From CNBC: 2024-06-05 08:32:12

Dollar Tree is considering selling its Family Dollar brand after closing over 500 locations during its fiscal first quarter. The company bought Family Dollar in 2015 for nearly $9 billion but has struggled to compete with Dollar General. Dollar Tree’s revenue rose to $7.63 billion, with a 1.7% increase in Dollar Tree brand same-store sales compared to 0.1% for Family Dollar.

The company is working with advisors to review the sale, with shares falling 2% in premarket trading. Dollar Tree reported $300.1 million in net income for the first quarter, exceeding analyst expectations. Despite losses from a tornado destroying a distribution center, the company expects insurance recoveries to offset the losses. Dollar stores face tough times as lower-end consumers cut back due to higher costs, losing market share to value retailers like Walmart.

While Dollar Tree’s cost-cutting efforts did not meet expectations, Dollar General surpassed estimates. Dollar Tree has faced challenges and undergone a turnaround effort since new CEO Richard Dreiling took over in 2023. Company shares have dropped about 15% in 2024 as the industry grapples with changing consumer habits and competition.



Read more at CNBC:: Dollar Tree (DLTR) earnings Q1 2024