Dollar General (DG) Q4 2025 earnings summary

Executive summary

• Q4 net sales rose 4.5% to $10.3 billion, with full-year sales up 5% to $40.6 billion, driven by new stores and same-store sales growth, partially offset by store closures.

• Same-store sales increased 1.2% in Q4 and 1.4% for the year, with consumables growth offsetting declines in other categories.

• Portfolio optimization led to the closure of 96 Dollar General stores and 45 popShelf stores, with $232 million in related impairment charges impacting Q4 and full-year results.

• Operating profit fell 49% in Q4 and 29.9% for the year, with Q4 net income down 52.4% to $191.2 million and diluted EPS at $0.87.

• Cash flows from operations increased 25% to $3 billion for the year.

Financial highlights

• Q4 gross profit margin was 29.4%, down 8 basis points year-over-year, pressured by higher markdowns, damages, and distribution costs.

• SG&A rose to 26.5% of sales in Q4, up 294 basis points, mainly from impairment charges and higher labor and technology expenses.

• Q4 operating margin was 2.9%, with net margin at 1.86%; full-year operating margin was 4.22%.

• Q4 EPS dropped 52.5% to $0.87, including a $0.81 per share negative impact from portfolio review charges.

• Merchandise inventories ended at $6.7 billion, down 4% year-over-year and 6.9% per store.

Outlook and guidance

• 2025 guidance: net sales growth of 3.4%-4.4%, same-store sales growth of 1.2%-2.2%, and EPS of $5.10-$5.80.

• Capital spending expected at $1.3-$1.4 billion, supporting 4,885 real estate projects, including 575 new U.S. stores, up to 15 in Mexico, 2,000 remodels, and 2,250 Project Elevate remodels.

• No share repurchases planned for 2025; quarterly dividend of $0.59 per share approved.

• Long-term framework targets 3.5%-4% annual net sales growth, 2%-3% same-store sales growth from 2026, and operating margin expansion to 6%-7% by 2028.

• Annual EPS growth of at least 10% (adjusted) expected beginning in 2026.