Dollar General Boosts Outlook After Strong Q2 Earnings

Dollar General lifted its full-year 2025 forecast after delivering second-quarter results that comfortably beat Wall Street estimates, signaling confidence in its low-price model even as it warned of growing cost pressures from tariffs. The news initially sent shares up as much as 6% in early trading.

The discount retailer reported adjusted earnings of $1.86 per share for the quarter, surging past analyst expectations of around $1.57. Net sales grew 5.1% year-over-year to $10.72 billion, driven by a solid 2.8% increase in same-store sales. Management credited the strong performance to its everyday low-price strategy, effective cost controls, and ongoing modernization efforts, which have resonated with budget-conscious shoppers.

Buoyed by the results, Dollar General raised its fiscal 2025 guidance. The company now projects earnings per share in the range of $5.80 to $6.30, a significant increase from its previous forecast of $5.20 to $5.80. It also boosted its outlook for net sales growth to a range of 4.3% to 4.8%.

However, the optimism was tempered by a caution from the company’s chief executive, who noted in a statement that tariffs are “already pushing prices up” for consumers. This warning appeared to weigh on investors throughout the day. Despite the strong earnings beat and raised guidance, the stock gave up its initial gains, suggesting concerns about how future cost inflation could impact margins and consumer spending.

Looking ahead, Dollar General plans to continue its strategic initiatives, including approximately 4,885 real estate projects and further investments in its digital and supply chain capabilities. The company's performance highlights its operational strength, but its stock's muted closing underscores investor uncertainty as the retailer navigates a challenging landscape of rising costs and potential shifts in consumer behavior.