Dive Brief:
- Alimentation Couche-Tard saw its strongest U.S. same-store merchandise sales performance in over two calendar years last quarter, the convenience retailer said in its Q3 earnings report on Tuesday.
- The 2.8% bump in same-store merchandise sales growth was primarily driven by foodservice, especially Circle K’s meal deals program, according to the report. Same-store sales specifically for foodservice grew in the mid-to-high single digits, President and CEO Alex Miller said during the retailer’s earnings call on Wednesday.
- The strong performance followsCouche-Tard’s recent goal to grow food revenues at four times the pace of merchandise revenues in the U.S.
Dive Insight:
Couche-Tard’s U.S. business got off to a slow start last quarter due to the government shutdown, Miller noted during the call. However, once that ended in November, Circle K’s sales and traffic rebounded, resulting in the retailer’s best quarter from a same-store merchandise perspective in over 100 weeks.
Miller said that Circle K’s hot food offer and value proposition “continues to gain traction with customers,” and that its meal deals — priced at $3, $4 and $5 — “remain a key anchor of that performance.” Circle K sold 13.3 million meal deal bundles during the quarter, with the majority listed at the $3 price point, he added. That outpaced the 10 million bundles sold in the first full year of the program’s existence after it launched in 2024.
“The results also reflect the investments we have been making in the category and the strength of our scale and procurement capabilities, which allow us to deliver compelling food offers at price points very few others can match,” Miller said during the call.
But it wasn’t just foodservice that supported the strong same-store merchandise performance. Energy drinks — a surging category across convenience retailing — delivered mid-teens growth, driven by both “leading brands and emerging players,” Miller said. Nicotine also helped fuel the same-store merchandise surge, Miller said. Same-store sales in the category grew in the mid-to-high single digits, driven by modern oral nicotine.
The profitable quarter comes as Couche-Tard, the second largest convenience retailer in the U.S., looks to add 750 company-operated Circle K stores to its network in the next five years through NTIs and small acquisitions. Miller said that Couche-tard built 37 new stores during the quarter, reaching a total of 80 NTIs since the start of fiscal 2026.
“We are winning in retail and widening the gap versus the convenience channel,” Miller said during Wednesday’s call.
