Dive Brief:
- 7-Eleven Inc. is keeping U.S. same-store merchandise sales in focus while it continues to scale its ongoing North Star transformation plan, parent company Seven & i Holdings outlined in its earnings presentation last week.
- Same-store merchandise sales in the U.S. grew 0.6% in the first half of the year while merchandise gross profit margins have improved by 0.3 percentage points, the company highlighted in its fiscal Q2 earnings release. Seven & i executives attributed the gains to expanded hot food offerings, improved product quality and ongoing conversions of company-operated stores to franchised sites.
- 7-Eleven’s ongoing North Star plan includes remodeling hundreds of stores, increasing its franchising and wholesale network and closing unprofitable locations to boost profitability and competitiveness ahead of a potential 2027 IPO.
Dive Insight:
Seven & i executives have repeatedly blamed a challenging U.S. macroeconomic environment for the company’s lack of profitability in recent years, prompting the unveiling of its North Star transformation plan last year.
Though still in its early stages, the plan is already yielding financial improvements, president and CEO Stephen Dacus said in pre-recorded earnings remarks released last week. While fiscal Q2 same-store merchandise sales were basically flat, the metric has continued a general upward trend over the past year.
“To create lasting value, we need to consistently get the basics right and keep strengthening the capabilities that elevate the customer experience,” Dacus said. “That is why disciplined execution of the transformation plan remains our foremost priority.”
Chief Financial Officer Tetsuya Takagi added that upgraded open-air cases alongside expanded hot food offerings are driving larger baskets. U.S. same-store fresh food sales declined 0.3% in fiscal Q2, an improvement from a 3.9% decline in Q1, according to the earnings presentation.
“Even in what is considered a challenging consumer environment, we believe that by capturing customer needs more closely and responding swiftly, sales will respond positively to those efforts,” Takagi said through a translator.
Franchise conversions are also showing results. The 47 U.S. company-operated stores converted in fiscal 2025 saw merchandise sales rise by low-to-mid-single-digit percentages compared with pre-conversion levels, while merchandise margins improved significantly, Takagi said.
In fiscal 2026, the North Star plan calls for closing 200 underperforming stores, opening 205 new locations, converting 390 sites to franchises and another 350 wholesale locations. So far, 7-Eleven has closed 162 stores, opened 69, completed 86 franchise conversions and added 79 wholesale sites, according to the presentation.
