In Q1 2025, Dollar Tree reported adjusted earnings per share (EPS) of $1.26 on revenue of $4.64 billion, surpassing analyst expectations of $1.21 EPS and $4.53 billion in revenue.  Comparable store sales increased by 5.4%, driven by a notable uptick in traffic from households earning over $100,000 annually. ‍

The company raised its full-year adjusted EPS guidance to a range of $5.15 to $5.65, up from the previous $5.00 to $5.50, citing reduced freight costs and steady demand for low-cost essentials.  However, Dollar Tree anticipates a significant decline in Q2 adjusted profit, projecting a drop of up to 50% compared to the previous year due to ongoing tariff uncertainties.

In a strategic move, Dollar Tree announced the sale of its Family Dollar brand to private-equity firms Brigade Capital Management and Macellum Capital Management for $1 billion, expected to close in the second quarter.  This divestiture allows Dollar Tree to focus on its core brand, which has been performing strongly, with a 5.4% increase in same-store sales during the quarter. ‍

Despite near-term challenges from tariffs, Dollar Tree's strategic initiatives and strong performance in its core business have instilled confidence among investors, reflected in today's stock price increase. However, given the Q2 profit headwind due to tariffs, DLTR may trade sideways (or even pull back) as investors digest the impact on margins. If you’re looking for a short‐term trade, be prepared for potential volatility around ongoing tariff developments—especially if Congress or administration policies shift unilaterally.