CHESAPEAKE, Va. — Dollar Tree Inc. reported strong third-quarter results driven by its expanding multi-price strategy and a continued focus on value and convenience. The company posted record Halloween sales and solid same-store growth as it works to redefine its namesake banner following the divestiture of Family Dollar.
“Our multi-price strategy drove strong momentum across our business in the third quarter and helped deliver an all-time record Halloween season,” chief executive officer Mike Creedon said. “With 85 percent of our assortment priced at two dollars or less, we continue to deliver exceptional value, while our multi-price assortment allows us to offer even more high-quality products and great gift options for the holidays.”
Net sales from continuing operations rose 9.4% to $4.7 billion, with same-store sales up 4.2%, driven by a 4.5% increase in average ticket that more than offset a modest 0.3% decline in traffic. Gross profit increased 10.8% to $1.7 billion, while gross margin expanded 40 basis points to 35.8%, supported by improved pricing, lower freight costs, and a favorable product mix.
Operating income grew 3.8% to $343.3 million, while adjusted operating income increased 4.1% to $345.3 million, representing a margin of 7.3%. Income from continuing operations totaled $244.6 million, or $1.20 per diluted share, compared with adjusted EPS of $1.21.
The company continued to invest in its multi-price rollout, converting 646 stores to the Dollar Tree 3.0 format during the quarter and opening 106 new locations. Year-to-date, the retailer generated $958.5 million in operating cash flow and $88.2 million in free cash flow from continuing operations.
Dollar Tree also repurchased 4.1 million shares for $399 million during the quarter and an additional 1.7 million shares for $176 million after quarter-end, leaving $2.0 billion remaining under its $2.5 billion authorization.
For the first nine months of fiscal 2025, net sales from continuing operations increased 11.0% to $13.9 billion, with same-store sales up 5.4%. Year-to-date operating income rose 3.2% to $958.4 million, while adjusted operating margin held at 6.9%.
Reflecting its continued momentum, Dollar Tree raised its full-year net sales outlook to a range of $19.35 billion to $19.45 billion, based on comparable-store sales growth of 5.0% to 5.5%. Adjusted diluted earnings per share are now expected to be $5.60 to $5.80, excluding further share repurchases.
For the fourth quarter, the retailer expects net sales of $5.4 billion to $5.5 billion and adjusted EPS between $2.40 and $2.60.
As Dollar Tree heads into the critical holiday period, Creedon said the company is positioned to capture share among value-conscious consumers seeking affordable gifts and essentials. “We’re ready to bring even more value, convenience, and discovery to our growing base of loyal customers,” he said.
