How did Dollar General perform in the first quarter of fiscal 2026?

Net sales grew 3.4% to $10.8 billion, same-store sales rose 2.0%, operating profit increased 10.8% to $638.5 million, and diluted EPS grew 12.4% to $2.00. Growth was supported by new stores and higher gross margin, while SG&A deleveraged modestly.

Did Dollar General change its fiscal 2026 outlook?

Only diluted EPS was changed, raised to $7.20–$7.45 from $7.10–$7.35, mainly due to an assumed effective tax rate of about 24.5% versus 25% previously. Net sales growth (3.7%–4.2%), same-store sales growth (2.2%–2.7%), and capex ($1.4–1.5 billion) guidance were reaffirmed.

Are there any concerns in the quarter's cash flow or balance sheet?

Operating cash flow declined to $716 million from $847 million, largely due to a $308 million increase in inventory. Inventory totaled $6.6 billion, flat year over year in dollar terms but down 1.6% per store. On the positive side, debt was reduced by about $1.2 billion year over year and cash increased to $1.35 billion.

What factors pressured results and what risks remain?

Severe winter weather and higher fuel costs weighed on the quarter, and the effective tax rate rose to 24.9% from 23.4% due to expired federal tax credits. Ongoing risks include tariff uncertainty (including the timing of potential tariff refunds, which are excluded from guidance), Middle East-related energy costs, and consumer financial pressure.

What did shareholders decide at the May 28, 2026 annual meeting?

All nine directors were re-elected, and the advisory say-on-pay proposal and the reappointment of Ernst & Young LLP as auditor were approved. Three shareholder proposals were rejected: changing the director resignation policy, adopting a human rights policy assessment, and lowering the special meeting threshold from 25% to 10%.

DG 8-K: Earnings & Results, Shareholder Matters & More

01—Abstract

Summary

Summary of the 8-K filed June 2, 2026. Cited figures are marked; the original filing is the authoritative source.

Dollar General reported first-quarter fiscal 2026 results (13 weeks ended May 1, 2026) that beat its own EPS expectations, with diluted EPS rising 12.4% to $2.00^a on net sales of $10.8 billion (up 3.4%) and same-store sales growth of 2.0%.

Operating profit grew 10.8% to $638.5 million^b, driven by a 65 basis point gross margin expansion (to 31.6%) from higher markups and lower shrink, partially offset by higher SG&A (25.7% of sales, up 25 bps) tied to depreciation, utilities and property taxes. Net interest expense fell 26.9% to $47.2 million, though the effective tax rate rose to 24.9% from 23.4%, largely due to expired federal tax credits. The company raised the low and high ends of its fiscal 2026 diluted EPS guidance by $0.10 to $7.20–$7.45, while holding net sales growth (3.7%–4.2%), same-store sales growth (2.2%–2.7%) and capex ($1.4–1.5 billion) guidance unchanged.

The EPS raise reflects a lower assumed tax rate of about 24.5%, versus roughly 25% previously. Guidance assumes no share repurchases and excludes any potential tariff refund payments. Balance-sheet and cash-flow data show operating cash flow of $716 million^c (down from $847 million a year earlier, driven by a $308 million inventory build), cash rising to $1.35 billion, and long-term obligations reduced to $4.56 billion from $5.72 billion a year ago.

The board also declared a $0.59^d quarterly dividend payable July 21, 2026, and shareholders re-elected all nine directors and approved executive compensation, while rejecting three shareholder proposals. For investors, the key takeaways are the solid margin-driven earnings beat and modest guidance raise, against softer operating cash flow, a higher tax rate, and inventory levels that rose 0.7% in total while declining on a per-store basis by 1.6%. The filing also notes that severe winter weather and higher fuel costs weighed on the quarter, and that the company remains exposed to tariff uncertainty and Middle East-related energy cost risks.

02—Key points

Key Highlights

Diluted EPS rose 12.4% year over year to $2.00 (vs. $1.78), and management said EPS exceeded its internal expectations.
Net sales increased 3.4% to $10.79 billion; same-store sales rose 2.0%, with customer traffic up 1.4% and average ticket up 0.5%.
Gross margin expanded 65 bps to 31.6%, driven by higher markups and lower shrink and damages, partly offset by markdowns and transportation costs.
Fiscal 2026 diluted EPS guidance raised by $0.10 at both ends to $7.20–$7.45, primarily reflecting a lower expected tax rate (~24.5% vs. ~25%).
Operating cash flow fell to $716 million from $847 million, with a $308 million inventory build; capex of $352 million was up from $291 million.
Long-term obligations declined to $4.56 billion from $5.72 billion a year earlier, and net interest expense fell 26.9% to $47.2 million.
Quarterly dividend of $0.59 per share declared, payable July 21, 2026; no share repurchases are assumed in fiscal 2026 guidance.

03—Questions

Frequently Asked Questions

How did Dollar General perform in the first quarter of fiscal 2026?
Net sales grew 3.4% to $10.8 billion, same-store sales rose 2.0%, operating profit increased 10.8% to $638.5 million, and diluted EPS grew 12.4% to $2.00. Growth was supported by new stores and higher gross margin, while SG&A deleveraged modestly.
Did Dollar General change its fiscal 2026 outlook?
Only diluted EPS was changed, raised to $7.20–$7.45 from $7.10–$7.35, mainly due to an assumed effective tax rate of about 24.5% versus 25% previously. Net sales growth (3.7%–4.2%), same-store sales growth (2.2%–2.7%), and capex ($1.4–1.5 billion) guidance were reaffirmed.
Are there any concerns in the quarter's cash flow or balance sheet?
Operating cash flow declined to $716 million from $847 million, largely due to a $308 million increase in inventory. Inventory totaled $6.6 billion, flat year over year in dollar terms but down 1.6% per store. On the positive side, debt was reduced by about $1.2 billion year over year and cash increased to $1.35 billion.
What factors pressured results and what risks remain?
Severe winter weather and higher fuel costs weighed on the quarter, and the effective tax rate rose to 24.9% from 23.4% due to expired federal tax credits. Ongoing risks include tariff uncertainty (including the timing of potential tariff refunds, which are excluded from guidance), Middle East-related energy costs, and consumer financial pressure.
What did shareholders decide at the May 28, 2026 annual meeting?
All nine directors were re-elected, and the advisory say-on-pay proposal and the reappointment of Ernst & Young LLP as auditor were approved. Three shareholder proposals were rejected: changing the director resignation policy, adopting a human rights policy assessment, and lowering the special meeting threshold from 25% to 10%.

04—Continue

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