Dollar Tree drops 10% after cutting full-year outlook due to challenges with customers

From CNBC: 2024-09-04 08:11:11

Shares of Dollar Tree dropped 10% after cutting full-year outlook due to challenges with middle and higher-income customers. Revised expectations include $30.6-$30.9 billion in sales and adjusted EPS of $5.20-$5.60. CFO Jeff Davis cited a conservative outlook and costs from acquiring 99 Cents Only stores for the forecast cut.

Dollar Tree attributed lower earnings to general liability claims and softer sales as customers across incomes were more cautious about spending. Rival Dollar General also slashed sales and profit outlook, blaming financially constrained customers. Dollar stores face pressure as shoppers make tradeoffs due to rising costs.

Same-store sales for Dollar Tree rose by 0.7% in the quarter, with Dollar Tree stores up by 1.3% and Family Dollar down by 0.1%. The company has announced closures of nearly 1,000 Family Dollar stores and is considering selling the brand. Dollar Tree shares are down nearly 43% this year, closing at $81.65 on Tuesday.



Read more at CNBC:: Dollar Tree (DLTR) earnings Q2 2024