What does Dollar Tree do and what are its main business segments?

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What factors drove the changes in Dollar Tree's revenue and profit?

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What were the key takeaways from Dollar Tree’s earnings call?

What guidance did Dollar Tree's management provide for the next earnings period?

What is the revenue and EPS growth rate for Dollar Tree year over year?

- **Revenue Growth**: Q3 comp up 4.2%, driven by 40 bps discretionary mix shift and 3 million new households (60% from higher-income brackets).
- **Multi-Price Dominance**: Halloween multi-price items generated 25% of sales and 3.5x more profit per unit, with total sales hitting $200 million.
- **Profitability**: Gross margin expanded 40 bps to 35.8%, supported by cost control and multi-price execution. Q4 EPS guidance of $2.40-$2.60 reflects strong momentum.
- **Customer Loyalty**: Lower-income households saw double the spending growth of higher-income ones, underscoring core customer loyalty.
- **2026 Vision**: 12%-15% EPS CAGR through 2028, driven by multi-price expansion, SG&A leverage, and freight savings.

**【CEO Summary Section】**
- **Revenue Growth and Customer Expansion**: Q3 comparable sales increased 4.2%, driven by a 40 basis point improvement in discretionary mix to 50.5%. The company added 3 million new households, with 60% from higher-income brackets (> $100k), 30% from middle-income ($60k-$100k), and the rest from lower-income (< $60k). Lower-income households saw double the spending growth of higher-income ones.
- **Multi-Price Strategy Success**: Multi-price items generated 25% of Halloween sales (vs. 3% in 2022) and contributed 3.5x more profit per unit than non-multi-price items. Total Halloween sales reached $200 million, a record high.
- **Operational Excellence**: Gross margin expanded 40 basis points to 35.8% due to cost control and multi-price execution. Store standards improved, with cleaner aisles and faster checkouts, supported by the 'Race to G.O.L.D.' initiative reducing turnover.

**【CFO Financial Commentary】**
- **Financial Highlights**: Q3 net sales of $4.7 billion (+9.4% YoY), adjusted EPS of $1.21 (+12%), and gross margin of 35.8% (up 40 bps). Strong performance driven by multi-price, tariff mitigation, and freight savings.
- **Expense Management**: SG&A rate increased 160 bps to 26.2% due to wage hikes, restickering, and claims costs. However, corporate SG&A (net of TSA income) improved 80 bps to 2.4%, aligning with the goal of 2% by 2028.
- **Q4 Outlook**: Comp guidance of 4%-6%, supporting $5.4-$5.5 billion in net sales and $2.40-$2.60 EPS. Full-year comp now expected at 5%-5.5%, with EPS of $5.60-$5.80.

**【Q&A Key Highlights】**
- **Traffic Trends**: Slight negative traffic in Q3 due to restickering, but strong end-of-quarter momentum (4.2% comp vs. 3.8% mid-quarter). Higher-income customers showed lower frequency but higher basket size potential.
- **Multi-Price Expansion**: 85% of items priced at $2 or below, with multi-price penetration expected to grow. Halloween success (25% multi-price mix vs. 3% in 2022) highlights long-term profitability gains.
- **2026 Outlook**: CFO reiterated 12%-15% EPS CAGR through 2028, driven by gross margin expansion (50-60 bps YoY) and SG&A leverage. Freight and markdowns remain key gross margin drivers.

Dollar Tree, Inc. (DLTR) Q3 2026 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

DLTR

DLTR fundamentals

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