Dollar Tree on Thursday highlighted pressure on profits from inventory loss and consumers turning to lower-priced products.
The discount retailer reported second-quarter earnings of 91 cents per share on revenue of $7.32 billion for the second quarter, which ended July 29. This beat estimates by analysts tracked by FactSet who were looking for 87 cents on $7.2 billion.Dollar Tree reported a gross margin of 29.2% in the latest quarter, a decline of 220 basis points from the same period last year.
Dick’s Sporting Goods in its latest earnings also sounded the alarm on theft. The company’s merchandise margin declined by 2.54 percentage points in the second quarter—one third of that was because of inventory loss. Dollar Tree adjusted its outlook for fiscal 2023 profits to $5.78 to $6.08 per share from a range of $5.73 to $6.13.