Dollar General (DG) Q2 2024 Earnings

US Dollar General Shares of the discount retailer fell sharply on Thursday after it slashed its full-year sales and profit forecasts, suggesting its lower-income customers were struggling in the current economic climate.

Shares of the retailer, which primarily serves rural areas, fell 25% following the earnings report.

The company now expects same-store sales to increase 1.0% to 1.6% in fiscal 2024, down from its previous forecast of 2% to 2.7% growth. Full-year earnings are expected to be between $5.50 and $6.20 per share, compared with a previous forecast of $6.80 to $7.55 per share.

“While we believe the soft sales trends are due in part to core customers feeling the financial pinch, we understand the importance of controlling the things we can control,” Chief Executive Officer Todd Vasos said in a statement.

Still, he acknowledged the company still has a lot of work to do. Dollar General said it needs to improve its stores and the way it handles inventory to reduce losses.

Dollar General’s second-quarter results were in line with Wall Street expectations, according to a London Stock Exchange survey of analysts:

• EPS: $1.70 vs. $1.79 expected
• Revenue: $10.21 billion vs. $10.37 billion expected

The company reported net income of $374 million, or $1.70 per share, for the three months ended Aug. 2, compared with net income of $469 million, or $2.13 per share, in the same period last year.

Sales increased to $10.21 billion, up about 4.2% from $9.8 billion in the same period last year.

competitor Dollar Tree Shares also fell, down more than 7% in early trading.