10-QPeriod: Q3 FY2027

DOLLAR TREE, INC. Quarterly Report for Q3 Ended Aug 1, 2026

Filed August 27, 2026For Securities:DLTR

Summary

Dollar Tree, Inc. reported strong financial performance for the 13 and 26 weeks ended August 1, 2026. Net sales increased by 7.0% and 7.1% respectively, driven by a 3.7% comparable store net sales increase in the quarter and a 3.6% increase over the six-month period. This growth was supported by a rise in average ticket price and a slight increase in customer traffic for the quarter, although traffic saw a minor decrease over the six months. The company also benefited significantly from a $368.7 million tariff refund, which substantially boosted gross profit margins to 42.9% for the quarter and 39.8% year-to-date, a notable improvement from the prior year. Operating income saw a substantial increase, more than doubling year-over-year for the quarter to $690.1 million, with operating income margin expanding to 14.1% from 5.1%.

Key Highlights

  • 1Net sales increased by 7.0% to $4,886.5 million for the 13 weeks ended August 1, 2026, and by 7.1% to $9,857.0 million for the 26 weeks ended August 1, 2026.
  • 2Comparable store net sales increased by 3.7% for the quarter and 3.6% for the six-month period, driven by a higher average ticket price.
  • 3Gross profit margin significantly improved to 42.9% (13 weeks) and 39.8% (26 weeks) due to an 850 basis point and 480 basis point decrease in cost of sales, respectively, largely attributed to $368.7 million in tariff refunds.
  • 4Operating income surged by 198.7% to $690.1 million for the 13-week period and by 89.1% to $1,163.4 million for the 26-week period.
  • 5Diluted earnings per share from continuing operations were $2.70 for the 13 weeks ended August 1, 2026, a substantial increase from $0.75 in the prior year.
  • 6The company repurchased approximately $1.2 billion of common stock during the 26 weeks ended August 1, 2026, demonstrating a commitment to returning capital to shareholders.
  • 7Transition services agreement income, net, related to the Family Dollar sale, increased significantly to $17.7 million (13 weeks) and $38.8 million (26 weeks), contributing to overall profitability.

Frequently Asked Questions

The primary driver for the substantial increase in gross profit margin was the receipt of $368.7 million in tariff refunds. This, combined with a comparable store net sales increase, lower tariff costs, and improvements in shrink, led to a significant decrease in the cost of sales as a percentage of net sales.

The sale of Family Dollar, completed on July 5, 2025, resulted in the presentation of its prior year results as discontinued operations. Additionally, Dollar Tree recognized increased income from the transition services agreement provided to Family Dollar, contributing positively to operating income in the current periods.

Dollar Tree demonstrated a strong commitment to returning capital to shareholders through significant share repurchases, totaling approximately $1.2 billion during the 26 weeks ended August 1, 2026. The company also replenished its share repurchase authorization to $2.5 billion, indicating a continued focus on this capital allocation strategy.

Dollar Tree is reinvesting a significant portion of the tariff refunds into its business. Initiatives include strengthening customer value through targeted pricing and marketing, improving store conditions and operations, and directing funds to a philanthropic initiative for associates and communities. Some of these reinvestments may result in additional costs like markdowns in the near term.