Meal deals, nicotine and booze boost Couche-Tard sales growth

MONTREAL – Alimentation Couche-Tard Inc. served up solid earnings growth last quarter despite cost-of-living concerns among customers, who CEO Alex Miller said are looking “to stretch their dollars” — on meal combos, nicotine pouches and beer, in particular.

Higher “meal deal” sales along with nicotine purchases and a change in rules governing alcohol sales in Ontario helped the convenience store giant raise second-quarter profits 4.5 per cent year-over-year to US$740.6 million. 

“Our meal deals are meeting their needs with the choices and options they want at an attractive price point,” Miller told analysts on a conference call Tuesday to discuss the company’s latest results.

The company’s share price rose 4.9 per cent to close at $74.41 on the Toronto Stock Exchange.

To double down on food deals, Couche-Tard cut back on the volume of freshly prepared food items it stocks. The decision was part of a move to slim down its selection over the past few quarters in order to offer discounts on the remaining products.

In the U.S. — Couche-Tard’s biggest market — nicotine purchases and meal deals that bundled popular items together with a drink fuelled a 1.2 per cent year-over-year increase in same-store merchandise revenue.

In total, the company sold more than 10 million food-and-drink bundles in its second quarter, up from 8.6 million in the first, Miller said.

In Canada, Couche-Tard enjoyed a 5.4 per cent rise in same-store merchandise sales.

“Canada’s growth benefited primarily from alcohol and food,” Miller said.

Chief financial officer Filipe Da Silva noted that much of the booze boost flowed from Ontario, where legislation last fall threw open the floodgates to beer, wine and cider sales at licensed convenience stores. 

The results helped the Laval, Que.-based company outperform its biggest rival, 7-Eleven, on several fronts recently, including overall revenue growth as well as same-store merchandise sales in the U.S. last quarter.

“This is only the second time in nine quarters that Couche-Tard reports an adjusted earnings-per-share growth year-over-year, and should be welcomed by investors,” said Stifel Canada analyst Martin Landry in a research note.

During its first quarter, Couche-Tard pulled its proposal to buy the parent company of rival 7-Eleven in July after courting Seven & i Holdings Co. Ltd. for nearly a year.

The money not spent on that massive would-be acquisition — Couche-Tard’s bid rose to US$47 billion in January — helped pave the way for a share buyback of nearly US$900 million in the quarter ended Oct. 12.

Miller said the company also remains on track to meet its store expansion goals despite a “challenging consumer environment.”

Couche-Tard plans to open 500 new locations by 2028, a target it first laid out two years ago.

The company will open 100 new locations in North America this year, with another 73 stores under construction, Miller said. It currently has 17,270 stores across the globe.

Cost-of-living concerns remain top of mind for many, with American consumer confidence in November falling to its lowest level since April, according to new economic data from the U.S. Bureau of Labor Statistics.

“Consumer spending remains constrained,” said RBC Dominion Securities analyst Irene Nattel in a note to investors.

On Monday evening, Couche-Tard reported that profits rose to US$740.6 million in its second quarter from US$708.8 million a year earlier.

The company, which keeps its books in U.S. dollars, said revenue increased 2.6 per cent to US$17.87 billion during the period ended Oct. 12.

On an adjusted basis, diluted net earnings per share jumped 5.4 per cent to 78 cents US from 74 cents US, beating analysts’ expectations of 75 cents US, according to financial markets firm LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 25, 2025. 

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