Dollar General Raises Forecast, Betting Big on Brick and Mortar

Dollar General posted stronger-than-expected Q2 results and boosted its full-year guidance, driven by a surge in customer traffic and spending. The performance underscores the discount retailer's resilience as consumers continue to prioritize value.

• By the numbers: For its second quarter, the company’s net sales jumped 5.1% to $10.7 billion, fueled by a 2.8% rise in same-store sales. The growth came from more foot traffic (up 1.5%) and bigger basket sizes (up 1.2%), boosting net income 10% to over $411 million. CEO Todd Vasos credited the company's "improved execution" for resonating with both new and existing customers.

• Brick by brick: The company is sticking to its physical expansion plans, with nearly 5,000 real estate projects slated for this year. The projects include opening nearly 600 new U.S. stores and remodeling thousands of others under its Project Elevate and Renovate initiatives, refreshing its vast network of over 20,000 locations.

• Tariff talk: While acknowledging that ongoing tariffs have caused some price increases, the company stated it has successfully absorbed most of the financial impact. Buoyed by the results, Dollar General bumped up its 2025 forecast, now projecting net sales growth between 4.3% and 4.8%.

• The long view: "We are proud of our progress, confident in the future of this resilient business model, and excited about the opportunity to further create sustainable long-term value," Vasos said, signaling a bullish outlook on future performance.

Dollar General's expansion comes as the broader retail sector braces for thousands of store closures. Meanwhile, key competitor Walmart also raised its outlook while pointing to rising tariff costs, and the recent cuts to federal SNAP benefits present a potential economic headwind for discount shoppers.