Dollar General Corp. shares jumped 8.4% in premarket trading on Wednesday after the discount retailer reported second-quarter earnings that exceeded expectations and raised its full-year guidance.
The company posted adjusted earnings per share of $2.48, topping the analyst consensus of $2.00 by 24% and rising from $1.96 a year earlier. Revenue increased 5.2% to $11.3 billion, surpassing the $11.19 billion estimate and up from $10.7 billion in the same period last year. Same-store sales grew 3.5%, marking the fifth consecutive quarter of customer traffic growth.
Operating profit surged 29.2% to $769.2 million, compared with $595.4 million in the prior-year quarter. Gross profit margin expanded by 127 basis points to 32.6%, driven by tariff refunds, a lower LIFO provision, and reduced distribution costs. The company estimated the gross margin benefit from tariff refunds, after related reinvestments, at approximately 81 basis points, or about $0.25 per share.
For the full fiscal year, Dollar General raised its diluted EPS guidance to a range of $7.80 to $8.00, with a midpoint of $7.90, exceeding the analyst consensus of $7.39. The previous range was $7.20 to $7.45. Net sales growth is now projected at 4.0% to 4.3%, up from the prior 3.7% to 4.2%, while same-store sales growth expectations were increased to 2.5% to 2.9% from 2.2% to 2.7%.
The Board of Directors declared a quarterly cash dividend of $0.59 per share, payable on or before October 20, 2026. CEO Todd Vasos noted the company's performance reflected balanced topline growth, healthy operating margin expansion, and strong double-digit EPS growth, adding that the results exceeded expectations even before tariff refund benefits.
