Japan’s Seven & i Forecasts 4% Drop in Operating Profit, Amid Sluggish Convenience Store Performance

By Tomoharu Mizuno / Yomiuri Shimbun Staff Writer

17:43 JST, October 10, 2025

Seven & i Holdings Co. on Thursday announced that it expects an operating profit of ¥404 billion for its financial year ending February 2026, representing a 4% drop.

It marked a drastic shift from the previous forecast in July, when Seven & i Holdings projected a 0.7% increase to ¥424 billion.

The downward revision stems from the company’s sluggish performance in its domestic convenience store business, with consumers becoming more budget-conscious amid rising prices. For the company, improving its earning power is an urgent task.

Seven & i Holdings President and CEO Stephen Hayes Dacus said the company is facing harsh business conditions, at a press conference on Thursday to announce the company’s consolidated first-half financial results through August. He added that the company must step up efforts to meet the needs of customers.

The company posted an operating revenue – often referred to as net sales – of ¥5.61 trillion in that half. The figure dropped 6.9% year-on-year, with reduced sales in its overseas convenience store business caused by a fall in gasoline prices being one driver. On the other hand, net profit rose 130% to ¥121.8 billion, helped by factors such as Ito-Yokado Co.’s return to profitability.

Behind all these figures, the underperformance of Seven & i Holdings’ domestic convenience store business has become conspicuous. Same-store sales for the first half slightly exceeded the figure for the same period the previous year. However, its operating profit dropped by 4.6%, affected by rising costs of raw materials such as rice and coffee beans. It also lowered its full-year operating profit forecast for the financial year by \30 billion.

For Seven & i Holdings, the dust has now settled following Canadian convenience store giant Alimentation Couche-Tard Inc.’s withdrawal of its acquisition proposal in July. Seven & i Holdings has since been concentrating its management resources on its convenience store business. In August, it announced its mid-term plan through fiscal 2030, setting out a policy of increasing domestic convenience store locations by about 1,000.

York Holdings Co., an intermediate holding company that manages non-convenience store companies such as Ito-Yokado, was deconsolidated on Sept. 1 and became an equity-method affiliate.

With consumers becoming more budget-conscious, the 7-Eleven convenience store chain has been unable to dispel sentiment that its products are overpriced. The chain’s same-store sales growth lags behind rivals. In the six months through August, increases in domestic same-store sales of 7-Eleven have consistently fallen short of its 2.5% target, while the figures for Lawson Inc. and FamilyMart Co. have stayed at around 4% to 5%. FamilyMart posted a record operating profit in its first-half financial results through August, buoyed by strong sales of onigiri rice balls and other products.

Seven & i Holdings has declared that it will concentrate on its convenience store business for further growth. The focus will be on whether Seven & i Holdings can encourage customers to flock back to its convenience stores.

Dacus said the company must provide products and services that excite consumers, during the Thursday press conference.