Dollar General raised its full-year outlook after exceeding Wall Street expectations for earnings and revenue in the fiscal first quarter, highlighting its ability to attract a broader range of consumers while navigating a volatile economic and trade environment.
The Tennessee-based discount retailer reported earnings per share of $1.78, ahead of the $1.48 consensus estimate, and revenue of $10.44 billion, beating the expected $10.31 billion. Same-store sales grew by 2.4%, also surpassing analysts’ projections.
Following the strong quarterly results, the company now expects net sales to grow between 3.7% and 4.7%, up from a prior range of 3.4% to 4.4%. It also raised its same-store sales outlook to 1.5% to 2.5%, and narrowed its earnings forecast to $5.20–$5.80 per share for the year.
CEO Todd Vasos attributed the strong performance to Dollar General’s growing appeal among middle- and higher-income shoppers seeking value amid economic uncertainty and tariff-related pressures.
“We have seen increased growth from both middle and higher-income customers,” Vasos said, noting that these consumers are making more visits and spending more per trip.
The retailer’s results come as other chains—such as Best Buy and Macy’s—have downgraded forecasts due to the impact of tariffs and slowing consumer demand. In contrast, Dollar General has worked to reduce its reliance on Chinese imports, shifting some manufacturing to other countries, adjusting product sourcing, and working closely with suppliers to control costs.
While Vasos acknowledged that some price increases may be necessary if tariffs intensify, he emphasized that the company views such steps as a last resort.
“We intend to work to minimize them as much as possible,” he said.
Customer behavior reflected changing consumer priorities. While foot traffic declined slightly by 0.3% year over year, the average transaction size increased 2.7%. Sales in food, seasonal, home, and apparel categories were particularly strong.
CFO Kelly Dilts said the company’s updated guidance accounts for the possibility of pressure on consumer spending but also assumes Dollar General will offset most tariff-related costs to protect margins.
The retailer’s core customer base remains under financial strain. According to company surveys, 25% of Dollar General shoppers reported having less income than a year ago, and nearly 60% anticipated needing to cut back on necessities. Still, the influx of new, higher-income shoppers has helped the company grow its market share.
Beyond its customer base, Dollar General has also invested in operations and customer experience. The company has reduced employee turnover, improved in-stock positions for popular items by cutting underperforming products, and expanded delivery options through its own service and a growing partnership with DoorDash. Delivery-related sales rose over 50% year over year.
The company is also diversifying its merchandise mix to include more discretionary items such as home decor and seasonal products—segments that have performed well with newer, higher-income customers. Its Popshelf store concept, which targets more affluent shoppers, also reported strong same-store sales growth during the quarter.
Despite regulatory scrutiny in the past over workplace safety issues, Dollar General appears to be regaining momentum. The retailer’s shares jumped more than 13% on the earnings news, signaling investor confidence in its strategy and resilience.
While tariff uncertainty continues to loom, Dollar General’s ability to attract new customer segments and adjust its operations appears to have positioned it favorably in the current retail landscape.
As Vasos noted, “We believe we are well positioned to succeed in a wide range of economic environments.”
CNBC, CNN, and Investor’s Business Daily contributed to this report.
