Dollar General (DG) Q2 2024 earnings

Dollar general Shares tumbled Thursday after the discount retailer cut its full-year sales and profit forecasts, signaling that its lower-income customers are struggling in this economy.

Shares of the retailer, which focuses on more rural areas, fell 25% after the earnings report.

The company now expects same-store sales to rise 1.0% to 1.6% in fiscal 2024, lower than its previous guidance of a 2% to 2.7% increase. Earnings per share for the year are expected to be in the range of $5.50 to $6.20, compared to previously forecast $6.80 to $7.55 per share.

“While we believe the softer sales trends are partly due to a core customer feeling financially constrained, we know the importance of controlling what we can control,” CEO Todd Vasos said in a statement.

However, he also acknowledged that the company still has more work to do. Dollar General has said it must improve its stores and the way it handles inventory to curb losses.

Here’s how Dollar General did in its second fiscal quarter, compared to what Wall Street expected, based on a survey of analysts by LSEG:

• Earnings per share: $1.70 versus $1.79 expected
• Revenue: $10.21 billion versus $10.37 billion expected

The company’s reported net income for the three-month period ended Aug. 2 was $374 million, or $1.70 per share, compared to $469 million, or $2.13 per share, a year earlier.

Revenue rose to $10.21 billion, up about 4.2% from $9.80 billion a year earlier.

Competitor Dollar tree fell in sympathy, down more than 7% in early trading.