American Shoppers Are Trading Down: Dollar-Store Sales Beat Expectations

Executives at America's two largest dollar-store chains struck the same note on Thursday: consumers prioritized "value and affordability" in the second quarter — and that dynamic showed up directly in Dollar General's and Dollar Tree's financial results.

Dollar General's net sales rose 5.2% year over year to $11.3 billion. The 3.5% increase in comparable sales was driven by a 2% rise in traffic and a 1.5% increase in average transaction size. CEO Todd Vasos said the company's results beat its own guidance even before accounting for the benefit of tariff mitigation.

Dollar Tree grew total sales 7% year over year to $4.9 billion. Comparable sales rose 3.7%, with average ticket up 3.3% and traffic up 0.4%. Neil Saunders, managing director at research firm GlobalData, said rising gas prices — particularly in rural areas — have made the proximity and convenience of Dollar General's stores even more appealing, boosting traffic in a pattern the company has seen before and that functions as a kind of built-in "new-customer acquisition engine."

Jefferies analysts singled out Dollar Tree's return to positive traffic growth, saying it signals that efforts to improve merchandise assortment, expand multi-price tiers, and raise in-store service levels are strengthening the connection with shoppers. At the same time, tariff mitigation had a notable effect on Dollar Tree's financials — the company's earnings per share benefited directly from those funds, and its third-quarter guidance already accounts for the effect of reinvesting that money.

Both companies raised their full-year outlooks. Dollar Tree expects third-quarter net sales of $5.0–5.1 billion and comparable-sales growth of 3–4%, with full-year net sales guided to $20.5–20.7 billion. Dollar General revised its full-year outlook upward: net sales growth is now expected at 4–4.3%, up from 3.7–4.2%, and comparable-sales growth at 2.5–2.9%, up from 2.2–2.7%.

These figures point to growing price sensitivity among American consumers — a trend that remains an important signal for other segments of retail as concerns over inflation and the cost of living persist.