Dollar General hikes forecast as shoppers flock to bargains
The budget retailer says it is seeing more demand, with tariff worries even pulling in wealthier households looking to tighten their belts
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Dollar General raised its profit forecast after stronger-than-expected sales, as more Americans turned to the budget retailer amid uncertainty over tariff-related cost increases.
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Same-store sales rose 2.8% in the second quarter, topping analyst forecasts, as shoppers visited more often and spent more per trip. Earnings came in at $1.86 per share, which “significantly exceeded our expectations,” said chief executive Todd Vasos.
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The results came in as discount retailers are capitalizing on a period of economic unease. Consumer confidence slipped in August as Americans grew more anxious about the job market, tariffs, and stubbornly high prices. More people now expect a recession within the next year, the Conference Board said earlier this week.
That uncertainty is already shaping shopping behavior. With grocery bills climbing and tariffs filtering into everyday goods, households across income levels are turning to discount chains for relief — a shift that has played to Dollar General’s strengths.
Dollar General, which is one of the biggest budget retailers in the U.S. with more than 20,000 stores, has already noted that it is drawing in more higher-income shoppers looking for bargains.
Vasos said earlier this year that richer shoppers are “looking to maximize value while still shopping for items they want” and that trend appears to have carried through the latest quarter. He said Thursday that the strategy is “resonating with both existing and new customers”.
Dollar General also lifted its full-year guidance, now projecting sales growth of 4.3% to 4.8% and earnings per share between $5.80 and $6.30. Both figures are above its earlier forecasts, reflecting confidence that bargain hunting will persist through the rest of the year.
It said it was “taking into consideration the potential for uncertainty related to consumer behavior” with the forecasts.
Vasos added that Dollar General still sees “ample opportunity to drive growth” and remains confident in its long-term strategy.
Elsewhere in retail, Dick’s Sporting Goods also beat forecasts and raised its outlook after a strong quarter, while Best Buy reported solid results but cautioned that tariffs could weigh heavily on electronics sales in the months ahead.
—Jennifer Ortakales Dawkins contributed to this article.