tax positions. However, the ultimate outcome of a settlement or litigation is uncertain and final resolution of these matters may have a material adverse impact on the Company’s consolidated financial statements. We do not expect a final resolution of these matters in the next 12 months. Based on the information currently available, we do not anticipate a significant increase or decrease to our tax contingencies for these issues within the next 12 months. |
Retirement benefits
Retirement benefits | 9 Months Ended |
May 31, 2024 | |
Retirement Benefits [Abstract] | |
Retirement benefits | Retirement benefits The Company sponsors several retirement plans, including defined benefit plans, defined contribution plans and a post-retirement health plan. Defined benefit pension plans (non-U.S. plans) The Company has various defined benefit pension plans outside the U.S. The principal defined benefit pension plan is the Boots Pension Plan (the “Boots Plan”), which covers certain employees in the UK. The Boots Plan is a funded final salary defined benefit plan providing pensions and death benefits to members. The Boots Plan was closed to future accrual effective July 1, 2010, with pensions calculated based on salaries up until that date. The Boots Plan is governed by a trustee board, which is independent of the Company. The plan is subject to a full funding actuarial valuation on a triennial basis. Boots Plan Annuitization On November 23, 2023, with financial support from the Company, Boots Pensions Limited (“Trustee”), in its capacity as trustee of the Boots Plan, entered into a Bulk Purchase Annuity Agreement (“BPA”) with Legal & General Assurance Society Limited (“Legal & General”) to insure the benefits of all 53,000 of its members. Under the BPA, the Trustee acquired a bulk annuity policy (the “Buy-In”) from Legal & General which will fund ongoing and future pension benefit payments to the Boots Plan members. The BPA is being funded through the existing Boots Plan assets, as well as incremental pre-tax contributions by the Company to the Boots Plan. The Company will accelerate approximately $210 million of already committed contributions to the Boots Plan, to be paid over the next two years. Additionally, the Company has committed to make an incremental contribution to the Boots Plan, which is expected to be approximately $760 million to $820 million, of which approximately $375 million was paid on December 7, 2023 and the remaining amount is expected to be paid within the next two years. In conjunction with the Buy-In, the Boots Plan was amended resulting in an interim remeasurement of the Boots Plan. The remeasurement resulted in an increase in the funded status of the Boots Plan of $124 million. The change resulting from the remeasurement was recorded in Accumulated other comprehensive loss within the Consolidated Condensed Balance Sheets. The BPA allows for the future potential conversion of the BPA into a buy-out where Legal & General would assume full responsibility to directly provide pensions or other benefits to the Boots Plan members, at which time the Boots Plan can be terminated. Components of net periodic pension income for the defined benefit pension plans (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2024 2023 2024 2023 Service costs Selling, general and administrative expenses $ 1 $ 1 $ 3 $ 3 Interest costs Other income, net 68 64 202 186 Expected returns on plan assets/other Other income, net (70) (81) (206) (237) Total net periodic pension income $ (1) $ (17) $ (1) $ (48) Defined contribution plans The principal retirement plan for U.S. employees is the Walgreen Profit-Sharing Retirement Trust, to which both the Company and participating employees contribute. The Company’s contribution is in the form of a guaranteed match which is made pursuant to the applicable plan document approved by the Walgreen Co. Board of Directors. Plan activity is reviewed periodically by certain Committees of the Walgreens Boots Alliance Board of Directors. The profit-sharing provision is an expense of $55 million and $166 million for the three and nine months ended May 31, 2024, respectively, and an expense of $59 million and $184 million for the three and nine months ended May 31, 2023, respectively. The Company also has certain contract based defined contribution arrangements. The principal one is in the UK in which both the Company and participating employees contribute. The cost recognized in the Consolidated Condensed Statements of Earnings was $23 million and $68 million for the three and nine months ended May 31, 2024, respectively, and $21 million and $62 million for the three and nine months ended May 31, 2023, respectively. |
Accumulated other comprehensive
Accumulated other comprehensive loss | 9 Months Ended |
May 31, 2024 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive loss | Accumulated other comprehensive loss The following is a summary of net changes in accumulated other comprehensive income (loss) (“AOCI”) by component and net of tax for the three and nine months ended May 31, 2024 and May 31, 2023 (in millions): Pension/ post-retirement obligations Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 29, 2024 $ (608) $ 85 $ (100) $ (2,274) $ (2,897) Other comprehensive (loss) income before reclassification adjustments (3) (13) (16) 20 (13) Amounts reclassified from AOCI (3) 3 10 — 10 Tax benefit (provision) 2 3 2 — 6 Net change in other comprehensive (loss) income (5) (8) (4) 20 3 Balance at May 31, 2024 $ (613) $ 77 $ (104) $ (2,254) $ (2,894) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2023 $ (698) $ (6) $ 83 $ (132) $ (2,240) $ (2,993) Other comprehensive income (loss) before reclassification adjustments 124 — (6) (3) (11) 104 Amounts reclassified from AOCI (10) 5 (1) 39 (3) 30 Tax (provision) benefit (30) — 2 (6) — (34) Net change in other comprehensive income (loss) 85 5 (6) 29 (14) 100 Balance at May 31, 2024 $ (613) $ — $ 77 $ (104) $ (2,254) $ (2,894) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 28, 2023 $ (167) $ (5) $ 140 $ (162) $ (2,461) $ (2,654) Other comprehensive (loss) income before reclassification adjustments — (2) (42) 16 143 115 Amounts reclassified from AOCI (7) 1 — (1) (2) (9) Tax benefit (provision) 2 — 10 (4) — 9 Net change in other comprehensive (loss) income (5) (1) (31) 12 141 115 Balance at May 31, 2023 $ (171) $ (6) $ 108 $ (150) $ (2,320) $ (2,539) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2022 $ (157) $ (2) $ 213 $ (254) $ (2,605) $ (2,805) Other comprehensive (loss) income before reclassification adjustments — (6) (138) (8) 301 149 Amounts reclassified from AOCI (20) 2 — 149 (16) 115 Tax benefit (provision) 5 1 33 (37) — 2 Net change in other comprehensive (loss) income (15) (4) (104) 104 285 266 Balance at May 31, 2023 $ (171) $ (6) $ 108 $ (150) $ (2,320) $ (2,539) |
Segment reporting
Segment reporting | 9 Months Ended |
May 31, 2024 | |
Segment Reporting [Abstract] | |
Segment reporting | Segment reporting The Company is aligned into three reportable segments: U.S. Retail Pharmacy, International and U.S. Healthcare. The operating segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the “chief operating decision maker”) to assess segment performance and allocate resources among the Company’s operating segments. The chief operating decision maker uses adjusted operating income to assess segment profitability. The chief operating decision maker does not use total assets by segment to make decisions regarding resources; therefore, the total asset disclosure by segment has not been included. U.S. Retail Pharmacy The Company's U.S. Retail Pharmacy segment includes the Walgreens business, which is comprised of the operations of retail drugstores, health and wellness services, specialty and home delivery pharmacy services, and its equity method investment in Cencora. Sales for the segment are principally derived from the sale of prescription drugs and a wide assortment of retail products, including health and wellness, beauty, personal care and consumables and general merchandise. International The Company's International segment consists of pharmacy-led health and beauty retail businesses outside the U.S. and a pharmaceutical wholesaling and distribution business in Germany. Pharmacy-led health and beauty retail businesses include Boots branded stores in the UK, the Republic of Ireland and Thailand, and the Benavides brand in Mexico. In the three months ended November 30, 2023, the Company completed the sale of the Farmacias Ahumada business in Chile. Sales for these businesses are principally derived from the sale of prescription drugs and health and wellness, beauty, personal care and other consumer products. U.S. Healthcare The Company’s U.S. Healthcare segment is a consumer-centric, technology-enabled healthcare business that engages consumers through a personalized, omni-channel experience across the care journey. The U.S. Healthcare segment delivers improved health outcomes and lower costs for payors and providers by delivering care through owned and partnered assets. The U.S. Healthcare segment currently consists of a majority position in VillageMD, a national provider of value-based care with primary, multi-specialty, and urgent care providers serving patients in traditional clinic settings, in patients' homes and online appointments; Shields, a specialty pharmacy integrator and accelerator for hospitals; CareCentrix, a participant in the post-acute and home care management sectors, and the Walgreens Health organic business that contracts with payors and providers to deliver clinical healthcare services to their members and members’ caregivers through both digital and physical channels. The results of operations for reportable segments include procurement benefits. Corporate-related overhead costs are not allocated to reportable segments and are reported in “Corporate and Other”. The following table reflects results of operations of the Company’s reportable segments (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Sales: U.S. Retail Pharmacy $ 28,503 $ 27,866 $ 86,308 $ 82,648 International 5,727 5,573 17,581 16,414 U.S. Healthcare 2,125 1,975 6,232 4,597 Corporate and Other 1 (3) — (9) — Walgreens Boots Alliance, Inc. $ 36,351 $ 35,415 $ 110,111 $ 103,659 Adjusted operating income: U.S. Retail Pharmacy $ 501 $ 962 $ 1,947 $ 3,134 International 175 208 562 676 U.S. Healthcare (22) (172) (151) (483) Corporate and Other 1 (42) (39) (158) (139) Walgreens Boots Alliance, Inc. $ 613 $ 959 $ 2,200 $ 3,188 1. Includes certain eliminations. The following table reconciles adjusted operating income to operating income (loss) (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Adjusted operating income (Non-GAAP measure) $ 613 $ 959 $ 2,200 $ 3,188 Acquisition-related amortization (266) (274) (811) (851) Transformational cost management (95) (414) (401) (697) Acquisition-related costs (68) (70) (480) (257) Adjustments to equity earnings in Cencora (57) (61) (129) (178) Certain legal and regulatory accruals and settlements (52) (268) (376) (7,249) LIFO provision 36 (51) (11) (89) Impairment of goodwill, intangibles and long-lived assets — (299) (13,091) (299) Operating income (loss) (GAAP measure) $ 111 $ (477) $ (13,099) $ (6,431) |
Sales
Sales | 9 Months Ended |
May 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Sales | Sales The following table summarizes the Company’s sales by segment and by major source (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 U.S. Retail Pharmacy Pharmacy $ 21,812 $ 20,898 $ 65,704 $ 60,991 Retail 6,691 6,968 20,604 21,657 Total 28,503 27,866 86,308 82,648 International Pharmacy 874 924 2,698 2,690 Retail 1,839 1,769 5,928 5,412 Wholesale 3,014 2,880 8,955 8,311 Total 5,727 5,573 17,581 16,414 U.S. Healthcare 2,125 1,975 6,232 4,597 Corporate and Other 1 (3) — (9) — Walgreens Boots Alliance, Inc. $ 36,351 $ 35,415 $ 110,111 $ 103,659 1. Includes certain eliminations. See Note 18. Supplemental information for further information on receivables from contracts with customers. |
Related parties
Related parties | 9 Months Ended |
May 31, 2024 | |
Related Party Transactions [Abstract] | |
Related parties | Related parties The Company has a long-term pharmaceutical distribution agreement with Cencora pursuant to which the Company sources branded and generic pharmaceutical products from Cencora. Additionally, Cencora receives sourcing services for generic pharmaceutical products. Related party transactions with Cencora (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Purchases, net $ 18,181 $ 16,573 $ 54,296 $ 47,772 May 31, 2024 August 31, 2023 Trade accounts payable, net of receivables $ 8,756 $ 7,814 |
New accounting pronouncements
New accounting pronouncements | 9 Months Ended |
May 31, 2024 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New accounting pronouncements | Accounting policies Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. and its subsidiaries (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest and certain variable interest entities (“VIEs”) for which the Company is the primary beneficiary. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2023, as amended by Form 10-K/A for the fiscal year ended August 31, 2023 filed on November 22, 2023. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. Adverse global macroeconomic conditions, the impact of opioid-related claims and litigation settlements, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payor and customer relationships and terms, strategic transactions including acquisitions and dispositions, asset impairments, changes in laws and regulations in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. Certain amounts in the Consolidated Condensed Financial Statements and accompanying notes may not sum due to rounding. Percentages have been calculated using unrounded amounts for all periods presented. Certain prior period data has been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. Adoption of new accounting pronouncements Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for business combinations completed in fiscal years beginning after December 15, 2022 (fiscal 2024). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's results of operations, cash flows, or financial position. Liabilities — Supplier Finance Programs In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Topic 405-50) - Disclosure of Supplier Finance Program Obligations. This ASU requires that a buyer in a supplier finance program disclose sufficient information about the program to allow a user of financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. This ASU is expected to improve financial reporting by requiring new disclosures about the programs, thereby allowing financial statement users to better consider the effect of the programs on an entity’s working capital, liquidity, and cash flows. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal 2024), except for the amendment on roll forward information which is effective for fiscal years beginning after December 15, 2023 (fiscal 2025). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's disclosures within these Consolidated Condensed Financial Statements. New accounting pronouncements not yet adopted Leases — Common Control Arrangements In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements. The ASU amends the accounting for leasehold improvements in common control arrangements by requiring a lessee in a common control lease arrangement to amortize leasehold improvements that it owns over the improvements’ useful life to the common control group, regardless of the lease term, if the lessee continues to control the use of the underlying asset through a lease. Further, a lessee that no longer controls the use of the underlying asset will derecognize the remaining carrying amount of the improvements through an adjustment to equity, reflecting the transfer of the asset to the lessor under common control. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025), including interim periods within those fiscal years. Early adoption is permitted in any annual or interim period as of the beginning of the related fiscal year. The Company is evaluating the effect of adopting this new accounting guidance. Segment Reporting - Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures. This ASU is expected to improve disclosures related to an entity’s reportable segments and provide additional, more detailed information about a reportable segment’s expenses. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025) and interim periods within fiscal years beginning after December 15, 2024 (fiscal 2026). The amendments in this ASU must be applied on a retrospective basis to all prior periods presented in the financial statements and early adoption is permitted. The Company is currently evaluating the effect of adopting this new accounting guidance. Improvements to Income Tax Disclosures |
Supplemental information
Supplemental information | 9 Months Ended |
May 31, 2024 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental information | Supplemental information Accounts receivable Accounts receivable are stated net of allowances for doubtful accounts. Accounts receivable balances primarily consist of trade receivables due from customers, including amounts due from third party payors (e.g., pharmacy benefit managers, insurance companies and governmental agencies). Trade receivables were $4.8 billion and $4.3 billion at May 31, 2024 and August 31, 2023, respectively. Other accounts receivable balances, which consist primarily of receivables from vendors and manufacturers, including receivables from Cencora, were $1.2 billion and $1.1 billion at May 31, 2024 and August 31, 2023, respectively. See Note 16. Related parties for further information. Depreciation and amortization The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Depreciation expense $ 369 $ 372 $ 1,120 $ 1,068 Intangible assets amortization 238 226 717 583 Total depreciation and amortization expense $ 607 $ 598 $ 1,837 $ 1,652 Accumulated depreciation and amortization on property, plant and equipment was $13.5 billion and $13.0 billion as at May 31, 2024 and August 31, 2023, respectively. Restricted cash The Company is required to maintain cash deposits with certain banks which consist of deposits restricted under contractual agency agreements and cash restricted by law and other obligations. The following represents a reconciliation of Cash and cash equivalents in the Consolidated Condensed Balance Sheets to total Cash, cash equivalents and restricted cash in the Consolidated Condensed Statements of Cash Flows as of May 31, 2024 and August 31, 2023, respectively (in millions): May 31, 2024 August 31, 2023 Cash and cash equivalents $ 703 $ 739 Cash and cash equivalents - assets held for sale (included in other current assets) — 24 Restricted cash - (included in other current and non-current assets) 37 93 Cash, cash equivalents and restricted cash $ 740 $ 856 Redeemable non-controlling interests The following represents a roll forward of the redeemable non-controlling interests in the Consolidated Condensed Balance Sheets (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Opening balance $ 172 $ 158 $ 167 $ 1,042 Net (loss) income attributable to Redeemable non-controlling interests (1) — 1 (24) Redemption price adjustments and other 1 1 2 5 456 Reclassifications to Accrued expenses and other liabilities 2 — — — (1,314) Ending balance $ 173 $ 160 $ 173 $ 160 1. Remeasurement of non-controlling interests, probable of redemption but not currently redeemable, to their redemption value, is recorded in Paid in capital within the Consolidated Condensed Balance Sheets. During the three months ended November 30, 2022, Shields and CareCentrix redeemable non-controlling interests were recorded to redemption value as the Company announced the acceleration of its plans for their full ownership. 2. Represents the reclassification of the Shields and CareCentrix redeemable non-controlling interests to Accrued expenses and other liabilities within the Consolidated Condensed Balance Sheets, resulting from the Company's full acquisition of Shields and CareCentrix. Earnings per share The dilutive effect of outstanding stock options on earnings per share is calculated using the treasury stock method. Stock options are anti-dilutive and excluded from the earnings per share calculation if the exercise price exceeds the average market price of the common shares. There were 13.6 million and 14.3 million weighted outstanding options to purchase common shares that were anti-dilutive and excluded from the earnings per share calculation for the three and nine months ended May 31, 2024, respectively, compared to 17.4 million and 17.8 million for the three and nine months ended May 31, 2023, respectively. Due to the anti-dilutive effect resulting from the reported net loss, an incremental 7.0 million and 3.3 million shares of potentially dilutive securities were omitted from the calculation of weighted-average common shares outstanding for the nine months ended May 31, 2024 and May 31, 2023, respectively. Cash dividends declared per common share Cash dividends per common share declared were as follows: Quarter ended 2024 2023 November $ 0.4800 $ 0.4800 February $ 0.2500 $ 0.4800 May $ 0.2500 $ 0.4800 Total $ 0.9800 $ 1.4400 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 344 | $ 118 | $ (5,631) | $ (2,900) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
May 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Accounting policies (Policies)
Accounting policies (Policies) | 9 Months Ended |
May 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. and its subsidiaries (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest and certain variable interest entities (“VIEs”) for which the Company is the primary beneficiary. The Company uses the equity method of accounting for equity investments in less than majority-owned companies if the investment provides the ability to exercise significant influence. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2023, as amended by Form 10-K/A for the fiscal year ended August 31, 2023 filed on November 22, 2023. The preparation of financial statements in accordance with GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. The Company bases its estimates on the information available at the time, its experiences and various other assumptions believed to be reasonable under the circumstances. Adjustments may be made in subsequent periods to reflect more current estimates and assumptions about matters that are inherently uncertain. Actual results may differ. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments necessary to present a fair statement of the results for such interim periods. Adverse global macroeconomic conditions, the impact of opioid-related claims and litigation settlements, the influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payor and customer relationships and terms, strategic transactions including acquisitions and dispositions, asset impairments, changes in laws and regulations in the markets in which the Company operates and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. Certain amounts in the Consolidated Condensed Financial Statements and accompanying notes may not sum due to rounding. Percentages have been calculated using unrounded amounts for all periods presented. Certain prior period data has been reclassified in the Consolidated Condensed Financial Statements and accompanying notes to conform to the current period presentation. |
Adoption of new accounting pronouncements; New accounting pronouncements not yet adopted | New accounting pronouncements Adoption of new accounting pronouncements Acquired contract assets and contract liabilities in a business combination In October 2021, the FASB issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805) - Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an entity to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606 (Revenue from Contracts with Customers). This ASU is expected to reduce diversity in practice and increase comparability for both the recognition and measurement of acquired revenue contracts with customers at the date of and after a business combination. This ASU is effective for business combinations completed in fiscal years beginning after December 15, 2022 (fiscal 2024). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's results of operations, cash flows, or financial position. Liabilities — Supplier Finance Programs In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Topic 405-50) - Disclosure of Supplier Finance Program Obligations. This ASU requires that a buyer in a supplier finance program disclose sufficient information about the program to allow a user of financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. This ASU is expected to improve financial reporting by requiring new disclosures about the programs, thereby allowing financial statement users to better consider the effect of the programs on an entity’s working capital, liquidity, and cash flows. This ASU is effective for fiscal years beginning after December 15, 2022 (fiscal 2024), except for the amendment on roll forward information which is effective for fiscal years beginning after December 15, 2023 (fiscal 2025). The Company adopted this ASU effective September 1, 2023 and the adoption did not impact the Company's disclosures within these Consolidated Condensed Financial Statements. New accounting pronouncements not yet adopted Leases — Common Control Arrangements In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842) – Common Control Arrangements. The ASU amends the accounting for leasehold improvements in common control arrangements by requiring a lessee in a common control lease arrangement to amortize leasehold improvements that it owns over the improvements’ useful life to the common control group, regardless of the lease term, if the lessee continues to control the use of the underlying asset through a lease. Further, a lessee that no longer controls the use of the underlying asset will derecognize the remaining carrying amount of the improvements through an adjustment to equity, reflecting the transfer of the asset to the lessor under common control. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025), including interim periods within those fiscal years. Early adoption is permitted in any annual or interim period as of the beginning of the related fiscal year. The Company is evaluating the effect of adopting this new accounting guidance. Segment Reporting - Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) - Improvements to Reportable Segment Disclosures. This ASU is expected to improve disclosures related to an entity’s reportable segments and provide additional, more detailed information about a reportable segment’s expenses. This ASU is effective for fiscal years beginning after December 15, 2023 (fiscal 2025) and interim periods within fiscal years beginning after December 15, 2024 (fiscal 2026). The amendments in this ASU must be applied on a retrospective basis to all prior periods presented in the financial statements and early adoption is permitted. The Company is currently evaluating the effect of adopting this new accounting guidance. Improvements to Income Tax Disclosures |
Acquisitions and other Invest_2
Acquisitions and other Investments (Tables) | 9 Months Ended |
May 31, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Schedule of Identifiable Assets Acquired and Liabilities Assumed | The following table summarizes the consideration for the acquisition and the amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions): Purchase price allocation Cash consideration 1 $ 4,778 Deferred consideration 100 Summit debt paid at closing 1,963 Fair value of equity consideration 2 1,971 Fair value of non-controlling interests 13 Total $ 8,825 Identifiable assets acquired and liabilities assumed: Cash and cash equivalents $ 69 Accounts receivable, net 381 Property, plant and equipment 607 Intangible assets 3 3,359 Operating lease right-of-use assets 756 Other assets 174 Operating lease obligations (773) Deferred tax liability (735) Other liabilities (466) Total identifiable net assets $ 3,372 Goodwill $ 5,454 1. Cash consideration excludes $87 million of cash paid to fund acquisition-related bonuses to Summit employees which was recognized as compensation expense of the Company. 2. The fair value of the non-controlling interests was calculated based on the implied equity value of VillageMD, allocated to all units on an as-converted basis. 3. Intangibles acquired include provider networks and trade names with fair values of $1.9 billion and $1.5 billion, respectively. Estimated useful lives are 15 years and 11 to 15 years, respectively. |
Schedule of Pro Forma Information | The following table represents unaudited supplemental pro forma consolidated sales for the three and nine months ended May 31, 2023, as if the acquisition of Summit had occurred at the beginning of each period presented. The unaudited pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company's results would have been had the acquisition occurred at the beginning of each period presented or results which may occur in the future. Three months ended May 31, Nine months ended May 31, (Unaudited, in millions) 2023 2023 Sales $ 35,415 $ 104,630 Actual sales of Summit, from the acquisition date, for the three and nine months ended May 31, 2023, included in the Consolidated Condensed Statements of Earnings are as follows: Three months ended May 31, Nine months ended May 31, (Unaudited, in millions) 2023 2023 Sales $ 730 $ 1,193 |
Exit and disposal activities (T
Exit and disposal activities (Tables) | 9 Months Ended |
May 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | Costs related to exit and disposal activities under the Transformational Cost Management Program for the three and nine months ended May 31, 2024 and May 31, 2023, respectively, were as follows (in millions): Three months ended May 31, 2024 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 37 $ 1 $ — $ — $ 38 Asset impairments 17 — — — 17 Employee severance and business transition costs 20 4 1 1 26 Information technology transformation and other exit costs 5 9 — — 14 Total pre-tax exit and disposal charges $ 80 $ 14 $ 1 $ 1 $ 96 Nine months ended May 31, 2024 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 192 $ 2 $ — $ — $ 194 Asset impairments 45 21 — — 66 Employee severance and business transition costs 71 4 5 6 86 Information technology transformation and other exit costs 11 10 — — 21 Total pre-tax exit and disposal charges $ 320 $ 37 $ 5 $ 6 $ 368 Three months ended May 31, 2023 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 35 $ 18 $ — $ — $ 53 Asset impairments 12 150 109 — 272 Employee severance and business transition costs 50 13 4 4 71 Information technology transformation and other exit costs 7 12 — — 19 Total pre-tax exit and disposal charges $ 104 $ 193 $ 113 $ 4 $ 414 Nine months ended May 31, 2023 U.S. Retail Pharmacy International U.S. Healthcare Corporate and Other Walgreens Boots Alliance, Inc. Lease obligations and other real estate costs $ 133 $ 18 $ — $ — $ 151 Asset impairments 127 149 109 — 385 Employee severance and business transition costs 72 15 4 11 102 Information technology transformation and other exit costs 23 22 — — 45 Total pre-tax exit and disposal charges $ 354 $ 204 $ 113 $ 11 $ 682 |
Change in Restructuring Liabilities | The changes in liabilities and assets related to the exit and disposal activities under Transformational Cost Management Program include the following (in millions): Lease obligations and other real estate costs Asset impairments Employee severance and business transition costs Information technology transformation and other exit costs Total Balance at August 31, 2023 $ 10 $ — $ 70 $ 22 $ 102 Costs 194 66 86 21 368 Payments (129) — (98) (41) (268) Other (66) (66) — — (133) Balance at May 31, 2024 $ 10 $ — $ 57 $ 2 $ 69 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
May 31, 2024 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases was as follows (in millions): Balance sheet supplemental information: May 31, 2024 August 31, 2023 Operating leases: Operating lease right-of-use assets $ 21,020 $ 21,667 Operating lease obligations - current $ 2,384 $ 2,347 Operating lease obligations - non-current 21,379 22,124 Total operating lease obligations $ 23,763 $ 24,472 Finance leases: Right-of-use assets included in: Property, plant and equipment, net $ 675 $ 678 Lease obligations included in: Accrued expenses and other liabilities $ 71 $ 57 Other non-current liabilities 917 919 Total finance lease obligations $ 988 $ 976 |
Schedule of Supplemental Income Statement and Other Information | Supplemental income statement information related to leases was as follows (in millions): Three months ended May 31, Nine months ended May 31, Statement of earnings supplemental information: 2024 2023 2024 2023 Operating lease cost Fixed $ 866 $ 879 $ 2,605 $ 2,545 Variable 1 228 218 653 613 Finance lease cost Amortization $ 13 $ 15 $ 45 $ 36 Interest 12 14 38 38 Sublease income 2 $ 29 $ 29 $ 84 $ 87 Impairment of right-of-use assets 13 38 194 109 Gain on sale-leaseback transactions 2 U.S. Retail Pharmacy $ 10 $ 263 $ 268 $ 647 International 3 — 30 — 178 Total gain on sale-leaseback 2 $ 10 $ 293 $ 268 $ 825 1 Includes real estate property taxes, common area maintenance, insurance and rental payments based on sales volume. 2 Recorded in Selling, general and administrative expenses within the Consolidated Condensed Statements of Earnings. 3 Includes gain on sale-leaseback related to the Germany wholesale business of $30 million and $178 million for the three and nine months ended May 31, 2023, of which $6 million and $47 million, respectively, related to the optimization of warehouse locations as part of acquisition integration activities. Other supplemental information was as follows (in millions): Nine months ended May 31, Other supplemental information: 2024 2023 Cash paid for amounts included in the measurement of lease obligations Operating cash flows from operating leases $ 2,779 $ 2,668 Operating cash flows from finance leases 37 35 Financing cash flows from finance leases 52 38 Total $ 2,867 $ 2,741 Right-of-use assets obtained in exchange for new lease obligations Operating leases $ 1,235 $ 1,773 Finance leases 55 23 Total $ 1,290 $ 1,796 Weighted average lease term and discount rate for real estate leases were as follows: Weighted average lease terms and discount rates: May 31, 2024 August 31, 2023 Weighted average remaining lease term in years Operating leases 9.3 9.6 Finance leases 17.7 17.4 Weighted average discount rate Operating leases 5.55 % 5.35 % Finance leases 5.18 % 5.25 % |
Schedule of Aggregate Future Lease Payments Under Operating Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2024 were as follows (in millions): Future lease payments (fiscal years): Finance lease Operating lease 1,2 2024 (Remaining period) $ 32 $ 915 2025 122 3,667 2026 119 3,594 2027 116 3,508 2028 95 3,374 2029 85 3,125 Later 882 12,608 Total undiscounted minimum lease payments $ 1,452 $ 30,791 Less: Present value discount 464 7,029 Lease liability $ 988 $ 23,763 1. Total undiscounted minimum lease payments include approximately $3.6 billion of payments related to optional renewal periods that have not been contractually exercised, but are reasonably certain of being exercised. 2. Total undiscounted minimum lease payments exclude sublease rental income of approximately $597 million due to the Company under non-cancelable sublease terms. |
Schedule of Aggregate Future Lease Payments Under Finance Leases | The aggregate future lease payments for operating and finance leases as of May 31, 2024 were as follows (in millions): Future lease payments (fiscal years): Finance lease Operating lease 1,2 2024 (Remaining period) $ 32 $ 915 2025 122 3,667 2026 119 3,594 2027 116 3,508 2028 95 3,374 2029 85 3,125 Later 882 12,608 Total undiscounted minimum lease payments $ 1,452 $ 30,791 Less: Present value discount 464 7,029 Lease liability $ 988 $ 23,763 1. Total undiscounted minimum lease payments include approximately $3.6 billion of payments related to optional renewal periods that have not been contractually exercised, but are reasonably certain of being exercised. 2. Total undiscounted minimum lease payments exclude sublease rental income of approximately $597 million due to the Company under non-cancelable sublease terms. |
Equity method investments (Tabl
Equity method investments (Tables) | 9 Months Ended |
May 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | Equity method investments were as follows (in millions, except percentages): May 31, 2024 August 31, 2023 Carrying value Ownership percentage Carrying value Ownership percentage Cencora $ 1,896 12% $ 2,534 16% Others 1,065 8% - 50% 963 8% - 50% Total $ 2,961 $ 3,497 |
Goodwill and other intangible_2
Goodwill and other intangible assets (Tables) | 9 Months Ended |
May 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill by reportable segment are as follows (in millions): Goodwill roll forward: U.S. Retail Pharmacy International U.S. Healthcare Walgreens Boots Alliance, Inc. August 31, 2023 $ 10,947 $ 1,378 $ 15,863 $ 28,187 Adjustments 1 — — 19 19 Impairments — — (12,369) (12,369) Cumulative translation adjustments and other — (8) (8) (16) May 31, 2024 $ 10,947 $ 1,370 $ 3,505 $ 15,821 1 Includes measurement period adjustments related to VillageMD's fiscal 2023 acquisitions. See Note 2. Acquisitions and other investments for further information. |
Schedule of Finite-Lived Intangible Assets by Major Class | The carrying amount and accumulated amortization of intangible assets consist of the following (in millions): Intangible assets: May 31, 2024 August 31, 2023 Gross amortizable intangible assets Customer relationships and loyalty card holders 1 $ 4,688 $ 4,658 Provider networks 2,957 3,202 Trade names and trademarks 2,303 2,300 Developed technology 469 469 Others 114 137 Total gross amortizable intangible assets $ 10,532 $ 10,767 Accumulated amortization Customer relationships and loyalty card holders 1 $ 2,014 $ 1,784 Provider networks 362 233 Trade names and trademarks 528 401 Developed technology 201 143 Others 57 48 Total accumulated amortization 3,162 2,609 Total amortizable intangible assets, net $ 7,370 $ 8,158 Indefinite-lived intangible assets Trade names and trademarks $ 4,640 $ 4,650 Pharmacy licenses 826 828 Total indefinite-lived intangible assets $ 5,466 $ 5,477 Total intangible assets, net $ 12,836 $ 13,635 1 Includes purchased prescription files. |
Schedule of Future Amortization Expense | Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2024 is as follows (in millions): 2024 (Remaining period) 2025 2026 2027 2028 2029 Estimated annual amortization expense $ 235 $ 915 $ 875 $ 791 $ 714 $ 657 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
May 31, 2024 | |
Debt Disclosure [Abstract] | |
Short-Term Borrowings | Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2024 August 31, 2023 Short-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ 290 $ — $850 million note issuance 1 0.9500% unsecured notes due 2023 — 850 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,156 — Other 2 60 68 Total short-term debt $ 1,506 $ 917 Long-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ — $ 289 December 2022 DDTL due January 2026 999 999 August 2023 DDTL due November 2026 1,000 — August 2023 RCF due August 2026 70 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 498 4.100% unsecured notes due 2050 638 793 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,445 1,444 4.650% unsecured notes due 2046 302 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 — 1,156 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 693 869 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 381 381 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 813 814 $4 billion note issuance 3 4.400% unsecured notes due 2042 252 263 Other 2 14 20 Total long-term debt, less current portion $ 7,407 $ 8,145 1 Notes, borrowings under credit facilities and commercial paper are unsecured and unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. 2 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 |
Long-Term Debt | Debt consists of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted): May 31, 2024 August 31, 2023 Short-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ 290 $ — $850 million note issuance 1 0.9500% unsecured notes due 2023 — 850 $8 billion note issuance 1 3.800% unsecured notes due 2024 1,156 — Other 2 60 68 Total short-term debt $ 1,506 $ 917 Long-term debt Credit facilities 1 November 2021 DDTL due November 2024 $ — $ 289 December 2022 DDTL due January 2026 999 999 August 2023 DDTL due November 2026 1,000 — August 2023 RCF due August 2026 70 — $1.5 billion note issuance 1 3.200% unsecured notes due 2030 498 498 4.100% unsecured notes due 2050 638 793 $6 billion note issuance 1 3.450% unsecured notes due 2026 1,445 1,444 4.650% unsecured notes due 2046 302 318 $8 billion note issuance 1 3.800% unsecured notes due 2024 — 1,156 4.500% unsecured notes due 2034 301 301 4.800% unsecured notes due 2044 693 869 £700 million note issuance 1 3.600% unsecured Pound Sterling notes due 2025 381 381 €750 million note issuance 1 2.125% unsecured Euro notes due 2026 813 814 $4 billion note issuance 3 4.400% unsecured notes due 2042 252 263 Other 2 14 20 Total long-term debt, less current portion $ 7,407 $ 8,145 1 Notes, borrowings under credit facilities and commercial paper are unsecured and unsubordinated debt obligations of the Company and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of the Company from time to time outstanding. 2 Other debt represents a mix of fixed and variable rate debt with various maturities and working capital facilities denominated in various currencies. 3 |
Financial instruments (Tables)
Financial instruments (Tables) | 9 Months Ended |
May 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Notional Amounts, Fair Value and Balance Sheet Presentation of Derivative Instruments Outstanding | The notional amounts and fair value of derivative instruments outstanding were as follows (in millions): May 31, 2024 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Cross currency interest rate swaps $ 400 $ 8 Other current assets Foreign currency forwards 283 1 Other current assets Cross currency interest rate swaps 250 10 Other non-current assets Foreign currency forwards 4 — Other non-current assets Foreign currency forwards 614 2 Other current liabilities Foreign currency forwards 2 — Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 1,593 $ 1 Other current assets Total return swaps 159 1 Other current assets Foreign currency forwards 2,415 9 Other current liabilities Total return swaps 43 — Other current liabilities Variable prepaid forward contracts 408 407 Other current liabilities Variable prepaid forward contracts 3,318 3,298 Other non-current liabilities August 31, 2023 Notional Fair Location in Consolidated Condensed Balance Sheets Derivatives designated as hedges: Foreign currency forwards $ 31 $ 1 Other current assets Cross currency interest rate swaps 650 28 Other non-current assets Foreign currency forwards 805 2 Other current liabilities Cross currency interest rate swaps 102 2 Other current liabilities Foreign currency forwards 4 — Other non-current liabilities Derivatives not designated as hedges: Foreign currency forwards $ 3,139 $ 6 Other current assets Total return swaps 168 1 Other current assets Foreign currency forwards 817 2 Other current liabilities Total return swaps 26 1 Other current liabilities Variable prepaid forward contracts 3,195 2,548 Other non-current liabilities |
Schedule of Derivative Instruments | The terms of the VPF transactions were as follows (in millions): Transaction date Shares pledged and maximum shares subject to forward sale Prepayment amount Forward settlement date May 11, 2023 4.6 $ 644 Fourth quarter, fiscal 2025 June 15, 2023 2.2 325 Third quarter, fiscal 2025 August 3, 2023 5.3 801 First quarter, fiscal 2026 August 4, 2023 5.3 797 Third quarter, fiscal 2026 November 9, 2023 2.7 424 Fourth quarter, fiscal 2026 20.0 $ 2,991 |
Gains and (Losses) due to Changes in Fair Value Recognized in Earnings | The income (expense) due to changes in fair value of derivative instruments were recognized in the Consolidated Condensed Statements of Earnings as follows (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2024 2023 2024 2023 Total return swaps Selling, general and administrative expenses $ 2 $ 2 19 $ 2 Foreign currency forwards Other income, net 1 (14) (112) 19 (203) Variable prepaid forward Other income, net 155 (26) (733) (26) 1. Excludes remeasurement gains and losses on economically hedged assets and liabilities. |
Fair value measurements (Tables
Fair value measurements (Tables) | 9 Months Ended |
May 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | Assets and liabilities measured at fair value on a recurring basis were as follows (in millions): May 31, 2024 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 32 $ 32 $ — $ — Cross currency interest rate swaps 2 18 — 18 — Foreign currency forwards 3 2 — 2 — Investments in equity securities 4 13 13 — — Investments in debt securities 5 84 — 84 — Total return swaps 1 — 1 — Liabilities : Variable prepaid forward 6 $ 3,705 $ — $ — $ 3,705 Foreign currency forwards 3 11 — 11 — August 31, 2023 Level 1 Level 2 Level 3 Assets : Money market funds 1 $ 11 $ 11 $ — $ — Cross currency interest rate swaps 2 28 — 28 — Foreign currency forwards 3 6 — 6 — Investments in equity securities 4 17 17 — — Investments in debt securities 5 15 — 15 — Total return swaps 1 — 1 — Liabilities : Variable prepaid forward 6 $ 2,548 $ — $ — $ 2,548 Foreign currency forwards 3 5 — 5 — Total return swaps 1 — 1 — Cross currency interest rate swaps 2 2 — 2 — 1 Money market funds are valued at the closing price reported by the fund sponsor and classified as Cash and cash equivalents within the Consolidated Condensed Balance Sheets. 2 The fair value of cross currency interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See Note 8. Financial instruments, for additional information. 3 The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates. See Note 8. Financial instruments, for additional information. 4 Fair values of quoted investments are based on current bid prices as of May 31, 2024 and August 31, 2023. 5 Includes investments in Treasury debt securities. 6 The fair value of the derivative was derived from a Black-Scholes valuation. The inputs used in valuing the derivative included observable inputs such as the floor and cap prices of the VPF, dividend yield of Cencora shares, risk free interest rate, and contractual term of the instrument, as well as unobservable inputs such as implied volatility of Cencora shares. The implied volatility ranged from 24.7% - 29.0% for the lower strike and 19.4% - 22.2% for the upper strike as of May 31, 2024, and 23.2% - 24.7% for the lower strike and 18.1% - 19.1% for the upper strike as of August 31, 2023. |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The roll forward of the fair value of the VPF derivatives associated with the forward sale of shares of Cencora common stock, classified as Level 3, is as follows (in millions): Three months ended Nine months ended May 31, 2024 May 31, 2024 Opening balance $ (3,861) $ (2,548) VPF derivative additions — (424) Unrealized gains (losses) recorded in Other income, net 155 (733) Ending balance $ (3,705) $ (3,705) |
Retirement benefits (Tables)
Retirement benefits (Tables) | 9 Months Ended |
May 31, 2024 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Costs (Income) | Components of net periodic pension income for the defined benefit pension plans (in millions): Three months ended May 31, Nine months ended May 31, Location in Consolidated Condensed Statements of Earnings 2024 2023 2024 2023 Service costs Selling, general and administrative expenses $ 1 $ 1 $ 3 $ 3 Interest costs Other income, net 68 64 202 186 Expected returns on plan assets/other Other income, net (70) (81) (206) (237) Total net periodic pension income $ (1) $ (17) $ (1) $ (48) |
Accumulated other comprehensi_2
Accumulated other comprehensive loss (Tables) | 9 Months Ended |
May 31, 2024 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | The following is a summary of net changes in accumulated other comprehensive income (loss) (“AOCI”) by component and net of tax for the three and nine months ended May 31, 2024 and May 31, 2023 (in millions): Pension/ post-retirement obligations Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 29, 2024 $ (608) $ 85 $ (100) $ (2,274) $ (2,897) Other comprehensive (loss) income before reclassification adjustments (3) (13) (16) 20 (13) Amounts reclassified from AOCI (3) 3 10 — 10 Tax benefit (provision) 2 3 2 — 6 Net change in other comprehensive (loss) income (5) (8) (4) 20 3 Balance at May 31, 2024 $ (613) $ 77 $ (104) $ (2,254) $ (2,894) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2023 $ (698) $ (6) $ 83 $ (132) $ (2,240) $ (2,993) Other comprehensive income (loss) before reclassification adjustments 124 — (6) (3) (11) 104 Amounts reclassified from AOCI (10) 5 (1) 39 (3) 30 Tax (provision) benefit (30) — 2 (6) — (34) Net change in other comprehensive income (loss) 85 5 (6) 29 (14) 100 Balance at May 31, 2024 $ (613) $ — $ 77 $ (104) $ (2,254) $ (2,894) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at February 28, 2023 $ (167) $ (5) $ 140 $ (162) $ (2,461) $ (2,654) Other comprehensive (loss) income before reclassification adjustments — (2) (42) 16 143 115 Amounts reclassified from AOCI (7) 1 — (1) (2) (9) Tax benefit (provision) 2 — 10 (4) — 9 Net change in other comprehensive (loss) income (5) (1) (31) 12 141 115 Balance at May 31, 2023 $ (171) $ (6) $ 108 $ (150) $ (2,320) $ (2,539) Pension/ post-retirement obligations Unrealized loss on cash flow hedges and other Net investment hedges Share of OCI of equity method investments Cumulative translation adjustments Total Balance at August 31, 2022 $ (157) $ (2) $ 213 $ (254) $ (2,605) $ (2,805) Other comprehensive (loss) income before reclassification adjustments — (6) (138) (8) 301 149 Amounts reclassified from AOCI (20) 2 — 149 (16) 115 Tax benefit (provision) 5 1 33 (37) — 2 Net change in other comprehensive (loss) income (15) (4) (104) 104 285 266 Balance at May 31, 2023 $ (171) $ (6) $ 108 $ (150) $ (2,320) $ (2,539) |
Segment reporting (Tables)
Segment reporting (Tables) | 9 Months Ended |
May 31, 2024 | |
Segment Reporting [Abstract] | |
Reconciliation of Operating Income (Loss) from Segments to Consolidated | The following table reflects results of operations of the Company’s reportable segments (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Sales: U.S. Retail Pharmacy $ 28,503 $ 27,866 $ 86,308 $ 82,648 International 5,727 5,573 17,581 16,414 U.S. Healthcare 2,125 1,975 6,232 4,597 Corporate and Other 1 (3) — (9) — Walgreens Boots Alliance, Inc. $ 36,351 $ 35,415 $ 110,111 $ 103,659 Adjusted operating income: U.S. Retail Pharmacy $ 501 $ 962 $ 1,947 $ 3,134 International 175 208 562 676 U.S. Healthcare (22) (172) (151) (483) Corporate and Other 1 (42) (39) (158) (139) Walgreens Boots Alliance, Inc. $ 613 $ 959 $ 2,200 $ 3,188 1. Includes certain eliminations. The following table reconciles adjusted operating income to operating income (loss) (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Adjusted operating income (Non-GAAP measure) $ 613 $ 959 $ 2,200 $ 3,188 Acquisition-related amortization (266) (274) (811) (851) Transformational cost management (95) (414) (401) (697) Acquisition-related costs (68) (70) (480) (257) Adjustments to equity earnings in Cencora (57) (61) (129) (178) Certain legal and regulatory accruals and settlements (52) (268) (376) (7,249) LIFO provision 36 (51) (11) (89) Impairment of goodwill, intangibles and long-lived assets — (299) (13,091) (299) Operating income (loss) (GAAP measure) $ 111 $ (477) $ (13,099) $ (6,431) |
Sales (Tables)
Sales (Tables) | 9 Months Ended |
May 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes the Company’s sales by segment and by major source (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 U.S. Retail Pharmacy Pharmacy $ 21,812 $ 20,898 $ 65,704 $ 60,991 Retail 6,691 6,968 20,604 21,657 Total 28,503 27,866 86,308 82,648 International Pharmacy 874 924 2,698 2,690 Retail 1,839 1,769 5,928 5,412 Wholesale 3,014 2,880 8,955 8,311 Total 5,727 5,573 17,581 16,414 U.S. Healthcare 2,125 1,975 6,232 4,597 Corporate and Other 1 (3) — (9) — Walgreens Boots Alliance, Inc. $ 36,351 $ 35,415 $ 110,111 $ 103,659 1. Includes certain eliminations. |
Related parties (Tables)
Related parties (Tables) | 9 Months Ended |
May 31, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Related party transactions with Cencora (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Purchases, net $ 18,181 $ 16,573 $ 54,296 $ 47,772 May 31, 2024 August 31, 2023 Trade accounts payable, net of receivables $ 8,756 $ 7,814 |
Supplemental information (Table
Supplemental information (Tables) | 9 Months Ended |
May 31, 2024 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Depreciation and Amortization Expense | The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Depreciation expense $ 369 $ 372 $ 1,120 $ 1,068 Intangible assets amortization 238 226 717 583 Total depreciation and amortization expense $ 607 $ 598 $ 1,837 $ 1,652 |
Restrictions on Cash and Cash Equivalents | The following represents a reconciliation of Cash and cash equivalents in the Consolidated Condensed Balance Sheets to total Cash, cash equivalents and restricted cash in the Consolidated Condensed Statements of Cash Flows as of May 31, 2024 and August 31, 2023, respectively (in millions): May 31, 2024 August 31, 2023 Cash and cash equivalents $ 703 $ 739 Cash and cash equivalents - assets held for sale (included in other current assets) — 24 Restricted cash - (included in other current and non-current assets) 37 93 Cash, cash equivalents and restricted cash $ 740 $ 856 |
Schedule of Redeemable Noncontrolling Interest | The following represents a roll forward of the redeemable non-controlling interests in the Consolidated Condensed Balance Sheets (in millions): Three months ended May 31, Nine months ended May 31, 2024 2023 2024 2023 Opening balance $ 172 $ 158 $ 167 $ 1,042 Net (loss) income attributable to Redeemable non-controlling interests (1) — 1 (24) Redemption price adjustments and other 1 1 2 5 456 Reclassifications to Accrued expenses and other liabilities 2 — — — (1,314) Ending balance $ 173 $ 160 $ 173 $ 160 1. Remeasurement of non-controlling interests, probable of redemption but not currently redeemable, to their redemption value, is recorded in Paid in capital within the Consolidated Condensed Balance Sheets. During the three months ended November 30, 2022, Shields and CareCentrix redeemable non-controlling interests were recorded to redemption value as the Company announced the acceleration of its plans for their full ownership. 2. Represents the reclassification of the Shields and CareCentrix redeemable non-controlling interests to Accrued expenses and other liabilities within the Consolidated Condensed Balance Sheets, resulting from the Company's full acquisition of Shields and CareCentrix. |
Schedule of Dividends Payable | Cash dividends per common share declared were as follows: Quarter ended 2024 2023 November $ 0.4800 $ 0.4800 February $ 0.2500 $ 0.4800 May $ 0.2500 $ 0.4800 Total $ 0.9800 $ 1.4400 |
Acquisitions and other Invest_3
Acquisitions and other Investments - narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||||
May 08, 2024 | Mar. 03, 2023 | Jan. 03, 2023 | Dec. 28, 2022 | May 31, 2024 | Nov. 30, 2023 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Aug. 31, 2023 | |
Business Acquisition [Line Items] | ||||||||||
Adjustments | $ 19 | |||||||||
Goodwill | $ 15,821 | 15,821 | $ 28,187 | |||||||
Rite Aid Asset Acquisition | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payments to acquire productive assets | $ 375 | |||||||||
VillageMD | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Noncontrolling interest, ownership percentage by parent | 53% | |||||||||
Summit Heath-CityMD | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 7,000 | |||||||||
Purchase price | 4,850 | |||||||||
Fair value of equity consideration | 1,971 | |||||||||
Deferred consideration | 100 | |||||||||
Business combination, consideration transferred, employees | 87 | |||||||||
Summit debt paid at closing | 1,900 | |||||||||
Intangible assets | 3,359 | |||||||||
Goodwill | 5,454 | |||||||||
Tax deductible goodwill | 416 | |||||||||
Summit Heath-CityMD | Partnership Interest | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Fair value of equity consideration | 2,050 | |||||||||
Summit Heath-CityMD | Provider networks | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets | $ 1,900 | |||||||||
Useful life of capitalized software costs | 15 years | |||||||||
Summit Heath-CityMD | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Intangible assets | $ 1,500 | |||||||||
Summit Heath-CityMD | Minimum | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Useful life of capitalized software costs | 11 years | |||||||||
Summit Heath-CityMD | Maximum | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Useful life of capitalized software costs | 15 years | |||||||||
VillageMD | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Fair value of equity consideration | $ 1,750 | |||||||||
Debt instrument, fee amount, credit | 220 | |||||||||
VillageMD | Line of Credit | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Face amount | 2,250 | |||||||||
VillageMD | Line of Credit | Term Loan | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Face amount | 1,750 | |||||||||
VillageMD | Line of Credit | Credit facilities | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Face amount | 500 | |||||||||
VillageMD | Cigna | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Fair value of equity consideration | $ 2,500 | |||||||||
CareCentrix | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Purchase price | $ 378 | |||||||||
Shields Health Solutions Parent, LLC | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Purchase price | $ 1,400 | |||||||||
Starling MSO Holdings, LLC | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 284 | |||||||||
Purchase price | 222 | |||||||||
Fair value of equity consideration | $ 62 | |||||||||
Intangible assets | 128 | 128 | ||||||||
Goodwill | 103 | 103 | ||||||||
Other Acquisitions | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration, net | $ 49 | $ 37 | $ 221 | $ 127 |
Acquisitions and other Invest_4
Acquisitions and other Investments - schedule of purchase price allocation and identifiable assets acquired and liabilities assumed - Summit (Details) - USD ($) $ in Millions | Jan. 03, 2023 | May 31, 2024 | Aug. 31, 2023 |
Identifiable assets acquired and liabilities assumed: | |||
Goodwill | $ 15,821 | $ 28,187 | |
Summit Heath-CityMD | |||
Purchase price allocation | |||
Cash consideration | $ 4,778 | ||
Deferred consideration | 100 | ||
Summit debt paid at closing | 1,963 | ||
Fair value of equity consideration | 1,971 | ||
Fair value of non-controlling interests | 13 | ||
Total | 8,825 | ||
Identifiable assets acquired and liabilities assumed: | |||
Cash and cash equivalents | 69 | ||
Accounts receivable, net | 381 | ||
Property, plant and equipment | 607 | ||
Intangible assets | 3,359 | ||
Operating lease right-of-use assets | 756 | ||
Other assets | 174 | ||
Operating lease obligations | (773) | ||
Deferred tax liability | (735) | ||
Other liabilities | (466) | ||
Total identifiable net assets | 3,372 | ||
Goodwill | $ 5,454 |
Acquisitions and other Invest_5
Acquisitions and other Investments - Schedule of Pro Forma and Actual Information (Details) - Summit Health-CityMD - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
May 31, 2023 | May 31, 2023 | |
Business Acquisition [Line Items] | ||
Sales, pro forma | $ 35,415 | $ 104,630 |
Sales, actual | $ 730 | $ 1,193 |
Exit and disposal activities -
Exit and disposal activities - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||||||||
Oct. 12, 2021 USD ($) store | Dec. 20, 2018 USD ($) | Feb. 29, 2024 USD ($) clinic | Nov. 30, 2023 USD ($) | Nov. 30, 2022 USD ($) | Feb. 29, 2024 USD ($) clinic | May 31, 2024 USD ($) store | Aug. 31, 2023 USD ($) | May 31, 2023 USD ($) | Feb. 28, 2023 USD ($) | Aug. 31, 2022 USD ($) | Sep. 01, 2019 USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Cumulative effect adjustment to decrease retained earnings | $ (15,192) | $ (15,192) | $ (15,257) | $ (28,322) | $ (29,359) | $ (29,439) | $ (29,366) | |||||
Software and Software Development Costs | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Asset impairment charges | 455 | |||||||||||
Retained Earnings | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Cumulative effect adjustment to decrease retained earnings | $ (26,448) | $ (26,448) | (26,571) | (33,058) | $ (33,654) | $ (33,952) | $ (37,801) | |||||
Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Costs incurred | $ 3,500 | |||||||||||
Number of clinics closed | clinic | 160 | |||||||||||
Transformational Cost Management Program | Retained Earnings | Adoption of New Accounting Standards | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Cumulative effect adjustment to decrease retained earnings | $ 508 | |||||||||||
Transformational Cost Management Program | United Kingdom | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Number of stores expected to close | store | 650 | |||||||||||
Number of stores closed | store | 581 | |||||||||||
Transformational Cost Management Program | UNITED STATES | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Number of stores closed | store | 673 | |||||||||||
Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Number of clinics closed | clinic | 90 | |||||||||||
Impairment | $ 303 | |||||||||||
Lease Obligations and Other Real Estate Costs | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Costs incurred | $ 1,300 | |||||||||||
Asset Impairments | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Costs incurred | 950 | |||||||||||
Employee Severance and Business Transition Costs | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Costs incurred | 959 | |||||||||||
Information Technology Transformation and Other Exit Costs | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Costs incurred | $ 275 | |||||||||||
Minimum | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected annual cost savings of restructuring plan | $ 3,300 | $ 2,000 | $ 3,300 | |||||||||
Expected cost | 4,100 | |||||||||||
Minimum | Transformational Cost Management Program | UNITED STATES | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Number of stores expected to close | store | 650 | |||||||||||
Minimum | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected annual cost savings of restructuring plan | $ 3,500 | |||||||||||
Minimum | Exit and Disposal Costs | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected cost | 3,800 | |||||||||||
Maximum | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected cost | 4,400 | |||||||||||
Maximum | Transformational Cost Management Program | UNITED STATES | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Number of stores expected to close | store | 700 | |||||||||||
Maximum | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected annual cost savings of restructuring plan | $ 4,500 | $ 3,500 | ||||||||||
Maximum | Exit and Disposal Costs | Transformational Cost Management Program | ||||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||||
Expected cost | $ 4,100 |
Exit and disposal activities _2
Exit and disposal activities - Restructuring Costs (Details) - Transformational Cost Management Program - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 96 | $ 414 | $ 368 | $ 682 |
Reportable segments | U.S. Retail Pharmacy | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 80 | 104 | 320 | 354 |
Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 193 | 37 | 204 |
Reportable segments | U.S. Healthcare | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 113 | 5 | 113 |
Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 4 | 6 | 11 |
Lease obligations and other real estate costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 38 | 53 | 194 | 151 |
Lease obligations and other real estate costs | Reportable segments | U.S. Retail Pharmacy | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 37 | 35 | 192 | 133 |
Lease obligations and other real estate costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 18 | 2 | 18 |
Lease obligations and other real estate costs | Reportable segments | U.S. Healthcare | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Lease obligations and other real estate costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Asset impairments | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 17 | 272 | 66 | 385 |
Asset impairments | Reportable segments | U.S. Retail Pharmacy | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 17 | 12 | 45 | 127 |
Asset impairments | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 150 | 21 | 149 |
Asset impairments | Reportable segments | U.S. Healthcare | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 109 | 0 | 109 |
Asset impairments | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Employee severance and business transition costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 26 | 71 | 86 | 102 |
Employee severance and business transition costs | Reportable segments | U.S. Retail Pharmacy | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 20 | 50 | 71 | 72 |
Employee severance and business transition costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 4 | 13 | 4 | 15 |
Employee severance and business transition costs | Reportable segments | U.S. Healthcare | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 4 | 5 | 4 |
Employee severance and business transition costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 1 | 4 | 6 | 11 |
Information technology transformation and other exit costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 14 | 19 | 21 | 45 |
Information technology transformation and other exit costs | Reportable segments | U.S. Retail Pharmacy | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 5 | 7 | 11 | 23 |
Information technology transformation and other exit costs | Reportable segments | International | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 9 | 12 | 10 | 22 |
Information technology transformation and other exit costs | Reportable segments | U.S. Healthcare | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | 0 | 0 | 0 | 0 |
Information technology transformation and other exit costs | Corporate and Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Total pre-tax exit and disposal charges | $ 0 | $ 0 | $ 0 | $ 0 |
Exit and disposal activities _3
Exit and disposal activities - Restructuring Reserve Activity (Details) - Transformational Cost Management Program $ in Millions | 9 Months Ended |
May 31, 2024 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 102 |
Costs | 368 |
Payments | (268) |
Other | (133) |
Ending balance | 69 |
Lease obligations and other real estate costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 10 |
Costs | 194 |
Payments | (129) |
Other | (66) |
Ending balance | 10 |
Asset Impairments | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 0 |
Costs | 66 |
Payments | 0 |
Other | (66) |
Ending balance | 0 |
Employee severance and business transition costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 70 |
Costs | 86 |
Payments | (98) |
Other | 0 |
Ending balance | 57 |
Information technology transformation and other exit costs | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | 22 |
Costs | 21 |
Payments | (41) |
Other | 0 |
Ending balance | $ 2 |
Leases - Narrative (Details)
Leases - Narrative (Details) $ in Millions | May 31, 2024 USD ($) |
Lessee, Lease, Description [Line Items] | |
Term of renewal contract | 5 years |
Undiscounted minimum lease payments, payments associated with options to extend lease terms | $ 3,600 |
Lessor, operating lease, payments to be received | $ 597 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Term of lease | 10 years |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Term of lease | 25 years |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Operating Leases: | ||
Operating lease right-of-use assets | $ 21,020 | $ 21,667 |
Operating lease obligations - current | 2,384 | 2,347 |
Operating lease obligations - non-current | 21,379 | 22,124 |
Total operating lease obligations | 23,763 | 24,472 |
Finance leases: | ||
Property, plant and equipment, net | 675 | 678 |
Lease obligations included in: | ||
Accrued expenses and other liabilities | 71 | 57 |
Other non-current liabilities | 917 | 919 |
Total finance lease obligations | $ 988 | $ 976 |
Finance lease, right-of-use asset, statement of financial position, extensible enumeration | Property, plant and equipment, net | Property, plant and equipment, net |
Finance lease, liability, current, statement of financial position, extensible enumeration | Accrued expenses and other liabilities | Accrued expenses and other liabilities |
Finance lease, liability, noncurrent, statement of financial position, extensible enumeration | Other non-current liabilities | Other non-current liabilities |
Leases - Supplemental Income St
Leases - Supplemental Income Statement Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Operating lease cost | ||||
Fixed | $ 866 | $ 879 | $ 2,605 | $ 2,545 |
Variable | 228 | 218 | 653 | 613 |
Finance lease cost | ||||
Amortization | 13 | 15 | 45 | 36 |
Interest | 12 | 14 | 38 | 38 |
Sublease income 2 | 29 | 29 | 84 | 87 |
Impairment of right-of-use assets | 13 | 38 | 194 | 109 |
Gain on sale and leaseback | 10 | 293 | 268 | 825 |
U.S. Retail Pharmacy | ||||
Finance lease cost | ||||
Gain on sale and leaseback | 10 | 263 | 268 | 647 |
International | ||||
Finance lease cost | ||||
Gain on sale and leaseback | $ 0 | 30 | $ 0 | 178 |
GERMANY | International | ||||
Finance lease cost | ||||
Gain on sale and leaseback | 30 | 178 | ||
GERMANY | International | Fiscal Year 2023 Acquisitions | ||||
Finance lease cost | ||||
Gain on sale and leaseback | $ 6 | $ 47 |
Leases - Other Supplemental Inf
Leases - Other Supplemental Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
May 31, 2024 | May 31, 2023 | |
Cash paid for amounts included in the measurement of lease obligations | ||
Operating cash flows from operating leases | $ 2,779 | $ 2,668 |
Operating cash flows from finance leases | 37 | 35 |
Financing cash flows from finance leases | 52 | 38 |
Total | 2,867 | 2,741 |
Right-of-use assets obtained in exchange for new lease obligations | ||
Operating leases | 1,235 | 1,773 |
Finance leases | 55 | 23 |
Total | $ 1,290 | $ 1,796 |
Leases - Average Lease Terms An
Leases - Average Lease Terms And Discounts (Details) | May 31, 2024 | Aug. 31, 2023 |
Weighted average remaining lease term in years | ||
Operating leases | 9 years 3 months 18 days | 9 years 7 months 6 days |
Finance leases | 17 years 8 months 12 days | 17 years 4 months 24 days |
Weighted average discount rate | ||
Operating leases | 5.55% | 5.35% |
Finance leases | 5.18% | 5.25% |
Leases - Future Lease Payments
Leases - Future Lease Payments for Operating and Finance Leases (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Finance lease | ||
2024 (Remaining period) | $ 32 | |
2025 | 122 | |
2026 | 119 | |
2027 | 116 | |
2028 | 95 | |
2029 | 85 | |
Later | 882 | |
Total undiscounted minimum lease payments | 1,452 | |
Less: Present value discount | 464 | |
Lease liability | 988 | $ 976 |
Operating lease | ||
2024 (Remaining period) | 915 | |
2025 | 3,667 | |
2026 | 3,594 | |
2027 | 3,508 | |
2028 | 3,374 | |
2029 | 3,125 | |
Later | 12,608 | |
Total undiscounted minimum lease payments | 30,791 | |
Less: Present value discount | 7,029 | |
Lease liability | $ 23,763 | $ 24,472 |
Equity method investments - Sch
Equity method investments - Schedule of Equity Method Investments (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 2,961 | $ 3,497 |
Cencora | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 1,896 | $ 2,534 |
Ownership percentage | 12.40% | 15.90% |
Others | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 1,065 | $ 963 |
Others | Minimum | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 8% | 8% |
Others | Maximum | ||
Schedule of Equity Method Investments [Line Items] | ||
Ownership percentage | 50% | 50% |
Total | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying value of equity method investments | $ 2,961 | $ 3,497 |
Equity method investments - Nar
Equity method investments - Narrative (Details) - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Jun. 08, 2023 | Mar. 03, 2023 | Dec. 15, 2022 | May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Aug. 31, 2023 | |
Schedule of Equity Method Investments [Line Items] | ||||||||
Gain on sale of equity method investments | $ 847 | $ 1,691 | ||||||
Cencora | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Outstanding shares owned (in shares) | 24,400 | 24,400 | 31,800 | |||||
Ownership percentage | 12.40% | 12.40% | 15.90% | |||||
Proceeds from sale of equity method investments | $ 400 | $ 50 | $ 1,600 | 3,100 | ||||
Gain on sale of equity method investments | 88 | 25 | 847 | 1,500 | ||||
Other comprehensive (loss) income before reclassification adjustments | (10) | (2) | $ (39) | $ (152) | ||||
Period of reporting lag | 2 months | |||||||
Equity investment, exceeded its proportionate share of net assets | 1,800 | $ 1,800 | ||||||
Cencora | Not Designated as Hedging Instrument | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Pledged collateral (in shares) | 20,000 | 17,300 | ||||||
Cencora | Level 1 | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Fair market value of equity investment | $ 5,500 | $ 5,500 | $ 5,600 | |||||
Guangzhou Pharmaceuticals | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Proceeds from sale of equity method investments | $ 150 | |||||||
Option Care Health | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Number of shares sold (in shares) | 10,800 | 15,500 | ||||||
Proceeds from sale of equity method investments | $ 330 | $ 469 | ||||||
Gain on sale of equity method investments | $ 154 | $ 76 |
Goodwill and other intangible_3
Goodwill and other intangible assets - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2024 USD ($) | Feb. 29, 2024 USD ($) clinic | May 31, 2023 USD ($) | May 31, 2024 USD ($) | May 31, 2023 USD ($) | |
Goodwill [Line Items] | |||||
Impairments | $ 0 | $ 0 | $ 12,369 | $ 0 | |
Amortization of intangible assets | 238 | $ 226 | $ 717 | $ 583 | |
Transformational Cost Management Program | |||||
Goodwill [Line Items] | |||||
Number of clinics closed | clinic | 90 | ||||
U.S. Healthcare | |||||
Goodwill [Line Items] | |||||
Impairments | $ 12,400 | ||||
Asset impairment charges | $ 266 | ||||
International | |||||
Goodwill [Line Items] | |||||
Impairments | $ 431 |
Goodwill and other intangible_4
Goodwill and other intangible assets - Schedule of Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2024 | Feb. 29, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Goodwill [Roll Forward] | |||||
Goodwill, beginning balance | $ 28,187 | ||||
Adjustments | 19 | ||||
Impairments | $ 0 | $ 0 | (12,369) | $ 0 | |
Cumulative translation adjustments and other | (16) | ||||
Goodwill, ending balance | 15,821 | 15,821 | |||
International | |||||
Goodwill [Roll Forward] | |||||
Impairments | (431) | ||||
U.S. Healthcare | |||||
Goodwill [Roll Forward] | |||||
Impairments | $ (12,400) | ||||
Reportable Segments | U.S. Retail Pharmacy | |||||
Goodwill [Roll Forward] | |||||
Goodwill, beginning balance | 10,947 | ||||
Adjustments | 0 | ||||
Impairments | 0 | ||||
Cumulative translation adjustments and other | 0 | ||||
Goodwill, ending balance | 10,947 | 10,947 | |||
Reportable Segments | International | |||||
Goodwill [Roll Forward] | |||||
Goodwill, beginning balance | 1,378 | ||||
Adjustments | 0 | ||||
Impairments | 0 | ||||
Cumulative translation adjustments and other | (8) | ||||
Goodwill, ending balance | 1,370 | 1,370 | |||
Reportable Segments | U.S. Healthcare | |||||
Goodwill [Roll Forward] | |||||
Goodwill, beginning balance | 15,863 | ||||
Adjustments | 19 | ||||
Impairments | (12,369) | ||||
Cumulative translation adjustments and other | (8) | ||||
Goodwill, ending balance | $ 3,505 | $ 3,505 |
Goodwill and other intangible_5
Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets by Major Class (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | $ 10,532 | $ 10,767 |
Accumulated amortization | 3,162 | 2,609 |
Total amortizable intangible assets, net | 7,370 | 8,158 |
Indefinite-lived intangible assets | 5,466 | 5,477 |
Total intangible assets, net | 12,836 | 13,635 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 4,640 | 4,650 |
Pharmacy licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 826 | 828 |
Customer relationships and loyalty card holders | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 4,688 | 4,658 |
Accumulated amortization | 2,014 | 1,784 |
Provider networks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 2,957 | 3,202 |
Accumulated amortization | 362 | 233 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 2,303 | 2,300 |
Accumulated amortization | 528 | 401 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 469 | 469 |
Accumulated amortization | 201 | 143 |
Others | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross amortizable intangible assets | 114 | 137 |
Accumulated amortization | $ 57 | $ 48 |
Goodwill and other intangible_6
Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions | May 31, 2024 USD ($) |
Estimated annual intangible assets amortization expense [Abstract] | |
2024 (Remaining period) | $ 235 |
2025 | 915 |
2026 | 875 |
2027 | 791 |
2028 | 714 |
2029 | $ 657 |
Debt - Short and Long-Term Debt
Debt - Short and Long-Term Debt (Details) | May 31, 2024 USD ($) | May 31, 2024 GBP (£) | May 31, 2024 EUR (€) | Aug. 31, 2023 USD ($) | Nov. 17, 2021 USD ($) |
Debt Instrument [Line Items] | |||||
Total short-term debt | $ 1,506,000,000 | $ 917,000,000 | |||
Total long-term debt, less current portion | 7,407,000,000 | 8,145,000,000 | |||
Other | |||||
Debt Instrument [Line Items] | |||||
Total short-term debt | 60,000,000 | 68,000,000 | |||
Credit facilities | November 2021 DDTL due November 2024 | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 0 | 289,000,000 | |||
Credit facilities | December 2022 DDTL due January 2026 | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 999,000,000 | 999,000,000 | |||
Credit facilities | August 2023 DDTL Due January 2026 | |||||
Debt Instrument [Line Items] | |||||
Long-term debt | 1,000,000,000 | 0 | |||
Unsecured Notes | |||||
Debt Instrument [Line Items] | |||||
Other | 14,000,000 | 20,000,000 | |||
Unsecured Notes | $850 million note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 850,000,000 | ||||
Unsecured Notes | 0.9500% unsecured notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 850,000,000 | ||||
Stated interest rate | 0.95% | 0.95% | 0.95% | 0.95% | |
Long-term debt | $ 70,000,000 | 0 | |||
Unsecured Notes | Total $8 billion note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 8,000,000,000 | ||||
Unsecured Notes | 3.800% unsecured notes due 2024 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 3.80% | 3.80% | 3.80% | ||
Long-term debt | $ 0 | 1,156,000,000 | |||
Unsecured Notes | Total $1.5 billion note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 1,500,000,000 | ||||
Unsecured Notes | 3.200% unsecured notes due 2030 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 3.20% | 3.20% | 3.20% | ||
Long-term debt | $ 498,000,000 | 498,000,000 | |||
Unsecured Notes | 4.100% unsecured notes due 2050 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.10% | 4.10% | 4.10% | ||
Long-term debt | $ 638,000,000 | 793,000,000 | |||
Unsecured Notes | Total $6 billion note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 6,000,000,000 | ||||
Unsecured Notes | 3.450% unsecured notes due 2026 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 3.45% | 3.45% | 3.45% | ||
Long-term debt | $ 1,445,000,000 | 1,444,000,000 | |||
Unsecured Notes | 4.650% unsecured notes due 2046 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.65% | 4.65% | 4.65% | ||
Long-term debt | $ 302,000,000 | 318,000,000 | |||
Unsecured Notes | 4.500% unsecured notes due 2034 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.50% | 4.50% | 4.50% | ||
Long-term debt | $ 301,000,000 | 301,000,000 | |||
Unsecured Notes | 4.800% unsecured notes due 2044 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.80% | 4.80% | 4.80% | ||
Long-term debt | $ 693,000,000 | 869,000,000 | |||
Unsecured Notes | Total £700 million note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | £ | £ 700,000,000 | ||||
Unsecured Notes | 3.600% unsecured Pound Sterling notes due 2025 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 3.60% | 3.60% | 3.60% | ||
Long-term debt | $ 381,000,000 | 381,000,000 | |||
Unsecured Notes | Total €750 million note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | € | € 750,000,000 | ||||
Unsecured Notes | 2.125% unsecured Euro notes due 2026 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 2.125% | 2.125% | 2.125% | ||
Long-term debt | $ 813,000,000 | 814,000,000 | |||
Unsecured Notes | Total $4 billion note issuance | |||||
Debt Instrument [Line Items] | |||||
Face amount | $ 4,000,000,000 | ||||
Unsecured Notes | 4.400% unsecured notes due 2042 | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.40% | 4.40% | 4.40% | ||
Long-term debt | $ 252,000,000 | 263,000,000 | |||
Credit facilities | November 2021 DDTL due November 2024 | |||||
Debt Instrument [Line Items] | |||||
Total short-term debt | 290,000,000 | 0 | |||
Unsecured Notes | 0.9500% unsecured notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Total short-term debt | 0 | 850,000,000 | |||
Unsecured Notes | 3.800% unsecured notes due 2024 | |||||
Debt Instrument [Line Items] | |||||
Total short-term debt | $ 1,156,000,000 | $ 0 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | |||||||
Aug. 09, 2023 | Dec. 19, 2022 | Jun. 17, 2022 | Nov. 17, 2021 | Nov. 15, 2021 | May 31, 2024 | May 31, 2023 | Aug. 31, 2023 | |
Debt Instrument [Line Items] | ||||||||
Interest paid | $ 460 | $ 481 | ||||||
Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt to total capitalization ratio | 0.60 | |||||||
Commercial paper | ||||||||
Debt Instrument [Line Items] | ||||||||
Commercial paper | $ 0 | $ 0 | ||||||
Unsecured Notes | 0.9500% unsecured notes due 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 850 | |||||||
Stated interest rate | 0.95% | 0.95% | ||||||
Redemption percentage | 100% | |||||||
Amount outstanding | $ 70 | $ 0 | ||||||
Credit facilities | ||||||||
Debt Instrument [Line Items] | ||||||||
Remaining borrowing capacity | 5,800 | |||||||
Credit facilities | 70 | |||||||
Credit facilities | August 2023 Revolving Credit Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 2,250 | |||||||
Debt term | 3 years | |||||||
Borrowing outstanding | 70 | |||||||
Credit facilities | August 2023 Revolving Credit Agreement | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.50% | |||||||
Credit facilities | August 2023 Revolving Credit Agreement | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 0.75% | |||||||
Credit facilities | Unsecured Credit Facility, Due August 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,000 | |||||||
Borrowing outstanding | 1,000 | |||||||
Credit facilities | Unsecured Credit Facility, Due August 2023 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.50% | |||||||
Credit facilities | Unsecured Credit Facility, Due August 2023 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 0.75% | |||||||
Credit facilities | Unsecured Credit Facility, 3 Year Term, Due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,000 | |||||||
Borrowing outstanding | 1,000 | |||||||
Credit facilities | Unsecured Credit Facility, 3 Year Term, Due 2026 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.50% | |||||||
Credit facilities | Unsecured Credit Facility, 3 Year Term, Due 2026 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 0.875% | |||||||
Credit facilities | June 17, 2022 Revolving Credit Facility, Five-Year Term | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 3,500 | |||||||
Debt term | 5 years | |||||||
Borrowing outstanding | 0 | |||||||
Credit facilities | June 17, 2022 Revolving Credit Facility, 18-Month Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,500 | |||||||
Debt term | 18 months | |||||||
Credit facilities | June 17, 2022 Revolving Credit Facility, 18-Month Facility | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.50% | |||||||
Credit facilities | June 17, 2022 Revolving Credit Facility, 18-Month Facility | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 0.80% | |||||||
Credit facilities | Delayed Draw Term Loan | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 5,000 | |||||||
Credit facilities | Delayed Draw Term Loan Credit Facility, 364-Day Facility | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 2,000 | |||||||
Debt term | 364 days | |||||||
Debt instrument, basis spread on variable rate | 0.75% | |||||||
Credit facilities | Delayed Draw Term Loan Credit Facility, Two-Year Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 2,000 | |||||||
Credit facilities | Delayed Draw Term Loan Credit Facility, Two-Year Facility | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 2 years | |||||||
Debt instrument, basis spread on variable rate | 0.88% | |||||||
Amount outstanding | $ 290 | |||||||
Credit facilities | Delayed Draw Term Loan Credit Facility, Three-Year Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 1,000 | |||||||
Credit facilities | Delayed Draw Term Loan Credit Facility, Three-Year Facility | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 3 years | |||||||
Credit facilities | Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 3,000 | |||||||
Credit facilities | Term Loan | June 17, 2022 Revolving Credit Facility, Five-Year Term | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 5 years | |||||||
Credit facilities | Term Loan | June 17, 2022 Revolving Credit Facility, 18-Month Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt term | 18 years | |||||||
Credit facilities | Term Loan | Delayed Draw Term Loan Credit Facility, Three-Year Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, basis spread on variable rate | 1.05% |
Financial instruments - Summary
Financial instruments - Summary of Derivative Instruments (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Other current assets | Foreign currency forwards | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | $ 283 | $ 31 |
Fair value, assets | 1 | 1 |
Other current assets | Foreign currency forwards | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 1,593 | 3,139 |
Fair value, assets | 1 | 6 |
Other current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 400 | |
Fair value, assets | 8 | |
Other current assets | Total return swaps | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 159 | 168 |
Fair value, assets | 1 | 1 |
Other non-current assets | Foreign currency forwards | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 4 | |
Fair value, assets | 0 | |
Other non-current assets | Cross currency interest rate swaps | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 250 | 650 |
Fair value, assets | 10 | 28 |
Other current liabilities | Foreign currency forwards | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 614 | 805 |
Fair value, liabilities | 2 | 2 |
Other current liabilities | Foreign currency forwards | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 2,415 | 817 |
Fair value, liabilities | 9 | 2 |
Other current liabilities | Cross currency interest rate swaps | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 102 | |
Fair value, liabilities | 2 | |
Other current liabilities | Total return swaps | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 43 | 26 |
Fair value, liabilities | 0 | 1 |
Other current liabilities | Variable Prepaid Forward | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 408 | |
Fair value, liabilities | 407 | |
Other non-current liabilities | Foreign currency forwards | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, assets | 2 | |
Notional amount, liabilities | 4 | |
Fair value, assets | 0 | |
Fair value, liabilities | 0 | |
Other non-current liabilities | Variable Prepaid Forward | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amount, liabilities | 3,318 | 3,195 |
Fair value, liabilities | $ 3,298 | $ 2,548 |
Financial instruments - Summa_2
Financial instruments - Summary of Variable Prepaid Forward Transactions (Details) - USD ($) shares in Millions, $ in Millions | 9 Months Ended | ||||||
Nov. 09, 2023 | Aug. 04, 2023 | Aug. 03, 2023 | Jun. 15, 2023 | May 11, 2023 | May 31, 2024 | May 31, 2023 | |
Derivatives, Fair Value [Line Items] | |||||||
Proceeds from variable prepaid forward contracts | $ 424 | $ 644 | |||||
Not Designated as Hedging Instrument | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Proceeds from variable prepaid forward contracts | $ 2,991 | ||||||
Not Designated as Hedging Instrument | Variable Prepaid Forward Due Fourth Quarter Fiscal 2025 | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Pledged collateral (in shares) | 4.6 | ||||||
Proceeds from variable prepaid forward contracts | $ 644 | ||||||
Not Designated as Hedging Instrument | Variable Prepaid Forward Due Third Quarter Fiscal 2025 | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Pledged collateral (in shares) | 2.2 | ||||||
Proceeds from variable prepaid forward contracts | $ 325 | ||||||
Not Designated as Hedging Instrument | Variable Prepaid Forward Due First Quarter Fiscal 2026 | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Pledged collateral (in shares) | 5.3 | ||||||
Proceeds from variable prepaid forward contracts | $ 801 | ||||||
Not Designated as Hedging Instrument | Variable Prepaid Forward Due Third Quarter Fiscal 2026 | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Pledged collateral (in shares) | 5.3 | ||||||
Proceeds from variable prepaid forward contracts | $ 797 | ||||||
Not Designated as Hedging Instrument | Variable Prepaid Forward Due Fourth Quarter Fiscal 2026 | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Pledged collateral (in shares) | 2.7 | ||||||
Proceeds from variable prepaid forward contracts | $ 424 |
Financial instruments - Summa_3
Financial instruments - Summary of Derivative Income and Expenses Due to Fair Value Changes (Details) - Not Designated as Hedging Instrument - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Total return swaps | Selling, general and administrative expenses | ||||
Derivatives, Fair Value [Line Items] | ||||
Loss on variable prepaid forward contracts | $ 2 | $ 2 | $ 19 | $ 2 |
Foreign currency forwards | Other income, net | ||||
Derivatives, Fair Value [Line Items] | ||||
Loss on variable prepaid forward contracts | (14) | (112) | 19 | (203) |
Variable Prepaid Forward | Other income, net | ||||
Derivatives, Fair Value [Line Items] | ||||
Loss on variable prepaid forward contracts | $ 155 | $ (26) | $ (733) | $ (26) |
Fair value measurements- Summar
Fair value measurements- Summary of Fair Value Measurements (Details) - Recurring - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | $ 32 | $ 11 |
Investments in equity securities | 13 | 17 |
Investments in debt securities | 84 | 15 |
Cross currency interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 18 | 28 |
Derivative liability | 2 | |
Foreign currency forwards | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 2 | 6 |
Derivative liability | 11 | 5 |
Total return swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 1 | 1 |
Derivative liability | 1 | |
Variable Prepaid Forward | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 3,705 | 2,548 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 32 | 11 |
Investments in equity securities | 13 | 17 |
Investments in debt securities | 0 | 0 |
Level 1 | Cross currency interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | |
Level 1 | Foreign currency forwards | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Level 1 | Total return swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | |
Level 1 | Variable Prepaid Forward | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 0 | 0 |
Investments in equity securities | 0 | 0 |
Investments in debt securities | 84 | 15 |
Level 2 | Cross currency interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 18 | 28 |
Derivative liability | 2 | |
Level 2 | Foreign currency forwards | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 2 | 6 |
Derivative liability | 11 | 5 |
Level 2 | Total return swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 1 | 1 |
Derivative liability | 1 | |
Level 2 | Variable Prepaid Forward | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Money market funds | 0 | 0 |
Investments in equity securities | 0 | 0 |
Investments in debt securities | 0 | 0 |
Level 3 | Cross currency interest rate swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | |
Level 3 | Foreign currency forwards | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Level 3 | Total return swaps | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | |
Level 3 | Variable Prepaid Forward | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 3,705 | $ 2,548 |
Fair value measurements- Additi
Fair value measurements- Additional Information (Details) $ in Billions | May 31, 2024 USD ($) | Aug. 31, 2023 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of long-term notes outstanding | $ 6.5 | |
Estimate of Fair Value Measurement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Carrying value of long-term notes outstanding | $ 5.9 | |
Minimum | Level 3 | Variable Prepaid Forward, Lower Strike | Measurement Input, Price Volatility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.247 | 0.232 |
Minimum | Level 3 | Variable Prepaid Forward, Upper Strike | Measurement Input, Price Volatility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.194 | 0.181 |
Maximum | Level 3 | Variable Prepaid Forward, Lower Strike | Measurement Input, Price Volatility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.290 | 0.247 |
Maximum | Level 3 | Variable Prepaid Forward, Upper Strike | Measurement Input, Price Volatility | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative Liability, Measurement Input | 0.222 | 0.191 |
Fair value measurements - Fair
Fair value measurements - Fair Value Roll Forward (Details) - Derivative Financial Instruments, Liabilities - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
May 31, 2024 | May 31, 2024 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Opening balance | $ (3,861) | $ (2,548) |
VPF derivative additions | 0 | (424) |
Unrealized gains (losses) recorded in Other income, net | 155 | (733) |
Ending balance | $ (3,705) | $ (3,705) |
Commitment and contingencies (D
Commitment and contingencies (Details) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Jun. 18, 2024 USD ($) | Mar. 19, 2024 USD ($) | Nov. 02, 2022 USD ($) | May 05, 2022 USD ($) | Aug. 31, 2022 USD ($) | Dec. 31, 2017 case | Dec. 31, 2020 case | May 31, 2024 USD ($) | Dec. 29, 2023 USD ($) | Aug. 31, 2023 USD ($) | Aug. 23, 2023 USD ($) | Jun. 08, 2023 | Nov. 30, 2022 USD ($) | |
Loss Contingencies [Line Items] | |||||||||||||
Accrued litigation obligations | $ 5,890 | $ 6,261 | |||||||||||
Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Litigation settlement, amount awarded to other party | $ 988 | ||||||||||||
Estimated litigation liability | 79 | ||||||||||||
Damages limit | $ 79 | ||||||||||||
Settlement Frameworks | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | $ 6,500 | ||||||||||||
Accrued litigation obligations | $ 754 | ||||||||||||
Settlement Frameworks | Settled Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | 6,600 | ||||||||||||
Accrued litigation obligations | 5,900 | ||||||||||||
Estimated litigation liability, current | 744 | ||||||||||||
Litigation Settlement, Percentage Of Litigating Subdivisions | 99.50% | ||||||||||||
Settling States | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | $ 4,800 | ||||||||||||
Litigation settlement, period | 15 years | ||||||||||||
Settling Tribes | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | $ 155 | ||||||||||||
Litigation settlement, period | 15 years | ||||||||||||
Consolidated Cases in State of Florida | Settled Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Litigation settlement, amount awarded to other party | $ 683 | ||||||||||||
Estimated litigation liability | $ 683 | ||||||||||||
Accrued litigation obligations | $ 620 | ||||||||||||
Litigation settlement, period | 18 years | ||||||||||||
Estimated litigation liability, current | $ 63 | ||||||||||||
Ohio Combined Cases | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Litigation settlement, amount awarded to other party | $ 651 | ||||||||||||
Loss Contingency, New Claims Filed, Number | case | 2 | ||||||||||||
Litigation Settlement, Period | 15 years | ||||||||||||
Ohio Combined Cases | Pending Litigation | Subsequent Event | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Litigation settlement, amount awarded to other party | $ 28 | ||||||||||||
Rite Aid Merger | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Loss Contingency, New Claims Filed, Number | case | 2 | ||||||||||||
Rite Aid Merger | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | $ 193 | ||||||||||||
Usual and Customary Pricing | Pending Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Estimated litigation liability | 310 | ||||||||||||
Humana | Settled Litigation | |||||||||||||
Loss Contingencies [Line Items] | |||||||||||||
Litigation settlement, amount awarded to other party | $ 642 | ||||||||||||
Accrued litigation obligations | $ 360 |
Income taxes (Details)
Income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Aug. 02, 2012 | |
Effective Income Tax Rate Reconciliation [Line Items] | |||||
Effective tax rate | 8% | 86.30% | 6.30% | 33.80% | |
Income taxes paid | $ 238 | $ 170 | |||
Estimate of possible loss | $ 2,700 | ||||
Alliance Boots | |||||
Effective Income Tax Rate Reconciliation [Line Items] | |||||
Outstanding equity interest percentage | 45% | ||||
Option to acquire outstanding equity percentage | 55% | ||||
Option to acquire outstanding equity, value | $ 866 |
Retirement benefits - Narrative
Retirement benefits - Narrative (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Dec. 07, 2023 USD ($) | Nov. 23, 2023 USD ($) member | May 31, 2024 USD ($) | May 31, 2023 USD ($) | May 31, 2024 USD ($) | May 31, 2023 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Accelerated future employer contributions | $ 210 | |||||
Contributions by employer | $ 375 | |||||
Plan assets, period increase | $ 124 | |||||
UNITED STATES | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Profit sharing provision expense | $ 55 | $ 59 | 166 | $ 184 | ||
Foreign Plan | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Cost recognized in the consolidated condensed statements of earnings | $ 23 | $ 21 | $ 68 | $ 62 | ||
Pension Plans | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Number of members | member | 53,000 | |||||
Minimum | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Expected future employer contributions | $ 760 | |||||
Maximum | ||||||
Defined Benefit Plan Disclosure [Line Items] | ||||||
Expected future employer contributions | $ 820 |
Retirement benefits - Schedule
Retirement benefits - Schedule of Net Periodic Pension Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Retirement Benefits [Abstract] | ||||
Service costs | $ 1 | $ 1 | $ 3 | $ 3 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration] | Other income, net | Other income, net | ||
Interest costs | $ 68 | 64 | $ 202 | 186 |
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other income, net | Other income, net | ||
Expected returns on plan assets/other | $ (70) | (81) | $ (206) | (237) |
Total net periodic pension income | $ (1) | $ (17) | $ (1) | $ (48) |
Accumulated other comprehensi_3
Accumulated other comprehensive loss (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 15,192 | $ 29,439 | $ 28,322 | $ 29,366 |
Net change in other comprehensive (loss) income | 5 | 121 | 100 | 274 |
Ending balance | 15,257 | 29,359 | 15,257 | 29,359 |
Pension/ post-retirement obligations | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (608) | (167) | (698) | (157) |
Other comprehensive (loss) income before reclassification adjustments | (3) | 0 | 124 | 0 |
Amounts reclassified from AOCI | (3) | (7) | (10) | (20) |
Tax benefit (provision) | 2 | 2 | (30) | 5 |
Net change in other comprehensive (loss) income | (5) | (5) | 85 | (15) |
Ending balance | (613) | (171) | (613) | (171) |
Unrealized gain on cash flow hedges and other | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (5) | (6) | (2) | |
Other comprehensive (loss) income before reclassification adjustments | (2) | 0 | (6) | |
Amounts reclassified from AOCI | 1 | 5 | 2 | |
Tax benefit (provision) | 0 | 0 | 1 | |
Net change in other comprehensive (loss) income | (1) | 5 | (4) | |
Ending balance | 0 | (6) | 0 | (6) |
Net investment hedges | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 85 | 140 | 83 | 213 |
Other comprehensive (loss) income before reclassification adjustments | (13) | (42) | (6) | (138) |
Amounts reclassified from AOCI | 3 | 0 | (1) | 0 |
Tax benefit (provision) | 3 | 10 | 2 | 33 |
Net change in other comprehensive (loss) income | (8) | (31) | (6) | (104) |
Ending balance | 77 | 108 | 77 | 108 |
Share of OCI of equity method investments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (100) | (162) | (132) | (254) |
Other comprehensive (loss) income before reclassification adjustments | (16) | 16 | (3) | (8) |
Amounts reclassified from AOCI | 10 | (1) | 39 | 149 |
Tax benefit (provision) | 2 | (4) | (6) | (37) |
Net change in other comprehensive (loss) income | (4) | 12 | 29 | 104 |
Ending balance | (104) | (150) | (104) | (150) |
Cumulative translation adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (2,274) | (2,461) | (2,240) | (2,605) |
Other comprehensive (loss) income before reclassification adjustments | 20 | 143 | (11) | 301 |
Amounts reclassified from AOCI | 0 | (2) | (3) | (16) |
Tax benefit (provision) | 0 | 0 | 0 | 0 |
Net change in other comprehensive (loss) income | 20 | 141 | (14) | 285 |
Ending balance | (2,254) | (2,320) | (2,254) | (2,320) |
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (2,897) | (2,654) | (2,993) | (2,805) |
Other comprehensive (loss) income before reclassification adjustments | (13) | 115 | 104 | 149 |
Amounts reclassified from AOCI | 10 | (9) | 30 | 115 |
Tax benefit (provision) | 6 | 9 | (34) | 2 |
Net change in other comprehensive (loss) income | 3 | 115 | 100 | 266 |
Ending balance | $ (2,894) | $ (2,539) | $ (2,894) | $ (2,539) |
Segment reporting (Details)
Segment reporting (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 USD ($) | May 31, 2023 USD ($) | May 31, 2024 USD ($) segment | May 31, 2023 USD ($) | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | segment | 3 | |||
Segment Reporting Information [Line Items] | ||||
Sales | $ 36,351 | $ 35,415 | $ 110,111 | $ 103,659 |
Adjusted operating income (Non-GAAP measure) | 613 | 959 | 2,200 | 3,188 |
Acquisition-related amortization | (266) | (274) | (811) | (851) |
Transformational cost management | (95) | (414) | (401) | (697) |
Acquisition-related costs | (68) | (70) | (480) | (257) |
Adjustments to equity earnings in Cencora | (57) | (61) | (129) | (178) |
Certain legal and regulatory accruals and settlements | (52) | (268) | (376) | (7,249) |
LIFO provision | 36 | (51) | (11) | (89) |
Impairment of goodwill, intangibles and long-lived assets | 0 | (299) | (13,091) | (299) |
Operating income (loss) | 111 | (477) | (13,099) | (6,431) |
Reportable Segments | U.S. Retail Pharmacy | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 28,503 | 27,866 | 86,308 | 82,648 |
Adjusted operating income (Non-GAAP measure) | 501 | 962 | 1,947 | 3,134 |
Reportable Segments | International | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 5,727 | 5,573 | 17,581 | 16,414 |
Adjusted operating income (Non-GAAP measure) | 175 | 208 | 562 | 676 |
Reportable Segments | U.S. Healthcare | ||||
Segment Reporting Information [Line Items] | ||||
Sales | 2,125 | 1,975 | 6,232 | 4,597 |
Adjusted operating income (Non-GAAP measure) | (22) | (172) | (151) | (483) |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Sales | (3) | 0 | (9) | 0 |
Adjusted operating income (Non-GAAP measure) | $ (42) | $ (39) | $ (158) | $ (139) |
Sales (Details)
Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Sales | $ 36,351 | $ 35,415 | $ 110,111 | $ 103,659 |
Reportable Segments | U.S. Retail Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 28,503 | 27,866 | 86,308 | 82,648 |
Reportable Segments | U.S. Retail Pharmacy | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 21,812 | 20,898 | 65,704 | 60,991 |
Reportable Segments | U.S. Retail Pharmacy | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 6,691 | 6,968 | 20,604 | 21,657 |
Reportable Segments | International | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 5,727 | 5,573 | 17,581 | 16,414 |
Reportable Segments | International | Pharmacy | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 874 | 924 | 2,698 | 2,690 |
Reportable Segments | International | Retail | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 1,839 | 1,769 | 5,928 | 5,412 |
Reportable Segments | International | Wholesale | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 3,014 | 2,880 | 8,955 | 8,311 |
Reportable Segments | U.S. Healthcare | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | 2,125 | 1,975 | 6,232 | 4,597 |
Corporate and Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales | $ (3) | $ 0 | $ (9) | $ 0 |
Related parties (Details)
Related parties (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Aug. 31, 2023 | |
Related Party Transaction [Line Items] | |||||
Purchases, net | $ 54,296 | $ 47,772 | |||
Related Party | Cencora | |||||
Related Party Transaction [Line Items] | |||||
Purchases, net | $ 18,181 | $ 16,573 | |||
Trade accounts payable, net of receivables | $ 8,756 | $ 8,756 | $ 7,814 |
Supplemental information - Narr
Supplemental information - Narrative (Details) - USD ($) shares in Millions, $ in Billions | 3 Months Ended | 9 Months Ended | |||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | Aug. 31, 2023 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Accumulated depreciation and amortization on property, plant, and equipment | $ 13.5 | $ 13.5 | $ 13 | ||
Antidilutive securities excluded from EPS calculations (in shares) | 13.6 | 17.4 | 14.3 | 17.8 | |
Incremental common shares attributable to dilutive effect of share-based payment arrangements | 7 | 3.3 | |||
Related Party | Cencora | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Receivables | $ 1.2 | $ 1.2 | 1.1 | ||
Trade Accounts Receivable | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Receivables | $ 4.8 | $ 4.8 | $ 4.3 |
Supplemental information - Depr
Supplemental information - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | ||||
Depreciation expense | $ 369 | $ 372 | $ 1,120 | $ 1,068 |
Intangible assets amortization | 238 | 226 | 717 | 583 |
Total depreciation and amortization expense | $ 607 | $ 598 | $ 1,837 | $ 1,652 |
Supplemental information - Summ
Supplemental information - Summary of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Millions | May 31, 2024 | Aug. 31, 2023 | May 31, 2023 | Aug. 31, 2022 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 703 | $ 739 | ||
Cash and cash equivalents - assets held for sale (included in other current assets) | 0 | 24 | ||
Restricted cash - (included in other current and non-current assets) | 37 | 93 | ||
Cash, cash equivalents and restricted cash | $ 740 | $ 856 | $ 1,117 | $ 2,558 |
Supplemental information - Sche
Supplemental information - Schedule of Redeemable Noncontrolling Interest (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
May 31, 2024 | May 31, 2023 | May 31, 2024 | May 31, 2023 | |
Increase (Decrease) in Temporary Equity [Roll Forward] | ||||
Beginning balance | $ 172 | $ 158 | $ 167 | $ 1,042 |
Net (loss) income attributable to Redeemable non-controlling interests | (1) | 0 | 1 | (24) |
Redemption price adjustments and other | 1 | 2 | 0 | 456 |
Reclassifications from redeemable non-controlling interests | 0 | 0 | 5 | (1,314) |
Ending balance | $ 173 | $ 160 | $ 173 | $ 160 |
Supplemental information - Su_2
Supplemental information - Summary of Dividends per Share (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||||||
May 31, 2024 | Feb. 29, 2024 | Nov. 30, 2023 | May 31, 2023 | Feb. 28, 2023 | Nov. 30, 2022 | May 31, 2024 | May 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | ||||||||
Cash dividends declared (in dollars per share) | $ 0.2500 | $ 0.2500 | $ 0.4800 | $ 0.4800 | $ 0.4800 | $ 0.4800 | $ 0.9800 | $ 1.4400 |