Dollar Tree Raises Fiscal 2026 Guidance After Q1 EPS Beat and 3.5% Sales Gain
DLTR•Dollar Tree reported Q1 EPS of $1.74 beating estimates of $1.55 and delivered $4.98 billion in revenue with 3.5% comparable‐store sales growth and a 4.5% increase in average transaction size despite lower traffic. The company raised its fiscal 2026 earnings guidance to $6.70–$7.10 per share, citing economic anxiety driving bargain hunting.
1. Strong First-Quarter Results
The discount retailer reported Q1 EPS of $1.74, topping estimates of $1.55 per share, and generated $4.98 billion in revenue. Comparable‐store sales rose 3.5% and average transaction size climbed 4.5% even as customer traffic declined.
2. Pricing Strategy Shift
Dollar Tree converted over half of its approximately 9,000 stores to offer $3–$5 items, boosting basket size and attracting higher-income shoppers seeking value. This move away from the $1 model drove the increase in average transaction size despite a pullback among budget-constrained consumers.
3. Raised Fiscal 2026 Guidance
Management lifted its full-year earnings outlook to $6.70–$7.10 per share, attributing the improvement to strong demand fueled by economic anxiety and continued pressure from fuel costs and tariffs.
