### Dollar General Surpasses Q1 Earnings Expectations, Raises Future Guidance

Shares of Dollar General (DG) soared on June 3 after the discount retailer reported an exceptional performance in the first quarter, significantly beating Wall Street's earnings expectations. The Goodlettsville, Tenn.-based company announced a record revenue of $10.44 billion for the quarter.

CEO Todd Vasos highlighted the company's growing customer base during an earnings call, noting that their value-focused approach is resonating across diverse income brackets. "While our core customer remains financially constrained, we have seen increased trade-in activity from both middle- and higher-income customers," Vasos stated.

Dollar General's data reveals that new customers are visiting more frequently and spending more compared to new customers from the previous year, with a notable increase in discretionary spending. "We believe this behavior suggests Dollar General is continuing to attract higher-income customers who are looking to maximize value while still shopping for items they want and need," Vasos added.

Amidst ongoing trade tensions under President Donald Trump's administration, which are impacting global economic forecasts, more than half of shoppers surveyed plan to prioritize the lowest-priced products in the coming months, as reported by Chain Store Age in April. The OECD has also revised the U.S. growth outlook downward to 1.6% for this year and 1.5% for 2026, reflective of the broader economic concerns.

Despite the economic uncertainty, Dollar General's strategic diversification in sourcing has mitigated potential impacts. Vasos mentioned that the company's direct imports constitute a small portion of total purchases, and exposure to China has been significantly reduced.

Analyst Chuck Grom from Gordon Haskett upgraded Dollar General's rating to accumulate, setting a $125 price target. Grom praised the retailer for raising guidance after its Q1 report and noted Dollar General's insulation from tariff impacts as key factors in its strong performance.

Looking ahead, Vasos expressed confidence in retaining new customers and sustaining growth, emphasizing ongoing efforts to refine strategies for future success. "What we're working on right now is how do we retain this trade-in consumer that we've been blessed with over the last couple of quarters," Vasos concluded.