Dollar Tree (DLTR) Q4 2025 earnings summary

Executive summary

• Announced sale of Family Dollar for just over $1 billion, with estimated net proceeds of $800 million and $350 million in tax benefits; Family Dollar now reported as discontinued operations.

• Dollar Tree Q4 same-store sales rose 2.0% on 0.7% higher traffic and 1.3% higher ticket; Multi-Price 3.0 format stores outperformed, with 2,900 stores at year-end and a target of 5,200 by end of 2025.

• Q4 adjusted diluted EPS was $2.29 ($2.11 from continuing, $0.18 from discontinued); full-year adjusted EPS from continuing operations was $5.10.

• Opened 33 new Dollar Tree stores in Q4, totaling 525 for the year, including 162 former 99 Cents Only Stores.

• Strategic separation enables each banner to focus on unique needs and clearer market valuation, with Dollar Tree emphasizing long-term growth, profitability, and returns.

Financial highlights

• Q4 net sales from continuing operations increased 0.7% to $5.0 billion; discontinued operations (Family Dollar) net sales decreased 11.2% to $3.3 billion.

• Consolidated net sales were $8.3 billion, at the high end of the $8.1–$8.3 billion outlook.

• Q4 adjusted operating income from continuing operations was $628 million, down 15% year-over-year; adjusted operating margin declined 230 basis points.

• Q4 gross margin contracted 130 basis points to 37.6%; sales per square foot at $225 in Q4 2024.

• Year-end cash and equivalents were $1.3 billion, with no borrowings under revolver and leverage below 2.5x.

Outlook and guidance

• Fiscal 2025 net sales expected between $18.5 billion and $19.1 billion, with comparable store sales growth of 3%–5%.

• Adjusted diluted EPS from continuing operations projected at $5.00–$5.50, including a $0.30–$0.35 negative impact from partial-year Family Dollar TSA reimbursement.

• Q1 2025 net sales guidance: $4.5–$4.6 billion; adjusted diluted EPS: $1.10–$1.25.

• Modest improvement in gross margin expected; adjusted SG&A rate to deleverage by 50–80 basis points.

• Capital expenditures planned at $1.2–$1.3 billion, including 400 new store openings.