shares fell in premarket trading after the discount store reported lower revenue than expected for the second quarter and lowered its full-year earnings forecast.
(ticker: DLTR) reported earnings of $1.60 a share for its second quarter, which ended July 30. That was in line with analysts’ estimates, according to FactSet, but revenue for the quarter was $6.77 billion, lower than the $6.79 billion Wall Street expected.
Enterprise same-store sales increased 4.9%, which was just below Wall Street estimates of 5%.
“Our second quarter performance reinforces the relevance of our brands for millions of households pressured by higher costs for food, fuel, rent and more,” CEO Mike Witynski said in the company’s earnings release.
Still, the company lowered its forecast for earnings for the full year because it is “making an investment in pricing at Family Dollar,” Witynski said.
Earnings for fiscal 2022 are now expected to range from $7.10 to $7.40 a share, which is down from the previous forecast of $7.80 to $8.20 a share.
“Combined with improvements in merchandising and store standards, we believe we are putting our best foot forward at a time when customers are coming to us to help them navigate difficult times,” the CEO said. “We expect the combination of this pricing investment at Family Dollar and the shoppers’ heightened focus on needs-based consumable products will pressure gross margins in the back half of the year.”
were down 8.3% in premarket trading Thursday to $152.01. Coming into Thursday trading, the stock had climbed 18% in 2022.
(DG), a direct competitor of Dollar Tree, also reported its second-quarter earnings Thursday. The retailer raised its financial outlook for the full year.
Write to Angela Palumbo at firstname.lastname@example.org
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